The export sector in Ethiopia has been under scrutiny for poor performance for decades. As Ethiopia has not been a manufacturing hub as such, the criticism has been downplayed. Despite the number of investors who are seemingly interested in the export business, the country has also been struggling to export value-added items including its flagship coffee. Looking at the exponentially increasing number of exporters that joined the line of business in the last five years, one may think new entrants are helping the country’s success in global trade. Unfortunately, exporters are increasingly in the business to support their imports. And there are even more controversial activities in the field. Though the number of exporters and Dollars earned has shown significant increases, practices in the export sector are full of malpractice that that are hurting the Ethiopian economy, writes Selome Getachew.

Ethiopia has historically produced some of the best-reviewed single-origin premium coffee beans and boasts the status as the birthplace of coffee. Ethiopian coffees are well renowned for their complexity—strong, wine-like flavor and a very wild acidity. The cash crop remains the nation’s major export item covering over 30Pct of the country’s total export earnings. Various administrations have attempted to fully tap into the country’s full potential for coffee and other agricultural products. The launching of the Ethiopian Commodity Exchange (ECX) was one such attempt, seeking to secure a larger and fairer share for Ethiopian farmers. Recently, coffee exporters, particularly from the State of Oromia, have walked away from ECX to join the vertical scheme where farmers can export or sell directly to exporters or suppliers. With authorities crediting this move for burgeoning exports, there are more complexities at play, writes Selome Getachew.

Private participation in investment and business activities in the Ethiopian economy has been struggling for decades. Various administrations have done little to nothing when it comes to developing the private sector towards development and alleviating poverty. From communism to state developmentalism to the current administration’s ideology—the private sector seems to be always stuck on the back burner. One recent move by the incumbent is the establishment of the Ethiopian Investment Holdings (EIH). Creating this arm into the Ethiopian economy, the government hopes to counter the sluggish development of private-sector participation in the economy at large. EBR’s Selome Getachew looks into the missions of EIH and expected challenges which it will face to achieve intended results.