INVESTMENT
As a result of natural diversity in agro climatic factors, Ethiopia is suitable land for growing of varieties of horticultural products that are adaptable to extreme lowland and highland conditions. The altitudinal diversity ranges from 126 meters below sea levels and 4620 meters above sea level that indicates Ethiopia is suitable land for growing the low, medium and high altitude types of horticultural products. There is an excellent temperature and long hours of sunshine usually for more than 11 hours a day. One of the necessary input in horticulture growing is availability of water for irrigations available in ample quantity. Soils of Ethiopia are suitable and satisfy the requirements for growing horticultural products well-drained soils with Ph ranging from 5.5-7 Labor is also available in abundant that can easily be trained and cost of labor is more cheaper than many African countries.
The market oriented policy reforms also aim to attract Foreign Direct Investment (FDI) into the agricultural sector and exports from Ethiopia. A number of sectors are reserved for domestic private investors and the state but the horticulture sector was opened up for FDI. Now foreign investors are exempted from customs duties and import tariffs on all capital equipment and upto 15% on spare parts; income tax holidays from 1 to 5 years are given; remittances of capital are tax exempted; and it is permitted to carry initial losses forward. Furthermore, investments in exports are exempted from income taxes if at least 50% of the output is directly exported or if at least 75% of the output is indirectly exported for a period of no less than 5 years.
In short, the agricultural context and investment climate in Ethiopia has altered over the past few years in the direction of privatization, facilitating direct (foreign) investments export oriented production and diversification. This trend is expected to be sustained over the coming years.
If you need additional information visit Ethiopian Investment Agency website on www.ethiomarket.com/eic/
