Ayka Addis, the largest textile factory in the country was established with 140 million-dollar investment in 2010 being an ice breaker to the entrance of Turkish investors in Ethiopia.
Since then, Turkish companies especially in the textile sector have been flowing to the country reaching more than 150 and employing 50,000 Ethiopians currently. These Turkish companies invested more than three billion dollars in the country. The number of the Turkish investors in the country in 2004 was only one with jobs created standing at five. The number of the investors grew to 155 within the following 10 years.
The country geared its focus to Africa adopting the African initiative in 2003 following the 1998 African Action plan; and declared 2005 as the year of Africa. And Ethio-Turkish business forum was also established in 2009 with a mission of serving as a business platform for bringing business people together.
In 2003, the Turkish investment in Africa was only four billion dollars while this number grew to 25 billion in 2013.
The overall volume of foreign trade has increased from 742 million dollars in 2000 to four billion in 2010 and 7.5 billion dollars in 2011. The volume of Turkey’s foreign trade with all African countries has increased from nine billion dollars in 2005 to 14.1 billion dollars in 2010 and 17.1 billion dollars in 2011.
With the visit to Ethiopia of Recep Tayyip Erdogan, the 60 year old president of Turkey, hope was laid in the investors both in the country and others intending to invest in the country.
“We would like to become Ethiopia’s partners and we have to promote and protect companies on both sides,” said Erdogan.
Although Turkey is among the 10top destinations for Ethiopia’s exports, the trade balance between the two countries still remains in favour of Turkey. In the 2013/14 fiscal year, the export to Turkey earned 84.6 million dollars standing at the ninth rank accounting to 2.6pc of the total earnings from export. And the trade gap between the two countries stands at 100 million dollars.
Among the top 10 destinations of Ethiopian exports are China, Somalia, Germany, Saudi Arabia, Netherlands, Switzerland and US.
But the Ethiopian government seems to be comfortable with the existing relations between the two countries as Hailemariam Desalegn, Ethiopian Prime Minister stated during a joint press briefing with President Erdogan at the national palace.
“Although the trade balance is in favour of Turkey, the growing foreign direct investment (FDI) from turkey will fill this gap,” he said.
Turkey is the number one investor in the country having 115 projects with an investment of 69.2 million dollars within the time January 2010 and October 2014. Out of these projects, 26 projects are under the implementation stage investing 3.6 million Br and employing 3,384 permanent and 2,492 temporary employees, 35 projects are in operation with a capital of 18.4 million Br and creating 1,627 permanent and 1,798 temporary jobs. The remaining 54 projects are in the pre-implementation stage creating 26,708 jobs permanently and 12,180 temporarily. India and China follow with investments of 38.9 million Br and 25 million Br respectively. Saudi Arabia and Sudan take the fourth and the fifth stages with investments of 14.2 million Br and 13.6 million Br.
The total trade turnover between the two countries stands at 400 million dollars in the first 11 months of 2014 growing from the 110 million dollars in 2004. And there is an interest in the two parts to increase the figure to half a billion.
“The first target is to bring this number to 500 million and then we will proceed to establishing a free trade agreement, which we have discussed and is a must to sign,” stressed Erdogan.
The major export items of Ethiopia are coffee, oil seeds, pulses, spices, khat, livestock, meat, flower, fruits and vegetables, textile and skin and hide products.
The human resource of Ethiopia, a country with the second largest population in Africa after Nigeria puts it at the primary focus of his country, according to Erdogan.
Erdogan, who expressed the financial bureaucracy problems of Turkey’s investors stressed that this has to get its end by the opening of Turkish Bank in Ethiopia which, as he said were discussed between the two leaders.
“Our Bank should come here and it will be a good leap to Ethiopia as well,” said Erdogan.
Turkey came to ninth rank as export destination for Ethiopia in 2013/14from 15th in 2012/13. China came to first place from its second rank; Saudi came to fourth from fifth, and Israel came from 10th to eighth position, while Somalia went down from first to second.
Turkey was a destination of Ethiopia’s oil seed that generated 38.4 million dollars, pulses that generated 15.6 million dollars, meat that generated 349.5 million dollars, and textile that generated 27.4 million dollars in the 2013/14 fiscal year.
Believing to transform this relationship to a higher stage as both the leaders were pronouncing, the two nations have launched a new relationship project for the years 2015 to 2018.
“Africa is going to be the next growth pool of the world,” said Hailemariam Dessalegn. The two governments signed a memorandum of agreement to cooperate in the fields of science and technology. The Adis Abeba University, which will be linked to universities in Turkey for cooperation confered honorary doctorate degre on the president
The president, who made his first visit to Africa making his first start from Ethiopia since he assumed the position of the presidency in 2014 promised that Ethiopia is going to be the central place or headquarter for the Turkish investment in Africa.
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