Promoting the business ecosystem in Ethiopia

Project description

Title: Private Sector Development in Ethiopia
Commissioned by​​​​​​​: German Federal Ministry for Economic Cooperation and Development (BMZ)​​​​​​​
Country​​​​​​​: Ethiopia​​​​​​​
Lead executing agency: Ethiopian Ministry of Industry​​​​​​​
Overall term​​​​​​​: 2020 to 2024


Ethiopia is one of Africa’s fastest-growing economies, and nonetheless one of the poorest countries in the world. Around two million new jobs would have to be created each year to keep up with population growth. However, companies have to wrestle with cumbersome bureaucracy, a shortage of foreign exchange, and strong competition from abroad.

The COVID-19 pandemic, the conflict in the north of the country, and the effects of the Ukraine war are placing additional pressure on the economy. Micro-, small and medium-sized enterprises (MSMEs) are particularly affected by this.


MSMEs, start-ups and small, growth-oriented companies benefit from improved growth opportunities, and create jobs and ways for the population to earn an income.


The project operates in five areas:

  1. It empowers experts and managers at public institutions to create better conditions for companies. It also promotes public-private dialogue and harmonises relevant institutions’ fields of work.
  2. The project improves the organisational structures and services of chambers and business associations so that they can play a bigger role in shaping legal and regulatory conditions.
  3. The project supports institutions which promote innovation, including business incubators, universities and investor networks, in expanding their competences and services.
  4. The project empowers private consulting firms to tailor the quality of their services to their clients’ needs and to offer them at international level.
  5. Direct support is provided to companies which are particularly affected by the impacts of the COVID-19 pandemic, the unstable security situation in the country, and the Ukraine war. In this context, there is a focus on vulnerable groups, especially women, young people, internally displaced persons and returnees.

Last update: September 2022

Additional information