July 6 , 2019
By TEMESGEN MULUGETA ( FORTUNE STAFF WRITER )
The administration of Prime Minister Abiy Ahmed (PhD) has been amending the investment law to enable the private sector engage in the manufacturing of weapons, ammunition and explosives, which were exclusively reserved for the state, in a joint venture arrangement with the government.
The bill, drafted by the Ethiopian Investment Commission and a technical team, also allows the private sector to invest in air transport and postal services, engage in the import and export of as well as the transmission and distribution of electricity partnering with the state.
Drafted by a 17-member technical team composed of experts from the Addis Abeba University, the federal government and private institutions, the bill is up for deliberation and validation at workshops by representatives from the private sector, institutions and development partners in two sessions.
The amendment aims to catch up with the changes in the global and local economy, according to Fantu Farris, co-chair of the technical team.
"The initiative to amend the law also shows the country's initiative in opening up the investment climate for the private sector," she said.
The team, which operates under the management team of the Commission, has been revising the law since January. In amending the proclamation, the team reviewed the investment laws of 25 countries including Uganda, Kenya, Tanzania, Brazil, Argentina and China.
The bill also defined the membership and structure of the Commission's board of directors. In the existing structure, the composition and number of members of the board of directors is not specified. However, the amendment stipulates the members to be nine people pooled from the ministries of Finance, Trade & Industry, Agriculture and Revenues, as well as from the energy sector.
Existing law does not allow the membership of representatives from the private sector to be represented in the board of directors. The new law proposes one non-voting private sector representative to join the board of directors.
The amendment will also bring a new organ to life, which will be reviewing grievances from investors. In the existing system, the investors lodge complaints with the Commission. Investors can also appeal to the Investment Board if they are not satisfied with the decisions of the grievance hearing body.
"We expect the bill to be legislated in the first quarter of the coming fiscal year," Abebe Abebayehu, head of the Ethiopian Investment Commission, said.
Tewodros Meheret, a lawyer and legal consultant and a lecturer at Addis Ababa University's College of Law and Governance Studies, says the revision would potentially help the country in attracting more foreign direct investment (FDI).
"The bill relaxes many areas of investment, which will definitely motivate foreign investors to invest in the country," said Tewodros.
In the last fiscal year, the country managed to attract 3.3 billion dollars in FDI, making the country the fifth largest FDI recipient in Africa. The value is also nearly half of the total inflow to East Africa. Manufacturing is the biggest driver of FDI, accounting 69pc of the total value.
Zemedeneh Negatu, investment consultant and chairperson of Fairfax Africa Fund, recommends the government consider different incentive packages in a bid to attract as many foreign companies as possible.
"In doing so, the country will get many global companies that will invest in the country as well as transfer knowledge to local firms," Zemedeneh said.
CLARIFICATION: We have reported that the Ethiopian Investment Commission has drafted a bill to amend the existing investment law where it opens the manufacturing of weapons and ammunition to the private sector through joint venture arrangements with the government. However, it came to our attention that the existing investment law allows joint venture investments in these sector with the government. We sincerely apologise for any misunderstanding and inconvenience this may have created for our readers and the Commission.
PUBLISHED ON Jul 06,2019 [ VOL 20 , NO 1001]
Fortune News | Jun 08,2019
Viewpoints | Sep 06,2020
Sunday with Eden | Feb 09,2019
Fortune News | Feb 16,2019
Fortune News | Nov 13,2021
Fortune News | Feb 29,2020
Fortune News | Aug 29,2020
Fortune News | Nov 23,2019
Fortune News | Sep 10,2021
Fortune News | May 23,2021
November 27 , 2021
Against my will, I have witnessed the most terrible defeat of reason and the most sa...
November 13 , 2021
Plans and reality do not always gel. They rarely do in a fast-moving world. Every act...
October 16 , 2021 . By HAWI DADHI
Residing in a country with no capital market, an organised marketplace for trading se...
August 28 , 2021 . By HAWI DADHI
The streets of Addis Abeba are as varied as they are many, although too many of them have yet to be named. From the narrow alleyways of the...
Leaders of the National Election Board are in a charm offensive mood, of a sort. Last week, they organised a rare tour for members of the me...
When the country’s most senior diplomats and envoys return back to their posts after two-week debriefings, they leave behind a point or tw...
May 21 , 2022
There was a great deal of handshaking and patting each other on the back at the Hyatt...
May 14 , 2022
Diana Yohannes is one of those actively engaging in social media platforms with her T...
May 7 , 2022
The Ethiopian Economic Association (EEA) recently proposed the formation of a macroec...
April 30 , 2022
There is no ambiguity in the UNDP's assessment of Ethiopia’s economic performance a...
PM Abiy Ahmed (PhD) at a Gala Dinner Called for the Awarding of the Félix Houphouët-Boigny Peace Prize
May 6 , 2019
Adulteration is getting out of hand. Consumers in Ethiopia are being left to their ow...
Or see contact page