U.S. Ambassador to Ethiopia
at the 10th Biennial U.S.-Africa Business Summit
“Doing Business in Ethiopia”
Tuesday, February 2, 2016
U.S. Embassy Addis Ababa
(As prepared for delivery)
I’m delighted to see so many participants here for the Doing Business in Ethiopia program, in conjunction with the Corporate Council on Africa’s Summit. Thank you to the Ministry of Foreign Affairs for organizing this event.
I quoted President Obama this morning at the opening of the CCA conference and his views underpin all of our work to support U.S. firms in Ethiopia: We don’t look to Ethiopia simply for its natural resources; we recognize Ethiopia for its greatest resource, which is its people and its talents and their potential. That is the reason the U.S. government, particularly through the Agency for International Development, places so much emphasis on helping Ethiopia increase the health and education of its population—goals we share with the Government of Ethiopia.
A healthy and educated population is the prerequisite for the sustainable economic development that will continue Ethiopia’s progress to becoming a middle-income country by 2025. That is why all of us are here: to explore ways foreign trade and investment can help move Africa, including Ethiopia, to more vigorous participation in the global economy.
U.S. businesses have a huge role to play in Africa, and Ethiopia especially. Not only because our companies are among the most innovative, flexible and efficient in the world, but also because, as a nation of immigrants, the United States is home to millions of people, including a very large population with Ethiopian roots, who have strong ties with their homelands and insights on how to navigate the international business landscape. In September, I welcomed a Tradewinds delegation of U.S. firms organized by our new Foreign Commercial Service office, all of them interested in doing business in Ethiopia. That interested is reflected in the number of U.S. firms here this week for the CCA conference.
But no matter how many emotional and cultural ties an American business may have, they remain first and foremost businesses competing in a global economy. That means investment decisions will be made based on a careful analysis of the risks and opportunities. U.S. companies look for a level playing field, with reliable rule-of-law and transparency that create an environment conducive to fair competition. This is where the U.S. government plays a constructive role by encouraging the development of institutions, legislation and best-practices that help create an environment suitable for U.S. business. Let me give you examples of the things American companies tell us they are looking for.
Membership in the World Trade Organization is an important indicator that a country is committed to meeting international standards for free, fair and open trade via the elimination of unfair barriers to the free movement of goods and services across international boundaries. WTO membership also includes a commitment to the protection of intellectual property rights. Ethiopia’s current Growth and Transformation Plan (GTP II) prioritizes Ethiopia’s integration into the multilateral trading system, and Ethiopian government officials have reiterated their specific commitment to seeking WTO membership. The U.S. government stands ready to assist and support Ethiopia’s move towards opening up its financial and telecom sectors and the other adaptations necessary to integrate more fully into international trade and attract the investment necessary for a growing economy.
Membership in the Extractive Industry Transparency Initiative (EITI)is another indicator that a country is committed to creating a level playing field for business. EITI evolved out of concerns expressed by civil society, industry and the donor community about the lack of transparency in revenues generated from natural resources in developing countries. The United States supported Ethiopia’s application as an EITI candidate country in March 2014. EITI accession shows a commitment to transparency and preventing corruption in the extractive sector but depends on cooperation by the government, private investors, and a completely independent civil society sector. Constraints on the activity of civil society in monitoring the extractive sector opens the door to the exact private-public collusion EITI is intended to prevent.
Government procurement is another area in which U.S. firms rely on a fair, transparent and predictable process. The United States has launched theGlobal Procurement Initiative, to educate procurement professionals on international best practice and avoid the pitfalls that lead to a misallocation of resources. It introduces “total costing” and ways to compare bids in a rational and consistent fashion. I am pleased that the U.S. government is working closely with a variety of Ethiopian entities to enable them to be part of the Global Procurement Initiative.
Last but not least, the first thing a U.S. investor looks for is a robust and active American Chamber of Commerce or “AmCham.” The mission of an AmCham is to promote economic relations between the host country and U.S. businesses. It provides a forum where U.S. companies can discuss challenges, identify possible solutions and to lobby host governments on ways to improve the investment climate. AmChams provide support, tailored to U.S. business needs, in areas such as training, networking, business facilitation, industry standards, and corporate social responsibility.
I have made establishment of an American Chamber of Commerce a top priority because an American Chamber of Commerce shows that Ethiopia is serious about welcoming American business.
In conclusion, Ethiopia offers tremendous potential and we look forward to working with the government and people of Ethiopia to bring to life the aspirations of the Growth and Transportation Plan II. The Ethiopian government has led the country in impressive economic growth under GTP I. The next stage requires solid partnership with the private sector to develop its manufacturing sector, boost exports and increase employment. We look forward to helping Ethiopia realize its full potential and hope that you too see the opportunities in this remarkable country.