Ethiopia is a country endowed with abundant and diversified natural resources and diverse climate. It has also several agro-ecological zones and sub-zones, each with its own physical and biological potential. These and other factors make the country favorable for undertaking investment in various areas. The priority areas of investment that the Government most wants to attract foreign direct investment/FDI/ as well as domestic investment include:

  • Horticulture,
  • Floriculture,
  • Agro-processing,
  • Textile and garment and
  • Leather and leather products
  • Construction
  • Agricalture
  • Pharmaceuticals
  • Manufacturing
  • Tourism
  • Power

Other areas of investment include agriculture and allied activities (livestock’s, fishery, forestry, etc), mining, cement tourism, grade I construction, services such as health and education, hydro-power, etc. For further information read Ethiopian Investment Guide 2015 or visit

About Investment Regulation in Ethiopia

Ethiopia’s primary law concerning foreign investment is the Investment Proclamation. This page contains a guide to the existing investment proclamations and regulations. It is meant to serve as a quick guide to investment in Ethiopia. It also has descriptions of areas of investment reserved for the Government or joint investment with Government; areas of investment reserved for domestic investors; areas of investment exclusively reserved for Ethiopian nationals; areas of investment open for foreign investors; capital requirement for foreign investors and forms of investments in Ethiopia.

  1. Investment Proclamation No. 769/2012 (Download) and its amendment Proclamation No. 849/2014 (Download)
  2. Council of Ministers Regulations No. 270/2012 Investment Incentives and Investment Areas Reserved for Domestic Investors Council of Ministers Regulation (Download) and its amendment Regulation No. 312/2014 (Download).
  3. The Commercial Code 1960 (provides the legal base for doing business in Ethiopia) (Download)

Ethiopia offers a comprehensive set of fiscal and non-fiscal incentives to encourage investment into priority areas, including:
•    Customs duty exemptions of up to 100% on imports of capital goods for eligible areas of investment;
•    Income tax exemptions for a period ranging between 1 and 9 years, depending on the specific activity and the location of the investor;
•    Loss carry forward for business that suffer losses during the income tax exemption period for half of the tax exemption period;
•    With the exception of a few products, no export tax is levied on Ethiopian export products;
•    Duty Drawback Scheme, Voucher Scheme and Bonded Factory and Manufacturing Warehouse Schemes
•    Various non-fiscal incentives for exporters
•    Guaranteed remittance of capital for foreign investors
For further details on incentives available in Ethiopia, download the following document (PDF).
The Ethiopian tax system comprises direct and indirect taxes. Direct taxes include personal income tax, rental tax, withholding tax, and corporation tax, among others. The main types of indirect taxes are VAT, customs duty, excise and turn over taxes. Main taxes are summarized in the table below.


Main Taxes in Ethiopia:

Type of Taxes    Rate
1    Corporate Income Tax    30%
2    Turn Over Tax    2% and 10%
3    Excise Tax    10% up to 100%
4    Customs Duties    0% up to 35%
5    Income Tax from Employment    0% up to 35%
6    Withholding Tax    2%
7    Value Added Tax (VAT)    15%
8    Export Tax    Nil (with exception of hides and skins-150%)
9    Royalty Tax    5%
10    Dividend Tax    10%


For More Information
Ethiopian Investment Commission
Addis Ababa, Ethiopia
P.O. Box 2313
(+251) 11 551 0033
(+251) 11 551 4396