Ethiopia-turkey Economic Relations An Assessment On Trade And Foreign Direct Investment From 2006 To 2018

Ethiopia has had long-standing historical relations with Turkey. The aim of this study is tornexamine Ethiopia-Turkey economic relations from 2006 to 2018 with particular reference to therntrade and FDI. To attain its objectives, the study used a qualitative method to assess economicrnties. Data were collected both from primary and secondary sources. Available pieces ofrnliterature were reviewed to discuss historical relations and bilateral economic relations betweenrnthe two countries. Additionally, in-depth interviews were conducted with officials from thernEthiopian Investment Commission, FDRE Ministry of Foreign Affairs, FDRE Ministry of Trade,rnThe Development Bank of Ethiopia and The Embassy of the Republic of Turkey, seven officials inrnnumber. The different economic cooperation agreements signed between Ethiopia and Turkeyrnare the responsible factors for the two country's relations. After the analysis of trade datarnbetween Ethiopia and Turkey, this paper showed that Ethiopia incurs a huge deficit in its tradernrelations with Turkey in the period under discussion. The result reveals that Ethiopia‟s export tornTurkey is much short of its imports from that country. Dependence on the export of a fewrnprimary products and raw materials and weak export performance are among the reasons forrnthe country‟s trade deficit. Turkish investments take the third highest in terms of capital next tornchina and Saudi Arabia, and the fifth-highest in the total number of FDI projects next to China,rnIndia, Sudan and the USA in Ethiopia. The Turkish foreign direct investments and its experiencernbring technology and access to employment, which have been lacking in Ethiopia. Thernavailability of natural resources, low labor wage, investment guarantees, and investor-friendlyrnpolicies, and incentives are among the prospects listed under this study. Besides the prospects,rnchallenges like lower human capital development, infrastructure problems, companies‟ failure tornservice their debt and corruption are among the findings of the study.rnKeywords: Economic Relation, Trade, Foreign Direct Investment, Ethiopia, Turkey.

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