The Ethiopian Investment Commission (EIC) has announced its cancelation of 65 foreign direct investment project licenses in the first quarter of the fiscal year because they did not complete their preliminary tasks and start operating on schedule.
The companies, whose licenses were canceled, had received their permit in 2011 but failed to start their venture despite getting the necessary support from the government.
EIC also ordered the concerned government offices to retrieve all incentives that had been provided for the cancelled projects.
Getahun Negash, head of Public Relations at EIC, told Capital that the annulled projects had received a number of notices to begin work before their licenses were canceled.
‘’ We want to develop. What we need now is an investor who is willing to do something on our soil, not investors who hold investment licenses but don’t do anything with it. ‘’
‘’ To promote direct investment we have been granting land, offering electricity and minimizing bureaucracy and all the ups and downs by offering an easier way to invest, but working effectively is still a challenge. The main reason we cancelled licensesfor these projects is that they didn’t use the opportunity that they received from the government’’
Meanwhile, many of the investors that had their licenses canceled this year say that a bad supply of electricity and the poor infrastructure was the major reason they weren’t able to start their operations.
“I appreciate the government incentives like allocating land and allowing some products to be imported duty free, but to attract more investors the country needs to have better supply of electricity and infrastructure because these are the crucial factors that an investor needs,” an Indian investor said.
In related news, 101 new investment and 34 expansion project licenses in all regional states and city administrations were given to foreign investors in the last four months.
Addis Ababa, Oromia, Amhara and the Southern Nation and Nationalities were the areas where the majority of investment took place.
54 projects which have licenses and have an aggregate capital of 4.47 billion birr began production which created job opportunities for 1,834 people.
Currently 863 foreign investment projects are going on in the country.