Addis Ababa, Ethiopia. Credit: Ninaras, CC BY-SA 4.0, via Wikimedia Commons
Small and Medium Businesses have always played a crucial role in empowering the economic growth in Africa. Whether it is in driving innovation or spurring entrepreneurship, small and medium businesses have become the backbone of African Economies, providing a diverse range of opportunities that cut across various sectors like Agriculture, Information Technology, Manufacturing, hospitality industries among many others.
For many African nations, SME’s play a crucial role in contributing to the country’s GDP growth, providing employment opportunities, alleviating poverty, and deepening the economic trajectory of the country.
In countries like Ethiopia, with ongoing government reforms, growing urban centers, and a burgeoning youth population, small and medium-sized businesses are poised to play a crucial role in shaping the country’s economic forecast for 2026.
Institutions like the International Monetary Fund (IMF), and FocusEconomics are already projecting a real GDP growth of 7.1%, On the other hand, the nation’s Finance Minister Ahmed Shide is projecting a more optimistic growth of 8.9% for the East African nation, putting it in pole position to be one of the growing global economies in 2026.Additionally, Yonas Alemu, Founder and CEO of Lovegrass, Ethiopia, shares a strong opinion on Ethiopia’s progressive policy strides. In an interview on VoxDevTalks with Tim Phillips it was pointed out that Alemu believes that Ethiopia still offers compelling opportunities for long-term investors due to the monetary and fiscal policy, as well as foreign exchange liberalisation and inflation control.
Image source: Lovegrass Ethiopia
So what are the small business opportunities in Ethiopia in 2026? Here are 10 SME sectors to explore in Ethiopia for 2026.
1. Tourism and Ecotourism Industry
Tourism has always remained a growing industry for the East African nation. With a rich history that boasts of several UNESCO World Heritage sites, 13th-century Lalibela Rock-Hewn Churches, ruins of the Axumite Empire as well as the various National Parks and other famous historical and cultural sites, the tourism industry presents a great opportunity for SME investment.
In a report by African Leadership Magazine titled – Why Tourists are Flocking to Ethiopia Again, it was noted that Ethiopia recorded its highest turnout of foreign tourists in July 2025. Surpassing 1.3 million visitors in the year, it was noted that the country is one of the fastest growing tourist destinations with a 40% increase in international tourist arrivals within a 6 month period earning the country a whopping 96 million Birr ($763 million) in revenue.
At the rate of growth, providing small and medium business services like Travel Support Agency, transportation services, Eco-friendly accommodation, Airbnb Management Services, Camping Equipment and Rental Service, Local Handcraft and Souvenirs Stores, among others can be a great investment idea for 2026.
2. Agro Processing and Food Processing
Ethiopia enjoys an enviable spot as one of the top 10 producers of coffee around the world and the first in Africa. With brands like Yirgacheffe coffee, Sidamo, Harrar amongst others, the coffee processing industry is one to explore. Beyond Coffee, Ethiopia also boasts several grain and livestock agricultural products that are in high demand at home and abroad.
With Agriculture being one of the major drivers of the Ethiopian economy, contributing nearly 40% of the GDP according to the International Trade Administration, many of its exports still remain in the unprocessed stage which provides a great opportunity for SME’s looking to venture into the agro-processing and Food Processing industry.
By converting these products to finished goods ready to meet and improve supply for FCMG’s (Fast Moving Consumer Goods) in the food and beverage industry, not only can the needs of the local market be met but also open up opportunities for exportation.
3. Financial Services
The finance world is gradually expanding to accommodate several financial services that conventional banks are unable to meet. With Fintech platforms providing value-added services to the numerous unbanked and underbanked population, the need to provide financial advisory access to consumers as well as insurance covers is one aspect to explore.
Services like Accounting and Auditing, Tax Consultation, Underwriting and Brokerage that cover insurance services, investment banking, and funds management are areas SME’s with the right expertise can venture into.
4. Manufacturing
Ethiopia has a growing textile industry as well as a bulging leather market due to its growth in livestock and agricultural farming making it one of the top three producers of leather in Africa. This affords opportunity for SME’s to play in the local production of apparel as well as leather goods that include shoes, bags, belts, and other leather accessories. Beyond this, manufacturing materials for other small and medium businesses looking to package finished products for local and international supply is another area SME’s can explore.
5. Hospitality
The Hospitality industry is a booming market in Ethiopia with a growing number of Hotel Chains both local and International as well as motels, Airbnb, resorts, rentals for vacation, including guesthouses.
With the country being a prime destination for tourism where it boasts nine UNESCO sites as well as hosting international meetings, conferences, and events, the hospitality industry is an attractive sector from any investor’s point of view.
6. E-Commerce
Though gradually evolving from its developmental stages due to improved internet connectivity and acceptance of electronic and digital payments, the E-commerce industry is one sector to look out for.
With the launch of the Digital Ethiopia Strategy for 2025 by the Ethiopian Government, the effort to play more in the digital space became necessary as the country looks to lay down digital infrastructure as well as empower businesses and citizens with the necessary tools for the digital age. With the growing need to connect with consumers all across the country, and operate online by leveraging various applications, the e-commerce industry is gradually taking shape with more room for investors.
Source: Adobe Stock
7. Technology Services
Riding on the back of e-commerce platforms is the growing need to provide digital and tech services such as cybersecurity, digital marketing, and AI, as well as digital communications like SEO/SEM marketing, social media marketing, among many others. As more small- and large-scale industries spring up and with the current digital push by the country’s government, the tech services industry is a great place to channel investment into.
8. Logistics, Delivery & Courier Services
With a growing market for e-commerce, another industry to leverage on and explore is logistics, delivery, and courier services. Investment in trucking and logistics is necessary as small and large businesses look to ensure delivery of goods and services to the final consumer at the right time. As a competitive sector, the application of solutions that include route optimization, effortless delivery time predictions, transparency, safe delivery, and technological innovations can give any interested SME an edge in owning the market space and meeting the growing industrial demands.
9. Real Estate and Property Market
A growing middle class and high urbanization especially in the capital city of Addis Ababa as well as a growing diaspora interest is shaping the real estate and property market in Ethiopia.
As noted in a research report titled – Opportunities in Ethiopia’s Emerging Real Estate Market by The African Dreams, “The Ethiopian real estate market is highly competitive at the moment, offering great prospects for developing and investing in projects.
The more people move into the cities and the economy improves, the greater will be the demand for residential, office, and industrial facility spaces. Urbanization and the middle class have put a different character on Ethiopian cities, especially Addis Ababa.”
With migration from rural to urban locations on the increase, many are looking to explore affordable accommodation opportunities that are both convenient and cost-effective. Local and foreign investors capable of providing affordable housing especially for this growing middle class can take advantage of this opportunity that exists in Ethiopia’s real estate sector.
10. Import and Export Agency
Ethiopia is a thriving market for Import and Export Agencies. As a major player in the exportation of products like coffee, spices, Teff, Oil and Nuts, Textile and Apparels, among others, working with an agency with a deep understanding of the import and export market, along with an understanding of the procedural requirements and licences from regulatory agencies as well as the opportunities provided by international business agreements like the African Continental Free Trade Area (AfCFTA), can prove helpful to businesses looking to explore the import and export market.
By exploring these opportunities in this sector, SME’s can bridge both the knowledge and services gap by providing critical services in these areas.
Okechukwu Nzeribe works with the Onitsha Chamber of Commerce, in Anambra State, Nigeria, and loves unveiling the richness of African cultures. okechukwu.onicima@gmail.com
