English is the most widely spoken foreign language and is the medium of instruction in secondary schools and universities. Amharic was the language of primary school instruction, but has been replaced in many areas by local languages such as Oromifa and Tigrinya.
Ethiopia is a multi-cultural and multi-ethnic country. Religion is a major influence in Ethiopian life. Nearly half the population belongs to the Ethiopian Orthodox Church but there is also a large Muslim population. Others adhere to an ancient form of Judaism.
Ethiopian greetings are courteous and somewhat formal. The most common form of greeting is a handshake with direct eye contact. The handshake is generally much lighter than in Western cultures. After a close personal relationship has been established, people of the same sex may kiss three times on the cheeks.
Across genders, men should wait to see if a woman extends her hand. Greetings should never be rushed and time should be taken to inquire about the person’s family, health and job. People are addressed with their honorific title and their first name. It is customary to bow when introduced to someone who is obviously older or has a more senior position.
Setting up in Ethiopia
A company incorporated outside Ethiopia may do business in Ethiopia in any of the following forms:
- Through wholly foreign owned enterprises or subsidiaries
- Through establishment of branches
- Through locally incorporated enterprises
The Commercial Code of Ethiopia governs foreign investor business guidelines. All foreign investors are required to register the proposed company with the Ethiopian Investment Authority. Prospective investors are required to submit a draft memorandum and articles of association. After the Authority examines these documents, the founders are required to appear in person or by proxy before the notary public at the high court and finalise the signing of statutes of the company. Following the signing of the documents, the Authority will announce the formation of the company through the official Gazette in less than 5 days. The Ethiopian Investment Authority will subsequently issue a certificate of incorporation as evidence to the registration of the company.
Foreign companies wishing to open liaison offices must submit their application to the Ministry of Trade and Industry.
Banking and finance
Ethiopia's financial sector consists of 3 public and 15 private banks, 14 insurance companies (1 public and 13 private) and 31 microfinance institutions. The banking system is dominated by state-owned banks, mainly Commercial Bank of Ethiopia (CBE) whose assets represent about 70 per cent of the sector.
The financial sector has a limited range of services, limited foreign participation and no capital markets.
Links and resources
Government, business and trade
DFAT country page – www.dfat.gov.au/geo/ethiopia
CIA World Factbook – https://www.cia.gov/library/publications/the-world-factbook/geos/et.html
World Bank Doing Business Index – www.doingbusiness.org/data/exploreeconomies/ethiopia
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