Ethiopia Turns to Property Ownership Incentives to Attract Foreign Investors

The Ethiopian government’s decision to liberalize foreign property ownership is a significant shift in the country’s economic reform agenda. This policy, which forms part of Prime Minister Abiy Ahmed’s broader strategy, seeks to attract more international investment and stimulate competition in the local real estate market.

The move is not only a long-term strategy but also a short-term solution to address some of the country’s pressing issues. The government believes that allowing foreign property ownership may bring much-needed foreign exchange into the economy and increase tax revenue. Additionally, it may encourage competition and drive innovation in the real estate sector.

While many see the potential benefits of this policy, there are concerns about Ethiopia’s appeal to foreign investors compared to other destinations like Dubai. However, local property developer Solomon Assefa believes that Ethiopia’s low labor costs and subsidized electricity offered by the state may make it an attractive destination for foreigners seeking property.

To support foreign investment, the government has allocated prime city-center plots for luxury apartments in Addis Ababa. Over the past year, property developers have been granted access to land throughout the capital, with agreements requiring them to reserve 30% of new housing units for public-private partnerships with the state. This move is aimed at encouraging investment and driving innovation in the real estate sector while also providing affordable housing options for Ethiopians living in urban areas.

In January, the finance ministry announced plans to construct over 78,000 affordable housing units in Addis Ababa through international tenders. The government aims to raise funds through auctions, leading to widespread demolitions in the capital to make way for these developments. While this move may bring much-needed affordable housing options to urban areas, it comes at a cost to Ethiopians who are evicted from their homes to accommodate these new properties.

Overall, while there are challenges associated with this policy implementation, it represents a significant shift towards promoting economic growth and development in Ethiopia through increased foreign investment and innovation in key sectors like real estate.

By Riley Johnson

As a content writer at newsmol.com, I dive into the depths of information to craft compelling stories that captivate and inform readers. With a keen eye for detail and a passion for storytelling, I strive to create engaging content that resonates with our audience. Whether it's breaking news, in-depth features, or thought-provoking opinion pieces, I am dedicated to delivering high-quality, informative content that keeps readers coming back for more. My goal is to bring a fresh perspective to every article I write and to make a meaningful impact through the power of words.

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