Foreign Chambers Close Ranks as Reform Promises Face Moment of Truth

Jan 31 , 2026. By YITBAREK GETACHEW ( FORTUNE STAFF WRITER )

Foreign businesses are uniting under a new platform, the “Chamber of Chambers,” representing more than 14 country chambers, including those from Europe, the US, China, and India. Led by the European Chamber, the coalition seeks to provide a central voice for foreign businesses facing persistent constraints in customs, tax administration, legal uncertainty, and access to foreign exchange.

A lofty experiment in business diplomacy is quietly taking shape behind glass doors, signalling both frustration and optimism. More than a dozen foreign chambers of commerce, including those representing Europe, the United States, China, India, the Netherlands, and Canada, are banding together under a single banner of the “Chamber of Chambers.”

According to its organisers, the initiative, which has drawn participation from more than 14 country chambers, aspires to provide a central platform for lobbying, raising shared concerns, and improving policy engagement. The consolidated approach comes as foreign businesses continue to report chronic problems from customs bottlenecks and tax administration to legal unpredictability and access to foreign exchange.

While Ethiopia offers a range of incentives, including duty-free privileges for capital goods and various income tax breaks, business leaders say these alone are not enough to drive substantial foreign investment. Instead, they prioritise stable policy, transparent regulation, efficient bureaucracy, and a secure operating environment.

The introduction of new laws and procedures often leads to operational delays as businesses scramble to adapt. Customs and bureaucratic hurdles, in particular, have emerged as formidable barriers. Some investors in the horticulture sector have reportedly relocated to Kenya, citing security worries. Under recent macroeconomic reforms, access to foreign exchange has become one of the largest operational bottlenecks for their members.

Failure to secure timely foreign exchange or adapt quickly to regulatory changes can impact profits and lead to an exodus of investment. The new Chamber’s goal, according to its architects, is to serve as a single point of contact with the government, making it easier for officials to respond to concerns and for chambers to advocate more effectively.

Chambers represent investors from various countries, including the European Chamber, the American Chamber, the French Chamber, the Chinese Chamber, the Indian Chamber, the Netherlands, and Canada.

Bahru Temesgen, CEO of the European Chamber of Commerce in Ethiopia, is leading the organisational effort. He is preparing for the official launch of the Chamber of Chambers and sees the lobby group as advantageous for the government and investors.

“If we come together and discuss the issues, we may come to terms with the government,” he told Fortune. “We believe this Chamber will allow us to work proactively to find solutions to the problems we face together and to propose our own solutions.”

For several foreign companies, accessing incentives to attract foreign direct investment (FDI) is only part of the equation. The deeper issue, chamber officials argue, is whether a more welcoming and predictable investment climate can bring in larger and more diverse capital flows. They note that investors ultimately come to make a profit and, in doing so, contribute to the country’s revenues, not merely to benefit from tax holidays.

Government officials have acknowledged some of these gaps. During the inauguration of EuroCham’s new office, Zeleke Temesgen (PhD), commissioner of the Ethiopian Investment Commission (EIC), conceded to the absence of a consistent and transparent certification system as a problem, particularly for the recognition and regulation of professionals and consulting firms serving investors. He disclosed that the Commission has begun developing competency criteria and certification procedures to protect investors' interests and enhance the credibility of the investment advisory sector. He also announced preparations for a “Deal Book” for the upcoming business forum, meant to guide visiting investors.

“I would like to acknowledge and commend EuroCham for becoming an increasingly active and influential association in the FDI space,” Zeleke told attendees at the inauguration, held at the Nile Source Building on Africa Avenue (Bole Road), near Boston Spa, on January 29, 2026.

He noted that further engagement with stakeholders is planned as part of ongoing reform efforts.

The Chamber’s headquarters features a new business incubation centre that offers foreign businesses free office space for up to six months.

"This is meant to allow newcomers to learn about taxes, customs procedures, and the local business environment before making long-term commitments," said Bahru.

"The move is seen as a gesture to encourage new investments, particularly from European companies. There are over 180 European companies active in the Ethiopian market, the majority of which are members of EuroCham, which Bahru manages. He and his colleagues are keen to see that the new Chamber is not only about voicing complaints but also about working collaboratively to improve the business climate.

"The government has shown a willingness to meet with the Chamber leaders to discuss solutions," Bahru said. "While long-standing issues around customs and taxation persist, there is at least a more open line of communications."

In about five months, Ethiopia will host an Ethiopian–European Business Forum, where at least 500 European businesses are expected to participate. Bahru hopes that by the time the forum is held, the Chamber of Chambers will be fully operational.

EuroCham is partnering with the Commission and the Ministry of Finance to produce a new Deal Book that highlights business and investment opportunities across the country.

Recent data from the federal Investment Commission showed a modest rebound in FDI, with inflows rising to four billion dollars in the 2024/2025 fiscal year from 3.8 billion a year earlier. Of the 544 new and expanded permits granted, foreign investors accounted for 308, joint ventures for 109, and domestic investors for 98.

However, questions remain over how many of the companies attending the forum will ultimately commit to new investments.

According to Sani Tuke, an investment advisor and founder of Optimum Logistics, foreign direct investment faces multiple constraints, from policy uncertainty to bureaucracy, and a unified chamber platform could strengthen investor protection and lobbying power.

“Trade is moving toward uniformity and a single trade system,” he said. "This is particularly important for the manufacturing sector."

Sani also pointed to shortcomings within the local business community. While business associations and lobby groups exist, they often fail to fulfil their advocacy roles and instead focus more on fee collections. He believes that the new Chamber, if managed well, could help resolve this, but stated the importance of staying true to the organisation’s core mission.

“I hope the chamber will prioritise the interests of investors rather than individual gains,” Sani said.

Henok Assefa, a consultant with Prime Consulting Plc, echoed these sentiments but sounded a note of caution about the effectiveness of chambers in Ethiopia. He noted that many chambers have struggled to deliver on their promises and that, in his experience, numerous clients have failed to resolve their problems even as members of these organisations.

“They tend to be less action-oriented than they should be,” Henok told Fortune. "The new body’s success will depend on moving beyond appearances to deliver tangible results."

EuroCham’s new headquarters and incubation centre are part of a broader effort to make Ethiopia more attractive to foreign investors, according to Ben Depraetere, chairperson of EuroCham. Two investment forums are scheduled to take place in Addis Abeba in March and April.

“The FDI community can work together because we all face the same challenges,” he said. "Working alongside groups like AmCham, the Indian Business Forum, and the Ethiopian–Netherlands Business Association is essential."

“Our incubation centre is ready to welcome those investors,” Ben said.

However, Henok believes the new incubation centre could be effective only if it supports viable, sustainable business ideas.

The performance of existing incentive programs and support structures remains under federal scrutiny. The Ethiopian Anti-Corruption Commission recently reported that some investors have obtained workspaces and incentives without meeting required financial benchmarks, often holding only licenses. Out of 55 projects that applied for investment expansion over six years, only eight have progressed to production, while 39, about 71pc, have yet to start operating.

The Commission attributed these problems in part to lax monitoring and insufficient oversight, warning that such an environment can encourage corruption and misuse by investors seeking to exploit incentives.

Investors seeking expansion permits are eligible for additional tax breaks under the Investment Law, but a large share of approved projects remain in the pre-implementation stage. The Commission called for stronger monitoring and control to ensure that incentives are used for their intended purpose and to curb malpractice.

PUBLISHED ON Jan 31,2026 [ VOL 26 , NO 1344]