Ethiopia's open up in import, export, retail and wholesale businesses would be turning point to streamline and foster legal trading system, Senior Policy Analyst commented.
Approached by The Ethiopian Herald, Senior Policy Analyst Costantinos Berhutesfa (PhD) said that the directive adopted to liberalize the most restricted business sector would be a significant milestone towards stabilizing the market, stimulating domestic product, promoting import substitution, among many others thereby benefiting the populace and the country at large.
Hailing the opening up of the venue to foreign investors, he also reiterated that it would be a game-changer towards transforming the country's trading system meaningfully.
According to Costantinos, the policy will be an opportunity to create a system that projects the nation into WTO membership. Besides, foreign companies' global experience sharing will also help advance the local private sector.
He said: "The directive not only help advance markets, but also increases the nation's competitiveness in the export sector, while propelling local business capacity into the 21st century."
Efforts to fix the market have now taken a new trajectory to stabilizing the market by making these sectors very competitive, he added.
With the advent of credit and capital markets in the country, the opening up of the financial and liberalizing other sectors, he elaborated that foreign companies with immense experience in business sector would bring access to global markets and stimulate domestic production and exports while advancing import substitution.
Moreover, he stated that such companies will not require capital (local or foreign currency) from local sources as they invest heavily to produce for exporting. This helps resident banks with excess and adequate foreign reserves.
In a similar vein, the directive provides schemes to control the proper implementation of mandatory provisions and procedures that especially ensures the benefits of customers when they engage in this business, as to him.
"The country would generate more triumphs in this scheme including new markets, economic growth that creates better-paid jobs, and foreign direct investment, not loans," the Analyst said.
Besides, it eases the process of importing raw materials from within Africa to access cheaper means of production for resident foreign companies," he remarked.
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"Ethiopian entrepreneurs and startups working with or in these foreign companies can start their own businesses to enter the competition that benefit consumers offering goods at competitive rates," he noted.
Costantinos stressed that political stability, peace and security and curtailing corruption are important for foreign companies to invest in all sectors of the economy and in particular in the aforementioned sectors with respect to the country's collective cultural and social narrative.
As to him, financial reform should also be frontloaded to facilitate foreign companies in the Ethiopia market.
It is to be recalled that the Ethiopian Investment Board has recently approved a legal amendment that allows foreign companies to participate in import, export, wholesale and retail trading activities.
BY ASHENAFI ANIMUT
THE ETHIOPIAN HERALD SUNDAY EDITION 21 APRIL 2024
