Why Ethiopia

Ethiopia is Africa’s sixth-largest economy, with a GDP of $120.37 billion in 2023. Ethiopia is one of the world’s fastest-growing economies of Africa and is witnessing rapid economic expansion, mainly in part to government investments in infrastructure and manufacturing. It has grown in popularity among overseas investors, the country’s population is estimated to be 115 million people.

According to incomplete statistics, there are roughly 1.2 million vehicles in Ethiopia, with a big chunk of them being well over 20 years old. Most of the cars on the road are secondhand imports raising transportation concerns such as air pollution, traffic accidents, and congestion as well as having a detrimental impact on the overall livability of cities.

Electric vehicle (EV) mobility in Ethiopia is gradually gaining attention and traction as the country seeks to address environmental concerns and reduce its dependency on fossil fuels. The Ethiopian government has shown interest in promoting EV adoption as part of its broader efforts to mitigate pollution and reduce carbon emissions. Leading the change Ethiopia’s Ministry of Transport and Logistics recently announced the country will ban imports of non-electric vehicles, making it the first country in the world to explicitly ban the entry of fuel vehicles.

The government has implemented various policies and incentives to support the adoption of electric vehicles. According to the Ministry of Finance of Ethiopia, electric vehicles are exempted from VAT, excise, and surtaxes. According to a statement shared by the ministry, the import tax for electric vehicles has been reduced, ministry’s new regulation reduces the tax rate on completely imported electric vehicles to 15%, while only 5% on semi assembled vehicles.

As part of its 10-Year Perspective Development Plan that runs from 2021 to 2030, the Ethiopian government plans to import 4,800 electric buses and 148,000 electric automobiles.