(Ecofin Agency) - The 17 agreements signed during Sheikh Mohamed bin Zayed Al Nahyan’s visit to Addis Ababa further reinforce the United Arab Emirates' ties with Africa. The agreements with Ethiopia, a promising market of over 100 million inhabitants, reflect the country’s increased ambition on the continent.
On August 18, Ethiopia and the United Arab Emirates signed 17 cooperation agreements covering various fields. The agreements were signed, during the visit of Sheikh Mohamed bin Zayed Al Nahyan (photo, left), President of the United Arab Emirates, to Addis Ababa.
One of the agreements paves the way for cooperation between Abu Dhabi Ports and Ethiopian Investment Holdings, one of Africa's largest sovereign wealth funds, with over $150 billion in assets under management.
Another was signed between Oumolat Security Printing, the company responsible for printing the Emirati dirham, and the National Bank of Ethiopia. It aims at mutual collaboration in customs matters, we learn. Until now, Ethiopian birrs were printed in Europe by the British company De La Rue.
One other agreement provides for the exchange of expertise in governance and technological cooperation between the two countries while others cover partnership between the Ethiopian Investment Commission and the Federations of Chambers of Commerce of the Emirates of Sharjah and Abu Dhabi, as well as financial alliances between Etihad Credit Insurance, the UAE's national credit insurer, and the Commercial Bank of Ethiopia.
Agriculture is not left out, with a memorandum of understanding between Al Dahra Group, specialized in agro-industry, and the Ethiopian Investment Commission. Last but not least, the agreements also pave the way for future collaboration between DP World FZE, a company operating in maritime cargo handling, and the Ethiopian Ministry of Transport and Logistics, to boost the logistics sector in landlocked Ethiopia. Climate and the fight against terrorism also feature prominently in the agreements signed.
"The growing relationship between our two countries is rooted in deep mutual respect and a shared vision for mutual progress.[...] We will continue to work together in the pursuit of sustainable development," said Ethiopian Prime Minister Abiy, who presided over the signing ceremony with Sheikh Mohamed bin Zayed Al Nahyan.
Growing commercial exchanges
Established by Sheikh Zayed bin Sultan Al Nahyan, former President of the United Arab Emirates, and former Ethiopian Prime Minister Meles Zenawi, Emirati-Ethiopian relations have progressed over time. Since their establishment, ties between the two countries have strengthened, especially after the opening of the Ethiopian consulate in the UAE in 2004, followed by the UAE embassy in Addis Ababa in July 2010, and the Ethiopian embassy in Abu Dhabi in 2014. This visit comes at a time when trade between the two countries is following an upward trend.
Between 2013 and 2022, trade in non-oil products grew by 180%, and now exceeds 34 billion Emirati dirhams ($9 billion). In 2022 alone, the two countries traded non-oil goods worth around $1.4 billion, more than double the figure recorded in 2013.
In detail, Emirati imports from Ethiopia amounted to $628 million, while Emirati exports stood at $564.5 million. The value of re-exports from the United Arab Emirates to Ethiopia reached $553.3 million.
Destination of choice for Emirati foreign direct investment
Foreign direct investment also represents an important stimulus for economic relations between the two countries.
With over 113 investment projects in various sectors –including renewable energies, chemicals, agro-industry, aluminum, and pharmaceutical industries– totaling $2.9 billion invested, the United Arab Emirates is a partner of choice for Ethiopia.
With the United Arab Emirates hosting COP28 in November, the state visit placed particular emphasis on climate action. According to reports, the two countries renewed their commitment to strengthening their partnership in the field of renewable energies, "a sector of common interest," especially as the UAE is a major international player in the field of clean energy.
In 2021, the Abu Dhabi Future Energy Company (Masdar) signed a memorandum of understanding with the Ethiopian government. That agreement aimed to develop 500 megawatts of solar energy projects, advancing Ethiopia’s renewable energy agenda.
In January 2023, Masdar and the Ethiopian government signed a new agreement providing for the development of up to 2,000 megawatts of photovoltaic energy projects in Ethiopia. The agreement provides for the development of 500 megawatts of energy in an initial phase.
Fiacre E. Kakpo