Following its economic success, Ethiopia has been dubbed the “African Lion.” But the current drought and a downturn in growth have taken their toll. A recent conference in Munich aimed at attracting investors.
Yinager Dessie Belay, Ethiopia’s Minister of Planning and head of his country’s business delegation to Germany, did not waste time in his lobbying efforts. “Ethiopia has many things that you need to look into,” the Minster told his German interlocutors. “A conducive business environment, political stability, sound economic policies, macroeconomic stability, abundant natural resources, a trainable workforce, low-cost energy and, above all, a sizable and captive market.”
His words were echoed by Zemedeneh Negatu, Managing Director of Ernst & Young and an Ethiopian government advisor. “The biggest economy in Africa is Nigeria; South Africa got dethroned two years ago by Nigeria. Third is Angola, and guess that who is number four: Ethiopia,” Negatu told the audience.
For the past five years, Ethiopia, Africa’s second-most populous country and one of the West’s most strategic partners in the continent, has indeed been enjoying rapid growth. Germany enjoys a strong trading relationship with the East African nation, ranking the fifth largest buyer of Ethiopian goods, behind Somalia, the Netherlands, Saudi Arabia and China. According to official figures, the total value of Ethiopian exports to Germany, mainly coffee and textiles, is set to increase to 185 million euros ($209 million) in 2016. On the other hand, German exports to Ethiopia are worth much more, amounting to 238 million euros ($268 million).
However, the International Monetary Fund (IMF), in its recent outlook, said overall growth in Ethiopia was projected to slump to 4.5 percent, down from 10.2 percent the previous year. One of the contributing factors is said to be the drought that has gripped the country. Figures compiled by the Ethiopian government and its humanitarian partners suggest that more than ten million Ethiopian are now critically short of food.
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