In South Korea
During a summit in South Korea this week, Ethiopia secured billions of dollars in loans, furthering economic ties between one of the continent’s largest counties and the Asian nation.
The loan agreements, part of broader deals, come as South Korea seeks access to Africa’s abundant natural resources and growing markets.
In addition to Ethiopia, Tanzania was another winner at the South Korea-Africa summit, securing $2.5 billion in concessional loans over five years. Additionally, Tanzania signed agreements allowing South Korea access to its resources critical for clean energy technologies, like nickel, lithium, and graphite.
Ethiopia, boasting a fast-growing economy, secured a $1 billion financing deal spread over four years. The funds will be directed towards infrastructure development, science and technology advancements, healthcare initiatives, and urban development projects.
The summit, which hosted over 30 African heads of state, presents an opportunity for further collaboration between Asian economic centers and the Africa continent, which features five of the fastest growing economies of the world. Ethiopia is one of these countries, with the IMF predicting a 6.2% growth rate this year.
Tanzania,through President Samia Suluhu Hassan, expressed interest in cooperation on various fronts, including sustainable use of ocean resources, development of natural gas reserves, fostering creative industries, and potentially supplying labor to South Korea.
For his part Prime Minister Abiy emphasized his country’s historic ties, where Ethiopian soldiers fought alongside South Koreans during the Korean war in the 1950s. He added by saying, “South Korea’s successful economic development over the decades served as an inspiration for Africa”.
South Korean President Yoon Suk Yeol has already met with leaders from Sierra Leone, Tanzania, and Ethiopia. Meetings with leaders from Zimbabwe, Togo, Rwanda, and Mozambique are scheduled for today.
In Singapore
Following the Africa-South Korea summit, Prime Minister Abiy had an official two day state visit in Singapore, where he held meetings with Prime Minister Lawrence Wong as well as President Tharman Shanmugaratnam. The trip highlighted political, economic, and social issues and on the need to strengthen bilateral relations and explore new areas of cooperation.
Compared to China, Singapore’s investments in Ethiopia are nonexistent. It remains to be seen whether that will change soon. One thing that is for sure is Asian countries are beginning to look at Africa much more seriously as an investment destination. This wasn’t the case until China started investing heavily during the last decade, particularly due to the continent’s rich minerals, which are crucial to green tech. The China effect might have spurred more attention, something the Africans welcome.
Ethiopia’s ambitious “homegrown economic reform” plan requires investment from a wide range of sources and the country’s leadership has been courting various governments and companies to garner investment with some success. The country’s image recently took a hit due to conflict, from which many regions are still recovering.
