HANDS-ON INVESTMENT GUIDE

Amhara Regional State

Horticulture Floriculture and Dairy Dear Investor

With much pleasure Amhara has not only a favorable I am introducing you this practical climate and good soils but also investment guide of Amhara Regional lots of facilities for investors like an State. international airstrip, a state-of-the-art cargo center and a fast developing We welcome you as investor infrastructure. Above all it has a warmheartedly and are ready to beautiful environment with great receive you, notably when you are potential. active in horticulture, dairy and agro- processing. Come and convince yourself!”

Published and commissioned by Embassy of the Kingdom of the Netherlands, , Ethiopia In cooperation with Amhara National Regional State of Ethiopia Mr. Gedu Andargachew (Ato Gedu), May 2014 President of the Amhara Regional State 3. 18 Floriculture Business Opportunity Floriculture: National Business Overview The Business within Specific Opportunity Areas 4. 24 Dairy Business Opportunity Dairy: National Business Overview The Business within Amhara Region Specific Opportunity Products IN 5. 30 Investment climate 6. THIS 34 Incentives 7. 38 Getting started Scoping and Site selection GUIDE Registration, Licensing and Land acquisition How to get started 8. 1. Checklist Application Investment License Introducing Amhara Regional State 46 04 Entirely owned by foreign investor 2. Joint investment of domestic and foreign investors 08 Horticulture Business Opportunity Horticulture: National Business Overview The Business within Amhara Region 9. Useful contacts Specific Opportunity Products 48 Introducing Amhara Regional State

ETHIOPIA

INTRO- Gonder Debre Tabor DUCING AMHARA AMHARA Debre Markos

Debre REGIONAL Birhan

STATE Addis Ababa Fast facts Geography: Amhara Regional State Economy: Agricultural sector is by area of 170.000 square kilometres; covers an area of 170.000 square far most dominant, accounting 90% Geography twice the size of the Netherlands and kilometres. of the economy. Amhara Regional State is one of Belgium combined. Administratively, it nine regions within the Federal is divided into 19 zones, 167 districts Population: Over 20,2 million Language: , though English Democratic Republic of Ethiopia. It and 40 urban administrations, of people live in the state, of which 56% is used in schools and international is found to the north and northwest which three are metropolitan cities. is between age of 15-60 years. business communication. of the country bordering with Tigray Its capital city is Bahir Dar, located on in the north, Afar in the east, Oromia the shores of Lake Tana out of which Climate: Mean annual rainfall Political system: the region in the south, Benishangul Gumuz in the Blue flows. varies from 300 mm to 2,000mm and complies with a multi-party the south-west and the Republic of annual mean temperatures mostly democracy system of the country. in the west. The region has an lies between 15-21°C.

4 5 Introducing Amhara Regional State Introducing Amhara Regional State Population Economy Language Political Over 20,2 million people live in Agriculture, tourism and trade are Amharic is the official language of Amhara Regional State. It is the the major economic endeavours Amhara Regional State. It is also System second most populous region in within Amhara region. The agriculture the official language of the Federal The political landscape of the Ethiopia. Of the total population, sector is by far the dominant one Government of Ethiopia. However, region complies with a multi-party 56% are between the ages of 15 accounting for 90% of the economy. Afan Oromo, Agew, Tigrigna and democracy system of the country. and 60 while 43,1% are below Farming and livestock account for other languages are also spoken The regional house of people the age of 14 - implying a strong 80% and 20% respectively within the in some areas within the region. representative is the law making manpower resource. Nearly 87% of sector. The major crops grown in the English is the medium of instruction body. All laws made at regional the population lives in rural area while region are cereals, oilseeds, pulses, at school and international business level should be aligned with Federal the remaining are urban dwellers. vegetables and fruits. About 27,9% of communication; many people in proclamations and strictly adhere Population density is the highest in the livestock in Ethiopia, 30,7% of the Government offices and major towns to the constitution of the Federal West Gojam zone while is lowest in poultry, and 18,5% of the beehives speak the language. Democratic Republic of Ethiopia. North . Bahir Dar, Gonder, are found in the Amhara region. The , Dessie, Kombolcha, region is home to the famous tourist Debre Birhan and Debre Markos are sites of the rock-hewn churches of the most prominent cities and towns , Gondar Castle, Siemen with population size of over 50.000 Mountain and Monasteries inside people. Lake Tana. Climate The mean annual rainfall of the region varies from 300 mm to 2,000mm while annual mean temperatures mostly lies between 15-21°C. The region generally receives high rainfall. Areas in north-western part of the region bordering Sudan and the eastern parts bordering Afar are mostly lowland while the majority of the central and south-eastern part of the region is midland or highland. Ethiopia’s largest inland body of water, Lake Tana, as well as the highest peak of the country Mount Ras Dashan are located in Amhara region. Abay (the ), Beles, Tekezie, Angereb, Athbara, Mili, Kessem, and are major rivers within the region.

6 7 Horticulture Business Opportunity

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HORTI- Gonder Lake Tana Debre Tabor Bahir Weldiya CULTURE Dar Dessie BUSINESS AMHARA Debre Markos Horticulture OPPOR- corridors Debre Birhan TUNITY Tana Robit Addis Ababa Fast facts National business overview: Specific opportunity products: 2013 was estimated to be 4 million Export of vegetable products from garlic, tomato, potato, onion, grapes, Horticulture: metric ton (MT). Smallholder farmers Ethiopia: 170.000 MT (2013). Export cabbage, peppers, beetroot, orange are the principal suppliers of fruits of fruit: 16.000 MT (2013); total and tropical fruits. National and vegetables; accounting for over production was 400.000 MT (2013) 98% of the national production. Fruit and vegetable production in the Business within Amhara: Business smallholders sector is mainly rain fed. 1,2 million ha irrigable land; with Few are using irrigation. three identified horticulture potential Overview corridors: Tana; Kobo; Shewa Robit/ The horticulture sector in Ethiopia Debre Birhan. is growing rapidly. Annual fresh vegetables and fruits production in

8 9 Horticulture Business Opportunity Horticulture Business Opportunity

Exports of vegetable products from countries the major importers were ANRS Vegetable Production (2012/13) Ethiopia increased from 66.000 MT the Netherlands and Russia. Most of Vegetable Import in MT Zonal Share in 2009 to 170.000 MT in 2013. Value the fruit currently exported are in the of vegetable exports increased from form of fresh, concentrate or dried. less than US $10 million to more Fruits like guava, banana, and mango 300 than US $300 million. Important are exported in dry form. This type 50 export markets for vegetables are of business has not been exploited 45 the surrounding countries (, in Ethiopia but has a high potential 250 Somalia, and Sudan); the main when looking at experience of Asian 40 products were non-graded fresh countries. 35 vegetables. Interestingly high value 200 fresh food products (including graded On the other hand, the country 30 and pre-packed vegetables and fresh imported over 60.000 MT juice during hers) account for only 11% of the total the same year; import has been 150 25 export. Most of these products are increasing by 1900 MT per annum exported to the United Kingdom (UK), since 2009. Tomato juice (35%), 20 United Arab Emirates (UAE) and the mixed juice (18%) and pineapple 100 15 Netherlands. juice (18%) are the top three imported juices to Ethiopia. 10 Ethiopia exported over 16.000 MT of 50 fruit in 2013 from a total production 5 of 400.000 MT. Djibouti, Somalia, 2009 2010 2011 2012 2013 0 0 UAE are the main destinations for West Awi North Easter South Gondar Gondar Gondar Ethiopian fruits. From European

Vegetable Production (2012/13) Wolo. Given its diverse agro-ecology Regional Share Vegetable Export Volume in 1000 MT The Business and rich water resource it is possible to introduce any type of horticultural within product in the region. 200 A study by the regioal Bureau of 16% Amhara Region Amhara Agricutlture shows a total irrigable land of 1,2 million ha. Three Region distinctive horticultural potential 150 The Amhara Regional State produced corridors are identified during the 16% of the total national horticultural study: Tana, Kobo and Shewa Robit/ 42% Oromiya Region products in 2013. The region is Debre Birhan. suitable for range of vegetables and 100 fruits. Among others the region has Tana corridor encompasses areas ample potential in potato, garlic, onion within the surrounding of the regional and pepper but production of lettuce, capital Bahir Dar city. These include Swiss chart and beetroot are also , Dumbia, Koga, Beles, 50 increasing. The fruits produced in the Kosober and other pocket areas 43% SNNPR region include orange, lemon, mango, along Lake Tana or Abay River. papaya, banana guava and avocado. A study conducted by Ethiopian Apple is a recent introduction in the Investment Commission (EIC) 2009 2010 2011 2012 2013 highlands of North Shewa and South indicated that there is over 270.000 0

10 11 Horticulture Business Opportunity Horticulture Business Opportunity ha of land suitable for fruit and (Cherry) Tomato Onion and Shallots vegetable only around Lake Tana and Specific Ethiopia exported about 19.000 MT of Ethiopia exported over 13.000 MT Abay River. Currently the government tomato worth of US $7 million in 2012. of onion in the year 2013 mostly has launched irrigation scheme of Opportunity The major destination countries were to Djibouti and Somalia. A smaller 7.000 ha in Koga (40 km from Bahir Djibouti (8.700 MT), Somalia (7.800 amount was also delivered to the Dar city), 7.000 ha in Fogera area (60 MT) and UAE (2.200 MT). Processed Netherlands and United Kingdom. km from Bahir Dar) and 5.000 ha in Products and canned tomato, juices, sauces Export increased by 71% compared Dumbia north of Lake Tana. and ketchups are consumed by to that of 2009. A study in 2012 Garlic urban households, restaurants and by the Centre for the Promotion of Ethiopia is the seventh biggest The Kobo corridor is another hotels within Ethiopia. Currently the Imports from developing countries producer of garlic in the world; important potential for fruits and country imports over 1.300 MT of (CBI) indicated that the Netherlands with China being the biggest vegetables. There is a big ground tomato paste and 1.500 MT of tomato is the largest onion exporter in the producer. Ethiopian garlic production water reserve that spans from Kobo juice to meet the existing supply gap. EU (1,1 million MT in 2008, or 29% has mostly been for domestic in the north to Girana in the south The Amhara region particularly Tana of all EU onion imports). However, consumption but an important with estimated irrigable potential of and Kobo corridors have significant it is also the second major importer export business opportunity exists to 96.000 ha as per estimation by the production volume of tomato. mostly from Peru, Mexico and Regional Bureau of Agriculture. An Europe and Middle East. The main China. Proximity to EU and already exporters to these destinations are area of 5.000 ha is now covered by Business opportunity lies in both existing successful business tie in the Asian countries; particularly China irrigation but the plan is to expand fresh export and processed tomatoes. floriculture sector between Ethiopia and India. The Amhara region grows this to 29.000 in the next ten years. Fresh cherry tomato, whose and the Netherlands can pave a way over 100.000 MT of garlic per annum; The Kobo corridor is suitable for production is picking up in Ethiopia, to develop onion export business. accounting for over 52% of the different vegetables such as onion, commands a lucrative market in the national production. The region has garlic, tomato, cabbage, lettuce, European Union and Middle East. The Amhara region produced about green mung beans as well as also the highest yield per ha of 11 100.000 MT onion; equivalent to 40% MT/ha. perennial fruits like mango, avocado Potato of the national production. Areas and orange. The Amhara region produced over such as Fogera, Koga, and Dembia Looking at these figures and facts, on 300.000 MT of potato (nearly 40% of within the Lake Tana corridor as the ground there are visible business The Shewa Robit corridor grows a the national production). The region well as others in Qobo and Shewa opportunities in garlic production, mix of lowland and highland fruits and has one of the highest yields per ha Robit valleys are the main production processing, canning and export. vegetables. Areas closer to Debre of 10 MT/ha - though this still remains sites. Most of the onion produced Such products can be marketed in Birhan have potential for highland far below with a potential of 100 MT/ currently is distributed throughout dried and/or powdered form aside vegetables and fruits such as apple, ha. the country but a smaller quantity beetroot and potato while the Shewa from the fresh vegetable. Garlic is is exported to Djibouti and Somalia; a convenient vegetable for export Robit valley with similar agro-ecology Business opportunities in potato lie particularly from Shewa Robit area. as it has a shelf life of six to nine to Tana and Kobo is suitable for in both production and processing A visible onion business opportunity months provided it is stored in a onion, tomato, cabbage, banana and sides. Production and export of fresh is fresh export to higher value conducive environment with regulated mango. Shewa Robit valley has a potato to neighbouring countries markets. However, cost and quality temperature and moisture. total irrigable land of over 33.000 ha. and to EU during off-season is competitiveness should be improved possible. At processing level tangible by introducing high yielding varieties opportunities exist in potato chips and technologies. and French fries. Currently, there are only two chips processing companies in Ethiopia (Arif and Hello), other than home or roadside frying. The fact that there is an increasing young population throughout major cities in Ethiopia means that snacks and chips have big market potential.

12 13 Horticulture Business Opportunity Horticulture Business Opportunity

Fresh Beans and Peas Grapes and Strawberries Cabbage, Kale and Green and Red Pepper There is an increasing demand The EU imports over 270.000 MT or Cauliflower The EU imported over 95.000 MT for fresh and chilled green beans €512 million worth of table grapes Cabbage grows best under cool or €547 million value of pepper in and peas in the European market from developing countries (DCs). conditions. China, India, Russia, Italy, 2012 (CBI, 2012). Germany (29%), particularly during the Autumn- The Netherlands accounted for South Korea, Japan and Poland are the Netherlands (18%) and the UK Winter-Spring period when European 50% of the imported volume from top countries in cabbage production. (13%) are the top three importers. production is low. According to CBI DCs. It is also an important player Top five African countries producing The main suppliers to the EU market (2013) the EU market imports over in global trading of strawberries; it is cabbages are Kenya, Egypt, Ethiopia, are Vietnam, Brazil and India. 200.000 MT per annum of fresh the third importer after Germany and Niger and South Africa. Germany is Ethiopia exported 800 MT of crushed beans and peas from developing France. Over one third of strawberry the leading importer of cabbage with red pepper mostly for Ethiopian countries. The main suppliers import comes from other European annual value of close to US $160 Diasporas abroad. ERCA data are Morocco (98.000 MT), Kenya countries namely Poland, Spain and million followed by the UK (US $81 doesn’t show any export of green or (43.000 MT), Egypt (24.000 MT) France while the remaining is mostly million) and USA (US $79 million). chili pepper. The country produced and Guatemala (10.000 MT). The imported from China, Morocco, The Netherlands is the ninth major over 400.000 MT of pepper. market for such products is highly Turkey, Chile and Egypt. importer with close to US $34 million. competitive, especially in the retail The leading exporters are USA, The Amhara region produced channel but quality standards are Ethiopia has strong competitive Spain and the Netherlands. 100.000 MT of pepper; equivalent also extremely strict particularly with edge to export table grapes both to to 25% of the national production. regard to pesticide residues and other the Middle East and EU, especially Apparently Ethiopia hardly competes The major pepper production belt contamination. during the market window of April with these countries in both quality within the Amhara region is located and May. In 2013, the country and cost. However, there is an in West Gojam and Awi Zones, both Export of fresh beans and peas exported over 640 MT of strawberry. important window of organic market closer to Bahir Dar. There is good from Ethiopia is picking up recently. Yemen (340 MT), the UK (73 MT) that can be targeted. In addition the opportunity to increase investment to According to data of Ethiopians and UAE (63 MT) are the top three Middle East and other neighbouring also produce more demanding export Revenue and Customs Authority strawberry importers from Ethiopia, countries are important markets markets. (ERCA) of 2012 the country exported while the Netherlands is ninth with for Ethiopia; where it has natural over 3470 MT of value about US a volume of 10 MT. Many areas competitive advantage in cost. $6,1 million; annual growth of 20% within the Amhara region, particularly Overview of export data for 2012 over previous years. Belgium, the those around Lake Tana and Kobo, shows that Ethiopia exported about Netherlands and the United Kingdom are highly suitable for grapes and 7.000 MT of cabbage, cucumber and are the top three destinations for strawberries. eggplant mostly to Djibouti, Somalia Ethiopian fresh beans and peas. and UAE. Particulary the areas around Lake Tana, Shewa Robit and Kobo Valley The Amhara region has strong in Amhara region are suitable to potential for production of cabbages, grow range of green beans and kale, cauliflower, Swiss chard and peas. Currently a Belgian company, lettuce. The region produced over Durabilis, has started growing peas 20.000 MT of these products in 2013. in Koga area on 50 ha for EU export. Though the agro-ecology of cabbage The company is also setting up and kale are different, a nucleus farm sorting, grading and packing facility along Lake Tana corridor can grow that can be utilized by other emerging cabbage and reach at the same time investors in the region. Another Indian popular highland areas within West company is setting up a green mung Gojam, Awi and South Gondar zones beans production in Kobo area. for supply of kale in less than 100 km distance.

14 15 Horticulture Business Opportunity Horticulture Business Opportunity

Beetroot and Carrot Orange and Lemon Tropical Fruits Beetroot is a popular root crop grown Orange and lemon are important Business opportunities exist in the for its fleshy roots, which are used fruits for juice processing as well as export and processing of tropical as cooked vegetable, salad and for fresh consumption. The EU imports fruits such as avocado, papaya, pickling and canning. Though it grows over 850.000 MT of orange fruits guava, mango and passion fruits. The in warm weather, development of (worth US $611 million). Within the Amhara region is currently producing colour, texture and sugar content of EU the Netherlands imported over over 8.000 MT per annum while there roots is the best under cool weather. 220.000 MT of orange fruits in 2010. is a potential to expand production in South Africa is the global leader in different areas. Currently production of beetroot in export of orange fruits with a total Amhara region is limited to 4.000 of one million MT exported in 2012 Over the last three years production MT per annum but there is potential season; followed by Egypt, Morocco of such fruits is on the rise. There to expand production particularly and Tunisia. is no commercial processor of fruit in North Shewa and Awi zones. in the region as of now except the Likewise, carrot production is Ethiopia though has enormous small fresh juice makers. Besides relatively a niche vegetable with potential in the lowland areas for processing opportunities exist annual production less than 1.000 MT these fruits; it is currently producing to export fruits to neighbouring but opportunities exist for investment only 43.000 MT. The fruits are countries and Middle East. A volume in pocket areas of North Shewa, Awi supplied mostly to the local market of 2.000 MT of papaya, guava and and South Wolo zones. but a handful quantity of 3.000 MT avocado has been exported last year has been exported to Djibouti and from Ethiopia to Djibouti and Somalia. Sudan. On the other hand the country Demand for such products is also imported over 8.000 MT of orange growing in EU market mostly in the juice in 2013. healthy food niche market.

The Amhara region produces over 17.000 MT of orange and lemon per year. Most of the production is in pocket areas along the Tana, Shewa Robit and Kobo corridors but there is a prospect for expansion. Outside these corridors a potential to engage in commercial farming of orange also exist in the lowland areas bordering Benishangul Gumuz and Sudan. Aside to production for local and export market, there are tangible business opportunities for juice processing.

16 17 Floriculture Business Opportunity

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FLORI- Gonder Lake Tana Debre Tabor Bahir CULTURE Dar BUSINESS AMHARA OPPOR- Floriculture corridors TUNITY Bahir Dar and Fogera Addis Ababa Fast facts National business overview: are located, regional government makes Ethiopia the fourth largest Export of cut flowers over 41.000 MT; has selected another 1.000 ha for Floriculture: exporter of flowers only after the generating US $165 million from the investors. Netherlands, India and Kenya. Cut sector (2013). Over 75% of the export National flowers are Ethiopia’s fourth largest goes to Aalsmeer Flower Auction, the Specific opportunity areas: exported commodity by value and Netherlands. South Achefer, Mecha, Dera represent 13% of all exports after Anbesame, , Fogera, Business coffee, oilseed and pulses and Business within Amhara: and Debre Birhan and surroundings. vegetables per available trade Agro-ecology and incentive packages Overview figures. Over 75% of the Ethiopian make Amhara region an attractive Ethiopia exported over 41.000 MT flower export goes to the well-known destination for starters and incumbent of cut flowers; generating US $165 Aalsmeer Flower Auction. In 2012, flower farms. So far 700 ha of land million from the sector in 2013. This Ethiopia was the second biggest

18 19 Floriculture Business Opportunity Floriculture Business Opportunity supplier of roses to this market only hand Debre Birhan offers similar South Achefer after the Netherlands. Flower export Flower Export in 1000 MT features to Menagesha and Holeta 110 ha located at 54 km from earnings are expected to rise up to us areas with cool climate suitable for Bahir Dar International Airport US $550 million by 2016. long maturing but high valued roses. The region has so far allocated 700 An area of 110 ha has been identified Looking at the fact that Ethiopia 50 ha of land to flower farmers mostly at a special site called Dubkan. was nowhere in the exporters list 10 45 around Bahir Dar and Debre Birhan It is found 54 km from Bahir Dar years ago, the achievement is truly cities. From Bahir Dar corridor Tana International Airport along tarmac phenomenal. The country still has 40 Flora and Giovanni Alfano Farms road to Addis Ababa. The altitude of enormous comparative advantages have started export. A renowned the site lies between 1923 and 1948 of fertile soil, cheap labour, and 35 flower breeder and grower from Latin meters above sea level (mamsl). an excellent climate suitable for 30 America, Esmeralda, and another The soil is predominantly red and production of roses. The Ethiopian company are finalizing construction of the textural class is clay with 35,04% Government also offers one of the 25 greenhouses and land clearance. In clay, 25,68% sand and 39,28% silt. best investment packages in the form Debre Birhan (130 km North East of The PH of the soil sample is 5,60. It is of easy access to land at minimal 20 Addis Ababa) two Indian Farms, ASK currently under crop production cover. lease price, duty free import of farm Flowers, Greens Plc, Esimo Flowers There is an electric line crossing by 15 inputs, access to finance, tax holidays & Agro Industries Plc are already the site and spring water and swampy and other support to facilitate 10 producing roses targeting the high site nearby. Asher and Pikkolo Abay investment within the sector. value niche market of Russia. River are found within a radius of two 5 km. Labour is readily available from To date, there are over 120 flower 2009 2010 2011 2012 2013 the nearby woreda town. The area 0 farms in Ethiopia; employing over has access to telecommunication 85.000 people. Flower production network. thus far has concentrated in the incentive package as well as agro- Specific surroundings of the capital Addis ecology. Though a number of areas Ababa and the rift valley region are suitable for flower farming Opportunity Mecha mostly for logistical and infrastructural within the region, areas surrounding 259 ha located at 35 km from reasons. However, fast infrastructural Bahir Dar City and Debre Birhan Bahir Dar International Airport growth, availability of cheap labour town provide the most interesting Areas and land is paving the way for further opportunities. The agro-ecology of Following allocation of the 700 ha The first site covers an area of 127 ha expansion to new spots all over the Bahir Dar and its surrounding is land and upgrading of Bahir Dar in a place known as Bechema. It is nation. similar to Debre Zeit and other rift International Airport Cargo facility, located at about 33 km from Bahir Dar valley areas, where a large number the regional government has international Airport along the asphalt of flower and vegetable farms are selected additional 1.000 ha of land road to Addis. The altitude of the concentrated. The government has for investors. Selection of this site site ranges between 2018 and 2036 put in place cold room facilities at was made after thorough analyses mamsl. It has red or brown soil with pH The Business Bahir Dar International airport to cater of the agro-ecology, soil type, water of 5,5 analysed at 30 cm depth. The for a direct cargo flight to anywhere in availability and other social-economic swampy area found in the northern the world. factors. Selected locations are: South side of the site can be potential source within Achefer, Mecha, Dera Anbesame, of subsurface water. There are also The regional government is also Bahir Dar Zuria, Figera and Debre other sources of water within a radius Amhara availing suitable land for floriculture Birhan and surroundings. Details as of four km. The site is located at three in the vicinity of Bahir Dar. Such size, access to water, infrastructure km distance from the woreda town of Region developments have increased the and labour are discussed below. Merawi and hence labour is available. The Amhara Regional State offers an demand of domestic and foreign Electric lines pass through the field attractive destination for starters and private investors who would like to and telecommunication network incumbent flower farms due to an invest in this sub sector. On the other functions well.

20 21 Floriculture Business Opportunity Floriculture Business Opportunity

The second site within Mecha is also optional. The site is found at Bahir Dar Zuria The electric power lines from Tis Enamirt with a total area of 132 ha. It near Hemusit town, which entails 179 ha located around Bahir Abay pass at a close distance to the is found at an approximate distance easy access to telephone, labour and Dar International Airport site. Electricity, labour and mobile of 37 km from Bahir Dar International electricity. network are easy available. Airport along the main road to Addis. The first site of Robitbata covers 34 The site has an altitude of 1993 to The third site known as Enkurkurit ha. It is located at eight kms from 2011 mamsl; the flat nature of the has an area of 213 ha located 31 km Bahir Dar city on the main road Fogera land may demand for diversion ditch from Bahir Dar on the main road to to Gondar. The altitude of the site 35 ha located 70 km from to prevent flood inflow. Farmers Gondar. It lies on a flat topography ranges from 1857 to 1888 mamsl Bahir Dar International Airport growing maize and teff currently with elevation range from 1916 to while the soil type is mostly brown occupy it. The Burka River found in 1958 mamsl and currently occupied to red with pH value of 5,50. Lake An area of 35 ha is available in a some 500 meters distance in the by farmers mostly growing maize Tana (six km away) will be the special site called Awuramba. It is northeast direction can be considered and teff. The soil type is red colour source of water. Currently, farmers located at 70 km from Bahir Dar as a potential source of surface water of pH 5,7. The site is found between growing maize and sorghum international Airport along the asphalt while options for ground water are two small rivers Shina River and occupy the land. Similar to the other road from to Debre Tabor. The also available. Labour, electricity and Mariamweha River but Lake Tana areas, it has access to electricity, altitude of the site ranges between telecommunication services can be within eight km map distance is the telecommunications and labour from 1857 and 1880 mamsl. The site is made available. most reliable water source. It has a nearby distance. used for crop production. The soil easy access to electricity from the is predominantly red in colour with main line passing to Gondar at close The second - Gombat site - covers pH value of 5,0. Though there are Dera Anbesame distance. an area of 63 ha and is located 10 two small rivers passing by the area; 373 ha located at 35 km from km from Bahir Dar on the main road ground water is the most realistic Bahir Dar International Airport The fourth zora site covers 54 ha and to Gondar. It has a flat topography source. There is electric line crossing located at 37 km from Bahir Dar on with altitude of 1880 up to 1906 the site while telecommunications The first site covers an area of the main road to Gondar. Alike the mamsl. The soil colour is mainly red and labour are also available from 72 ha located at a place known second one it has flat topography with with pH value of 5,40. Gombat site nearby town of Woreta. as Chekame; 20 km on the main elevation ranging from 1861 to is found between two small rivers road from Bahir Dar to Gondar and 1897 mamsl and is under private Gelda River and Idimo River, but both another four km after right turn. It has cultivation. The soil is red colour with are intermittent. Lake Tana within Debre Birhan and an altitude of 1886 to 1891 mamsl pH value of 5,9. Lake Tana within 10 eight km map distance is the most surroundings and the soil is pH 5,7. The area is km map distance is a realistic water realistic water source, while ground 60 km from Bole International under maize and sorghum cultivation. source but other options such as and harvested water are also options Airport in Addis Ababa The most viable water source is Lake ground water and water harvest are to be considered. It has access to Tana at 10 km distance but other possible. The power lines to Mekele electricity; telephone and labour from Debre Birhan town is located at 60 options like ground water and water and Gondar both pass at a short a closer distance then the first site. km from Bole International Airport harvest also exist. Electric lines going distance to the site also simplify in Addis Ababa. The altitude of the to Gondar pass by a closer distance electrification. Labour and telephone The third site of Sabatamit has a town is above 2800 mamsl - a sharp from the site. are more or less the same as the total of 82 ha; situated at seven km contrast to Bahir Dar and yet offers other sites. from Bahir Dar city. The area has alternative for high quality flowers. The second site located near the an elevation of 1753 to 1779 mamsl. The soil type is mostly red. Electricity first one occupies 34 ha. It has an It is currently found under private and telecommunications service are altitude ranging from 1900 to 1931 cultivation of maize, teff and noug readily available. The main water mamsl.The soil is red with a pH of (oilseed). The soil colour visually source is ground water. One main 5,6. The area is used for cultivation identified was brown with pH of 5,9. challenge for this area is frost. The of maize, teff and finger millet. The Potential water source is from Abay Indian companies are managing water source of this site is from Lake river (within two km) and ground it by focusing niche season sales. water. Andasa River is also found Tana at seven km map distance but Production for Valentines’ Day is risky within two km but the base flow is ground water and water harvest are unless with double greenhouses. very small at critical times.

22 23 Dairy Business Opportunity

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Gonder

Lake Tana Debre Tabor DAIRY Bahir Dar BUSINESS AMHARA OPPOR- Dairy corridors TUNITY Bahir Dar and Fogera Addis Ababa Fast facts National business overview: opportunity lies in the processing over US $1 billion. Over 63,3% of Production of milk is 3,2 billion litres aspect. Two interesting sites for this Dairy: the national milk supply comes from per annum; worth over US $1 billion purpose are Bahir Dar city and Debre rural small-scale mixed farms in in country. Despite large number Birhan town. National the highlands. Pastoral and agri- of animals, the dairy sub-sector in pastoral producers in the lowlands Ethiopia is operating far below its Specific opportunity products: Business and small urban and peri-urban potential. pasteurized milk and yoghurt; cheese farms contribute for 22% and and butter; animal feed processing 14,3% respectively. Estimated calf Business within Amhara: Overview consumption and wastage of milk is Ethiopia produces 3,2 billion litres For international investors targeting 32% of the milk produced. Studies of milk per annum. The value of milk dairy, the most promising business suggest that 83% of the remaining and milk products in the country is milk produced is consumed in

24 25 Dairy Business Opportunity Dairy Business Opportunity

household, 8% of the milk is kg of hard cheese and 90.000 kg of In Ethiopia, per capita milk of 50 km land for processing plant is processed into products with longer soft cheese (SNV, 2009). In addition consumption is about 19 kg of milk/ available at Bahir Dar industrial zone shelf life, and 7% is sold. The major to these large companies there are year - compared to 98 kg/year for for marginal lease payment. species used for milk production in also about 16 medium and large Kenya and WHO recommendation Ethiopia are cattle, camel and goats. processing companies that produce of 200 kg/year. Milk consumption Similarly Debre Birhan or North Cattle account for 83% of the total approximately 35.000 to 40.000 litres is low for economic and cultural Shewa offers tangible business milk and 97% of the cow milk comes per day. reasons i.e. large number of fasting opportunity in milk processing as from indigenous breeds. An estimated days and high price of milk and milk well as large-scale commercial dairy 10 million cows are kept primarily for Despite large number of animals, products. During peak production in farming. It is close to Addis Ababa milk production. the dairy sub-sector in Ethiopia is the wet seasons, rural farmers face which is both the input and output operating far below its potential. challenges in marketing their milk as market for dairy. The North Shewa USAID (2013) indicated that there The country generated a negligible most regions experience a surplus, corridor hosts few commercial are 23 dairy processors in Ethiopia, amount of less than US $100.000 which is usually processed at the processors as Timret Agro Industry, and four new ones are under by exporting butter and cheese home into local cheese or butter. Ruth and Family Dairy Farm and construction. These processors have mostly to neighbouring countries. In many small and micro enterprises; daily capacity of close to 250.000 contrast it is importing milk and milk all delivering to Addis Ababa market. litres; a potential entrant velocity dairy products. The sector suffers from Lame Dairy has also a bulking and of Dutch Investment is aiming with a low productivity, poor management chilling centre in Debre Birhan, where daily processing capacity of 150.000 and lack of access to feed, new it bulks milk from Basona Worana litres. The main individual players breeds and stable market. Average The Business and neighbouring woredas, until are Lame, Agro Industry, milk productivity per cow is less than transported to the dairy’s processing Holland Dairy, Lema and Genesis 1,5 litre/day; 98% of the dairy cows within plant in Addis Ababa. Farms. The three largest processing are indigenous breeds based on companies produced 14 million litres traditional management practices. Amhara The Dessie/ Kombolcha corridor of milk, 120.000 kg of butter, 20.000 offers another option for milk Region processing. Dessie and Kombolcha The Amhara region produces over towns have combined a population Dairy Products Import in 1000 MT Dairy Products Export in 1000 MT 740 million litres of milk per annum of over 250.000 people and hence accounting for 22% of the national a significant market. This belt is milk production. Nearly all of the milk situated at strategic location with production comes from smallholder easy access to market cities like 10 3 farmers. Prominent milk producing in and is very areas within the region are South close to Djibouti (480 km) for potential export to neighbouring countries 3 Gondar, Awi, North Shewa and East 8 and West Gojam. The most promising as well as serving the eastern part business opportunity for international of Ethiopia. There are also various institutions like Wollo and Weldya 2 investors targeting dairy lies in the University. 6 processing aspect. Two interesting sites for milk processing in Amhara 2 region are Bahir Dar city and Debre Birhan town. In Bahir Dar there is a 4 place reserved for urban agriculture 1 and hence interested investors can set-up their own dairy farm within the 2 suburb to secure part of the milk for 1 processing but the biggest supply can be sourced from small holders in 2009 2010 2011 2012 2013 2009 2010 2011 2012 2013 Fogera and Tis Abay areas in a radius 0 0

26 27 Dairy Business Opportunity Dairy Business Opportunity

Cheese and Butter Animal Feed Processing Specific Supply of processed butter and Bahir Dar has a natural competitive cheese hardly exist in Bahir Dar edge for animal feed processing. Opportunity City. When available, a kilogram of There is big volume of maize Mozzarella cheese costs 120 Birr (US produced in the area. Oil cake can $6). The bigger hotels and the few easily be sourced from local millers Products pizza houses mostly use homemade and importantly the largest soybean cheese or ship from Addis Ababa. production zone in Ethiopia-Metekel Pasteurized Milk and Yoghurt Both Bahir Dar and Gondar offer is located only 235 km. Currently The supply of pasteurized milk in robust market opportunity for such the main sources of feed are hay/ Bahir Dar and other cities within products. Taking the population straw, grass and oilcakes but a small Amhara region solely come from of the two cities and considering amount is imported from Debre Zeit. Addis Ababa and Debre Zeit areas. the fact that both cities are main A feed processing in Bahir Dar can But yoghurt can be rarely found. Price tourist destinations with large easily reach wider markets in the of a litre of pasteurized milk is 20 Birr, number of hotels and restaurants, North Western and Western parts of while row milk from local farmers is annual demand for cheese and the country including export options 12 Birr per litre. Price of 250 gram of butter can reach over 10.000 kg. to Sudan. yoghurt is 10 Birr (US $0,46). Based Besides exporting such products to on per capita consumption of 19 litre/ neighbouring regions including Sudan year; daily milk consumption in the is an alternative market. A processing cities Bahir Dar and Gondar alone is centre based in Debre Birhan can close over 52.000 litre. Institutional easily reach the Addis Ababa market, buyers such as universities could be which has annual demand of over interesting markets for pasteurized 100.000 kg of cheese and butter milk. Currently, the universities of each. Bahir Dar and Gondar host over 50.000 students that can easily be targeted. A base in Bahir Dar can also serve as supply point to Debre Markos, another bigger town with a population of over 60.000 and hosts over 10.000 students. A processing centre close to Debre Birhan can supply the Addis Ababa market that has estimated annual demand close to 60 million litres.

28 29 Investment Climate Governance Socio- and Stability economy Ethiopia is generally peaceful and Similar to other regions in Ethiopia stable country in Africa. The Amhara there is a steady economic growth in Regional State is one of the most Amhara Regional State. Agricultural stable and peaceful regions in the Development, Education, Health, country. It is also relatively better in Infrastructure received over 60% of terms of good governance and ethics. the regional budget. In line with the INVEST- Regional Government offices are five year Growth and Transformation eager to attract investors. Plan, the region gives highest priority to agro-processing and Investors can freely move around the export-oriented investments. The region with valid passport or work/ Amhara region is among the best MENT residence permit though language performing economies in relation to can be a barrier in rural areas and achieving the goals of the Growth and smaller towns. Another possible Transformation Plan. challenge is delay in decision making on issues related to land and farmers. Inhabitants of the region are CLIMATE The strict anti-corruption and ethics hospitable and welcoming to stance of the government means foreigners. They are hardworking that some people prefer to consult and committed to their words. and think for rather long time to Religion and history plays a big role give answers or decisions on such in shaping their characteristics of Fast facts requests. Despite this, the Amhara honesty, respectful and self-esteem. Regional State has a relatively stable The religious aspect of the society Governance and stability: Telecommunication: Mobile and robust governance system also means that fasting seasons Amhara is one of the most stable and phone is the primary medium of and there is a zero tolerance for and holidays are widely adhered. peaceful regions in the country, with a communication. Internet access corruption. This may affect day-to-day business robust governance system. (ADSL) is available in all major cities and towns. operation and market for products like dairy. Also the fact that people have Socio-economy: In line with the strong dignity or self-esteem means five year Growth and Transformation Electricity: From the total of that they place high value for mutual Plan, the region gives highest priority 105 districts (woredas), about 60% respect and a more positive approach to agro-processing and export- have electricity varying from 6hrs to in dealing with them. oriented investments and it is among 24hrs per day. Massive investment is the best performing economies. underway in upgrading transmission lines and by the end of 2017 75% Transport and logistics: Over of the people will have access to 2000 km of asphalt road connecting electricity. all major towns, including ports in Dijbouti/ Sudan, daily flights and a Manpower: The majority of railway (under construction) make the regional population is within transportation excellent. Also, a economically active age range. dry-port, cold room facility and direct The region hosts seven universities cargo flights are available. including Bahir Dar and Gondar Universities that are among the biggest universities in Ethiopia.

30 31 Investment Climate Investment Climate Transport and Telecommuni- Electricity Manpower From the total of 105 districts The majority of the population living Logistics cation (woredas), 53 have 24 hours in Amhara Regional State is within The region has over 2000 km of All the urban centers (cities and hydroelectric services, one has 16 economically active age range. asphalt road connecting all the district towns) of the Amhara hours diesel generator service and The region hosts seven universities major cities and towns as well as Regional State have access to seven have six hours diesel generator including Bahir Dar and Gondar to ports in Djibouti and Sudan. mobile telecommunication service. service. The region has allocated Universities that are among the Amhara Regional State has strong ADSL internet is available in major budget for infrastructure instalment biggest universities in Ethiopia. All competitive advantage of proximity cities and most towns. The national in six major cities and seven woreda of the universities have Agricultural to both Djibouti Port (500 km from telecommunication service provider towns selected as investment areas. Colleges and departments focusing industrial town of Kombolcha in the is working to expand its 3G mobile There is an occasional problem of on horticulture and animal science. East) and Port Sudan (900 km from network to major cities such as electric power cut at peak seasons Beside there are 105 Technical boarder town of Metema in the Bahir Dar, Gondar, Kombolcha and when a transmission line and Vocational schools. Most of West). Besides, there are daily flights and Debre Birhan. However, the is damaged. However, with the them have an agricultural training connecting Bahir Dar, Gondar and telecommunication network in completion of the the Great Ethiopian component. Daily labourers are Lalibela to Addis Ababa. A fourth flight general and the internet connection Renaissance Dam (GERD) and other readily available for a fee of US $1,20 to the industrial town of Kombolcha in in particular is intermittent - as in any big hydropower projects in the coming to US $2,00 per day. the east is expected to resume soon. part of the country. Steps are being two years, Ethiopia will generate over The under construction railway line taken by Ethio Telecom at national 10.000 MWt of electricity - nearly from Djibouti-Semera-Woldia-Mekele level to resolve this longstanding tenfold of the current production. will be finished in two years. problem. Massive investment is also underway in upgrading transmission lines There is a dry-port facility at and by the end of 2017 75% of the Kombolcha and another one is people will have access to electricity. under-construction in Woldia. Bahir Dar International Airport has a cold room facility and can provide direct international cargo flight service for flower and vegetable exporters. This service is temporarily not available due to limited volume but will be open when the three big flower farms (currently under construction) start production in June 2014. For the moment the regional and federal governments are subsidising inland transport of flowers and vegetables from Bahir Dar to Addis Ababa. International cargo flight will also be available from Kombolcha.

32 33 Incentives

• Any investor who exports or Duty Free supplies to an exporter gets at least 60% of income tax exemption for two Import of years in addition to the exemption Capital Goods privilege. To encourage private investment and promote the inflow of foreign capital and technology into Ethiopia, the following customs duty exemptions Duty Free are provided for investors (both domestic and foreign) engaged in Import of eligible new enterprises or expansion projects such as manufacturing, Motor Vehicle agriculture, agro-industries, Total or partial exemption of motor generation, electrical energy, vehicle from customs duties is information and communication determined by the type and nature of technology: investment projects such as amount of capital invested. Investors are IN- • 100% exemption from the payment advised to consult the Ethiopian of customs duties and other taxes Investment Commission (EIC) desk levied on imports is granted to for further information before making all capital goods, such as plant, decisions. machinery and equipment and construction materials; CEN- • Spare parts worth up to 15% of the Income Tax total value of the imported investment capital goods, provided that the goods are also exempt from the Holidays payment of customs duties; Investors engaged in growing of • An investor granted with a customs vegetables, fruit, flower farming TIVES duty exemption will be allowed and agro-processing in Amhara to import spare parts duty free Regional State are entitled income within five years from the date of tax exemption for a period of four to commissioning of a project; five years. • An investor entitled to a duty-free Fast fact privilege buys capital goods or construction materials from local The Council of Ministers Regulation manufacturing industries shall be No. 270/2012 outlines eligibility for refunded customs duty paid for raw investment incentives and investors materials or components used as in targeting Amhara Regional State are puts for the production of goods; entitled for the following benefits: • Investment capital goods imported duty free import of capital goods, duty without the payment of custom free import of motor vehicle, income duties and other taxes levied on tax holidays, loss carry over, export imports may be transferred to another incentives, capital remittance, land investor enjoying similar privileges; lease and access to finance.

34 35 Incentives Incentives Loss Export Capital Acces to Carry Over Incentives Remittance finance Business enterprises that suffer • With the exception of few products A foreign investor has the right to Investors targeting export oriented losses during the income tax (e.g. Semi-processed hides and make the following remittances out agriculture (flori- and horticulture) exemption period can carry forward skins-150%), no export tax is levied of Ethiopia in convertible foreign and all agro-processing sectors can such losses, following the expiry on export products of Ethiopia; currency: get access up to 70% of finance from of the exemption period, for half of • Duty Drawback Scheme: It offers • profits and dividends; the Development Bank of Ethiopia the tax exemption period. For the investors an exemption from the • principals and interest payments on and other commercial banks – upon purpose of calculating a period of payment of customs duties and other external loans; presenting a viable project proposal. loss carry forward, a half year period taxes levied on imported and locally • payments related to technology shall be considered as a full income purchased raw materials used in the transfer agreements; tax period. Any loss during income production of export goods. Duties • payments related to collaboration tax exemption period is not allowed to and other taxes paid are drawn back agreements; carry forward such loss for more than 100% at the time of the export of the • proceeds from the sale or liquidation five income tax period. finished goods; of an enterprise. • Voucher Scheme: A voucher is a printed document having monetary value which is used in lieu of duties Land Lease and taxes payable on imported raw In addition to the foregoing materials. The beneficiaries of the incentives specified by the Council of voucher scheme are also exporters, Ministers the Amhara Region State as in particularly the Bonded Government provides the following Manufacturing Warehouse Scheme; benefits to domestic or international • Exporters are allowed to retain investors: and deposit in a bank account up to 20% of their foreign exchange a) Provision of land free of charge for export earnings for future use in the investors targeting floriculture; operation of their enterprises and no b) Agro-processing and those who export price control is imposed by the can introduce new technology, create National Bank of Ethiopia; large employment and are export • Franco valuta import of raw focussed pay a marginal lease fee of materials is allowed for enterprises US $0,10 per square metres. engaged in export processing; • Exporters can benefit from the export credit guarantee scheme which is presently in place in order to ensure an exporter receives payment for goods shipped overseas in the event the customer defaults, reducing the risk of exporters’ business and allowing it to keep its price competitive.

36 37 Getting started

Step 2 - Plan visit to Amhara Scoping and Region Once Ethiopia becomes a viable Site Selection investment choice the next step is to get first-hand information by visiting Step 1 - Check Ethiopian the Amhara region. The visit provides Embassy opportunity to get detailed The first step for international understanding of the investment investors is to get basic information climate, choose specific locations from the local Ethiopian Embassy suitable for the envisaged investment or consular offices. The offices will and establish a first contact with local provide the different investment resource persons. opportunities Ethiopia can offer, investment packages for foreign Information about visa requirements investors, requirements and steps and applications can be obtained ahead. from the local Ethiopian Consular GET- Office or Ministry of Foreign Affairs Ethiopia has over 40 embassies and (www.mfa.gov.et). consular offices in different countries across the world. Within the EU, Ethiopia is one of the safest countries Ethiopia has Embassies in Belgium, in Africa and the Amhara region is Paris, Berlin, London, Vienna and one of the safest within Ethiopia. The TING Stockholm. The Embassy in Brussels people are hospitable and welcoming covers the Benelux region. Also to foreigners. Plenty of hotels are it is important to visit Ethiopian available and can be booked online. Investment Commission (EIC) Logistics service can be arranged via website (www.investethiopia.gov.et) your respective local consular office which gives up-to-date information to in Addis Ababa or using own contacts. START- prospective investors.

Investors from the Benelux can alternatively get guidance from Embassy of the Kingdom of the Netherlands in Addis Ababa. For ED agricultural initiatives, including agro-processing and agro-logistics you can make an appointment with the agricultural counsellor (via the office manager Solomé Ketema, Fast facts see chapter Useful Contacts). The Scoping and site selection: Registration, licensing and agricultural counsellor will give first check Ethiopian Embassy, plan visit land acquisition: notarized guidance and if required he will to Amhara region, your business documents, business type and link you as investor with the Dutch mission and site selection name clearance, legal framework business community (Ethiopian- for investment, investment license Netherlands Business Association, and TIN certificate, land acquisition, ENLBA), the Agri Business Support business license and Value Added Facility (ABSF) and/or Ethiopian Tax (VAT) central or local authorities.

38 39 Getting started Getting started

Step 3 – Your business Step 4 - Site Selection Step 5 - Notarized Documents Step 6 - Business Type and mission in Amhara Region The outcome of the first three steps Investors are strongly advised to Name Clearance The ideal base for the scoping is selection of specific site where appoint an agent authorized to There are different types of business mission to Amhara is the regional you want to invest. The selected site deputize on their behalf. This agent organizations in Ethiopia: Sole capital Bahir Dar city located at 560 could be part of the areas designated should be someone who has an Proprietor (Investment made in the km from Addis Ababa. It is one of the by the regional government for in-depth understanding of Ethiopian name of individual), Private Limited most beautiful cities in Ethiopia lying investment or outside that scope. It is investment laws and procedures. Company or Share Company. Details along Lake Tana. also possible that farmers occupy the The agent needs a power of attorney about the different forms of business site. They will be compensated and that authorizes him or her to sign types can be obtained from the Flight connection to Bahir Dar is via relocated by the regional government documents. The power of attorney Ethiopian Commercial Code 1960. Addis Ababa: flight is available twice - once the investor acquires an should be signed by the investor or (www.eia.gov.et/english/articles/ a day. The city has many hotels (see investment permit. general manager of the company; read_more/24/en) chapter Useful Contacts). Detailed stamped by public notary office of information and guides to investment the investor’s country; validated by Step 7 - Legal Framework for sites within Amhara region can be Ethiopian Embassy in the home Investment freely obtained from the Amhara country of the investor; and finally Once a decision is made on the type Regional State - Industry and Urban authenticated by Ministry of Foreign of business organization, investors Development Bureau. Registration, Affairs and Document Authentication should clear envisaged name of their Office of Ethiopia. company. For example ‘’ABC PLC’’ at Investors targeting Debre Birhan Licensing EIC. When going to the Commission, corridor can base in Addis Ababa and Documents needed it is advised to think of three names hire car to drive one and half hour to and Land for the agent: and fill name clearing application meet the zonal investment bureau to • Copies of relevant pages of form in the order of priority. The name get information. Acquisition passport of the company’s manager/ clearing will take half up to one day. The Ethiopian Investment investor; As part of the scoping mission Commission (EIC) has recently • Memorandum and Articles of investors are advised to plan been restructured to provide a one- Association signed by all founders meetings with federal government stopshop service for issuing: an and notarized by home country officials in Addis Ababa. Some of Investment Permit, TIN certificate and notary service; the government offices included Business License. • Letter of power of attorney of the in this visit list are: Horticultural For manufacturing or agro-processing agent; Development Agency for national industries to whom a investment • Many passport size photos of the level information about flower, permit was issued, the agency issues general manager of the company/ vegetable and fruit sectors; Ethiopian a duty free-, work- and residence investor. Investment Commission (EIC) for permit. licensing and registration; Ministry of Industry-Food and Beverage Institute. The EIC also provides additional Their respective consular offices services on behalf of investors’ in Addis Ababa can also assist in request to process acquisition of logistical coordination. land, utilities (water, electrical power and telecommunication services) A visit to Ministry of Agriculture - and bank loan. The steps involved Livestock Sector and development in licensing, registration and land organizations such as USAID and acquisitions are highlighted in ‘How to SNV (active in the dairy sector) get started’. Though investors should are useful to get sectorial level always validate these with Ethiopian information. Contacts are available in Investment Commission this guide, at chapter Useful Contacts. (www.investethiopia.gov.et).

40 41 Getting started Getting started

Step 8 - Investment License Step 9 - Land Acquisition Step 10 - Business License and TIN Certificate Land Application can be submitted The Business License should be Application will be submitted to at Ethiopian Investment Commission processed after acquiring land, but Ethiopian Investment Commission; directly after securing the investment before starting operation. Application requirements are available on their license. The authority will issue a to Business License should be made website (http://www.investethiopia. letter to Amhara Regional State to Ethiopian Investment Commission. gov.et). The location selected in step Investment Bureau to facilitate for the Your authorized agent or general 1 above should be filled in the form. land acquisition. When submitting the manager of the company in Ethiopia For a PLC or Share Company the letter, investors are also expected to can apply for you. Sole Proprietor General Manager of the company submit a project proposal that clearly business types should apply for TIN under formation should submit indicate profitability, employment Certificate and the owner should be finger print for TIN certificate. For opportunity and new technology. present for fingerprints at this stage. Sole Proprietor business types, TIN A team of experts from the Regional The business license processing can Certificate and fingerprints can wait Government will evaluate the take half up to one day. until the Business License Processing proposal. The outcome will be stage. communicated within two weeks. Step 11 - Value Added Tax (VAT) Fully foreign-based investors If accepted, the Regional After acquiring business license are expected to demonstrate Administration for Urban Land and investors can apply for Value Added bank deposit of US $200.000 in Environmental Protection and the Tax Certificate. Application should Ethiopian bank account. However, Land Administration office for Rural be submitted at the same place as if the investment is in partnership Land will liaise with city, district the business license. Generally, it with domestic investor(s), the (woreda) and village (kebele) will take another half to one day to minimum capital required of him is authorities to engage current users of receive the VAT certificate. US $150.000. To facilitate opening the land and process compensation. of bank account, the EIC, upon Making occupied land ready to receiving complete application, issues investors may take two up to a letter to National Bank of Ethiopia three months. For dairy and agro- who then write a supporting letter to processing where there is already any commercial bank. Investors can non-occupied land, it can be finalized collect their investment license by in one week once the project is bringing stamped bank statements accepted. and a letter signed by the Branch Manager of their bank. Excluding the bank transfer, the entire process will take half to one day.

42 43 Getting started Getting started

How to get started Overview of steps to be taken in order to invest in Amhara Regional State

Filled out Bank investment Letter of Authorization confirmation license support to from NBE to Investment request form NBE Commission

Tax payer Identification Support letter Investment Bank account Number (TIN) to region license and transfer

Business Regional Land License VAT acquisition and main registration certificate

44 45 Checklist for Application Investment License

• When foreign nationals are among • Three passport sized recent the members of the shareholders, photographs of the general manager. photocopies of certificates evidencing the domestic investor status of the Note: If the foreign partner is a foreign nationals or identity cards (for business organization, the following companies to be established); documents are also required:

• Three recent passport-sized • A copy of the memorandum and photographs of the general manager. articles of associations or equivalent documents of the parent company;

• A photocopy of a document Joint Invest- ascertaining the legal personality of the business organization (i.e. ment between registration certificate); CHECKLIST • Minutes of the parent company domestic and passed by an authorized body for the foreign establishment of a joint company in FOR APPLI- Ethiopia, authenticated by the public notary, or a letter written by the owner investors in case of a one-man company; • An application form duly filled and CATION signed by the agent of the business • A photocopy of an authenticated organization; power of attorney of the representative of the company • Where the application is made by and photocopies of the pages INVESTMENT an agent, a photocopy of his power of relevant of the representative’s valid attorney; passport or identity card in case the representative is an Ethiopian LICENSE • Photocopies of the memorandum national. and articles of associations. If it is to be newly stablished, photocopies of the pages relevant of a valid • When an agent is doing the passport of each shareholder, and Entirely application, a photocopy of his/her draft memorandum and articles of owned by a power of attorney; associations; • Photocopies of memorandum and • Where foreign nationals taken for articles of associations. If it is to be domestic investors or Ethiopian foreign newly established, photocopies of the nationals are among the members relevant pages of a valid passport of the shareholders, photocopies of investor of each shareholder, clearance certificates evidencing the domestic • An application form duly filled and letter from the Ministry of Trade and investor status of the foreign nationals signed by the manager or agent of Industry for the company name and or identity cards (for companies to be the business organization; draft memorandum and articles of established); associations;

46 47 Useful contacts

Horticulture production: Mr. Tesfaye Development Bank of Mengestu +251 582 200 929 Ethiopia, Addis Ababa P.O. Box 1900 Amhara Regional Bureau of Tel: +251 15 11188/ +251 11 51526/ Finance and Economic +251 15 13120 Development, Fax: +251 15 11606 Bahir Dar Email: [email protected] Tel.: +251 582 200 792 Fax: +251 582 265 398 Head of Bureau: Mr. Ayenew Belay Embassy of the Kingdom of +251 918 340 144 the Netherlands (EKN), Addis Ababa Old Airport Zone, Kifle Ketema – Amhara Regional State Lideta, Kebele 02/03 Investment Promotion Office, www.ethiopia.nlembassy.org Bahir Dar Tel: + 251 11 371 1100/ Mr. Melaku Alebel +251 91 878 6406/ +251 11 371 1577 USEFUL +251 582 200 640/ Agricultural Counsellor: Mr. Hans van +251 582 202 033 den Heuvel +251 11 866 94157/ Email: [email protected] +251 91 120 2541 Email: Hans-vanden.Heuvel@ minbuza.nl, [email protected] Amhara Regional State Appointments made via office CON- Trade and Industry Office, manager, Mrs. Solome Ketema Bahir Dar Email: [email protected] Tel.: +251 582 204 122/ +251 582 201 063 Ethiopian Airlines, TACTS Addis Ababa Agri Business Support Director ADD-HUB cargo Facility (ABSF), traffic handling: Mr. Alemu Bekele Amhara Region Agricultural Amhara Regional Addis Ababa +251 11 517 8054/ Research Institute (ARARI), Administration Office, part of the Addis Ababa Chamber + 251 91 120 3442 Bahir Dar City Bahir Dar City of Commerce and Sectorial Email: AlemuB@ethiopianairlines. P.O.Box 527 code 100 Tel.: +251 582 200 499 Associations (AACCSA) com www.arari.gov.et President: Mr. Gedu Andargachew P.O. Box 2458 Tel.: +251 582 206 400 +251 91 834 0690 www.agribiz.net Ethiopian Embassy in Fax : +251 582 205 174 Project Advisor: Gertjan Becx Brussels Director General: Dr. Biru Metaferia +251 11 554 2405/ +251 91 266 0725 Avenue de Tervuren 62, 1040 +251 912 027 600 Amhara Regional Bureau of Email: [email protected] Brussels, Belgium Director Deputy: Dr. Tilaye Tekleweld Agriculture, www.ethiopianembassy.be +251 911 375 787 Bahir Dar City Tel.: +32 2 771 32 94 P.O.Box 437 Bahir Dar City Fax: +32 2 771 49 14 Tel.: +251 582 200 929 Mayor: Mr. Lake Ayalew Email: [email protected] Fax: +251 582 201 510 +251 91 834 0300 H.E. Ambassador Teshome Toga Livestock Production Process Owner: Email: [email protected] Mr. Alemu Admas +251 918 014 912

48 49 Useful contacts Useful contacts

Ethiopian Horticultural Ethiopian Electric Power SNV - EDGET, LMD Development Agency, Corporation, Partnership & Institutional Hotels Addis Ababa Addis Ababa Development www.ehda.gov.et Corporate Communication: Addis Ababa Home Land Hotel, Director General: H.E. Ato Alem Tel. +251 11 155 9567/ Tracon Building, Kebele 01/02 Bahir Dar WoldeGerima +251 11 157 1860 P.O.Box 40675 www.homlandhotelbahirdar.com +25 11 155 02483/5127 Email: eepcocommunication@ www.snvworld.org Tel: +251 58 222 0220/ Email: [email protected], yahoo.com SNV-LMD Relationships: Mrs. Mahlet +251 58 220 4545 [email protected] Yohannes Email: info@homlandhotelbahirdar. Email: [email protected] com Livestock Resources Ethiopian Horticulture Development and Promotion Producers Exporters Agency, USAID Contractor Jacaranda International Association (EHPEA), Bahir Dar Agricultural Growth Hotel, Addis Ababa Dairy Expert : Mr. Belete Anteneh Program-Livestock Market Bahir Dar www.ehpea.org +251 91 877 9016 Development www.jacarandahotelbahirdar.com Executive Office: +251 11 663 6751 Addis Ababa Tel.: +251-582 209 899/ Email: [email protected] CMC Road, Palm Building 3rd floor +251 582 209 565 Ministry of Agriculture P.O.Box 20451 Email: contacts@jacarandahotelba. Agricultural Investment Investment & Finance Manager: Mr. hirdar.com, reservation@ Ethiopian Investment Agency, Support Directorate Amdework Berhanu jacarandahotelbahirdar.com Addis Ababa Addis Ababa Email:aberhanu@ P.O. Box 2313 P.O.Box 62347 livestockmarketdevelopment.com www.eia.gov.et www.moa.gov.et Kuriftu Resort and Spa, Tel: +251 11 551 0033 Acting Director: Ato Bizualem Bekel Bahir Dar Fax: +251 11 551 4396 +251 911183340 www.kurifturesortspa.com Email: bezualemmogessie@gmail. Tel.: +251 116 623 605/ com +251 91 109 1185/ +251 92 095 9697 Ethiopian Revenue and Email: [email protected] Customs Authority, Addis Ababa National Bank of Ethiopia, P.O. Box 2559 Addis Ababa Summer Land Hotel, www.erca.gov.et P.O. Box 5550 Bahir Dar Tel: +251 11 466 7666 www.nbe.gov.et Tel. +251 582 206 566 Fax:+ 251 11 466 8244 Tel: +251 11 551 7430 Email: [email protected] Email: [email protected] Fax: +251 11 551 4588 Email: [email protected]

Environmental Protection, Land Administration and Use Shayashone Consult, Authority, Addis Ababa Bahir Dar City www.shayashone.com Tel.: +251 582 182 164 / Yared Sertse +251 11 618 6741/ +251 582 202 275 +251 93 000 0563 Rural Land Administration & Use Email: [email protected] Authority Process Owner: Mr. Sintayehu +251 918 012 824

50 51 See You in Amhara

Published and commissioned by Embassy of the Kingdom of the Netherlands, Addis Ababa, Ethiopia www.ethiopia.nlembassy.org

In cooperation with Amhara National Regional State of Ethiopia

Prepared by Shayashone Consultancy, Addis Ababa, Ethiopia www.shayashone.com

Design and development by BrandOutLoud, The Hague, The Netherlands http://www.brandoutloud.org

Image cover by Mark van Luyk/ BrandOutLoud, The Hague, The Netherlands http://www.markvanluyk.nl

Paper in this booklet is certified Copyright © Embassy of Kingdom of The Netherlands, against the Forest Stewardship Addis Ababa, May 2014. All rights reserved. Council standards (FSC).