Ethiopia to Allow Foreign Ownership of Property

Prime Minister Abiy Ahmed announced that Ethiopia is striving to enact laws allowing foreigners to own property, aligning with its overarching strategy to liberalize the economy and entice investors. At present, foreigners are prohibited from possessing real estate in Ethiopia, including both residential and commercial properties, posing a challenge to the nation’s endeavors to allure foreign investment to the Horn of Africa.

Addressing a gathering of prominent business figures in Addis Ababa, the Prime Minister stated that his administration was in the process of completing a fresh legislation enabling foreign ownership of real estate. However, he did not specify the timeline for its presentation to parliament. “We are preparing to enact a law that permits foreigners to possess property,” he affirmed, further expressing the government’s intention to revise current regulations to broaden access to Ethiopia’s retail industry, currently limited to citizens only.

“It used to be closed, but now we’re planning to gradually open it up. Therefore, we urge you to prepare accordingly,” he remarked. Over recent years, Abiy’s administration has initiated the opening of segments within the heavily regulated economy, such as telecommunications and banking, to foreign investors. This forms part of a strategy to enhance foreign capital inflows, stimulate growth, and generate employment opportunities in the nation, which boasts a population of over 100 million people.

Ethiopia is one of Africa’s fastest growing economies, and the government has grand plans for privatization. However, these policies faced headwinds in recent years, as domestic political conflict was compounded by international black swan events, such as the Covid pandemic and the War in Ukraine. Ethiopia is currently in discussion with the International Monetary Fund to garner financial backing to galvanize its Home Grown Economic Agenda.