The Ethiopian Finance Ministry announced on Tuesday that a two-day investment conference in Addis Ababa produced $1.7 billion dollars in investment deals, most of them from Chinese companies.
Reuters summarized the most prominent announcements from the Invest In Ethiopia 2025 conference:
The deals signed include a planned $500 million investment by Hua Ye Mining Processing Company in minerals exploration and processing, and the development of a special economic zone focused on minerals, the ministry said.
Another $600 million will come from Sequoia Mining & Processing Plc to develop coal mining projects, while another $360 million will come from Hainan Drinda New Energy Technology to build a solar cell manufacturing plant.
Another $250 million will come from CSI Solar, also for solar energy development, the ministry said.
The Ethiopian Investment Commission (EIC), the government agency which organized the forum, did not provide a timetable for when these projects would begin.
The Finance Ministry celebrated the Invest In Ethiopia 2025 conference as a “significant step in the country’s drive to attract foreign investment and foster private sector growth.”
Ethiopia is often seen as synonymous with poverty and starvation, but as the EIC eagerly points out, it actually holds enormous mineral wealth. Everything from gold and gems, to coal, iron, nickel, and phosphates can be mined from Ethiopian soil. Ethiopia boasts one of the oldest and most detailed geological survey operations in Africa.
One of Ethiopia’s challenges is that none of its riches were extensively mined until recently, except for gold, which became such a dominant product that it distorted the entire mining industry. Gold mining absorbed most of the country’s skilled workforce and most of its foreign investment. When the gold mines were booming, the industry had a habit of growing careless with its money. When the value of gold dropped, the entire Ethiopian economy sank with it.
Then there was the painful problem of political instability and tribal violence, which has kicked the legs out from beneath Ethiopian industry every time it tried to stand tall. Decades of unrest began when the government began shifting from an agrarian economy to industrialization and big cities in the early 1990s.
Ethiopia’s brutal Tigray War, from 2020 to 2022, drew in many ethnic groups, as well as neighboring Eritrea. Credible allegations of atrocities were leveled against all parties to the conflict.
The Tigray War was only the latest of Ethiopia’s devastating conflicts, and it is not entirely over. Ethiopia’s desperate central government recruited numerous tribal militias to help it battle the Tigray insurgents. When the Tigray conflict ended, the government told its allies to disarm, but they refused — and now thousands of people are once again being displaced by a violent insurgency.
Such unstable environments do not easily attract foreign investors, even when the ground is full of buried treasure. One of the major goals of this week’s investment forum was to convince outside companies their mines and energy projects would be safe.
Prime Minister Abiy Ahmed launched an ambitious post-civil war reform program last year, including extensive privatization of stagnant state industries, stabilization of Ethiopia’s wildly inflated currency, and more capital made available to foreign buyers.
The International Monetary Fund (IMF) was sufficiently impressed with Abiy’s reforms to extend $3.4 billion in credit last year. In April, Ethiopia succeeded in restructuring $8.4 billion of its debt, securing more time to make payments. The government hopes massive foreign investment to develop Ethiopia’s mineral resources will provide the income it needs to manage its older debts and satisfy the IMF.
Chinese companies accounted for about $1.1 billion of the $1.7 billion in deals flowing from the recent investment forum. China now makes about half of the foreign direct investments in Ethiopia.
This is not necessarily good news for the Ethiopians, as China’s ventures have been criticized for exploiting the local workforce, and a government hungry for big foreign money is not the most receptive audience for complaints from its abused citizens. On the other hand, some Ethiopians are outspokenly grateful for China’s investments, and they appreciate Beijing’s reluctance to criticize their government for using whatever force is necessary to suppress insurrections.
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