The major challenges of the mining sector of Ethiopia

Practical issues faced often largely depending on the nature and size of the mining project. A few of the key
issues and factors for investors and stakeholders are summarized as follow;

1. Infrastructure and access to reliable power supply

In Ethiopia infrastructure and local services are under developed such as roads ,health care ,water
access ,power generation etc. the lack those infrastructure undermine the development of mining
sector.
2. Lack of skilled professionals
The lack of skilled professionals in Ethiopia such as geologists, Geophysicists, Geochemists ,Mineralogists
, Geotechnologists ,Mining engineers, Surveyors and Service providers are the key problems for
investors to participate in the mining activity.
3. Transformational capabilities in Ethiopia era limited
Currently active mining projects often exclude the possibility of producing many other valuable
elements that are found in the deposit, thus waste the scarce non-renewable natural resources of the
Nation. To develop the mining activity the mining industry need to have coproduction other mining
materials.
4. Inflation
Ethiopian experience high inflation rate and foreign currency crisis has its own effect on mining sectors
as other sectors.
5. Workers human and Labour right violation
Violation of human and labor right of workers by mining companies in developing countries are common
practice,while expatriates enjoy higher salary privileges and comfortable work condition.
6. Terrorism and violence
With radical groups in the region to resist and attempt to undermine the government .Terrorist has been
real threat in Ethiopia .These groups has real risk and violence to personal ,damage equipment and
conflict affect the mining projects found like around Ogaden ,some parts of Oromia region
7. Environmental impact
Due to the lack of strategic environmental assessment the waste material from those companies pollute
and affect the environment .these activity has severe impact on the people who live near those
companies.but now a day government try to control this issue.
8. License
In Ethiopia artisanal extract a lot capital without any license. Specially, Gold miners.
One important aspect of exploration and mining title is that they should be exclusive .The exclusivity is
important because no investor risk capital to investigate or develop deposit unless nobody else can
legally explore or exploit ore deposit covered by the right.