Politics, Practices, and Potentials: Analyzing the Role of Diaspora-Owned Businesses in Ethiopia's Development

In 2010, under the guidance of its developmental state planning, Ethiopia launched its Growth and Transformation Plan (GTP) aimed to achieve accelerated economic growth and middle income country status by 2020-2025. In an attempt to realize its GTP, the Ethiopian government has strategically engaged its diaspora population as ‘development partners’. Existing policies and proclamations outlined by the Ethiopian government speak to the institutionalized attempts to attract diaspora capital for the development of the country. Through an exploratory case-study of small and medium sized businesses in Ethiopia’s capital Addis Ababa, this paper interrogates the complexities surrounding Ethiopia’s state-led engagement of its diasporas and explores the potential of the Ethiopian diaspora to contribute to the country’s development. While the politics of engagement and challenges with Ethiopia’s business environment emerge as salient issues, findings indicate that diaspora business owners possess a unique potential to contribute to human capability transformation in the country.