Ethiopia’s mining sector attracts Chinese investors to invest, extract mineral resources

Chinese investors are looking forward to pump out huge investment in Ethiopia’s mining sector. The investors are considering the East African country’s mining sector highly emerging to extract mineral resources.

Ethiopia’s State Minister of Mining and Petroleum, Assefa Kumsa has said in an exclusive interview with Xinhua that as the government of Ethiopia invites experienced foreign companies to invest in the mining sector, a growing number of Chinese investors seek to penetrate in the exploration and production of the East African country’s untapped mineral and natural-gas resources.

"As Chinese firms' engagement in Ethiopia's overall investment landscape augmented in recent years, the mining sector has become a priority investment potential for potential Chinese businesses, garnering tremendous interest and capital," Kumsa recently said to Xinhua.

Kumsa further said that dozens of Chinese firms have been recently awarded licenses in the exploration and production of various mineral resources across mineral-rich parts of Ethiopia. Minerals such as gold, iron-ore, various types of precious stones, chemicals, oil and natural gas, as well as construction inputs are among the mineral resources in which Chinese firms are presently exerting their capital and technology in Ethiopia, according to the state minister.

Among the Chinese companies that have recently ventured into Ethiopia's mining sector is Tanaramu Chemical Industrial Plc., which inked a 12-year contract accord with the Ethiopian Ministry of Mining and Petroleum late last week to embark on the production of Bromine chemical resource in Ethiopia.

An agreement finalized in Ethiopia's capital Addis Ababa reveals that the Chinese firm will pump out funds of USD 57 million in Ethiopia's mineral-rich eastern Afar regional state, where an abundant reserve of Bromine -a chemical element used as an ingredient for areas including agricultural chemicals and chemical intermediates -is said to be at hand.

Wang Peilin, another official with Tanarmu, told Xinhua that the Ethiopian government has given "great emphasis to ease procedures for foreign investors," adding "this gives us a great confidence to expand our business in the coming years."

In February this year, governments of Ethiopia and Djibouti had contracted a Chinese firm, Poly-GCL Petroleum Group Holdings Limited (Poly-GCL), to construct the 767 km Ethiopia-Djibouti natural gas pipeline.

The agreement with the Chinese company is expected to help Ethiopia generate USD 1 billion every year from the extraction of natural gas and crude oil deposits following the discovery of 7 to 8 billion cubic trillion feet of natural gas by Poly-GCL in Ethiopia's eastern Somali region, as reported by Xinhua.

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