National legislation

Land is available for foreign investors on lease-hold and rental basis

Land Classification

In Ethiopia, there are three categories of land

Rural land, used for agricultural purposes

Urban land for industrial purposes

Urban land for other activities

Industrial land in industrial zones is allocated to investors at fixed prices. Land for export-oriented industries is generally available at concessionary rate.

Land lease

Duration of lease holding

The maximum lease holding period varies according to the type of activity and the location.

Area of activity Location Period of lease (years)
Residential housing, science and technology, research and study, charitable organizations, and religious institutions Any urban center 99
Urban agriculture Any urban center 15
Education, health, culture and sports Addis Ababa 90
Other urban centers 99
Industry Addis Ababa 70
Other urban centers 80
Commerce Addis Ababa 60
Other urban centers 70
Others Addis Ababa 60
Other urban centers 70

Modalities of payment

The payment of the lease can be made in full or periodically.

Rights of lease holding

Any lease-hold possessor can freely transfer its rights.

Land bank

Dedicated areas are reserved for investors. Land is, for instance, available in the following IPDC industrial parks

Industrial park name Location Type and number of sheds Status
11,000 sq. m 5,500 sq. m 3.000 sq. m
Debre-Birhan Debre-Berhan   8   Under construction
Bahir-Dar Bahir-Dar 8 Under construction
Dire-Dawa Dire-Dawa 5 6 4 Under construction
Mekelle Mekelle 5 6 4 Operational
Adama Adama 6 9 4 Under construction
Hawassa Phase- I, Cycle -I Hawassa 12 22 3 special sheds Operational
Hawassa Phase- I, Cycle -II Hawassa 5 10 Operational
Bole Lemi –II Addis Ababa Under construction
 Kilinto Addis Ababa Under construction
Jimma Jimma 4 5 Under construction

Source: IPDC. Last update: October, 1 2018

Building and construction

Before starting construction work, the investor has to get a construction permit.

Depending on the location of the project, the construction permit might be delivered by the woreda, the district, the municipality or a ministry. The application has to be made to the urban administration or to any other designated organization. The application has to provide the following information/documents


Full name and address of the applicant Investment permit Location of the project Table showing the total area of the floors
Planning consent Architectural and electrical
designs for buildings of category “A” which
have no concrete roofing
Architectural, structural and electrical
designs for buildings of category “A” having concrete
Architectural, structural, sanitary,
electrical designs and soil test and structural
analysis report for buildings of category “B”
In addition to the plans required
for buildings of category “B”,fire safety
plans and descriptions thereof
shallbe submitted for buildings
of Category “C”
Electro-mechanical designs and analysis
for buildings using lifts and artificial ventilation
Number of floors of neighbouring
buildings below and above ground level and their
distance from the boundary lines
Full name, address, signature
of the person that prepared plans of the building.
A copy of the registration certificate
is also required.

Source: IGuide Ethiopia