News / Africa

Ethiopia's Economic Growth Attracts Young Diaspora

People walk past office blocks under construction in Ethiopia's capital Addis Ababa, January 27, 2010.
People walk past office blocks under construction in Ethiopia's capital Addis Ababa, January 27, 2010.
Young members of the Ethiopian diaspora are returning in large numbers to their country of birth.  The Ethiopian government welcomes the impact these returnees could have on the economy.
 
There are about 3 million Ethiopians living abroad - mostly in North America and Europe.  But in recent years, thousands of young professionals have come back to Ethiopia to look for business opportunities.
 
The government is well aware of the trend.  The director of the Diaspora Office in the Ministry of Foreign Affairs, Feisel Aliyi Abrahim, says that investment by the returnees is very important.

“They are our development partners, we need them and also they need us because of they do business here they also benefit, the return is very high.  And we need them because they bring us knowledge, they bring us technology, they bring us foreign direct investment, they create jobs, so this overall has very significant role in reducing poverty," he said.
 
Ethiopia is one of the fastest growing economies in the world.  Most cafes in the capital of Addis Ababa that offer free Internet connections are filled with young returnees working on their laptops.  Samuel is one of them.  He is a 32-year-old graphic designer who spent most of his life abroad before coming back to Ethiopia seven months ago to see if he could start a career.

“It was a struggle at first, but now its been picking up a few plans here and there.  And it’s ok, its ok, it’s getting better, there’s enough opportunity.  I haven’t decided if I’m planning to stay yet, but I’m optimistic so far," he said.
 
Nardi is another Ethiopian who just moved back from the U.S. state of Texas.  The 27-year-old pharmacist hopes that her skills will benefit her country.

“I’m not sure exactly how I can apply my professional experience in the country because its very different from what I'm used to.  The field is different here, the setup is different, even the degree is different.  I would like to start a business where I can help my country as well as myself grow.  But I want to do something in pharmacy," she said.
 
Many returnees have already started new businesses.  Lily Kassahun, who lived in Canada for the last 20 years, is opening a restaurant with Canadian dishes this month in Addis Ababa.  She says her decision to return was not just about economic opportunities.

“I always wanted to come back to Ethiopia to learn more about my culture since I left when I was younger.  Also to be with my family, it was the biggest goal for me.  More so than the money I think it’s more about feeling good and giving back to the community, and bring what I learned in Canada here," she said.
 
The total investment capital of the returnees is an estimated $1.1 billion.  That's almost as much as the $1.4 billion Ethiopia received last year in remittances.  But investment is more important in the long run says Feisel.

“Both is important but we need investment, that is more important because its increases the development," said Feisel.

The most popular industries among the returnees are real estate development, manufacturing, construction, and the tourism and hotel industry.  About 3,000 members of Ethiopia's diaspora have returned for investment purposes. Feisel says that nowadays they are involved in every sector.

“There is not any field that they haven’t been involved in so far.  And from the Ethiopian government side, because they are originally Ethiopians, we make legal arrangements that enables them to invest to do business in every sector they are interested in," he said.
 
Mikhayel Tesfaye is a 36-year-old designer and CEO of a California-based company called Passport ADV.  He started manufacturing his shoes in Ethiopia last year.
 
“My business was doing quite well, and I was at point where I just said that this was my one opportunity to stop what I was doing outside, for one year I will take the risk for just trying, with no expectations, no demands," he said.
 
Mikhayel will export 900 shoes in the coming months, mainly to North America, Europe and Japan. His shoes are produced in a factory in Addis Ababa with new and modern machinery, mainly from Italy.
 
Exchanging knowledge, ideas and skills is important for Mikhayel as he feels it could have a long lasting impact.

“I didn’t come here to create a charity project for one.  Two, not only do I want to design a good product, but I want to raise the bar.  Not only for what is capable here but for the outside world, what they believe is capable.  I’ll be producing $1,000 pairs of crocodile sneakers here.  I think because of the level of distribution that I already have, that I'll really be able to put made in Ethiopia products on the map," he said.

Feisel says that the government is actively working on making life easier for returning diaspora.

“What we are doing now is we are drafting Ethiopian diaspora policy.  We try to create awareness to all government structures who has direct relation with the diaspora engagement," he said.

The first draft of Ethiopian diaspora policy will be sent to the federal government in the coming weeks for approval.

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Comment Sorting
Comments
     
by: Anon from: Addis
October 14, 2012 7:09 PM
Come on. I am very sorry to read such platitude which is common place in local Addis medias and on there websites, which would have been enough. No VOA had to join that choir led by a new journalist from whom more of an investigative gist had been appreciated than running around and listening to friends and one government official.


by: Anonymous
October 08, 2012 4:34 PM
Didn't the Ethiopian thug regime arrested Marthe Van Der Wolf - just yesterday?? .... hahahahhaha... yeah, the thug regime running a policy of "no accountability", "my-way or the highway", and day light robbery of the people resources. They run businesses, TV and Radio stations, Banks, Telecoms --- and expect the diaspora to come back home and compete with their business. ...That will NEVER happen. The dictatorship just closed the remaining independent news paper and exiled award winning journalists. Yet, they expect the diaspora to invest their life time saving and leave their personal security in their hand!!..... ARE YOU REALLY KIDDING ME??.... HOW CAN YOU HOLD A REGIME RESPONSIBLE - WITH NO INDEPENDENT JUSTICE SYSTEM - IF YOU GET ROBBED BY REGIME LOYALISTS???... Look?!?!... it didn't work in Egypt, Lybia, Tunisia and all other countries run by terrorist regimes - so, it WON'T work in Ethiopia!!.... If you can't run the country democractically or can't handle criticism, you should leave your power to individuals who can. EPRDF is confused about its role in gov't - whether they want to be a business org., or government institution. So, they will need to leave power and let others take over. They can't run business and run the country at the same time - that's called corruption. Otherwise, they'll join Mengistu (Derg) sooner than later.


by: The Ethiopian from: Washington, dc
October 06, 2012 7:34 PM
In all honesty the government has much more to go before attracting a significant amount of skillful and knowledgeable diaspora, there is no coordination between government offices and bureaucracy is rampant, there is also the issue of corruption. The government of Ethiopia needs to create a policy to ease and accelerate the start up of businesses by returnees. This is inferred from first hand experience.


by: Alem
October 05, 2012 11:38 PM
Marthe: What do you "returning in large numbers"? You must be quoting Ethiopian government sources. Population of Ethiopians living abroad is not even 1 million. The names you mentioned [Nani, Lily, Mikhayel] are meant to make you believe indeed a reverse exodus is taking place. It is a lie. Ethiopian rulers are on the verge of losing control - especially with a dwindling foreign reserves. They need to quickly raise revenues. They have all along known about resources the diaspora could bring into the country. The problem is that they are afraid to lose or share power because a/ allowing investment requires creating a safe environment b/ those in the diaspora want also to participate in the politics NOT just bring in their money for the gov to decide on how it should be invested. Marthe, you've been had. You need to begin to do your own research if only to remain credible.

In Response

by: Yay from: Addis Ababa
October 07, 2012 5:41 PM
Why do you assume Marthe hasn't done his/her reseach? Have you done yours?


by: Ras Mitat from: US
October 05, 2012 6:57 PM
Still suffocating with archaic tax rules and endless bureaucracy.

Import tax on small van costs more than overhead to open small bakery...Not everyone is a multimillion dollar investor, or politically connected.

"Absent increased role of the private sector to leverage the large public infrastructure investment and efforts to improve the doing business conditions, IMF staff project that real GDP growth will slow down to 6.5 percent in 2012/13 and over the medium term (IMF report, 10/2012)."

http://www.imf.org/external/np/sec/pn/2012/pn12117.htm


by: amare from: PA
October 05, 2012 1:14 PM
I'm thinking to come back too, I mean if the govt facilitate doing business just like in the US, why not?
Thinking back, Derge took my grand mother houses, and this kind of story stays with you. But i see we got a new PM, so this tells me stiblility.

In Response

by: kidist777 from: Addis Ababa
October 06, 2012 9:08 AM
This is a good news. VOA the English service is fair in reporting events related to Ethiopia. But I always wonder why, VOA the Amharic service most often than not, does not want to talk about the economic achievements in Ethiopia. It seem VOA, the Amharic department has been hijacked by some members of the opposition groups.

In Response

by: seyoum777 from: Addis Ababa
October 06, 2012 9:00 AM
It is encouraging that the young Ethiopian are returning to their country. I believe they have a lot to contribute to the on going economic progress of the country. However, this is a sad news to the die hard opposition members living among the diaspora community who often have a bleak picture of the developmental activities in their home land.

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