The Addis Ababa Investors Forum (AAIF) has sounded the alarm over widespread land seizures affecting hundreds of enterprises that have transitioned from small and micro-scale operations to medium-sized industries in the capital and its surrounding areas. The Forum claims that more than 900 businesses are facing existential threats due to political instability and the fallout from recent conflicts, particularly those linked to the northern region.
In a formal letter to the Ministry of Industry, the AAIF urged immediate government intervention to protect these factories, which it described as vital to the nation’s economic backbone. The letter highlights that the turmoil following the country’s political transition-exacerbated by unrest and the actions of certain activists and ethnic-based political actors-has left many previously thriving enterprises vulnerable to illicit land takeovers.
According to AAIF President Ashenafi Muse, the affected businesses had grown into medium-sized industries through years of perseverance and organization, with significant government investment aimed at boosting import substitution and saving foreign exchange. “These enterprises have legitimate investment licenses, but their premises are being taken over in ways that are not transparent, often under the guise of legal sales, and are ending up in the hands of illegal traders and the chaotic land market,” Ashenafi said.
The Forum alleges that hundreds of factory sites intended for industrial use have been seized and diverted from their original purposes, pushing many businesses toward collapse. Ashenafi noted that the situation was so severe during the height of the instability that it was difficult to notify authorities in a timely manner. However, with relative peace now restored and the government reiterating its support for manufacturers, the AAIF is calling for urgent action to restore seized properties to their rightful owners.
The Forum emphasized that these issues are particularly acute for enterprises established in the first three rounds of industrial development, which are now under intense pressure. “This situation could seriously undermine the country’s industrial growth, and the government’s efforts to support this sector could be in vain if immediate steps are not taken,” Ashenafi warned.
Meanwhile, the Ethiopian Enterprise Development (EED) reported the creation of 2,752 new enterprises in the first nine months of the 2024/25 fiscal year, achieving 76% of its annual target. While more than 151,000 jobs have been generated in the sector, AAIF cautions that the collapse of existing factories could jeopardize these gains.
The AAIF called on authorities to restore the affected factories to full production capacity by returning seized premises to their legal owners. The Forum argues that such action would not only help save foreign exchange by promoting local manufacturing but also play a crucial role in job creation and economic stability.
The situation highlights broader concerns about land administration and governance in Addis Ababa, where irregular land allocations, a lack of transparency, and political interference have contributed to a climate of uncertainty for investors and business owners. Experts warn that unless these challenges are addressed, the city’s ambitions for industrial growth and equitable development could be at risk.
