Ethies in U.S. send billions back to Ethiopia

Above: Image design by Blen Grafix for Tadias Magazine

First Ethiopian Diaspora Business Conference to Take Place in Addis

BY STAFF WRITER

New York – Ethiopians abroad are a powerful and successful group in several countries. They are one of the largest, most educated and most affluent African immigrant population in the United States.

Their annual income is estimated at 10-20-billion dollars, about equal to Ethiopia’s gross domestic product.

They are now looked upon as a resource that could be tapped to assist Ethiopia’s development.

The First Annual Ethiopian Diaspora Business Conference will be held in Addis Ababa next month, according to a press release by Precise Consult International (PCI), organizers of the event.

The conference, which is being organized with the financial support of The World Bank and USAID, is scheduled to take place on September 19, 2007 at the UNECA conference center.

Crude calculations using remittance figures ($1.1 billion in the first 9 months of 2006/07 alone) show that the gross income of Ethiopians in the Diaspora is in the range of 10-20 billion dollars per annum, roughly equal to the home country’s GDP of $13 billion in 2006. 

As we approach the New Ethiopian Millennium, advances in communications technology have made it easier for Ethiopians across the globe to connect and do business.  There are significant untapped opportunities that exist in this equation for all parties involved. 

The Diaspora can reap the benefits of investing in a growing home economy or stay behind and make profits by facilitating the import of quality Ethiopian products into their home countries. 

At a time when global competitiveness decides the fate of nations, some of the capital, world class know-how, and market access necessary for the survival of the Ethiopian nation can be provided by the Diaspora.

“Back in the old days, our forefathers fought off colonization using spears, guns, and even their bare hands.” said Ato Henok Assefa, Managing Partner at Precise Consult International, who also happens to be an ex-Diasporan who grew up in New York City. 

“Times have changed, however.  The survival of the Ethiopian state now depends on building the competitiveness of Ethiopia’s industries.  Be competitive or perish is the order of the day.  And in this endeavor, utilizing the Diaspora who already possess world class know-how and capital is a no-brainer for Ethiopia”

Indeed the Ethiopian Diaspora’s contribution is already notable.  In addition to the large amount of money entering the country as remittance by the Diaspora, direct investment over recent years has run into the hundreds of millions of dollars. 

While still at a nascent stage, export opportunities facilitated by the Diaspora are starting to make an impact using the duty free and quota free access Ethiopia enjoys to the United States and European markets. 

However, given the potential that exists, these numbers are only indicative of this important group’s possible contribution to the Ethiopian development agenda in the form of investment (FDI), business partnerships, advisory services to local businesses, and participation in the local debate on improving the investment climate.

Ato Henok says this is partly due to a lack of coherent information and strategic engagement with the Diaspora community. 

“It is surprising how many Diasporans we have met who say to us, I have 150,000 dollars and would like to invest it in Ethiopia.  Where do I go? How do I start?  They all seem to have an irresistible urge to contribute to the country but do not know how to begin”, he said.

“The lack of basic information and facilitation services to navigate the local beaurocracy are quite possibly undermining a large influx of investment and exporting opportunities from being realized.  So this is basically how the idea for the conference and associated support services to be disclosed soon came about.”

The conference is divided along two main themes with expert panels to discuss the prevailing business conditions in Ethiopia and a mini-information/products tradeshow.  The first theme is aimed at de-mystifying the process of doing business in Ethiopia. 

With a legacy of communism and a history of a beaurocratic regulatory culture tarnishing the image of the Ethiopian business environment, few are aware of the significant improvements achieved over the past few years.  

Even fewer are bold enough to venture in and find out what it takes to invest in Ethiopia.  There appears to be a gap between the perception and reality of doing business in Ethiopia. 

What is the experience of investors so far in this regard?  Where are the opportunities and constraints to investing in Ethiopia?  Key issues such as investment process, land acquisition, finance, etc. will be discussed based on the experiences of a panel of successful diaspora investors.

The second theme focuses on the investment opportunities and incentives that exist on the ground.  With an economy expanding in double digits per annum, exports growing at almost 30% per year and a fast improving investment environment, Ethiopia now offers the prospect of high returns in many sectors.  This panel will discuss where some of these high potential sectors lie and showcase concrete opportunities for investment. 

The panel will also discuss emerging opportunities for the diaspora to link with local producers and import Ethiopian products into their adopted home countries.

Learn more about the conference at: diasporainvest.com

Related Links and Tadias Stories:

Diaspora’s Contribution to Ethiopia’s Economic Progress
By Selamawit Legesse

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Ethiopian Diaspora Business Conference

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