Ethiopia Plans to Offer Firms Shares in Road Projects – Finance Minister

Ethiopia Plans to Offer Firms Shares in Road Projects – Finance Minister Abraham Tekeste

Abraham Tekeste of MoFED said the government expected gross domestic product to grow 11 percent in the 2016/17 fiscal year, up from 8 percent the previous period.

ADDIS ABABA―Ethiopia plans to offer shares in its road-building and maintenance projects to private investors, its Finance and Economic Development (MoFED) said on Tuesday, the latest step to open up and modernize the state-led economy.

The Horn of Africa country has over 113,000 kilometers (68,0000 miles) of paved roads and plans to increase that to 220,000 kilometers by 2019/20, official data showed.

“We do not have private-run roads. Through public-private partnerships, the private sector is interested to develop roads,” Minister of Finance and Economic Development (MoFED) Abraham Tekeste told Reuters in an interview.

“Through this arrangement, we could work to share the risks and create an environment whereby the private sector can recoup returns on its investment.”

The move to partly liberalize the sector follows Ethiopia’s decision to offer foreign companies stakes in the government-operated Ethiopian Shipping and Logistics Services Enterprise early this year and its energy sector in 2013.

Ethiopia is one of the fastest-growing economies in Africa, but the expansion has mainly been fueled by huge public investment. The spending has gone into roads, schools, new highways and dams for hydroelectric power.

It opened an electrified railway linking the landlocked nation to a port in neighboring Djibouti this year.

Mr. Abraham Tekeste said the government expected gross domestic product to grow 11 percent in the 2016/17 fiscal year, up from 8 percent the previous period.

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