US Envoy Calls for Improved Business Climate in Ethiopia
November 30, 2018 - Assistant Secretary of State for African Affairs of the US government, Tibor Nagy, has been visiting Ethiopia this week. In message to senior officials, Mr. Nagy called on Ethiopia to improve its business climate so it can attract US businesses.
He met with several high ranking Ethiopian officials, including the Minister of Foreign Affairs, Dr. Workneh Gebeyehu, and Minister of Finance Ahmed Shide with whom he discussed U.S. government support for Ethiopia’s long-term economic growth.
Tibor Nagy expressed the United States’ commitment to partner with Ethiopia to promote a business and investment climate that encourages innovation and job creation and increased trade. He added, the US wants to leverage “the strength of the U.S. private sector investment to support Ethiopia.”
He called on Ethiopian leaders to facilitate this move by improving the business climate in Ethiopia. In particular, he called Ethiopia to address issues such as access to foreign currency, improving customs and logistics, offering transparent procurement and tender processes, and enabling a legal environment that addresses commercial disputes in a fair way.
Ethiopia often ranks poorly on ease of doing business reports, such as this one from the World Bank, where the country ranked 161 out of some 190 countries surveyed in 2017, and 159 out of 190 in 2018. Neighboring countries such as Kenya and Rwanda fared much better in a 2018 World Bank report, ranking 61 and 29, respectively. Ethiopia ranked 104 in 2010, but progressively declined to its worst ranking in 2017.
To many foreign businesses, Ethiopia is considered as one of the most difficult countries in the world to start and run a business. Often cited issues are archaic business rules and bureaucracy, highly restrictive financial regulations, lack of transparency and corruption in bidding processes, import and export difficulties, and inadequate legal protections. These issues make Ethiopia too risky for major international businesses, including those from the US.
Tibor Nagy also toured Ethiopian Airlines facilities, including a ride on a Boeing 777 flight simulator, a walk through the world class catering facility, and a view of the next generation GE engine repair shop, according to FBC report.
Under the leadership of Ethiopian Prime Minister Abiy Ahmed, Ethiopia and the US appear to have developed a deeper relationship than ever before.
The US government is believed to have played a crucial role in the transition from former Prime Minister Hailemariam Desalegn led government to one led by the new Prime Minister, Abiy Ahmed.
Tibor Nagy is a frequent visitor to Ethiopia and a great supporter of the ongoing reforms in Ethiopia.
In his previous visit to Ethiopia in September this year, Tibor Nagy said “Prime Minister Abiy Ahmed has initiated groundbreaking reforms across most every area of Ethiopian society; he deserves tremendous credit for his boldness in tackling issues previous governments have not addressed.”
Mr. Tibor is visiting Ethiopia as part of his tour in the Horn of Africa, including Djibouti, Eritrea and Kenya.
During his stay in Ethiopia, he held discussions with senior government officials, including the Ethiopian Minister for Foreign Affairs, also the United States-African Union high level dialogue, and officials of the Intergovernmental Authority on Development (IGAD).