Ethiopia Vows to Improve Business Climate in the Country
February 27, 2019 (Ezega.com) - Ethiopia has vowed to continue improving the ease of doing business in the country as part of its wider economic reform agenda under the leadership of Prime Minister Abiy Ahmed.
According to the premier’s office, the goal is to promote an enabling environment for businesses and also to make funds accessible to entrepreneurs.
Despite Ethiopia being Africa’s second most populous country, it suffers from among other issues, high unemployment rates. The premier is adamant that a conducive business climate, coupled with the availability of funds will help solve that.
“The result of a favorable business atmosphere and finance will be a means of tackling structural problem or unemployment,” he said.
The prime minister shared his thoughts while meeting with the Ethiopia Investment Commission (EIC) to review the progress made on the performance of the “Doing Business Initiative” the government is presently undertaking.
He also suggested that to address the issue of financial accessibility affecting many startups, the lending practices should be revised to allow movable assets to be used as collateral when acquiring loans.
In line with improving the ease of doing business, especially in the capital, the prime minister is set to host a fundraising dinner to help raise $1billion for infrastructural development.
The capital is one of the country’s business hubs and expanding and improving its infrastructure is key to improving the ease of doing business in the country.
Officials from the prime minister’s office disclosed the tickets for the dinner will be sold at more than $175,000 per head, but other details remain scanty. The intention is to boost foreign investment into one of Africa’s most vibrant economies.
A video released by the prime minister’s office shows plans to redevelop the capital by expanding retail areas and spaces. This is in line with the goal of improving the ease of doing business in the country, and what better way to start than to improve the capital?
For a long time, Ethiopia has embraced the idea of raising funds by itself as opposed to relying heavily on foreign donors. Similar events have been previously conducted to raise funds for economic development.
At one time, Abiy Ahmed sold his watch for $175,000 during an event to raise money for infrastructure development in Ambo, 100 kilometers west of the capital. $14 million was raised in that fundraiser.
Ethiopia has witnessed a raft of reforms since Abiy assumed office in April last year. Under the economic reform drive, he’s reaffirmed his determination to open up a hitherto state-controlled economy.
Experts say country also needs security reforms, as is the case with human rights and political sectors. Reforms in the security sector are crucial if the premier wants to get a firm grip to consolidate the reforms gained in less than a year since he ascended to power.
The Central Bank has also revised some of the retrogressive measures on the general financial system; including loans.
Ethiopia’s improvement in ease of doing business is anchored on the following:
- Ease of starting a business
- Property registration
- Enforcing contracts
- Construction licenses
- Paying taxes
- protection of minority rights
- Getting electricity
- Cross border trade
- Resolving insolvency
In a tweet from the premier’s office, the prime minister said eliminating bottlenecks in the above processes is key to enabling an improvement in the ease of doing business in Ethiopia. It’ll allow small and medium enterprises to operate effectively.
By Solomon O. for Ezega News