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12
April

Foreign Direct Investment

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It is an  undeniable  f act   that  Ethiopia  has  made a  considerable progress  in economic and  social development since 1 992 as a result of the implementation of   favorable  policies  and   strategies   that   are  instrumental in  improving the national economy. The  Rural Development Policy  and  Strategy,  the  Industrial Development Strategy, and  other  sectoral  policies and  strategies have  initiated a  new  push towards  creating frameworks  conducive  to  economic and  social development.

The Rural Development Policy and Strategy, which is under implementation in the country, underlines  that  agriculture-centered development will bring  about fast economic growth,  enable its people become beneficiary of economic grow th, and lay solid foundation for industrial development.

The  Industrial Development  Strategy   focuses  on  export  manufacturing  with priority    given   to   textile    and    garments,    leather   and    leather   products, agro-processing, and small and micro-enterprises.

The Government of Ethiopia in recognition of the role of the private sector in the economy has  revised  over  three   times  the   Investment   Code over   the  last eighteen years to make  it more  transparent, attractive and  competitive. Major positive  changes regarding  foreign  investment  have  been  introduced through Investment Proclamation No.280/2002 and Regulations No.84/2003.

As a result of the implementation of the above mentioned policies and strategies, agricultural and  industrial production, investment and  export trade are growing steadily from year to year both in terms of variety and volume. The World Bank has also witnessed  the double-digit  economic growth registered in the  last several years. This achievement is the highest among the non-oil producing economies of Africa.

Due to the investment-friendly environment created in the country, the inflow of foreign  direct investment (FDI) has been  increasing  over the last eighteen years. Accordingly, out  of the  total  investment projects licensed between 1 992- 2009, FDI' s share is about 15.2 %.

Ethiopia remains an untapped and unexploited market  for investors. China,India, Sudan, Germany, Italy, Turkey, Saudi Arabia,  Yemen, the United Kingdom Israel, Canada and  the United  States  are  the  major  sources of  FDI.

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