Ethiopia: Foreign investments in Ethiopia’s beverage industry showing increase

Foreign investment in Ethiopia's beverage industry is showing massive increase as multinational companies are increasingly attracted to the industry, according to the Ethiopian Food, Beverage and Pharmaceuticals Industry Development Institute.

The Institute says investment in alcoholic, non-alcoholic beverages and soft drinks as well as stimulants industry have shown a tremendous progress during the past decade.

Institute Beverage Processing Directorate Director Aklilu Kefyalew said multinational beverage companies are continuing to increase their presence in Ethiopia's rapidly growing economy.

"Hence, Ethiopia is attracting more investment as a business and world tourism destination, beverage investment has become the lucrative market for the wine and beer industry."

According to Aklilu, breweries are helping transform Ethiopia's business landscape with alcoholic beverage industries having a lion's share in terms of investment and market coverage.

By the end of the fiscal year, the country's export revenue from the alcoholic beverage industry is expected to hit USD 17 million. Over USD 6 million has already been secured during the past six months, he added.

In line with its policy of encouraging private investment, the Ethiopian government privatized state-owned breweries including Harar and Meta.

The Director said despite the rapid expansion of brewery investment, the inefficient supply capacity of malt factories has been a major constraint in the area.

European companies especially from Germany have shown interest to engage in malt project which would help promote agro-processing and stimulate further expansion of beer companies in the country.

BGI Ethiopia Brewery Marketing Manager Isayas Hadera for his part indicated the emerging middle income class and the increasing trend of the population as key growth drivers of alcoholic beverage companies in Ethiopia.

"The domestic market is rising from 15 to 20 per cent every year. We are the real witnesses of Ethiopian rapid growth in the previous decade which has allowed us get better market share in the country," Isayas said.

"We have investment in over 25 African countries. But our investment in Ethiopia is different because the development is not artificial like other African countries [whose] economy depends on petroleum," the Manager added.

With annual production capacity of three million hectolitres of beer, BGI is exporting beer to South Sudan, Djibouti, USA, Israel and Europe which is showing increment every year.

Dashen, BGI, Heineken, Meta, Raya, Habesha and Zebidar are the seven beer companies operating in Ethiopia which collectively run 11 factories.

Four giant liquor and two wineries also make part of Ethiopia's growing beverage industry.

05 May, 2016