Addis Ababa mayor: Ethiopia can be major destination for Turkish investors

 

Mayor Deriba Kuma of Addis Ababa, the Ethiopian capital, has called on Turkish businessmen to come to Ethiopia, saying the East African country offers great opportunities with huge investment potential.

“We have a lot of advantages in Addis Ababa and Ethiopia. The labor cost in our country is very low compared with Turkey and other countries. The land rent is very cheap. We have a trainable young population. There is also strong support from the government for foreign business investments. We have globally competitive investment packages in Ethiopia. Investors who come to Addis Ababa and Ethiopia will benefit, without a doubt,” he said, adding, “Ethiopia can be a major destination for Turkish investors.”

Speaking to Today’s Zaman in an exclusive interview, the mayor stressed that there are many areas for investment in Ethiopia, especially in the fields of dam construction and hydropower, explaining that Turkish investors can find opportunities to invest in power and energy generation, agriculture, the metals industry, railway and road construction and airport infrastructure.

Turkey’s exports to Ethiopia were around $300 million in the first nine months of 2013, remaining steady over the same period of 2012. However, there has been a remarkable increase in Turkish exports to Ethiopia in the last three years. While Turkish exports to the African country were $174 million in 2010, they reached $395 million in 2012 with an increase of 125 percent. On the other hand, Turkey’s imports from Ethiopia are low. Ethiopia exported goods totaling $47 million in 2012 to Turkey, with a $7 million increase over 2010.

Paying a five-day visit to Turkey with a number of Ethiopian businessmen, Kuma visited Addis Ababa’s sister city, Ankara, to learn from the Ankara Metropolitan Municipality and share experiences with his counterpart.

“The main purpose of my visit to Ankara was to share experiences and to see what kind of projects have been launched there. We mostly wanted to see dam construction, water treatment plants, the airport, the ring road, infrastructure, housing, agriculture and railway projects in the province and to cooperate with Ankara in these sectors. More or less, we want to learn from Ankara, which is a very developed city,” Kuma said.

The mayor explained that Addis Ababa has a plan to build 50,000 houses every year and asked for the Ankara Municipality’s help to learn how they might manage these housing projects. He said Addis Ababa also has a major railway project and that the capital is hoping to benefit from Ankara’s experiences in this field.

Kuma related that he and Ankara Mayor Melih Gökçek have agreed to cooperate in these fields. “Ankara will send experts to Addis Ababa to identify problems in these areas of cooperation. Our agreement with Ankara will become definite after the experts’ studies,” he said.

As a former transportation minister, Kuma praised Ankara’s transportation system, noting that the bus, train and metro are well developed, and they want to bring these kinds of systems to the Ethiopian capital.

Kuma also described the state of Turkish investors in Ethiopia, saying their numbers have been increasing rapidly. The mayor gave the example of Ayka Addis Textile, one of the largest Turkish companies in Ethiopia, explaining that the company employs more than 8,000 workers and exports goods made in Ethiopia to the world.

Kuma stated that visas are not a problem for investors entering Ethiopia, as they can obtain one easily. “Turkish businessmen in particular can get a visa without any difficulty, as we have had a very long and stable political relationship, and the Ethiopian government maintains this excellent relationship with the Turkish government. So, through this contact any Turkish businessman can find great opportunities and a big welcome in Ethiopia,” he said and cited Prime Minister Recey Tayyip Erdoğan’s visits to Ethiopia in recent years as a sign of the excellent relations between the two countries.

Kuma also commented on Turkey-Ethiopia ties, saying the countries’ relationship is a win-win situation and that the increasing cooperation between Addis Ababa and Ankara is sign of this.

The mayor said Ethiopia is a good way to understand Africa and can be a springboard for Turkey’s entrance into the African market.

“Africa has a comparative advantage in agricultural infrastructure, energy and railway projects. It is important to promote African countries, because there is vast potential for investment in Africa and Ethiopia. I think Ethiopia is the best place for Turkey to open up the African market,” he stated.

Ethiopia is one of the world’s fastest-growing economies. While its economy expanded 8.4 percent between 2001 and 2010, from 2011 to 2015 it is set to rank third among the world’s fastest-growing economies and first in the African continent, according to Ufuk Tepebaş, an analyst with the Turkish Asian Center for Strategic Studies (TASAM).

Easing investors’ concerns about Ethiopia’s security, Kuma noted that Ethiopia played an important role in preventing conflicts in the region. The mayor said Ethiopia has no problem with any neighboring country, as it is a model country that hosts the African Union (AU) headquarters.

“Foreigners coming to Ethiopia never faced any problems in our country. We have very strong institutions in the fight against terrorism to defend our institutions, citizens, investors and foreign investors, including Turkish ones. Terrorism is a global challenge, but its effects depend on how strong your institutions, government, police and military are. We are confident on the issue of terrorism,” he said.