VII. DEVELOPMENTS IN INVESTMENT SECTOR

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1 VII DEVELOPMENTS IN INVESTMENT SECTOR During the fourth quarter of 213/14 Ethiopian Investment Agency Regional Investment Offices issued investment licenses to about 1,21 projects with a total capital of Birr 141 billion The number of approved investment projects the registered investment capital decreased by percent on annual percent on quarterly basis wing to the decline in the newly registered number of projects in Addis Ababa, es pecially in construction sector as the dem for the machine renting is declining the government also ceased to provide incentive to the subsector (Table 71) With respect to ownership, about 997 percent of the approved projects were private of which 1,117 projects (93 percent) were domestic the remaining 8 projects (67 percent) foreign Foreign investment projects recorded an investment capital of Birr 58 billion; accounting for 41 percent of the total investment capital registered during the review quarter Compared with the preceding quarter foreign investment projects slowdown by 545 percent despite increased in investment capital by 7 percent Similarly, four public investment projects with a capital of Birr 4949 million were registered during the same period The approved investment projects are expected to generate employment opportunities for 138,999 thous workers of which 66,252thous or 477 percent would be permanent 523 percent casual (Table 71) 1

2 Table 71 Performance of Approved Investment Projects Type of Projects 1 Investment 2 Private Investment 21 Domestic Investment 22 Foreign Investment Items [in million Birr] [in million Birr] [in million Birr] [in million Birr] [in million Birr] 3 Public Investment Source: Ethiopian Investment Agency 212/13 213/14 QIV QIII QIV Percentage changes A B C C/A C/B 1,41 1,359 1, ,399 39,765 14, ,26 92,23 66, , ,55 72, ,39 1,355 1, ,972 31,538 13, ,26 85,644 64, ,493 14,623 7, , , , , , , , , ,463 19,812 5, ,742 66, 46, ,57 37,633 28, ,427 8, ,559 1,8 9,432 2,6 2

3 With respect to sectoral distribution of projects, real estate, renting business activities is the leading sector in terms of number of projects (36 percent) followed by manufacturing ( 257 percent), agricultural project (149 percent), construction (142 percent), hotels restaurants (58 percent) the rest is taken by other sectors In terms of employment opportunities, about 455 percent of permanent employment is envisaged to be created by manufacturing sector followed by construction (328 percent), agriculture (8 percent) health social work (67 percent) On the other h, about 875 percent of casual employment would be in manufacturing agriculture sectors (Table72) Table 72 Investment Distribution by Sector during the Fourth Quarter of 213/14 Sectors Agriculture, hunting forestry Construction Education Electricity, gas, steam water supply Health social work Hotels restaurants Manufacturing Mining quarrying Other community, social personal service activities Real estate, renting business activities Transport, storage communication No of Proj (in Millions of Birr) Perm Emp Emp , , , , , , , , , , , , , , , ,39 2 1, Wholesale, retail trade & repair service 1, , , ,747 1 Gr Source: Ethiopian Investment Agency 3

4 As for regional distribution of the total approved investment projects, about 61 percent with 533 percent share in estimated total investment capital will be in Addis Ababa Similarly, about 192 percent of the projects with an investment capital of 174 percent will go to Amhara region followed by Oromia region with 88 percent of the project with 144 percent of investment capital (Table 73) Of the total permanent jobs, 59 percent is expected to be in Addis Ababa, Tigray region (169 percent), Amhara region (19) percent Oromia region (85 percent) Of the total temporary employment, 426 percent will be in Amhara, 41 percent in Addis Ababa 64 percent in Oromia regional states Similarly, about 848 percent of the approved investment projects in real estate, renting business activities with an 84 percent investment capital will go to Addis Ababa Addis Ababa will take the lion share in terms of number of projects (68 percent) investment capital (457 percent) in manufacturing sector followed by Amhara (168 percent project 16 percent capital) Oromia region (11 percent project 198 capitals) Regarding investment projects in agriculture, Amhara took 626 percent with capital share of 567 percent followed by Oromia 179 percent 268 percent project capital share, respectively (Table73) Second Quarter, 214/15 4

5 Table 73: RegionalSector Nexus in the Number, (in thouss of Birr) Employment Creation Capacity of Licensed Projects for the Fourth Quarter of 213/14 Sector/Re gions Agricultu re, hunting forestry Construct ion Educatio n Electricit y, gas, steam water supply Fishing Health social work Hotels Indica tors Addis Ababa Afar Amha ra BGu muz Dire Dawa Oromi a SNN PR Gamb ella Soma li Har ari Tigra y Multi regio nal* Gr Proj , , 851, ,4 42, ,5 111, ,15 1,51,1 769 mp , , ,31 emp , , ,748 Proj ,125,6 469 mp 21,298 37,1 28,57 8, ,5 15,9 5, 6, 2,272, ,744 emp 2, ,21 Proj ,56 6 2, 2, ,641 4 mp emp Proj mp emp Proj mp emp Proj ,834 54,92 117,926 mp 4, ,453 emp 1,67 5 1,117 Proj Second Quarter, 214/15 5

6 Sector/Re gions Restaura nts Manufact uring Mining quarry Real esate,,ren ting business activities Tour operation, ecotourism, cold storage service, etc Wholesal e, retail trade & repair service Others Indica tors Addis Ababa Afar 677, , Amha ra 36,71 2 BGu muz 5, Dire Dawa Oromi a 174,62 62 SNN PR 77,14 98 Gamb ella Soma li 48,36 65 Har ari Tigra y 116,4 182 Multi regio nal* Gr 1,566,2 576 mp ,544 emp ,982 Proj mp 3,65, ,118 emp 24,254 4, 1,72, , ,329, ,8 74 1,3 26 3, , ,5 4 1, , , ,537 6,71, ,116 31,894 Proj , 1,7 1,5 4, 19,2 mp emp Proj ,334, , 93,831 59, ,1 7,5 1, ,4 21 1,63 1,659, 164 mp ,39 emp ,416 Proj ,61 1,3 2, 4,91 mp emp Proj ,6 34,25 2, 8, 45,85 mp emp Proj , , 18,65 123,883 9 mp Second Quarter, 214/15 6

7 Sector/Re gions Indica tors Addis Ababa Afar Amha ra BGu muz Dire Dawa Oromi a SNN PR Gamb ella Soma li Har ari Tigra y Multi regio nal* Gr emp No of Proj ,21 7,541,6 195,1 2,464,8 5 5, 45,1 2 2,37, , , , ,7 2 11,21 m 39, ,189 1,48 5, , em 29, , ,656 1,422 3, ,95 p Percentage shares 14,136, ,252 72,747 Proj m p em p Source: Ethiopian Investment Agency *are projects having one license but invested in more than one region Second Quarter, 214/15 7