A Significant Boon for Ethiopia
The 4th Summit of the Forum on China-Africa Cooperation (FOCAC), held in Beijing from September 4 to 6, 2024, brought together heads of state, policy makers, media representatives, international invited delegations and global stakeholders. President Xi Jinping declared that “the China-Africa relationship is now at its best in history”, highlighting the peak of cooperation and mutual benefit. This piece examines the significance of the summit, the current bilateral cooperation between Ethiopia and China, the implications of the partnership action for trade prosperity to Ethiopia and the future direction of the evolving partnership.
The central theme of this year’s FOCAC Summit is “Joining Hands to Advance Modernization and Build a Community with a Shared Future”, with a focus on collaboration for sustainable development. Since 2000, FOCAC has strengthened relations between China and Africa. This year’s summit focused particularly on promoting modernization. President Xi emphasized that modernization should be defined contextually and advocate a collaborative, just and equitable approach that puts people at the center, embraces diversity and inclusiveness, promotes environmentally friendly practices, and is based on peace and security. The Summit also highlights ten partnership actions to improve political cooperation and financing for development.
These partnership actions include Mutual Learning among Civilizations, Trade Prosperity, Industrial Chain Cooperation, Connectivity, Development Cooperation, Health, Agriculture and Livelihoods, People-to-People Exchanges, Green Development, and Common Security. By engaging in these initiatives, Ethiopia can pave the way for a prosperous future marked by growth, inclusiveness, and stronger ties with China and other global partners. These Partnership Actions will benefit countries such as Ethiopia through trade, investment and infrastructure development.
Ethiopia’s multi-faceted partnership with China has brought significant benefits to the country through a solid strategic relationship that promotes trade and investment in various sectors such as infrastructure, agriculture, manufacturing and technology. This cooperation promotes knowledge transfer, skills development and the political understanding necessary for long-term cooperation.
The Belt and Road Initiative (BRI) ensures continued investment in Ethiopia, highlighted by major projects such as the Addis Ababa-Djibouti Railway and industrial parks that promote industrialization and regional connectivity. These parks are attracting Chinese manufacturing investment, creating jobs and diversifying Ethiopia’s export base. In addition, the BRICS Plus framework enhances trade opportunities by promoting cooperation among emerging economies, addressing common challenges and allowing Ethiopia to negotiate better terms in international agreements.
Ethiopia and China are also working together under the Green Legacy Initiative in line with Xi Jinping Thought on Ecological Civilization, which aims to combat climate change through large-scale tree planting and promote agricultural productivity through green technologies. This partnership has also contributed to the spread of electric vehicles in Ethiopia. Cultural exchanges and people-to-people ties further strengthen bilateral relations, with programs such as scholarships for Ethiopian students in China helping to train future leaders. Joint ventures and training courses promote capacity building and strengthen the competitiveness of Ethiopian companies.
Among the Ten Partnership Actions for Modernization that President Xi unveiled at this year’s FOCAC Summit, the Partnership Action for Trade Prosperity is of particular importance to Ethiopia. This initiative will allow China to open up its market by granting duty-free access to all goods to least developed countries with diplomatic relations, including 33 African countries. The initiative will improve access to agricultural products, promote cooperation in e-commerce and launch a “China-Africa Quality Improvement Program”. In addition, China plans to establish agreements with African countries to ensure long-term and stable support for trade and investment.
Zero tariff treatment for 100 percent of tariff lines means that China will eliminate all import tariffs on products from certain countries, including Ethiopia. This will allow free trade in all listed products and make goods more affordable for consumers and businesses in China. By offering zero tariffs, China is encouraging imports from Ethiopia and giving exporters access to a larger market without tariff costs.
In my view, the Partnership Action for Trade Prosperity offers important benefits for Ethiopia. It aims to significantly stimulate Ethiopia’s economic growth through various mechanisms. By enhancing access to the Chinese market, Ethiopian businesses can boost exports of agricultural and manufactured goods, driving revenue and job creation in critical sectors like agriculture and manufacturing. The initiative will attract more Chinese investment, strengthening local industries and infrastructure while fostering technology transfer to improve production efficiency and competitiveness. Joint ventures and training programs will enhance the skills of the Ethiopian workforce, supporting economic diversification and stability. Improved infrastructure will facilitate trade logistics, and strengthened cultural ties will promote collaboration. Additionally, the partnership emphasizes sustainable development through green initiatives, ensuring environmentally responsible growth. Overall, aligning with China will enhance Ethiopia’s position in international markets, attracting further investment and fostering economic development.
The Partnership Action for Trade Prosperity helps to increase Ethiopia’s exports to China and thus promote economic growth and trade expansion. This initiative improves market access for agricultural products and deepens cooperation in e-commerce, as demonstrated by the launch of AliExpress in Addis Ababa on August 22, 2024. The improved connectivity will benefit Ethiopian smallholder farmers and traders, especially for high-value coffee, sesame and oilseeds, which are critical for foreign exchange sourcing. The partnership will also provide duty-free access for Ethiopian products, increase export opportunities and strengthen the manufacturing sector, particularly the footwear and garment industries.
In addition, the initiative focuses on job creation through foreign direct investment in infrastructure and agriculture as well as the promotion of entrepreneurship in small and medium-sized enterprises (SMEs). Investments in advanced manufacturing technologies and digital infrastructure will improve productivity and access to global innovation. Educational exchanges and scholarships for Ethiopian students in China will familiarize them with cutting-edge technologies and thus promote sustainable growth and economic diversification in Ethiopia.
The Partnership Action for Trade Prosperity helps to promote Ethiopia’s economic growth through various initiatives. Major investments in infrastructure, such as roads, railroads and telecommunications, will promote trade and reduce transportation costs. The establishment of industrial parks will attract foreign investment, create jobs and integrate Ethiopia into global production networks. The partnership will focus on skills development and technology transfer to modernize industry and increase workforce productivity. Improved trade logistics and investment in digital infrastructure will further support industrial activities.
The Partnership Action for Trade Prosperity helps to improve technology transfer to Ethiopia through various initiatives. Investments in industrial parks will introduce advanced manufacturing technologies in the textile and electronics sectors, enabling modern production techniques. Skills development programs will train the Ethiopian workforce in manufacturing and IT to promote innovation. Joint ventures will provide access to expertise and equipment, while joint research will focus on local needs such as agricultural productivity. In addition, investment in digital infrastructure and renewable energy will improve energy management. Educational exchanges and scholarships for Ethiopian students in China will further develop technological skills and promote sustainable economic growth.
The Partnership Action for Trade Prosperity helps to diversify exports and boost economic growth. The initiative focuses on industry chain cooperation, artificial intelligence and technology transfer to increase production capacity and export efficiency, especially in agricultural products such as coffee and sesame. With the pledge of 50 billion dollars in financial assistance to Africa, China is supporting Ethiopia’s balanced trade relations and infrastructure development, including transportation networks, industrial parks and improving telecommunications.
The partnership will also promote cultural exchange through initiatives such as cultural programs, scholarships for Ethiopian students and tourism promotion. Establishing cultural centers and facilitating language learning will enrich exchanges and promote mutual understanding between the two nations.
The Partnership Action for Trade Prosperity helps to enhance Ethiopia’s sustainable development and global positioning through various initiatives. Major investments in special economic zones, including transportation networks and industrial parks, will improve trade efficiency and reduce costs. The partnership promotes green technologies and renewable energy to reduce CO2 emissions and supports the modernization of agriculture to increase productivity and food security. Capacity building programs will develop local skills, while industrial parks will create jobs and alleviate poverty.
In conclusion, the FOCAC Partnership Action for Trade Prosperity offers Ethiopia a pivotal opportunity to improve its economic landscape and promote sustainable development. As President Xi noted, “a friend is someone you share the path with”, allowing Ethiopia to leverage this partnership for increased market access, investment and joint projects that meet its goals. This mutual cooperation not only facilitates the expansion of trade, but also strengthens Ethiopia’s position in the global economy. After all, as President Xi stated, “no one and no country should be left behind on the path to modernization”.
