Golden Africa has high ambitions to become the premier palm oil refining and packaging center in East Africa. It invested more than US$30 million in a refinery in Djibouti, which opened in December 2018. Within a year, the company, headed by the Yemeni Fouad Hayel Saeed, has captured a fifth of the palm oil market in Ethiopia.
Saeed is also Djibouti’s honorary consul in Malaysia, which along with Indonesia produces 85 percent of the world’s total supply of palm oil. His connections to the Yemeni community in Djibouti helped give Golden Africa a foothold on the continent, with Djibouti intending to become a processing hub for the Horn of Africa. The company’s current monthly target is 21,000 tons of vegetable oil, which doesn’t meet Ethiopia’s monthly demand of 50,000 tons but does grant the company a significant share of this market.
Imports of palm oil into Ethiopia from Malaysia nearly doubled from 76,000 tons in 2014 to 149,000 tons in 2017. The downside is that Ethiopia pays about US$500 million for these imports, a problem compounded by foreign exchange shortages. By having Golden Africa in Djibouti, Ethiopia benefits by reducing its foreign-exchange deficits and cutting import costs, which the Ethiopian government estimates could save it US$80 million per year.