It would have been a nice picture for Germany's Foreign Minister Heiko Maas to meet Ethiopian Prime Minister Abiy Ahmed during his visit to the Horn of Africa country in May.

It would have been a chance for the German government to publicly show its support for the country's new bearer of hope. However, no meeting occurred because Abiy was himself traveling abroad.

The Ethiopian leader, only in office for a month, had already announced a relaxation of relations with neighboring Eritrea. Action soon followed his words — at a pace that even surprised experts.

The state of emergency was lifted, political prisoners released, and a peace accord sealed with arch-enemy Eritrea.

"The new prime minister in Addis Ababa is a thoroughly positive surprise for everyone. We are happy that things are changing for the best in Ethiopia," Günter Nooke, German Chancellor Angela Merkel's commissioner for Africa, told DW.

Read more: Ethiopia: Who is new Prime Minister Abiy Ahmed Ali?

But the German federal government otherwise holds back from making public statements on the matter. A few days ago, the Federal Foreign Office issued a brief statement, simply saying that the Ethiopia-Eritrea peace treaty gave hope that a conflict which had "claimed tens of thousands of lives and forced hundreds of thousands to flee can now be permanently resolved."

"The process is certainly being welcomed, but one is still waiting," says Annette Weber, an expert on Ethiopia at the German Institute for International and Security Affairs.

In the first month after Abiy took office, it was unclear whether he would succeed within the government. He has many powerful adversaries, even within the ruling Ethiopian People's Revolutionary Democratic Front (EPRDF).

This became especially apparent at the end of June, when two people were killed in a grenade attack at a rally for the reformist prime minister.

There are a host of problems in addition to this which Abiy still needs to tackle. For example, the ethnic conflict in the south of the country, where United Nations figures show that in June alone 800,000 people were forced to flee. 

Anchor of stability in crisis region

But the German government's restraint should not be misunderstood as disinterest. The Horn of Africa is one of the most important geopolitical regions in Africa, says Nooke. Ethiopia is a key country for the German development cooperation agency, GIZ, and is home to one of its biggest offices worldwide. 

In the crisis-stricken region, Ethiopia is a stable power which borders South Sudan and Somalia — both of which have been caught up in civil wars. But increasing protests against the EPRDF dictatorship has made it increasingly difficult for Ethiopia to assume this role.

"One hopes that the country stabilizes once the political situation and the human rights record improves so that Ethiopia no longer concentrates only on internal security, as it has in the past, but on playing a role in the region," Weber told DW.

Refugees in focus

Ethiopia, as well as neighboring Eritrea, are very important when it comes to migration politics. Ethiopia is a transit country for African refugees bound for Europe. Last year Eritrea followed only Syria, Iraq and Afghanistan as a top country of origin of people seeking asylum in Germany.

Alongside poverty and a lack of prospects, many Eritreans also cite the policy of indefinite military service as grounds for fleeing the country.

"This national service is justified by the fact that [Eritrea] is in a state of war with Ethiopia. If it is abolished, because the conflict no longer exists and there is no basis left for appeal, it will have an immense impact," says Nooke. Perhaps people could then return to Eritrea, he added. 

The German government is already working on plans to expand its cooperation with Ethiopia. Due to the authoritarian government and its poor human rights record, talks of cooperation have been controversial. But with Abiy in power, this ethical dilemma is no longer so serious. In fact, the German government wants to encourage the new prime minister. Ethiopia is already included in Germany's G20 initiative "Compact with Africa." The goal is to attract more private investment to selected African countries. Reform partners would benefit from additional German development aid. In exchange, these countries would be obliged to uphold democratic values, respect human rights and fight corruption.

Is Ethiopia a reform partner?

"Within the framework of Compact countries there are other so-called reform partnerships that Germany maintains with Tunisia, the Ivory Coast and Ghana. One can certainly imagine more," says Nook.

A new opportunity potentially lies ahead at the end of October: Chancellor Merkel has invited the heads of state and government of the Compact countries for talks in Berlin, according to her commissioner for Africa.    

German businesses are also watching new developments in Ethiopia with interest. The government is building huge industrial parks and the road network is also set to be expanded. Peace with Eritrea means Ethiopia can once again use the port of Assab, which is part of a major trade route between Europe and Asia. As a result, exports could become a great deal cheaper.   

"I can imagine that German companies would also think about building up manufacturing capacity in Ethiopia once political reform — flanked by economic policy reform — have gained stability," said Christof Kannengiesser, the head of the German-African Business Association.

Entrepreneurs who are interested will have a chance to take a closer look in November, when a delegation from the association plans to visit Ethiopia. 

Gwendolin Hilse contributed to this report.