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26 May, 2007
In its nine-month performance report presented to the House of Peoples' Representatives on Wednesday, the Ethiopian Investment Agency (EIA) indicated that it had cancelled the license issued to about 228 investment projects either due to their failure to report on their progress or to renew their licenses on time.
Out of the total 1327 foreign investment projects which were covered by the agency's report, the stated number were cancelled with some investment licenses being voluntarily returned. In addition about 8 of the projects have been identified to have ceased operation at the moment. Of the projects which were licensed beginning from 1996, only 301 have become operational and started production at present. However, a great deal of these projects are undertaking works phase.
The report revealed that during nine months of the current fiscal year about 2571 investment projects with a total capital of 54 billion birr had been approved and licensed. Compared with the previous year's performance, the report said that this year's figures surpass last year's by 962 additional projects and 30.9 billion birr capital investment. Furthermore, from this total figure 838 projects were foreign-owned investments, accounting for 74.5% of the total registered capital of the period.
The level of investment licensed in period, anticipating that all will materialize, is expected to create 99,581 additional jobs with the majority being absorbed by the agricultural sector.
On the other hand, a council which is responsible for promoting foreign direct investment opportunities in the country has been organized and members from high ranking government officials and dynamic members from the business community constitute the council. The working programme of the council has been discussed and adopted by the relevant body.
The report also assessed the regional distribution of the gross investment within the nine-months period and not surprisingly Addis Ababa claimed the lion's share of total investment followed by Oromia region. Out of the total 188 agri-based projects, about 120 are to be implemented in Oromia region while on the other extreme Benishangul and Harari regions accounted for a small share of the total investment licensed in the reporting period.
As far as supporting and after care of foreign investment which were licensed concerned, the agency has closely monitored and extended various support to a total of 398 projects licensed in the current budget year. The support given includes facilitating access to land, visa, residence permit and so on to foreign investors who obtained licenses from the agency.
Toward its conclusion, the report made mention of the factors which had posed obstacles on the agency in the performance of its tasks. Among these are shortage and high rate of turnover of professionals who left the agency without completing their tasks was the major one. On top of that, limited office facility to accommodate the already existing staff and newly recruited professionals was also identified to be another pressing problem.
By Asrat Seyoum - Ethiopian Reporter