Trade and the economy: the Netherlands and Ethiopia

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Trade and the economy: the Netherlands and your country or region

From Aid to Trade

Over the past decade Ethiopia has achieved high economic growth. The country’s emphasis on agricultural transformation and its strong expansion of public investment have delivered impressive results. With the rise of the industrial sector (light manufacturing, mining), significant changes in Ethiopia’s economy are to be expected. The agriculture sector will still remain prominent, and offer many opportunities for intensified economic cooperation in a number of agribusiness subsectors.

The Embassy plays an active role in advising and supporting Dutch companies, and has attracted new Dutch and other foreign investors. Since 2004 many Dutch companies started joint ventures in Ethiopia, bringing the total to about 130. These investments are translated into ca. 70.000 direct jobs. As most of these companies are active in the agricultural sector, the Embassy provides support to some of the most important agribusiness subsectors, like the flowers-, vegetables- and fruit sector, sesame and dairy.

In addition, support is provided to the development of several promising subsectors, like poultry, potato, soy, spices and aquaculture, through the development cooperation project Ethiopian Netherlands Trade for Agricultural Growth (ENTAG), implemented by Wageningen University. The activities on agriculture align well to the Dutch ‘Topsectors’ Agro & Food and Horticulture & Planting Material. The Embassy is active to support the sustainable development of the cotton and textiles sectors in Ethiopia, together with Solidaridad. As much as possible, the Embassy is combining available central (HQ) funds and networks with its bilateral activities.

To create a more enabling business environment, the Embassy takes part in the MultiDonor Initiative of the IFC, with a focus on the investment climate and financing private sector. With regard to agro-logistics, the Embassy supports the development of a cooled chain for the export of perishables from Ethiopia, making Ethiopia competitive on international markets, by making use of Dutch knowledge, experience and access to the European market. With regard to agro-financing, the embassy cooperates with the World Bank and ATA on the financial strategy for Ethiopia, as well as through working with Dutch banks, financial NGO’s and micro-finance institutions to explore the possibilities for improving services and increasing access to credit and other financial services for companies, cooperatives and small holders. Companies seeking finance are guided to (Dutch) financial instruments. The Embassy also provides direct support to Dutch companies in Ethiopia through individual hands-on support, in cooperation with ENTAG and the ENLBA (Ethio Netherlands Business Association).

The Embassy promotes CSR (Corporate Social Responsibility) and inclusive economic development, especially within the context of new investors, exporter/processor and outgrowers relations, consisting of environmental, climatological, economic and social aspects. In this respect attention is paid to aspects such as micro-finance and voucher systems, crop insurance, IT and capacity building as well as linking Dutch growers with Ethiopian knowledge institutes and producer organizations.