ADDIS ABABA – Ethiopia has emerged as the second-largest destination for foreign direct investment (FDI) in Africa, according to new government data, with Chinese firms accounting for the lion’s share of capital entering the country.
The Ethiopian Investment Commission (EIC) reported on Monday that the country attracted $18.6 billion in FDI over the past five years, trailing only Egypt on the continent. In the 2024/2025 fiscal year alone, inflows rose by 22.7% to $4 billion.
The surge is largely attributed to Ethiopia’s “open-door” policy, which recently lifted restrictions on foreign participation in retail, wholesale, and export sectors.
A major highlight of the current week is a $4.2 billion gas deal between the Dangote Group and China’s GCL Group, intended to power a massive fertilizer project.
However, the economic optimism is tempered by a persistent humanitarian crisis. The Ethiopian Human Rights Commission (EHRC) released a report on Tuesday documenting a “pattern of attacks” in the Oromia region, where recent ethnic violence has resulted in dozens of deaths and mass displacement.
Investors remain wary of how the government will balance its industrial ambitions with the need for internal stability.
