Investment opportunities in Eritrea and Ethiopia




Investment opportunities in Eritrea and Ethiopia

by Eritrean Press

The climate to invest in Eritrea and Ethiopia has never been better for both citizens.

Ethiopians are eager to visit and invest in Asmara, Assab, Massawa and the coastal areas. So are we in Hawassa, Adama, Gondar, Dessie, Bahir Dar, Jimma, Assosa, Dire Dawa....

Eritrean Press gives the guide in which sectors Ethiopians could invest in Eritrea.

For investors, Eritrea's remarkable peace and security are the main pillars for conducive investment environment. That is one of the main selling points to invest in the country.

INVESTMENT IN ERITREA

Hospitality (hotel, catering, and tourism) Industry in Eritrea is an industry that has less of competitors and can be one of the fastest growing sectors among others industry.

The establishment of a Free Port Zone at Massawa is further expected to boost trade prospects within the already established Middle Eastern and African Markets.

Key investment opportunities in the fisheries sub-sector provide a potential of 90,000sq.km of fishing ground, with an estimated annual production potential of 65,000-70,000 tons of fish and other marine produces. But mind our beautiful coral reef.

Investment incentive in Eritrea

The investment policy of Eritrea provides the following incentives to foreign and domestic companies.

- Both local and foreign private sector investors are allowed to participate in all sectors of the economy with no restriction and discrimination

- Priority foreign exchange allocation is given to exporters;
Up to 100% retention of foreign currency earning;

- No taxes on dividends declared;

- Capital goods, intermediates, industrial spare parts and raw materials are subject to the nominal customs duty of 2%

- Raw materials and intermediate inputs are subject to 3% sales tax; however, all sales tax will be rebated on all materials and inputs that have been used for export production.

- Exports are exempted from export duties and sales taxes;

- Any loss incurred during the first two years of operation by an investor may be carried forward for three consecutive years;

- A marginal tax rate on personal income from 2%-38%: on non-corporate profit from 2%-38%; on corporate profit from 25%-35%; on commercial agriculture from 2%-320%; and on rent income from 1%-48%;

- Profit derived from mining activities will be taxed as per the mining legislation; and

- A corporate profit that is set aside from reinvestment taxed at the rate of 20%.

INVESTMENT IN ETHIOPIA

Ethiopia is considering finding a new partner to develop a potash mine abandoned in 2016 by Israel Chemicals Ltd., which has sought $198 million compensation at an arbitration court after accusing the former government led by TPLF of failing to support the project.

Ethiopia wants to get the mine operating as soon as possible.

According to the former Minister for mines, Petroleum and Natural Gas, now Defense Minister Motuma Mekassa said the government is eager to begin work on the project as long as there are no legal hindrances from the arbitration process currently underway in The Hague.

This project makes sense to the Eritrean National Mining Company (ENAMCO) to invest on the Ethiopian potash project. Proximity to merge it with the existing Eritrean Colluli Potash Project (picture) is economically viable. Now that the Eritrea and Ethiopia relation is back on, there won't be any hindrance to transport and ship the potash through Massawa or the future new port of Anfile Bay than the long and expensive route via Djibouti.

CONCLUSION

The sky is the limit now for these two sisterly countries.

To Abiy's "love one another" message to Asmara, Wedi Afom has responded positively and brilliantly.

"Where was he the last 16 years?"


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