Africa has a hot new investment destination and it’s not Nigeria.

The buzz at the World Economic Forum on Africa, an annual summit of the continent’s rich and powerful, is all about Ethiopia, where the economy is flourishing and the government is embracing select foreign capital. Executives from General Electric Co., Dow Chemical Co., Standard Bank Group Ltd. and MasterCard Inc. attending the June 3-5 gathering in Cape Town all singled out the East African nation as a market with strong potential.

Ethiopia was Africa’s eighth-largest recipient of foreign direct investment last year, up from 14th position in 2013, a report released by accounting firm EY on June 2 showed. The number of projects in Ethiopia surged 88 percent, the most of all countries ranked, while those in Nigeria slumped 17 percent.

“It’s got a government that is managing economic development in a very deliberate, cautious manner,” Ross McLean, Dow’s president for sub-Saharan Africa, said in an interview on Thursday. “It’s the second-most populous country in Africa. It hasn’t urbanized like other African countries, but it’s going to. It’s a very exciting place.”

Ethiopia’s economy is expected to expand 8.6 percent this year and 8.5 percent in 2016, compared with 10.3 percent growth last year, the International Monetary Fund said in its World Economic Outlook released on April 14. Nigeria, which has Africa’s largest economy and is grappling with energy shortages and the fallout of an oil price slump, is forecast to grow 4.8 percent this year and 5 percent next year.
Construction Boom

Ethiopia’s capital, Addis Ababa, shows all the signs of a construction boom. Private developers are erecting scores of office blocks and luxury housing estates, while the government is clearing slums to build low-cost apartments. Radisson Hotels International Inc. and Marriott International Inc. are among global chains that have opened hotels to cater for an influx of business travelers.

A Chinese-built railway line that snakes alongside the capital’s main roads is part of a nationwide infrastructure development program that’s helping entice investors. In April, Chinese company Huajian Group began work on a $400 million shoe-manufacturing park on Addis Ababa’s southwestern outskirts, while companies including Taiwan’s George Shoe Corp. have opened plants in an industrial zone in the Bole Lemi district.
On Thursday, Dangote Group, the Nigerian company controlled by Aliko Dangote, Africa’s richest man, said it will spend $500 million expanding its cement plant in Ethiopia, adding to $600 million already invested.

Credit Rating
“We will leave no stone unturned to make this country a suitable destination for foreign investment,” Prime Minister Hailemariam Desalegn said at the opening of the plant at Mugher, about 80 kilometers (50 miles) west of Addis Ababa.
The country was assigned its first credit ratings in May. Moody’s Investors Service rates it a non-investment grade B1 with a stable outlook, while Standard & Poor’s and Fitch Ratings awarded the country a B, one grade lower.
Yields on the nation’s debut $1 billion Eurobond have climbed to 6.77 percent from 6.625 percent when they were sold on December 4.
Business Obstacles
“We’ve done quite a lot of Ethiopian business,” said David Munro, head of corporate and investment banking in Standard Bank, which has applied for a license for a representative office. “We see it as a prospective place to grow our business. There’s the possibility of significant resources and it’s within an economically significant zone, the east African trade area.”

Obstacles to doing business in Ethiopia remain. The Ethiopian Peoples’ Revolutionary Democratic Front has ruled the country for the past two decades and the state continues to dominate the financial services, telecommunications and transport industries. Foreign exchange is in short supply, because the government uses inflows to finance its infrastructure program and exports remain meager.
Razia Khan, Standard Chartered Plc’s head of Africa macroeconomic research, said Ethiopia’s economy has a “hollow” structure because it doesn’t have a big enough middle class to enhance economic growth.

Poverty Data
Only 18 percent of Ethiopia’s 94.1 million people are urbanized and the economy is worth just $48.9 billion, according to the Abidjan, Ivory Coast-based African Development Bank. About 30 percent of the population live in poverty, according to 2010 data from the World Bank, down from 46 percent in 1995.

Pan-African lender Ecobank Transnational Inc. has a representative office in Ethiopia. Equity Group Holdings Ltd., owner of Kenya’s second-biggest bank, will prioritize its Ethiopian business as part of an expansion into nine other African nations, Chief Executive Officer James Mwangi said in an interview in Cape Town.
Dow doubled its sales in Ethiopia last year and sees more growth to come.
“There are some significant challenges,” said McLean. “We manage them. We think we are in at the right time.”

http://www.bloomberg.com/news/articles/2015-06-05/ethiopia-s-hot-nigeria-s-not-for-investors-targeting-africa

The buzz at the World Economic Forum on Africa, an annual summit of the continent’s rich and powerful, is all about Ethiopia, where the economy is flourishing and the government is embracing select foreign capital. Executives from General Electric Co., Dow Chemical Co., Standard Bank Group Ltd. and MasterCard Inc. attending the June 3-5 gathering in Cape Town all singled out the East African nation [size=13pt]as a market with strong potential[/size].

Nigeria's hotness or potential ended with GEJ's departure, even Dangote invested $600mill in Ethiopia.

M0GIDI:


Nigeria's hotness or potential ended with GEJ's departure, even Dangote invested $600mill in Ethiopia.

Smell the coffee, bro. The World Economic Forum report being referred to is that of the 2014 edition. Whose government was in power then? You guys are just impossible!

TonySpike:


Smell the coffee, bro. The World Economic Forum report being referred to is that of the 2014 edition. Whose government was in power then? You guys are just impossible!

I thought the buzz is about the upcoming WEF in South Africa.

I heard Ethiopia embraced True Federalism

BlackTechnology:
I heard Ethiopia embraced True Federalism

What are you implying now?

atlwireles:


I thought the buzz is about the upcoming WEF in South Africa.

WEF 2015 already started yesterday in Cape Town, South Africa. Whatever report is being discussed at this forum contains analysis inferred from data collected over 2014, I think.

dunkem21:



What are you implying now?

True federalism is the secret of their economic success.

BlackTechnology:
I heard Ethiopia embraced True Federalism

I also heared stealing is corruption in Ethopia

I can't wait for the WEF Report

May God help Ethiopia continue to grow and transform. Ethiopia is a better country than Nigeria and they would have beat Nigeria in every field of human endeavor if it were not for some specific hardworking tribes of Nigeria that are hard to beat.

TonySpike:


WEF 2015 already started yesterday in Cape Town, South Africa. Whatever report is being discussed at this forum contains analysis inferred from data collected over 2014, I think.

Selective amnesia abeg

do i care? uhm.. no

How many barrels of oil per day does Ethiopia export?

Between America and China, who are their allies.

Stupid Nigerians.

_Preamble
We, the Nations, Nationalities and Peoples of Ethiopia:
Strongly committed, in full and free exercise of our right to self-determination, to building a political community founded on the rule of law and capable of ensuring a lasting peace, guaranteeing a democratic order, and advancing our economic and social development;
Firmly convinced that the fulfillment of this objective requires full respect of individual and people's fundamental freedoms and rights, to live together on the basis of equality and without any sexual, religious or cultural discrimination;
Further convinced that by continuing to live with our rich and proud cultural legacies in territories we have long inhabited, have, through continuous interaction on various levels and forms of life, built up common interest and have also contributed to the emergence of a common outlook;
Fully cognizant that our common destiny can best be served by rectifying historically unjust relationships and by further promoting our shared interests;
Convinced that to live as one economic community is necessary in order to create sustainable and mutually supportive conditions for ensuring respect for our rights and freedoms and for the collective promotion of our interests;
Determined to consolidate, as a lasting legacy, the peace and the prospect of a democratic order which our struggles and sacrifices have brought about;
Have therefore adopted, on 8 December 1994 this constitution through representatives we have duly elected for this purpose as an instrument that binds us in a mutual commitment to fulfill the objectives and the principles set forth above.



VERY INTERESTING

Great. Africa arising.
#wecanbebetter

atlwireles:
_Preamble
We, the Nations, Nationalities and Peoples of Ethiopia:
Strongly committed, in full and free exercise of our right to self-determination, to building a political community founded on the rule of law and capable of ensuring a lasting peace, guaranteeing a democratic order, and advancing our economic and social development;
Firmly convinced that the fulfillment of this objective requires full respect of individual and people's fundamental freedoms and rights, to live together on the basis of equality and without any sexual, religious or cultural discrimination;
Further convinced that by continuing to live with our rich and proud cultural legacies in territories we have long inhabited, have, through continuous interaction on various levels and forms of life, built up common interest and have also contributed to the emergence of a common outlook;
Fully cognizant that our common destiny can best be served by rectifying historically unjust relationships and by further promoting our shared interests;
Convinced that to live as one economic community is necessary in order to create sustainable and mutually supportive conditions for ensuring respect for our rights and freedoms and for the collective promotion of our interests;
Determined to consolidate, as a lasting legacy, the peace and the prospect of a democratic order which our struggles and sacrifices have brought about;
Have therefore adopted, on 8 December 1994 this constitution through representatives we have duly elected for this purpose as an instrument that binds us in a mutual commitment to fulfill the objectives and the principles set forth above.

VERY INTERESTING

Ethiopia is a true federal state

Lower Niger Republic will embrace True federalism

ki02020:



I also heared stealing is corruption in Ethopia

Ethiopia never over flogged the issue of corruption like Yorubas but address the core issue of true federalism like Igbos.

BlackTechnology:


Ethiopia never over flogged the issue of corruption like Yorubas but address the core issue of true federalism like Igbos.

Loudmouthed Yeebhoe fool, The cursed bigot from the cursed land of the fading sun. I dont know what concern in this nonsense, your father must be crying for you in his smelling grave. Pathetic.

BlackTechnology:


Ethiopia never over flogged the issue of corruption like Yorubas but address the core issue of true federalism like Igbos.

Welldone...hope you know that a true federalism built on corruption will lead to false democracy

Before 1996, Ethiopia was divided into thirteen provinces, many derived from historical regions. The nation now has a tiered governmental system consisting of a federal government overseeing ethnically based regional states, zones, districts (woreda) and neighborhoods (kebele).

Since 1996, Ethiopia has been divided into nine ethnically based and politically autonomous regional states (kililoch, singular kilil) and two chartered cities (astedader akababiwoch, singular astedader akababi), the latter being Addis Ababa and Dire Dawa. The kililoch are subdivided into sixty-eight zones, and then further into 550 woredas and several special woredas.

The constitution assigns extensive power to regional states, which can establish their own government and democracy according to the federal government's constitution. Each region has at its apex a regional council where members are directly elected to represent the districts and the council has legislative and executive power to direct internal affairs of the regions.

Article 39 of the Ethiopian Constitution further gives every regional state the right to secede from Ethiopia. There is debate, however, as to how much of the power guaranteed in the constitution is actually given to the states. The councils implement their mandate through an executive committee and regional sectoral bureaus. Such elaborate structure of council, executive, and sectoral public institutions is replicated to the next level (woreda).

http://en.wikipedia.org/wiki/Ethiopia