Ethiopia and China have held a joint Investment and Trade Cooperation Forum in Addis Ababa. The forum that aimed at further augmenting trade and economic ties was held on Thursday, hosted by the Ethiopian Investment Commission (EIC), the Investment Promotion Agency of the Ministry of Commerce of China, and the Chinese Embassy in Ethiopia. The Forum saw the signing ceremony of a Memorandum of Understanding (MOU) on investment promotion and facilitation between the two countries which will serve as a new cooperation mechanism for investment.
During the forum, a Memorandum of Understanding (MOU) on Investment Cooperation was signed between the two countries, which will serve as a new cooperation mechanism to promote investment cooperation and inject new impetus into the collaboration of the two countries.
Aside from the MOU signed between the two governments, Ethiopian and Chinese partners inked five other cooperation agreements in the manufacturing, agriculture, pharmaceutical, and other sectors. It is to be noted that the recent years have seen closer bilateral relations between China and Ethiopia with trade and investment cooperation furnishing a solid foundation for the longstanding friendship between the two countries.
The forum, among other things, aimed at implementing the Nine Programs of China-Africa cooperation announced by China at the Eighth Ministerial Conference of the Forum on China-Africa Cooperation (FOCAC), promoting China’s Initiative for Peace and Development in the Horn of Africa, and facilitating development plans such as the joint building of programs under the Belt and Road Initiative.
It further envisaged facilitating the implementation of the China-Africa Cooperation Vision 2035 as well as Ethiopia’s Homegrown Economic Reform while further deepening China-Ethiopia’s comprehensive strategic and cooperative partnership.
The forum, which was held in a hybrid format, brought together senior Ethiopian government officials, the business community from the two countries, as well as the Chinese diplomatic community in Addis Ababa. Senior Chinese government officials also took part in the high-level investment and trade forum virtually from China.
Demeke Mekonnen, Ethiopia’s Deputy Prime Minister and Foreign Minister noted in his keynote address that China has proven to be Ethiopia’s most trusted economic and political partner and that its support continues to sustain Ethiopia’s economic growth trajectory. While addressing the forum, Ethiopia’s Deputy Prime Minister said that the East African country has become one of the largest recipients of foreign direct investment (FDI) in Africa, in which Chinese engagement has injected a much-needed momentum into the country’s drive.
“Today’s agreement will be essential in directing our attention to the creation of new partnership and the providing of strategic and coordinated direction to our common investment challenges.”
He emphasized that, despite substantial progress in attracting and expanding investments, Ethiopia’s institutional, technical, and financial capacities remain limited, resulting in lower national achievement in comparison to the country’s investment opportunities and potential. According to him, Chinese investment in communication technologies, large-scale infrastructure, industrial parks, and manufacturing sectors have certainly augmented the efforts of the Ethiopian government to create a competitive and sustainable industrial development base. Mekonnen said, declaring that the newly signed cooperative instrument:
“Indeed, China has proven to be our most-trusted economic and political partner, and its support continues to reinforce the impressive growth trajectory of Ethiopia, will play a unique role by developing the institutional capacity of the EIC in promoting and facilitating Chinese investment inflows to new heights.”
Meanwhile, Qian Keming the Vice Minister of the Ministry of Commerce of China, on his part said, since the establishment of diplomatic ties between the two countries more than 50 years ago the political mutual trust between the two countries has been continuously deepened, and the cooperation in various fields such as economy and trade has achieved practical and fruitful results. He mentioned the need to implement the nine programs
Qian affirmed China’s willingness to join hands with Ethiopia to uphold the spirit of China-Africa friendly cooperation and jointly advance bilateral economic and trade cooperation to a new level, so as to bring more tangible benefits to the two peoples. He also emphasized that the two countries need to implement the Nine Programs stated under the China-Africa Cooperation (FOCAC), deepen the synergy of development strategies, promote the healthy development of economic and trade cooperation, and enrich the exchange and cooperation mechanism. He said:
“China and Ethiopia need to strengthen solidarity, deepen friendly cooperation, achieve mutual benefit and win-win results, and promote steady progress in economic and trade cooperation between the two countries.”
In connection with that, he explained China’s outlook for peace and development in the horn of Africa and mentioned development plans that called for cooperation such as the Belt and Road initiative, the China- Africa cooperation vision 2035, and Ethiopia’s Home-grown Economic reform.
Ethiopia Investment Commission Commissioner Lelise Neme also echoed the Ethiopian deputy prime minister’s comments as she emphasized that the newly signed MOU will lay down a foundation for a strong economic relationship between the two countries. She added by saying, the growing Chinese investment in Ethiopia is a continuation of the generous development support that China provided through various channels, including the Belt and Road Initiative.
“China is not only a reliable development partner and consistent supporter of Ethiopia’s development efforts but also a role model and exemplary on how to formulate and implement development policies and eliminate poverty to achieve inclusive and sustainable development.”
Chinese Ambassador to Ethiopia Zhao Zhiyuan on his part said the Investment and Trade Cooperation Forum is “highly timely and relevant” to promote the development of businesses between the two countries toward creating a more favorable business environment. He said for consecutive years, China has been Ethiopia’s biggest trading partner, the top source of FDI, and the largest project contractor, as the two countries deepen cooperation through the Belt and Road Initiative.
Ethiopia’s export to China has registered steady growth amid booming trade and investment cooperation between the two countries, Chinese Ambassador to Ethiopia Zhao Zhiyuan said Thursday. In 2021, compared with the previous year, Ethiopia’s exports to China increased by 8 percent as new Foreign Direct Investment (FDI) from Chinese companies to Ethiopia grew by 346 percent, the official said. The value of newly signed contract projects by Chinese companies in Ethiopia was up by 25 percent in the same period, Zhao said.
“I am confident that, the signing of the MoU today to promote investment cooperation will create a new cooperation mechanism and inject new impetus to our collaboration.”
According to the Chinese ambassador, Chinese FDI in Ethiopia and other main indicators of bilateral commercial cooperation has maintained good momentum during the first quarter of the current year.
In 2021, bilateral trade volume reached 2.66 billion U.S. dollars, of which, China imported commodities of nearly 370 million U.S. dollars from Ethiopia, a year-on-year increase of 8.1 percent. Zhao told the forum:
“Practice has proved that no matter how the international situation changes, the overall direction of China-Ethiopia practical cooperation and long-term friendship will never change.”
China has been Ethiopia’s largest trading partner and biggest source of investment for many consecutive years.