TRALAC - Trade Law Centre

US officials highlight opportunity for Ethiopia's future

Thursday, 27 June 2013 Published: | US Embassies / Government

Source: US Embassies / Government

Ethiopia is "an important partner" of the United States in the East Africa region and one of the fastest-growing economies in the world, a senior State Department official told a US House of Representatives Foreign Affairs Subcommittee June 20.

Donald Yamamoto, the acting assistant secretary of state for African affairs and a former U.S. ambassador to Ethiopia, told the lawmakers that the Ethiopian economy has been growing by double-digit percentages over the last five years. However, he cautioned that Ethiopia-U.S. business relationships have been limited because of investment climate challenges.

He also noted that Ethiopians in the United States are returning to their homeland to expand political and economic ties between the two countries and to provide humanitarian support. Ethiopia is a major recipient of U.S. aid, primarily for development in the health, agriculture and education sectors, and Ethiopia is one of the U.S. Peace Corps’ largest host countries.

In development, Ethiopia “has emerged as a leader on the push to end preventable maternal and child deaths,” Yamamoto said. As part of its leadership, in 2012 Ethiopia co-hosted the global Child Survival Call to Action with India, the U.S. Agency for International Development (USAID) and the United Nations children’s agency UNICEF. The meeting was held in Washington.

Yamamoto stressed that the United States wants to increase cooperation with Ethiopia in key areas, including security, counterterrorism and bilateral trade and investment. He said that as chair of the African Union, Ethiopia “will play a key role in determining AU priorities on peace and security and development and governance.”

On August 12–13, 2013, the United States will partner with Ethiopia to host the 2013 U.S.–Sub-Saharan Africa Trade and Economic Cooperation Forum in Addis Ababa. Also known as the AGOA Forum, this year's theme is “Sustainable Transformation through Trade and Technology.” The event will bring together senior officials from the United States and AGOA-eligible African countries to discuss a range of trade and investment-related issues. The U.S. African Growth and Opportunity Act (AGOA) offers incentives for African countries to continue their efforts to open their economies and build free markets.

An Ethiopian farmer tends his chickens. He has provided umbrellas so they can keep cool.

Yamamoto said the United States will “encourage Ethiopia to work toward greater market liberalization, including progress toward World Trade Organization accession." He added that recent successes on the economic front include a May trade mission to Ethiopia sponsored by the state of Illinois and a November 2012 agricultural investment conference in Ethiopia sponsored by the Corporate Council on Africa.

Yamamoto further noted that the United States is working with a major U.S. company to secure multimillion-dollar deals aimed at improving Ethiopia’s infrastructure.

Following Yamamoto, USAID Assistant Administrator Earl Gast testified that to fuel development in health, education and growth, Ethiopia wants to boost its power production capacity fivefold by 2015. The United States in early June signed an agreement with Ethiopia’s Ministry of Water and Energy that will serve as the basis for the government to negotiate project deals with private-sector developers.

Yamamoto also said that U.S. companies have signed letters of intent to make investments in support of Ethiopia’s country plan under the Group of Eight’s New Alliance for Food Security and Nutrition. The alliance, introduced in May 2012, aims to form partnerships between investors and local companies in Africa to accelerate progress in mobilizing private capital, taking innovations to scale and managing risk.

Gast said Ethiopia is one of the United States’ key African partners in countering the effects of climate change and promoting food security. “USAID’s programs in Ethiopia have seen remarkable results,” he said.

But, Yamamoto said, Ethiopia wants to eventually eliminate the need for donor assistance.

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