While Europe and the US are grinding to a halt economically and the Middle East continues to be weighed down by political unrest, investors are looking to new territories. Africa is seen as the next most lucrative region and Ethiopia has been singled out as a country offering almost boundless investment opportunities.

Not only is the country Africa’s second most populated, with 85 million people, its projected economic growth rate of 11% this year is among the world’s highest. Similar growth rates are forecast for the next five years.

The need for investment is such that the east African country’s government is encouraging foreign investors, public and private, to participate in the development of the economy. For example, the government of Ethiopia is selling four state-owned construction companies, according to Beyene Gebre Meskel, the head of the country's privatisation and public enterprise supervisory agency, as reported by mergermaket.

According to the report, the government is receptive to a full sale of the companies and welcomes approaches from foreign investors. It is seeking foreign investment in practically every sector such is the need for infrastructure, including roads, bridges and basic utilities as well as agriculture.

There has been a strong push for foreign investors to buy assets in the privatisation process and participate in public private partnerships, Mr Meskel said. So far, 85% of all privatisations have involved local companies, he added.

However, the government faces challenges with some of those bidders because of concern about corruption, according to an Ethiopian diplomat. The diplomat also stated that the anti-corruption commission "is doing its level best" to eliminate corruption. Previously, when the country was under military rule, industries were heavily nationalised, with the government holding assets across all sectors – from metal factories to coffee processors, the diplomat said. But since 1995, nearly 300 companies have been privatised.

Lucia Dore is head of GCC and Middle East at mergermarket, part of the Financial Times Group. E-mail: lucia.dore@mergermarket.com