Ethiopian Investment Board has decided to lift the regulation that restricts foreign investors from engaging in logistics industry which was exclusively reserved for Ethiopian nationals.
According to a statement issued by the Investment Commission today, the board has lifted the restrictions, including the provision of bonded warehouse, consolidation and deconsolidation services, and allows joint venture participation of international logistics service providers holding up to 49 percent or fewer stakes.
Explaining the rationale behind the revision, the board pointed out that no significant improvement in cost or speed to market has so far been achieved by the logistics sector. The “country’s low performance against its peers under international benchmarks is a key testament in this regard,” it added.
The decision is aimed at improving the logistics sector performance which can be developed as a thriving and productive cluster that serves as another pillar of industrialization and driver of growth.
Policy and regulatory barriers that precluded participation of international logistics service providers, among others, had imposed serious strains on the export manufacturing sector as it limited the availability of capital and technology intensive end-to-end logistics solutions, it elaborated.
The promotion of joint venture investments between international players and their Ethiopian counterparts, the former holding minority stake participation, will not only promote the transfer of technology and know-how to Ethiopia but also ensure that domestic players will retain key decision-making powers, the release noted.
Comments are closed.