A recent report by Ethiopia’s Federal Anti-Corruption Commission reveals that less than 40 per cent of foreign direct investment (FDI) projects registered over the past six years have become operational. Covering the period up to 2025, the report highlights that out of 1,509 permits issued by the Ethiopian Investment Commission (EIC), only 586 projects, valued at approximately 281 billion Birr (USD 1.8 billion), have commenced operations. Many factories have been forced to cut or cease production due to insufficient support, including delays in addressing security risks and infrastructure deficiencies.
The report details specific cases where investors were unable to start operations despite significant upfront payments. For example, Emirates Steel Ethiopia PLC in Oromia could not commence production due to a missing power line, while Saudi Agricultural Investment Co Ltd Ethiopia was denied access to land it had paid for a decade earlier, forcing the company to store equipment in leased warehouses at considerable cost. Overall, 307 FDI permits remain valid but inactive for more than two years, a situation the report describes as illegal.
Criticisms extend to systemic lapses in oversight, including the EIC’s failure to follow up on investor incentives, enforce capital requirements, and address foreign exchange shortages that cripple manufacturers such as Transsion Manufacturing PLC. The report warns that these lapses have allowed investors to exploit loopholes, contributing to billions of Birr in losses for the government. Despite parliamentary pressure in recent months, the Anti-Corruption Commission calls for urgent reforms to ensure foreign investments translate into operational projects and tangible economic benefits.