Wednesday, 25 February 2015 09:57

Economic Environment

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1. STABLE ECONOMIC ENVIRONMENT

• Comprehensive development strategy resulting in strong economic growth.

• Stable macro-economic condition.

• Double digit economic growth averaging 11% per annum in the past 7 years.

• Generally, inflation managed at a single digit figure.

• Stable exchange rate.

• Government commitment to private sector.

• Safe and secure working and living environment, identified by the UN and the International Chamber of Commerce (ICC) as a key asset for investors in Ethiopia.

• Low level of corruption – Ethiopia is described by the UN and ICC as “exceptional in its almost complete absence of routine corruption”.

2. LIBERALISED ECONOMY

• Major economic sectors are open for investment and marketing.

• Remittance out of Ethiopia from invested capital (dividends and interest) is permitted.

• Remittance also permitted for principal and interest with technology transfer, proceeds from sales or liquidation of an enterprise, salaries and other payments.

• The investment code provides a conducive environment for private sector development.

• 100% foreign ownership of investment is permitted with the following minimum initial investment:

  • US$100,000 – sole foreign investment
  • US$60,000 – where the foreign investor is in a joint venture with a domestic partner
  • US$50,000 – for consultancy or publishing businesses. This figure reduces to US$25,000 for foreign investors working in partnership with a domestic investor in the areas of engineering, accountancy, architecture, auditing services or business/management consultancy.

• An investor reinvesting profits or dividends or exporting of at least 75% of outputs is not required to allocate a minimum capital.

• Substantial market liberalisation.

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