According to article 26(2) of the Refugee Proclamation, every recognized refugee and asylum seeker shall have the right to engage in agriculture, industry, small and micro enterprise, handicrafts, and commerce, in the same circumstances as the most favorable treatment accorded to foreign nationals pursuant to relevant laws. Furthermore, the Directive to Determine the Procedure for Refugees Right to Work provides, under article 19(1), that any recognized refugee or asylum seeker may be self-employed, individually or in group, in areas open for foreign nationals upon obtaining the appropriate license from the relevant licensing bodies in accordance with applicable national laws.

However, regarding rural and urban projects jointly designed by the Ethiopian government and the international community to benefit refugees and Ethiopian nationals including in environmental protection, industry and small and micro enterprises, article 26 (4) of the Refugee Proclamation provides that recognized refugees and asylum-seekers engaged in such projects shall be given equal treatment with Ethiopian nationals engaged in the same projects.

As noted above, the standard of treatment applied by the Refugees Proclamation with regard to refugees’ right to self-employment is the most favorable treatment accorded to foreign nationals. The Ethiopian government has granted some categories of foreigners certain preferential rights in regard to investment. These include Foreign Nationals of Ethiopian Origin (FNEO) and foreign nationals who are entitled to preferential treatment by virtue of bilateral and multilateral treaties concluded with other countries. 

According to the Proclamation Providing Foreign Nationals of Ethiopian Origin with Certain Rights to be exercised in their Country-of-Origin Proclamation, Proclamation. 270/2002 (FNEO Proclamation), foreign nationals of Ethiopian origin have the right to be considered as domestic investors to invest in Ethiopia as per the investment law. Also, Djiboutian nationals are also considered to be domestic investors by virtue of the Preferential Investment Facilitation and Property Acquisition Agreement between Ethiopia and Djibouti. As per article 3(3) of the Directive of Ministry of Trade and Industry to Implement the Preferential Investment Facilitation and Property Acquisition Agreement between Ethiopia and Djibouti, Directive No. 1/2008 (Ethio-Djibouti Investment Directive), Djiboutian nationals will also enjoy the same benefits and the restrictions imposed on ordinary foreigners do not apply to them. However, the scope of rights enjoyed by Djiboutian nationals is lesser when compared with FNEO that makes FNEO the most favored foreigners in Ethiopia. Hence, this may imply that refugees are entitled to the same treatment accorded to FNEO by virtue of the standard of the most favored national treatment. 

According to the FNEO Proclamation, article 3, foreign nationals of Ethiopian origin have the right to be considered as domestic investors to invest in Ethiopia under investment law. If refugees were accorded this more favorable foreigner treatment, it would have significant positive implications on refugee’s self-employment rights, as it will allow them to engage in the activities that are reserved to domestic investors or Ethiopian nationals.