In a major boost to its industrialisation agenda, Ethiopia’s largest sovereign wealth fund, Ethiopian Investment Holdings (EIH), has signed an initial deal with Rusal to develop a high-capacity aluminium smelter. With a planned output of 500 thousand tonnes a year and an estimated USD 1 billion in initial investment, this agreement, led by Ethiopian Investment Holdings (EIH), marks one of the country’s most significant new industrial ventures.
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A strategic investment with long-term ambition
EIH said the project, covered under a memorandum of understanding (MoU), will take three to four years to complete. The plant is designed with a projected operating lifespan of around 50 years, underscoring Ethiopia’s long-term intent to build a stable metals sector.
EIH stated on its X account: “Preliminary activities — including site identification and a comprehensive feasibility study — are already underway to ensure timely progress.” These early steps show that the government wants a fast and smooth rollout.
Rusal declined to comment, yet its involvement marks a notable Russian commitment to Africa’s aluminium industry.
Why Ethiopia wants aluminium now
Aluminium demand is rising globally. Ethiopia sees an opportunity to anchor local manufacturing, reduce import reliance, and build a future export base.
A smelter of 500,000 tonnes would place Ethiopia as a major African aluminium producer. It also strengthens the government’s industrial policy, which aims to secure international partners in metals, fertilisers, and energy.
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A growing pipeline of big-ticket investments
The Rusal agreement follows other large commitments. In August, Ethiopia and Nigeria’s Dangote Group signed a USD 2.5 billion agreement to develop a fertiliser plant. Next month, in September, Russia and Ethiopia agreed on an action plan for a nuclear power project.
If completed on schedule, the smelter could reshape regional aluminium supply. It may draw new logistics corridors, renewable-power investment and downstream industries such as extrusion, rolling, or cables.
This aligns with global decarbonisation trends, where energy-efficient smelting capacity in emerging regions is gaining interest. Ethiopia now aims to position itself as a competitive and long-term player in Africa’s aluminium value chain.
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