Foreign relations between Ethiopia and Indonesia have not always been smooth since their trade relations establishment in 1961, that was culminated by the opening of Indonesian embassy in Addis Ababa in 1964. Trade volume between the two states continues to be small though it is forecast a quantum leap could be recorded. In 2007, the trade volume stood at $69 million in favour of Indonesia. In 2010, their trade total trade was $94.1 million while in the year 2011, the volume of trade recorded was $106 million. In 2017, the trade value recorded was $293.37. East African country Ethiopia imports most of its electronics, soap and detergents from the Southeast Asian nation.
Indonesia is eager to boost its trade cooperation with Ethiopia, not only due to the market potential Ethiopia has but the possibility of Indonesian products to penetrate the African market. Ethiopia has opened its boundaries to do business and the Government has seen foreign investments swarm in to establish their businesses. Kenyan companies such as Safaricom and KCB have set their eyes on the prize of a promising market to grow their businesses and reach a wider population.
Ethiopia’s economy has shaken the economic predominance of Rwanda and Kenya in East Africa, being dubbed as the new East Africa’s investment hub. This has triggered Indonesia to act swiftly to boost the economic relations between the two. Indonesian Government seeks to carry out a market research in Ethiopia and explore investment opportunities available to reap benefits from.
Already five Indonesian companies are operating in Ethiopia, signifying a healthy working relationship with Ethiopia. More companies could set their feet on the African soil as they look to reach other parts of the continent.
The poor global economic situation has not deteriorated their economic ties as they seek to invest in each other’s sectors. One of the areas both are looking to strongly build are the technology sectors. Ethiopia is also eying private sector in Indonesia.