Turkey signs deals to boost infrastructure investments in Ethiopia

Under the terms of the agreements, signed by Turkey's economy minister Nihat Zeybekci and heads of Ethiopian agencies, "both sides agreed to mutual cooperation in the fields of energy, mining and hydrocarbons", Turkish newswire service Anadolu Agency reported.

Turkish experts will support Ethiopian institutions "to upgrade their skills sets in geothermal and coalfield surveys", Anadolu said. "Turkey also agreed to provide technical support to build the capacity of Ethiopia's small-and-medium enterprises."

In addition, the head of the Turkish Exporters' Assembly (TIM) Mehmet Buyukeksi said: "Given the growth of businesses between the countries, we want to have an office which could facilitate banking services."

"We also requested the Ethiopian side to expedite procedures for working visa extensions for Turkish businessmen, investors and employees in Ethiopia," Buyukeksi said.

Buyukeksi said TIM had also urged Ethiopia to set up a "free trade area" for both countries "to improve their bilateral trade and business relations". However, he said Ethiopia "was not ready at this moment to enter into this agreement".

According to figures published last year $2.5 billion of the $6 billion Turkey is currently investing across Africa is focused on Ethiopia.

Turkey's president, Recep Tayyip Erdoğan, has said the value of Turkish trade with Ethiopia amounted to around $400 million by the end of 2014. He said he wanted that figure to increase to at least $500m.

"We will encourage our businessmen, they can develop joint ventures in Ethiopia or they can invest in other countries together," Erdoğan said. "Our construction companies can significantly contribute to the infrastructural and superstructural projects of Ethiopia."

Ethiopia is also open to Turkish investors who want to build hydroelectric power plants in the country, "either as sole investors or in the form of partnerships", Erdoğan said.

Ethiopia's ambassador to Turkey Ayalew Gobeze said in December 2016 that some 150 Turkish companies are currently operating in his country's manufacturing, infrastructural development and agricultural sectors. "We consider Turkey our good development partner," he said.

A recent report by the World Bank said ongoing investments in Ethiopia's power and transport infrastructure are expected to help boost future growth and exports, despite the impact on the country of "the worst drought in 50 years".

The bank's '5th Ethiopia Economic Update' (79-page / 8.19 MB PDF) said the government's increased focus on new industrial parks was also helping to "improve export performance and stimulate growth in the short to medium-term".

Last year, the World Bank's International Finance Corporation (IFC) said it was working with Ethiopia's government to boost geothermal development as part of the country's efforts towards becoming 'carbon neutral' in power generation by 2025.

Geothermal energy is "abundant" in Ethiopia's Rift Valley, but "tapping the potential requires both investment and expertise, making it expensive and risky", the IFC said.