Overview of the sector

Ethiopia’s pharmaceutical industry provides ample potential for investment. Ethiopia has the second- largest population in Africa (>105 million, ~8.5 % of Africa population), with an expected growth rate of 2.3% per year. Such an increase in population size will result in an increase in the number of individuals requiring pharmaceutical products. With average economic growth of >10% per year, the expected increase in disposable income will influence spending on pharmaceutical products. In addition, promising health coverage improvements, both in urban and rural areas, is among many driving forces of market growth for the sector. 

Policy and strategy

  • The goal is to become a pharmaceutical manufacturing hub in Africa by 2025
  • First country in Africa to establish a national strategy for pharmaceutical sector development
  • Pharmaceutical manufacturing is a priority sector of government
  • Strong investor and pharmaceutical manufacturing-friendly policies; with various fiscal and non-fiscal incentives, one-stop-shop government services and price preference in public procurement with an opportunity for a long-term procurement guarantee
  • State-of-the-art industrial park that specializes in pharmaceutical manufacturing is being developed in Addis Ababa and will host multi-national manufacturers

Key reasons for investing

  • Growing local market: Ethiopia’s pharmaceutical market is expected to grow by 15% annually and reach $ 1 billion by 2020
  • Accessible local and regional market: Ethiopia has the potential to serve as an export hub for the > $ 20 billion pharmaceutical markets in Africa
  • Trainable workforce with competitive wages
  • More than 10 schools of pharmacy in Ethiopia are planning to expand with sector specialization programs
  • Availability of tailored investment incentive schemes towards the pharmaceutical sector and industrial park development
  • A big demand and supply gap for pharmaceutical products, with only a few local manufacturers covering < 20% of the demand



Major brands investing in Ethiopia