September 20, 2022

Ethiopia claims its FDI increased by 0.2 bil. USD in two years despite foreign media influence

City: Addis AbabaNewsBusiness

Despite the fact that the fiscal year’s FDI income is below the target, the commission asserted that it showed a 0.2 increment in two years.

Avatar: Ilyas Kifle
By Ilyas Kifle

Ilyas is a reporter at Addis Zeybe experienced in creative writing and content production.

Ethiopia claims its FDI increased by 0.2 bil. USD in two years despite foreign media influence
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Credit: Addis Zeybe (Lelisse Nemme, Commissioner of EIC-May 2022)

The Ethiopian investment commission (EIC) reported that Ethiopia garnered 3.307 billion USD from foreign direct investment (FDI) in the fiscal year of 2021/22, which is 64.4 percent of the targeted income. 

Despite the fact that the fiscal year’s FDI income is below the target, the commission asserted that it showed a 0.2 increment in two years. 

In the fiscal year of 2018/19, a year before the outbreak of the conflict in Northern Ethiopia, the country acquired an income of 3.1 billion USD only from foreign direct investment. While it was able to obtain 3.7 billion USD in the 2017/18 fiscal year, which is greater than the current fiscal year income.

The commission’s annual report received by Addis Zeybe stated that covid-19 global pandemic, foreign media influence, and the conflict in the country were the major hindrances to attaining the target income.

“in general, this fiscal year showed satisfactory achievements despite the shortcomings such as the ban from The African Growth and Opportunity Act (AGOA), lack of foreign currency, the conflict in the Northern part of the country, influence from international news outlets and deficiency of infrastructures.”

The export market is noted to bring in an income of 202.5 million USD which is greater by 24.4 million USD from the past year.

Until the third quarter of this fiscal year, the commission earned 2.43 billion USD which was also 1.2 billion USD lower than its target.

During the press statement at the end of the third quarter in May 2022, Lelisse Nemme, Commissioner of EIC, mentioned that multiple market orders were canceled as a result of the ban from AGOA among other impediments attributed to the lower performance mentioned in the report. 

In the past Ethiopian fiscal year, a total of 168 investors, including 142 foreign investors, have been granted a new license for investment following their interests. The investment license is issued for 100 investors to work in the manufacturing sector, 62 investors in the service sector and the rest 6 investors will run agricultural investments.

The investment commission also claimed to mobilize more than 77 thousand new employment opportunities of which over 60 percent of them are women. 

In 2019, the United Nations investment trends monitor report identified and reported that “Ethiopia has shown a drop in income of foreign direct investment, from 3.2 billion USD to 2.5 billion USD”, also echoed by the national news agency’s report at the time. Later, EIC refuted the claim.

Following drawbacks set by the AGOA, war, and inflation, the EIC said it has been undertaking promotional activities in various countries around the world to attract foreign direct investment in the fiscal year.