Ethiopia emerges as top FDI destination in East Africa, surpassing Kenya, Uganda

Ethiopia attracted a staggering $3.3 billion in foreign direct investments (FDI) in 2023, surpassing its neighbors Kenya and Uganda, and hence has emerged as the leading destination for FDI in East Africa.

The latest World Investment Report published by the United Nations Conference on Trade and Development (UNCTAD) has highlighted Ethiopia’s position as a beacon of economic progress In the vibrant landscape of East Africa. The report reveals that Ethiopia secured $3.3 billion in FDI in 2023, nearly half of which accounts for China’s FDI projects, surpassing Uganda and Kenya that have attracted $2.9 billion and $1.5 billion in FDI respectively.

The Chief Commissioner of the Ethiopian Investment Commission (EIC) recently revealed that the Horn of Africa country has already attracted $3 billion in the first ten months of the 2023/24 fiscal year and it aims to reach $3.5 billion in FDI by the end of the fiscal year.

The EIC attributed the primary driver for FDI in Ethiopia in 2023 to the country’s efforts to foster investment through strategic adoption of public-private partnerships (PPPs) and a mechanism for direct PPP negotiations with foreign firms. One of the key projects realized through the PPP mechanism last year was undertaken by AMEA Power of the United Arab Emirates (UAE) that has invested $600 million to develop a 300 MW Aysha onshore wind power project located in the Somali Regional State. According to the UNCTAD’s report, Egypt was the top African country for FDI, attracting $9.8 billion, followed by South Africa with $5.2 billion.