One of an occasional series on countries less often considered by businesses seeking international expansion.
Most of my articles cover aspects of international expansion from a general perspective, without any specific regional or country focus. However, I’ve been lucky enough to visit many countries, and have learnt that some of the best opportunities lie in the least considered places.
Even those who’ve thought about expanding in Africa have never seen Ethiopia as an easy place to grow. It’s #161 on the World Bank list of business-friendly countries.
It’s the home of one of the biggest and best airlines in Africa, widely used not only for regional destinations but with good connections to most points in Asia; however, most passengers just make connections and don’t visit. Which is a shame.
Those that do visit Ethiopia discover a thrilling country, unlike any other, with incredible landscapes and unique historic sites, and definitely not what most expect on the basis of the occasional news items on Western TV.
I’ve visited Ethiopia twice now, most recently a few months ago, and can highly recommend it.
But back to business.
There’s historically been strong — indeed dominant — government involvement in business — and even the biggest multinationals found previous governments hard to work with. They were very interventionist and repressive.
Now, things in Ethiopia seem to be changing fast.
From my first conversation in the taxi from Addis Ababa airport, I found everyone talking about the massive changes under the new prime minister, Abiy Ahmed. He’s young, dynamic and seems to be changing things fast. He’s fired people previously seen as unchallengeable. He’s made peace with Eritrea. Wherever I went, in meetings, bars and restaurants, the consensus was that more change had happened in a fortnight than in the previous 20 years.
It’s not to say that there has not been any foreign investment in the past. From the west it’s mostly been concentrated on hotels and the rag trade — big multinational clothing firms have been moving work there in recent years, particularly from Bangladesh, expanding the leather workshops already established there.
The biggest investors –as in most other countries in Africa — have been the Chinese. Most obviously they’ve been investing in infrastructure. Addis Ababa has a gleaming new light rail metro system, and there are motorways to cities — replacing roads that were not much better than tracks when I last visited just 4 years ago.
There are lots of reasons to hope the country opens up more to foreign direct investment. There are a lot of very well educated young people with good English who need jobs, so I think this could be a great place to establish a Shared Service Centre or undertake R&D.
It’s also the ideal hub for business to the rest of Africa — Addis Ababa is pretty central (at least North-South!) in the continent, and no other airport is better connected with other African cities.
So this may be premature, but I think it would be wise to keep an eye on the opportunities in Ethiopia. And if you’ve never been there, and you’re visiting Africa — or points in Asia — plan a stopover. I think you’ll be pleasantly surprised.
I’d be glad to know your thoughts or answer any questions you may have (even it’s just tourist advice!). Just comment below, or get in touch via our contact page
International expansion — even to countries you may never have thought about before — is easier than you may think.
Oliver Dowson offers subscribers to growinternational.org complimentary initial consultations on any aspect of international expansion – just get in touch via our contact page
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