9 February 2017

Africa: 'Ethiopia Is a Gateway to the Wider Market of Africa,' Swedish Ambassador Jan Sadek

Photo: Daily News
(File photo).

Of late, the 70th Anniversary of Ethiopia and Sweden's diplomatic relations was marked. Accordingly, The Ethiopian Herald held an exclusive interview with Swedish Ambassador Jan Sadek and Minister Counselor and Head of Development Cooperation Section, Annika Jayawardena, for their reflections on the seven decades diplomatic journey of the two countries. This piece is the first part of the summary of their responses to the questions raised by the Herald. Excerpts:

Ambassador Sadek responded to questions regarding historical relations, Swedish investors' engagement, and status of trade exchange volume and investment potentials in Ethiopia as follows:

On historical relations

One has to look at the history of the two countries to explain what's happening now regarding co-operations. Sweden and Ethiopia had a very rich history together. Actually we celebrated 70 years of our diplomatic presence here on mid December. It was in 1946 the Emperor [Haile Selassie I] donated a property to the King of Sweden for the embassy. Since then, we had strong relations with the country.

We had missionaries here for 150 years who came to this country at the end of the 19th century. The Emperor made a very good decision and invited so many Swedish experts to this country in the fields of military, medical science, education, sports and training. Even the famous marathon runner Abebe Bikila was trained by a Swedish fellow.

Sweden in the 50s became the first official development cooperation country in the world, and the Swedish government spends development funds here in Ethiopia. When the Swedish Development Agency (SIDA) was founded later, Ethiopia of course became a natural starting point for SIDA's mission in Africa. Besides, the Swedish Embassy in Addis Ababa is one of the oldest in Africa after the ones in South Africa and Egypt.

On Swedish investors' engagement

Swedish businesses have been here for many decades even a century, since the telephone company Eriksson came here 100 years ago. Four and five years ago, our relation with Ethiopia reaches a new level of business cooperation. Now we have seen a growing interest of Swedish business companies as a number of big well-known companies show interest to invest in this country. Besides, smaller companies, most of them owned by the Ethiopian Diaspora in Sweden are also abundantly flowing to Ethiopia bringing the skills, contacts and experiences they acquired in there.

In 2015, we had a record of Swedish export to Ethiopia. That year Sweden was the biggest exporter to Ethiopia from Europe with an export of 600 million US dollars. This basically is because of the contract with Eriksson in the telecom sector. The performance of companies like this one fosters the interest of other companies to come and invest in Ethiopia.

When Swedish corporations plan to come to Ethiopia, they look at the fast economic growth and the enormous 100 million people potential market. Besides, when you look at Africa as a whole, Ethiopia is a gateway to the wider market of Africa.

The other is H and M, a global cloth retail company. The company will produce clothes in Ethiopia for the global market. They are also inviting their partners from Asian countries, which is very interesting because it will create many jobs.

In recent times, the internet breakdown and the State of Emergency posed practical problem for the companies. Companies from European countries particularly from Scandinavian countries are sensitive about the issue of politics, and they look a little bit hesitant as the result of the recent instabilities. However, I hope the government will follow the right steps in managing the situation and the interest will likely rise again.

When it comes to H and M here in Ethiopia, they are engaged in lobbing and encouraging a number of companies to come and invest in the country besides creating job opportunities.

Moreover, we work with H and M regarding development cooperation and they are committed to good working conditions. This is the other good thing that these companies are bringing here. They are curious about both the physical working conditions and the wages. As Ethiopia is a growing country, companies should not be solely dependent on cheap labor like the problems that have been created in Asian countries. Sweden together with H and M is working on a decent working condition.

On Status of trade exchange volume and investment potentials in Ethiopia

There was about 400 million US dollars of Swedish export to Ethiopia in 2016. Ethiopia's export was around 11 million during that year.

Besides Eriksson, a classical telecom company and H and M, a cloth retail company, other main Swedish companies are here. The trade exchange should be balanced and the export from Ethiopia to Sweden needs to grow. There's a know-how and tradition in textile production, leather production, and recently flower farming which are potential areas in Ethiopia.

We have Swedish companies working on textile and leather ware. We have an interesting delegation going to Sweden with women entrepreneurs, who own various companies. The Ethiopian coffee and Wine is also another potential area to increase export. We also import a tone of Injera per week to Sweden for the Scandinavian market. Hence, there is an enormous potential to do business in this country.

Regarding Capacity Building, Minister Counselor and Head of Development Cooperation Section, Annika Jayawardena commented the following:

We were building a lot of good schools here in Ethiopia in the 1960s and 70s. I meet regular people who have gone to those schools, who are now in ministerial and various other areas. We have evaluated what we were doing in that sense in the end of the 80s and now we know that, you cannot just build schools, rather you should be caring about the school administration, the policy, the capacity of teachers as well.

The issue of development is wide. It is important to build the capacity of the state at the national, regional and local level to be able to handle the schools. We always put a lot of effort on building people's capacity. It can be with civil society, it can be working with the ministry of environment, and it can be in universities to build the capacity of teachers in PhD programs. It can also be working with the UN agencies. In addition to that, there is also a special hub at the Ethiopian Chamber of Commerce and we are working with them on capacity building matters.

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