ETHIOPIA REGISTERS AMERICAN CHAMBER OF COMMERCE - HOPE FOR

UNCLAS ADDIS ABABA 002093 SIPDIS E.O. 12958: N/A TAGS: BEXP ETRD ECON PREL ET SUBJECT: ETHIOPIA REGISTERS AMERICAN CHAMBER OF COMMERCE - HOPE FOR EXPANDED TRADE SUMMARY -------------- ¶1. The Ethiopian Ministry of Justice formally registered the American Chamber of Commerce in Ethiopia (ACCE) on June 26 after a concerted 20-month effort by Embassy Addis Ababa to establish what is only the fourth American Chamber of Commerce in Africa. The establishment of the ACCE offers a unique opportunity on the continent to leverage private sector engagement to greatly expand bilateral trade and investment relations. Embassy Addis Ababa is working with ACCE leaders to orchestrate a major launch of the Chamber and greatly expand its membership, and, through a modest foreign assistance project, will help establish a strong institutional foundation for the Chamber to quickly become self-sustaining. U.S.-Ethiopian trade has expanded, and although the U.S. maintains a large trade surplus, the Chamber can help to develop greater trade ties. End Summary. BACKGROUND -------------- ¶2. The Ethio-American Business Community Association (EABCA) came into being in November 2004 as a loose affiliation of Diaspora returnee business leaders. Since 2004, the association has grown to 140 members consisting of U.S. based companies, local Ethiopian Companies working closely with American counterparts, and individuals with an interest in doing business with U.S. companies. Recognizing the need further to promote the development of trade and investment relations between the United States and Ethiopia, Ambassador Yamamoto initially proposed creating an American Chamber of Commerce in Ethiopia in late 2006. Once established, the ACCE could provide members a forum to identify common commercial interests, serve as an information clearing house, provide a direct liaison office with the U.S. Chamber of Commerce, and address the need for a stronger and fully functioning association. The EABCA leadership and Post agreed that the EABCA would be the appropriate foundation from which to establish the ACCE. Together, we secured ACCE recognition from the U.S. Chamber of Commerce in 2007 and the EABCA's executive membership was paramount in leading the lengthy and sometimes frustrating transformation from the EABCA to American Chamber of Commerce in Ethiopia. CHALLENGES FACED -------------- ¶3. Despite the confirmed verbal recognition from a range of pertinent Ethiopian ministers of the value and advantages of establishing an American Chamber of Commerce in Ethiopia, transforming EABCA into ACCE has required persistent diplomatic engagement between Post and relevant GoE entities. The chairman of EABCA has reported that officials of Ethiopian Chamber of Commerce has presented their objection to the Ethiopian Ministry of Trade and Industry, which has a say in the process, to block the registration of ACCE. Countering this has required sustained engagement by the Ambassador with the Ministers of Trade and Justice and the Prime Minister over the course of the past 18 months. THE WAY FORWARD -------------- ¶4. Although ACCE is now registered, the EABCA must convene a General Assembly formally to transform the association into the Chamber, adopt the ACCE's revised bylaws, and elect a new Board of Directors. The leadership has tentatively targeted the end of October 2008 for this Assembly. USAID/Ethiopia has allocated $75,000 to support the hiring of an Executive Director, expand membership better to capture interested U.S. companies and improve demographic representation, and establish strong institutional procedures and relationships. Post will maintain one ex-officio member on the Board of Directors and will actively guide and support the development of a strong, professional, and capable institutional foundation for the ACCE. After over a year of active commercial outreach to U.S. companies with vested interests in Ethiopia, Post expects to see strong and prominent American corporate support for the ACCE as it leads the way in dramatically expanding trade and investment ties between the U.S. and Ethiopia. ¶5. Potential benefits include expanded trade. Currently the U.S. exports USD 500 million in machinery and tools to Ethiopia and imports about USD 80 million from Ethiopia. The Chamber is viewed as a positive vehicle to help Ethiopia improve business activities and receptivity to foreign business. The two critical areas of banking and telecom will be a focus for the Chamber as keys to attracting U.S. investment. The Prime Minister supports the Chamber and has urged the U.S. to increase investment. YAMAMOTO