Investors who bought shares in 18 international companies engaged in investment activity in Ethiopia have earned higher than expected average returns. This is the finding of research by Access Ethiopia which notes that stock market investors in ‘Ethiopia-invested Global Stocks’ with Ethiopia-based projects have earned double-digit annual returns over three years.
The research covered a number of international companies whose shares can be purchased on the international market. The companies represent a wide range of experience. They include Total, Adrica, Tullow and Marathon, engaged in oil exploration and distribution; Allana Potash, Ethiopia Potash Corporation and Nyota Minerals in the mining sector; Yara and Karuturi in agriculture; Pittards, Elsewedy and Pretoria Cement in manufacturing; Proctor and Gamble, Tiger Brands and Unilever in consumables and Diageo, SAB Miller and Heineken in the beverage sector.
The direct contribution of their Ethiopian operations may still remain small in some cases in comparison with total profits, but the Ethiopian projects are expected to have significant impact in the near future on the growth potential of these companies, particularly those engaged in agricultural and mining ventures. The latest World Bank Report on doing business, 2013, ranks Ethiopia in 13th position overall among sub-Sahara African countries. It stands at 4th place in dealing with construction permits and in 6th place for enforcing contracts, helping to give the country a competitive edge.
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* Originally published on A Week in the Horn – Oct. 25, 2012 issue, titled “Ethiopian investments prove lucrative”. Items from A Week in the Horn are re-published here with a permission to do so.
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