Chinese Investment in Ethiopia: Contribution, Challenges, Opportunities and Policy Recommendations

Recognizing the immense potential for greater Chinese investment promotion and its contribution to Ethiopia’s industrialization and acknowledging the gaps, this paper aims to conduct a rigorous research through analysis of secondary sources and qualitative survey of Chinese enterprise doing business in Ethiopia in various sectors. In this regard, the key policy questions that this study tries to answer are ‘the involvement in and the contribution to Ethiopia’s industrialization and the challenges and opportunities they face. Hence, the overall objective of this research will be to (i) assess the trends in Chinese enterprises involvement in Ethiopia’s industrialization for the last decade, (ii) inform both the Chinese government and Ethiopian government on key business barriers and market failures that are constraining Chinese business entry and growth in Ethiopia; (iii) investigate the immense untapped investment potential from China that can be attracted and opportunities that Ethiopia could offer to Chinese investors; and (iv) propose policy options on how to address the challenges and thereby maximize the opportunities to enhance Chinese investment towards Ethiopia’s industrialization