Approximately 88 million dollars is traded between Ethiopia and Korea every year, but only around five million dollars are products imported from Ethiopia to Korea. The grand opening of the Korean investment promotion trade center may help bring a change to that figure.

The center has the potential to level the balance of trade between the two countries and increase commerce between Korea and Ethiopia, in general, by diversifying and increasing the amount of products exchanged and through aggressive marketing strategies such as advertising Ethiopian products on the Korean market and creating joint ventures between the Korean and Ethiopian private sector.

By doing this Ethiopia’s high value agricultural products such as coffee, sesame seeds, flowers, textiles, leather and livestock can be destined for the Korean market in greater numbers. Because of Korea’s position in the Asian market this means Ethiopian products will be headed to other countries in the region as well. In fact, because of Ethiopia’s duty and quota free market through AGOA; EBA and a number of big markets including China, Japan, Canada and India, Korea and Ethiopia have the potential to export products jointly from Ethiopia.

Ambassador Soon Suk Chung Ambassador of the republic of Korea to Ethiopia said the opening of the Korea trade and investment agency promotion center (KOTRA) last Tuesday April 12, 2011 at ADOT building in Sar-bet Gabriel, would enhance trade between the two countries because of the “abundant experience and know-how,” such an endeavor brings.

However, despite the excellent relationship and political good will prevailing between the two countries, the result achieved so far, both in trade and investment, has not corresponded with the potential.

To improve this poor trade performance and to expedite improvement, it is critical for both countries to work together without hesitation, the ambassador stressed.
Trade statistics between Ethiopia and Korea show that the average trade exchanges (total trade turn over) from 2004 to Nov 2010 is about 88.1 million USD per year, but only 4.6 million USD represents exports to Korea, according to Ato Yacob Yalla, state minister of trade.

Meanwhile, imports from Korea have been increasing, about 14.6 percent per year and total trade exchange has increased by 15.5 percent. Products such as coffee, sesame seeds and leather products were the main export items from Ethiopia. Ethiopia has mainly imported vaccines, polyethylene, bulldozers, excavators, and dumpers for high way construction and diesel vehicles.

Ato Yacob says that Ethiopia could learn a lot from Korea because Korea has moved from an agricultural economy to an industrial one; much like Ethiopia plans to do under the current five year growth and transformation plan. He added that Korea achieved its transformation while maintaining its social values that have sustained it for centuries.

Ato Eyesusework Zafu, president of the Ethiopian chamber of commerce agrees. He says, “there are similarities on the economic development strategy of the two countries: The Korean economic miracle of industrialization was an export driven development policy and Ethiopia, as well follows an export driven strategy. Ethiopia stands to benefit considerably from the Korean experience.”

Yacob added that he hopes KOTRA in Addis will fill the gap and strengthen the economic ties and investment between Ethiopia and Korea.

Recently, Mr. Kim Sung- Hwan, the ministry of foreign affairs and trade of the republic of Korea, paid a visit to Addis Ababa to improve trade relations and Prime Minister Meles Zenawi attended the G20 summit in Seoul, representing African countries as the chair of NEPAD last year.

Mr. Hanchul Lee, vice president of KORTA, Mr. Dooyoung Lee, director of the Korea business center in Addis Ababa, Ato Mekonnen Manyazewal, minister of industry and Athlete Haile Gebreselassie were also present at the opening.

By Betelhem Assefa
CapitalEthiopia