Investment Guarantees in Ethiopia
Ethiopia provides the following guarantees to foreign investors:
Repatriation of Capital and Profits
Capital repatriation and remittance of dividends and interest is guaranteed to foreign investors under the Investment Proclamation. Any foreign investor has the right, in respect of an approved investment, to make the following remittances out of Ethiopia in convertible currency at the prevailing exchange rate on the date of remittance:
- profits and dividends accruing from an investment;
- principal and interest payments on external loans;
- payments related to technology transfer or management agreements;
- proceeds from sale or liquidation of an enterprise;
- proceeds from the sale or transfer of shares or of partial ownership of an enterprise to a domestic investor;
- compensation paid to a foreign investor;
Expatriates employed in an enterprise may remit, in convertible foreign currency, salaries and other payments accruing from their employment in accordance with the foreign exchange regulations or directives of the country.
Guarantee Against Expropriation
The constitution of the Federal Democratic Republic of Ethiopia protects private property. The Investment Proclamation also provides investment guarantee against measures of expropriation and nationalization that may only occur for public interest and in compliance with the requirement of the law. Where such expropriations are made, the Government guarantees to provide adequate compensation corresponding to the prevailing market value of property and such payment shall be effected promptly.
Ethiopia is a member of the World Bank-affiliated Multilateral Investment Guarantee Agency (MIGA) which issues guarantees against non-commercial risks to enterprises that invest in signatory countries. Ethiopia is currently concluding bilateral investment promotion and protection agreements with a number of developed and developing countries, and it is ready to conclude such treaties with any country at any time. Ethiopia has also signed the World Bank treaty, "the International Convention on Settlement of Investment Disputes between States and Nationals of other States (ICSID)".