The Ministry of Trade (MoT) is to amend the proclamation for Trade Registration and License, which came into effect in 2011. The new drafted proclamation was mainly to create favourable business environment where businesses could thrive in the processes by providing significant inputs.
‘If the country is to continue on the path of sustainable growth and transformation, the business and investment environment should improve greatly,’ asserted participants of the symposium for Public Private Consultation for Development that was held on February 27, at the Hilton Addis.
Among others, ‘ease of starting a business and liquidating it just as easily are some of the defining elements of a conducive business environment,’ said the participants.
The symposium was organized by the Addis Ababa Chamber of Commerce and Sectoral Association (AACCSA) in connection with the 17th Addis Chamber International Trade Fair, which opened on Thursday, February 21 and concluded on February 27.
The trade fair involved 213 companies displaying their high-end products from 28 countries, including Ethiopia.
The symposium was meant to highlight the importance of public, private consultation in promoting trade, investment and economic growth, according to Getachew Regassa, Secretary General of AACCSA.
“It shouldn’t be very cumbersome for any interested person to start a business: and if they decide on leaving the business, then, there shouldn’t be administrative hurdles,” said Abebe Abebayehu, senior Private Sector Development (PSD) specialist at the Ethiopian Public Private Consultative Forum (EPPCF) Secretariat.
The government believes that development is unthinkable without the private sector’s involvement, Mulu Solomon, President of the Ethiopian Chamber of Commerce and Sectoral Associations (ECCSA), noted. But in practice the regulations in effect do not always go hand-in-hand with the kind of environment needed to encourage and sustain the growth of businesses and investments, she commented. ECCSA, AACCSA and other regional chambers as well as the business community have made a great deal of effort to convince the government to work together with the private sector so as to make the business environment conducive. As a result, the government is making improvements, Mulu said. “After having this PPCF with the government, sometimes they change [the laws and regulations] in line with our recommendations, and sometimes they don’t,” she said. “However, we certainly see improvements.” For Mulu, the new outlook and approach as well as creating the necessary momentum itself, which she believes came through the PPCF, is a big achievement.
“We are striving to help translate the theories into practical applications and to create real engagement between the public and private sectors in a meaningful way,” Mulu added.
The government has its own wish list, which includes seeing the private sector complying with the policies, rules and regulations that it ratifies, as well as giving significant regard to public safety and national security.
The business community would like to see a favorable business environment, which involves predictability of commercial laws, regulations and administrative practices affecting businesses. ‘The problem arises when the business community is only concerned about maximizing profit without any regard for business ethics and when the government takes stringent measures to counter it,’ states an expert.
Mulu informed the business community that the government is amending the trade registration and license proclamation to improve registration and renewal processes. “They are going to change this in a radical way. I am quite sure it will benefit the private sector,” she noted. According to Mulu, government officials have also promised to actively engage the business community when laws and regulations are drafted.
Officials at MoT confirmed that the idea of improving the proclamation does exist but declined to comment further, stating that it was premature to do so at this stage.
Mulu said both foreign and Ethiopian investors can really be encouraged to invest in Ethiopia, because the country’s economy is growing and, at the same time, the PPCF is working for both sides in the right way.