.

As BRICS economies grow up, 10 upstarts emerge: Report

.

Paris: Indonesia, Bangladesh and Ethiopia are among 10 countries set to take over as emerging economies from the powerful BRICS nations as they struggle with growing pains, a French credit body said on Tuesday.

“After 10 years of frenetic growth” the big five emerging economies of Brazil, Russia, India, China and South Africa — the BRICS — “are slowing down sharply,” the French trade credit and insurance group Coface said.

In a report entitled “Coface identifies 10 emerging countries hot on the heels of the BRICS,” the organisation said that average economic growth by the BRICS this year would be 3.2 percentage points less than the average in the last 10 years.

But “at the same time, other emerging countries are accelerating their development,” it said.

The growth of emerging economies and the effect this has on world trade flows is closely analysed by economists because of the huge impact on every aspect of the global economy and power balances.

Coface broke the 10 new emerging economies it has identified into two groups.

The first comprises Peru, the Philippines, Indonesia, Colombia and Sri Lanka, which it named the PPICS.

They had “strong potential confirmed by a sound business environment,” Coface said.

The second group comprises Kenya, Tanzania, Zambia, Bangladesh and Ethiopia.

But these countries are marked by “very difficult or extremely difficult business environments which could hamper their growth prospects,” Coface said.

However, the head of country risk at Coface, Julien Marcilly, said that in 2001 “the quality of governance in Brazil, China, India and Russia was comparable to that of Kenya, Tanzania, Zambia, Bangladesh and Ethiopia today.”

But the 10 “new emerging countries” currently accounted for only 11.0 percent of the world population whereas the BRICS had accounted for 43 percent of the population in 2001.

The total gross domestic product of the new 10 was only 70 percent of the output of the BRICS in 2001, and they had a current account deficit of about 6.0 percent of GDP whereas the BRICS had run a surplus on average.On a positive note, the new 10 had inflation which was about 2.8 percentage points lower than BRIC inflation in 2001, and their public debt was about 40 percent of output compared with 54 percent for the BRICS at that time.

Coface said that growth in the BRICS was slowing down, despite favourable trends for consumption, because of an adjustment in supply and “a marked slow-down in investment.”

Local businesses could no longer satisfy strong demand, it said.

Marcilly said that the BRICS were moving into a new phase since their exports were becoming less competitive, and because they were not yet competitive in offering products with very high added value.

This was why Coface had set out to identify the next wave of driving emerging markets, looking for potential annual growth exceeding 4.0 percent, a diversified economy without undue dependence on the sale of raw materials, and some capacity to absorb economic shocks.

These conditions had to be matched by a financial system capable of supporting investment, but without raising risks of overheating.

The chief economist at Coface, Yves Zlotowski, said that the organisation had tried to combine measures of growth potential and risk potential.

This method had excluded Vietnam from the list of new emergers because although it had strong economic potential, its financial system was out of control, he said.

Coface said that its list of so-called neo-emerging markets could not be compared with the BRICS in terms of size and population.

The use of the word PPICS as an acronym comes in a line of attempts by economists to group various types of new emerging economies.

Among these are MINT for Mexico, Indonesia, Nigeria and Turkey, or CIVETS for Colombia, Indonesia, Vietnam, Egypt, Turkey and South Africa. 

http://zeenews.india.com/business/news/international/as-brics-economies-grow-up-10-upstarts-emerge-report_96815.html

.

Ethiopia’s Renaissance Dam To Start Generating 700MW By 2015

.

.

VENTURES AFRICA – Ethiopia’s National Council has announced that the Grand Ethiopian Renaissance Dam (GERD), currently being constructed over the Blue Nile, would start generating 700 megawatts of electricity from 2015.

“By next year, two of the turbines among the 16 will start to generate 375 MW electric power each,” Zading Abreha, the National Council’s Deputy Director General, said.

Construction of the project, which started in 2011 and estimated to cost $4.7 billion, was awarded to Salini Costruttori SPA, an Italian company that has constructed over 20 dams spread across Africa, Asia and Europe.

Although Ethiopia’s Metal and Engineering Corporation (METEC) was awarded hydro and electro mechanical work, installation of all electro-mechanical equipment and supply of generators and turbines was given to Alstom, a French engineering company..

Currently 30 percent complete, $1.3 billion has been invested in the dam which is also expected to ensure and regulate the steady flow of water downstream, preventing flood occurrence in countries like Sudan and Egypt.

Egypt has however raised concerns about the construction of the dam, saying it will restrict the flow of water into the country, thus affecting its citizens, farmlands and livestock. The country asked that construction be put on hold until further studies are conducted, despite an initial study by the International Panel of Experts (IPoE) on Ethiopia’s request.

Ethiopia refused on the basis that it is a ‘flagship project’, but was willing to consider Egypt’s proposals on the implementation of the recommendation made by the IPoE report. It said it will not stop the construction of what is considered to be one of the largest dams in the world.

On completion, the GERD is expected to produce 6, 000 megawatts, supplying the electricity needs of the country as well as serving as a green energy hub to other East African countries, delivering clean and renewable energy.

http://www.ventures-africa.com/2014/03/ethiopias-renaissance-dam-to-start-generating-700mw-by-2015/

.

ZTE Demonstrates New ICT Solutions to Ethiopian Market

.

On a three-day ICT workshop held at the Intercontinental Hotel Addis Ababa, from March 18 to 20, ZTE has properly introduced its new ICT solutions to the participants of the different ministries as well as related companies.

The theme of the workshop was mainly focused on three solutions addressed as : Power Grid, E – Learning and the Smart City solutions that encompassed the e – health and e – transport that are highly suitable to Ethiopian market.

During the three days workshop, Chinese Ambassador to Ethiopia Xie Xiao Yan, Economic and Commercial Counselor of Chinese Embassy to Ethiopia Qian Zhao Gang, Higher officers of Ministry of Communication and Information, Ministry of Education and the World Bank, Delegates from the Ministry of Health and Ministry of Transport, Addis Ababa City Administration, ICTDA of Addis Ababa, attended the workshop in such a way that, they have clearly acknowledged its importance as well as manifested /showed their deep interest to deploy to the Ethiopian market.

On this historical workshop ZTE also aspired and proofed its unwavering stand to work in the Ethiopian Market, realize its commitment so as to strengthen its collaboration for the better of Ethiopia in the future.

Jia Chen, CEO of ZTE said on the workshop, “Addis Ababa, being the center of Africa Union, nowadays getting a very fast development in Economic and Social Protection. On the other side, this development is facing various problems in such a way that , city crime, food safety, traffic jam, accidents, education and medical resource distort. We provide our latest solutions here to the country to bring a change in citizens daily life, in particular as well as to foster and promote harmonious and sustainable development of the country’s growth at large.”

http://allafrica.com/stories/201403250485.html

.

Flower firm now sets it sights on Ethiopia

.

By Moses Michira

Kenya: Kenya’s flower industry is a lucrative one, worth over Sh80 billion in revenues a year, but the recent collapse of Karuturi with billions in unpaid obligations could be the clearest indicator yet that the ground is shifting.

There is consensus among flower producers that Ethiopia has an edge over Kenya in tax incentives and better access to new markets to the US owing to the direct flights it operates through its national airline.

And now the European Union has made a new demand that could further hurt flower exports, especially after Parliament declined to enter an economic partnership with the bloc. Starting October 1, flower exports to the EU will attract an import duty of 8.5 per cent, which will push up prices of Kenyan flowers and reduce their competitiveness in the market. The same taxes will not affect the other Eastern African countries, including Ethiopia, Rwanda and Tanzania, which are classified as least developed while Kenya is not.

Kenya sells more than 70 per cent of its flowers to the EU, mostly through auctions in the Netherlands and direct sales to resellers such as supermarkets.

It is these emerging challenges that could have informed Karuturi’s collapse, say insiders.

“The focus has been Ethiopia — that is where the money has been going,” a manager told Business Beat.

Kenya currently supplies around 38 per cent of the fresh flower imports into the EU, but there are fears that market share could be chopped. Columbia and Ethiopia are the other key source markets.

The concerns could be valid given that Sher Agencies, which was once the world’s largest roses producer, moved to Ethiopia after selling its Kenyan business to Karuturi seven years ago. Several other companies with operations in Kenya are said to be looking north, taking the cue from Sher.

Naivasha MP John Kihagi says Kenya “has a situation to handle” in its flower sector, which is estimated to employ 500,000. President Uhuru Kenyatta is expected to make a case for Kenya in the latest round of negotiations starting today, regarding the economic partnership.

Under the Economic Partnership Agreement, Kenya and its neighbours would be expected to cut taxes levied on imports from the EU, which is the point of contention.

Karuturi has acquired long leases on about 350,000 hectares in Ethiopia where it is in different stages of producing grains and flowers. Despite the multi-billion dollar investment, Karuturi’s Kenyan subsidiary has been struggling to the point of failing to pay salaries while supplies to its farms, such as fertilisers and pesticides, have run dry.

Its workers have staged violent protests owing to delayed wages and deteriorating living conditions, compounding problems for a company that has been accused of tax evasion by the government.

Karuturi’s senior staff say the local subsidiary has been under-billing its sister companies registered in tax havens for flowers produced in Kenya.

Tax experts argue that the losses reported could be artificial to enable the firm utilise a trading mechanism called transfer pricing. In Karuturi’s case, a subsidiary domiciled in Dubai handles the export and selling of flowers to report huge profits for the mother company that is listed on the Mumbai Stock Exchange.

The Kenyan business produces between 350 million and 400 million flowers annually, and is the flagship operation for Karuturi Global, which made Sh1.5 billion in profits in 2013 while the local subsidiary reported a Sh208 million loss.

Receiver managers appointed by CFC Bank, whose loan Karuturi defaulted on, think the business should be very profitable. Its latest exports are fetching prices upwards of 0.25 euros (Sh29.8), which is higher than the 0.04 euros (Sh4.8) Karuturi was selling its stems at.

http://www.standardmedia.co.ke/business/article/2000107766/flower-firm-now-sets-it-sights-on-ethiopia

.

Germany keen to further strengthen relations with Ethiopia

.

Addis Ababa, 25 March 2014 -  Germany’s Foreign Minister, Doctor Frank-Walter Steinmeier, said his country is keen to further bolster its relation with Ethiopia.

Doctor Frank-Walter Steinmeie arrived in Addis Ababa yesterday for a day long official visit.

In a joint statement he gave with his Ethiopian counterpart after the visit on the same day, the Minister said that Germany is keen to further strengthen its relation in all sectors.

Dr Steinmeier described the relationship between the two countries as traditional and important, noting that more should be done to extend this as there was common ground for closer cooperation.

He further appreciated Ethiopia’s contribution to the peace and stability of Africa and the Horn region in particular.

Dr. Tedros on his part thanked Germany for its commitment to help the Hon of Africa and expressed his hope that this close cooperation would continue.
At the same time he urged Germany to continue assisting the Somali Federal government in training its own security forces.

Dr. Tedros said the South Sudanese leaders needed to look at the bigger picture to solve the crisis in their country, and he explained that external forces, including Eritrea, were playing a role in aggravating the situation there.

Dr. Tedros explained to Dr Steinmeier that the Nile Basin countries had taken ten years to negotiate their Comprehensive Framework Agreement and this had now been signed by six of the nine riparian countries.

In addition, Sudan now supported the Great Ethiopian Renaissance Dam project after the report of the International Panel of Experts had made it clear that the Dam would not cause any appreciable harm to either Sudan or Egypt.

Ethiopia had repeatedly assured Egypt that this was the case and stressed that only solution to the issue of Nile water was a win-win approach. It continued to try to discuss the issue with Egypt, and Dr. Tedros said Egypt should develop the necessary confidence to proceed with such dialogue. Referring to the role of the European Union role in Africa, Dr. Tedros noted that Africa has now developed its own way security structure and was working to establish an Africa Stand-by Force.

Dr Steinmeier’s visit to Addis Ababa is the start of a three-nation African tour which also includes Tanzania and Angola.

http://www.waltainfo.com/index.php/explore/12763-germany-keen-to-further-strengthen-relations-with-ethiopia-

.

Japan brings kaizen philosophy to Ethiopia

.

By Paul Melly BBC News, Ethiopia

“Sorting, setting in order, shining, standardising, sustaining,” proclaims a handwritten poster stuck to the wall of a shed where women gather twice a week to make craft items in the village of Faniekir.

Kaizen, the workplace philosophy that helped guide Japan’s recovery from the ruins of defeat in World War Two, has reached the rural uplands of southern Ethiopia.

Simple principles of tidiness and self-discipline are among the foundations of an approach that so impressed the late prime minister Meles Zenawi that he adopted it as national strategy.

Now it is helping women in southern highland villages develop businesses to supplement their farming work.

“We’ve got social recognition. Since we organised this, farmers come and sell to us and local government administrators respect us,” says Amelewerk Haile, who chairs the Faniekir women’s craft group.

“As women we cover many domestic expenses, plus we get more recognition from our husbands because we have got more skills.”

Mr Zenawi learned of kaizen at a 2008 Tokyo conference on African development – and its themes now feature in numerous Ethiopian projects supported by Japanese aid.

Experts from a government institute spread the message. Listening to their upbeat enthusiasm it would be easy to dismiss this as a passing management gimmick.

But behind the campaign lies a seriousness of purpose that reflects the massive challenges facing the country.

Population challenges

With a population of 92 million, which is growing by 2.6% a year, Ethiopia is Africa’s second most-populous country.

The government has set a goal of reaching middle-income status by 2025.

But it will be impossible to achieve this on the back of traditional farming.

Already rural population growth imposes huge environmental strains, evident in widespread soil erosion and deforestation.

So Ethiopia is pursuing a “growth and transformation plan”, to expand manufacturing employment and help rural communities diversify their livelihoods.

Motivation and competitiveness will be key. That’s where kaizen comes in.

For Ethiopia’s challenge is comparable to the task that faced Japan in the 1950s as it began to build a modern industrial economy in a largely rural society.

Evolving mainly in the countryside but soon taken up by industrial groups such as the car-maker Toyota, kaizen – which means “livelihood improvement” – came to encompass a range of development ideas.

But at its heart are simple principles:

• Keep the workplace tidy
• Encourage workers to suggest innovations, rather than wait for instructions
• Work with local resources

Japan later promoted the philosophy in emerging economies such as Egypt and Tunisia. Their experience impressed Meles Zenawi.

“What we hope to achieve through the introduction of the kaizen system is improvement in the productivity of all our enterprises, public and private,” Mr Zenawi once said, explaining why he had sought Japan’s help.

“It’s based on the creativity of all employees; it involves all employees in the improvement of quality and productivity of a company.”

‘We are very much interested’

Teams from the Ethiopian Kaizen Institute visit factories and offices to help them adopt the philosophy.

The early months of a company programme concentrate on organising the workplace and building a team ethic, explains institute general director Getahun Tadesse.

Motivation, productivity and creating a mood of change come next, while the long term theme is on innovation and management.

On a recent visit to Addis Ababa, Japanese Prime Minister Shinzo Abe said the institute should become a centre of excellence for human resource development across Africa.

Tadesse says kaizen is being applied in 160 companies so far, and last year his staff trained around 11,000 people.

The designer Sara Abera, founder of hand-woven textiles maker Muya Ethiopia – whose products are now sold in London and New York department stores – is keen to take up the philosophy.

“We have not yet started kaizen, but we are trying to get someone to come and train us,” she says.

“We are very much interested. We have heard a lot about it. Meles used to talk about it.”

‘Workers have to be involved’

Some themes are uncontroversial, such as reorganising a factory shop floor to save space.

But persuading bosses to listen to their staff – and giving workers the self-confidence to make their own suggestions – is a bigger task.

“Workers have to be involved,” says Bonsa Regassa, one of the advisory team.

“We are seeing a cultural change in Ethiopian workers.”

And the application of kaizen is not confined to factories in the capital, Addis Ababa.

Across Ethiopia the Japan International Co-operation Agency (Jica) spends around $100m a year, and sometimes more. Much is focused on supporting rural activity such as village craft-making.

That’s how kaizen thinking even finds its way to communities such as Faniekir, 125 miles (200km) south-west of Addis.

“We are trying to apply kaizen principles not only in our workshop but in our homes,” says craft group leader Amelewerk Haile.

http://www.bbc.com/news/business-26542963

.

Transport: Riding the rails in Ethiopia and Kenya

.

Ethiopia and Kenya are in a race to complete ambitious railway projects, but while Addis Ababa is in a frenzy of construction its East African neighbour may have hit the buffers.

At Meskel Square, in the heart of Addis Ababa, traffic is even more chaotic than usual as cars, buses and pedestrians weave around the 5.5m-high pillars now straddling an eight-lane highway.

Confusion reigns too at Mexico Square to the west and Megenagna round-about to the east – evidence that work on the city’s light rail transit (LRT) system is progressing at a phenomenal pace.

Bringing in the resources from the rural areas for processing is a problem. Part of that is transportation costs being high

East Africa is home to a series of promising rail projects, from Kenya’s standard gauge line to the railroad linking the Ethiopian capital to the port of Djibouti.

Ethiopia’s projects are far more advanced – they benefit from the wholesale support of the government – while Kenya’s are lagging behind.

The railway to link South Sudan to the port at Lamu lacks investment, and the development of the new standard gauge line is bogged down in debates about how the contract was awarded.

In Ethiopia, two twin-track lines will bisect Addis Ababa north to south and east to west, diving underground along certain sections and, as in Meskel Square, rising up high on elevated tracks.

Trains will run for up to 18 hours per day at intervals of three to six minutes at peak times and will be able to carry a maximum of 60,000 passengers per hour.

With journey times from the periphery slashed by up to two-thirds, the LRT has the potential to revolutionise transportation in this fast-growing city.

“Ground was broken on 31 January 2012 and the first trains are expected to start running on 1 January 2015,” says project manager Behailu Sintayehu, adding that 52% of the construction has been completed so far.

More than 3,000 Ethiopian labourers and engineers, overseen by the main contractor China Railway Engineering Corporation (CREC), are working in shifts around the clock to meet the ambitious deadline.

 

Networking the country

This first phase of the LRT scheme is expected to cost $475m, with 85% of the financing in the form of a loan from China Export-Import Bank.

The Ethiopian government is funding the remainder. A second phase, which will double the length of the track and reach further into the city’s suburbs, is also planned.

Aside from the Addis Ababa mass transit system, the Ethiopian Railways Corporation (ERC) – the body charged with realising the government’s bold rail strategy – has also begun construction of a 5,000km network that will criss-cross the country, stretching into almost every area of Ethiopia.

“The main purpose of the national network is to connect Ethiopia economically and increase access for imports and exports,” explains Abebe Miheretu, head of information and public relations at the ERC.

The routes will link the country’s main productive centres, allowing for the swifter transport of commodities such as sugar, charcoal, potash and coffee, he continues. They will also extend to the borders with Djibouti, Sudan, South Sudan and Kenya.

Henok Assefa, managing partner of Precise Consult International in Addis Ababa, is convinced of the economic benefits of the rail network.

“Part of the poverty that we have in Ethiopia is a direct consequence of the unintegrated nature of the country,” he says. “Bringing in the resources from the rural areas for processing is a problem. Part of that is transportation costs being high.”

The majority of goods entering and leaving this landlocked country travel by road to and from Djibouti. It is an expensive and time-consuming journey that, according to some manufacturers, can cost up to $4,000 per container.

“For a country that is looking to grow richer by light manufacturing, where margins are very low, you need to be doing volumes and railways become a very handy instrument,” says Henok.

Ethiopia thinks ahead

As a result, the ERC’s priority is the line from Addis Ababa to the port of Djibouti. The government awarded this contract to CREC and China Civil Engineering Construction Company, and so far around 25% of the project has been completed.

The government is using the first phase of construction of both the LRT and the national rail network to build capacity for domestic industries.

Contractors conduct training for local staff and the Institute of Technology has opened at Addis Ababa University specialising in engineering. The government is sending promising undergraduates to Russia, India and China to continue their education.

The government hopes that the second phases of the LRT and rail network projects will be carried out entirely by Ethiopian enterprises, says Abebe.

Amid two parliamentary investigations and a court case against the contract for the standard gauge line that will link Nairobi and Mombasa, Kenya’s rail projects have been slow to develop. 

In November 2013, President Uhuru Kenyatta laid the first stone for the new line, which will compete with the colonial-era narrow gauge line managed by Rift Valley Railways.

The company is doubling its number of locomotives this year, but the long-term viability of its concession is now in doubt.

China Export-Import Bank has agreed in principle to provide 85% of the finance for the standard gauge line, which estimates put at a cost of $5.3bn.

However, transport principal secretary Nduva Muli told the Public Investments Committee in early February that the cost of the project had not been agreed and the finance deal had not been signed.

The first phase will cover 500km, while the second phase would link the line to the Ugandan capital of Kampala. Work is expected to begin in July of this year and last four years.

The government started the process of buying up land along the railway’s proposed path in February.

The Nairobi government says that the project will be beneficial because it will reduce freight costs from $0.20 per tn/km to $0.08 per tn/km.

In late January, Kenyatta said “the standard-gauge railway must and will go ahead for us to achieve our development agenda,” and said that critics are sore losers who lost out on the contract.

China controversy

The Chinese and Kenyan governments signed a state-to-state contract that includes a provision that China Road and Bridge Corporation (CRBC) will carry out the work.

Groups opposed to the deal say that there are no provisions in the constitution for single-sourced deals like this one and point to the fact that the World Bank banned the company from participating in its bids due to corruption involved with a contract in the Philippines.

Critics also argue that the deal allows CRBC to conduct the feasibility studies, so there is no independent oversight on costs, which they say are inflated and more expensive per kilometre than its Ethiopian counterpart.

The authorities say the deal is structured like this because the previous government under President Mwai Kibaki had shopped around for financiers and found Beijing to be the only party interested.

With China Merchants Holdings having signed a deal with the Tanzanian government in May 2013 to build a port, special economic zone and railroad network at Bagamoyo, competition in East Africa’s transportation and other sectors is heating up.

The Ugandan government has now agreed to build a pipeline through Kenya that could terminate at the new port under construction at Lamu, in northern Kenya.

Both the Kenyan and Ethiopian governments would like to serve as South Sudan’s access route to the coast, so being the first across the finishing line is crucial for wooing the Juba government.

The ports at Bagamoyo and Mombasa can both attract trade from Rwanda and the Democratic Republic of Congo, providing East Africa with some of the continent’s densest rail networks.

http://www.theafricareport.com/East-Horn-Africa/transport-riding-the-rails-in-ethiopia-and-kenya.html

.

Train build aiming to pass over costs Ethiopia 6 billion more

.

ESAT News

March 25, 2014

Ethiopia has allocated 34 billion birr to construct the Mekele – Woldiya/Hara Gebeya – Semera – Tadjourah Port Railway Project; the railway line will cost Ethiopia 6 billion more birr ($300,000) in order to pass over the Asseb region which is located on the borders of Ethiopia and Eritrea.

The Railway Corporation has been forced to do so not to touch the Asseb area which the railway line is supposed to pass through. This railway project is mainly aimed at exporting the Potash mineral found in the Dallol area, Northern Ethiopia. Yapi Merkezi, a Turkish company, has signed an engineering, procurement and construction contract, with the Ethiopian Railway Corporation to complete the construction of the new line within 42 months.

Although Ethiopia is still searching funds for the project, so far a Chinese and a Swiss Bank have promised to offer a loan.

http://ethsat.com/2014/03/25/train-build-aiming-to-pass-over-costs-ethiopia-6billion-more/

.

Ethiopian trade delegation due in Kenya today

.

Addis Ababa, 25 March 2014 –  A delegation of 35 Ethiopian entrepreneurs is expected in Kenya on a reciprocal visit to one made by Kenyan manufacturers last August.
The tour also comes against the backdrop of a four-day visit by President Uhuru Kenyatta to Addis Ababa.
Kenya Association of Manufactures (KAM) Chief Executive Officer Betty Maina says the businessmen will arrive on Tuesday for a three day visit that will include tours to key value addition facilities in the country, business-to-business meetings with local industrialists and talks with key government officials.
Maina says Ethiopia has made great strides to open up its market and is expected to sign the Free Trade Agreement and become a fully fledged member of the Common Market for Eastern and Southern Africa (COMESA) by the end of this year.
“Ethiopians have shown themselves very willing to work with us and we are happy to see Inter-Africa Trade flourish through these joint trade visits,” added Maina.
Jointly, Kenya and Ethiopia provide a market of 125 million people with a joint Gross Domestic Product of Sh5.8 trillion (US$ 67 billion) and this visit is expected to provide an opportunity to create new business ties within the two countries.
Key areas where Ethiopians can learn from Kenya include agro processing and dairy processing sectors as well as Kenya’s mobile sector.
Ethio Telkom, Ethiopia’s sole telecommunication service provider is still under State ownership and getting a mobile phone line takes ages. In comparison, a robust ICT sector has contributed to an innovation ranking of 49 in the latest global competitiveness report and mobile banking services have improved Kenya’s financial penetrability from 20 percent to 60 percent.
Ethiopia on the other hand exports cereals, vegetables, copper, ores, tyres and concentrates, textile yarns, spices to Kenya.
The country also boasts of the Ethiopian Commodity Exchange, a one of kind trading platform for agricultural commodities that Kenya could borrow a leaf from.
Long term Joint projects in energy and infrastructure development such as LAPSSET are currently underway and both countries have already signed an agreement that will see the building of 800 Km railway line from Lamu to Addis Ababa.
These projects will pave the way for joint private sector investments in the two countries.
Joint promotional activities are envisioned in the Special Status Agreement (SSA) signed in 2012 by former President Mwai Kibaki and Ethiopia Prime Minister Hailemariam Desalegn to promote trade between the two countries.
“The SSA stipulates the setting up of a Private Sector Council for which we do not need the SSA to sign and a step towards the setting up of such a council is if we organise trade visits which give businessmen from both countries the opportunity to test the waters and explore trade possibilities” Maina said.

http://www.waltainfo.com/index.php/explore/12766-ethiopian-trade-delegation-due-in-kenya-today

.

Turkey’s TIKA provides Ethiopia’s Harar with ambulances

.

“When receiving the ambulances, I recalled those who lost their lives before they reached health institutions due to the shortage of ambulances,” Harari Regional State Deputy Chief Regasa Kefale said at a formal delivery ceremony.

http://www.worldbulletin.net/news/131893/turkeys-tika-provides-ethiopias-harar-with-ambulances

.

Misrepresenting the CSO legislation and Tarnishing Ethiopia’s image

.

Hassan Adem 03/24/14

The Extractive Industries Transparency Initiative is a global initiative launched by the then PM of U.K. Mr. Tony Blair in 2002. It is an International multi-stakeholders initiative of governments, companies and civil society working to strengthen governance by improving transparency and accountability in the extractive sector.  EITI  involves  a  process  by  which  the  payments  made  by  companies  and  revenues  received by governments are published in independently verified reports. The process is overseen and governed by a multi-stakeholders working group represented from government, civil society organizations and extractive companies.

Implementing EITI will help countries to efficiently collect the revenue generated from the extractive industry, supports anti-corruption and good governance agendas of countries and establish citizen trust in public institutions and extractive companies. Citizens would be able to hold government accountable  in  the  use  of  revenues  collected  from  the  extractive  companies.  A transparent system will bring conducive investment climate and attract more direct foreign investment.

To the chagrin of the neo-liberal forces, EITI decided to admit Ethiopia on March 19. The decision infuriated Human Rights Watch, which have been lobbing against the admission, that it issued a statement claiming: “With this move, the EITI may have added a member, but it lost its credibility as a good governance initiative”.

Ethiopia’s application for membership was accepted because Ethiopia met the criterion for membership in the group. One of those criterions is that: A member shall commit to meaningful participation for civil society on issues related to natural resources. EITI’s Standard instructs that, “government must ensure there are no obstacles to civil society and company participation in the process,” including with regard to “relevant laws, regulations, and administrative rules as well as actual practice in implementation of the EITI.”

However, Human Rights Watch has a different view. It position is based on none but the CSO legislation. Human Rights Watch’s dep. director argued that Ethiopia’s law “prohibits nongovernmental organizations from working in human rights and good governance if they receive more than 10 percent of their funds from abroad. As a result, today there are few organizations working on these issues and those that do, self-censor and straddle a knife-edge, always concerned about a potential crackdown.”

However, this is a gross misrepresentation of the reality. To begin with the 2009 Proclamation of Charities and Societies of Ethiopia was not intended to stifle rather to encourage and broader civil society activities.

Charities and Societies, and national and international Non-Governmental Organizations (NGOs) have been operating in Ethiopia for a long time. The laws governing their registration and operations were first drawn up in the early 1950s and were based on the 1952 Ethiopian Civil Code and Regulation 321/1959.  However, those legal frameworks have become outdated that they reached to a point where they can no longer provide a workable environment, not least due to the many legislative and other changes that had taken place in Ethiopia and elsewhere. They were certainly incapable of ensuring the maximum benefits for the country from NGO activities.

Indeed, some Charities and Societies repeatedly requested the Government for more up-to-date regulations to enable them to carry out their operations smoothly, and put an end to unclear procedures and bureaucratic hindrances. Another significant factor that needed to be taken into account was that, after the demise of the former military regime and the introduction of a democratic federal government allowing for full freedom of association in the country, the number of Non-Governmental Organizations (NGOs) dramatically increased and their areas of activity multiplied.

The government therefore issued a new Proclamation of Charities and Societies in 2009 in order to facilitate and strengthen the effective contributions of NGOs to the socio-economic development of the country. The Proclamation made the necessary amendments to reflect new realities and incorporate the best practices from the similar regulations of other nations. There were also extensive public discussions during the drafting process with all NGOs operating in the country and with other stakeholders.

The newly enacted Proclamation No.621/2009 for the registration of Charities and Societies came into force on February 13^th 2009, and on November 9^th 2009, the Council of Ministers also issued Regulation No.168/2009 to ensure its implementation in a transparent manner.

The Proclamation had two main objectives. One of these was to ensure the realization of citizens’ rights to association as enshrined in the Constitution of the Federal Democratic Republic of Ethiopia, and secondly to support and facilitate the role of Charities and Societies, and of NGOs, in the overall development of Ethiopian peoples.

In sum, the legislation is designed to create an enabling environment for citizens to exercise their right to organize, engender the prevalence of accountability and transparency, and enable the civil society community to become government partners in enhancing development and democratization processes. It is indubitable that these rationales and policy objectives are valid, and for the same reasons, the existing old legislations need to be changed.

Besides the good intentions, the drafting process was highly participatory. It involved the civil society community thorough discussions of the draft proclamation. There had been a series of discussions held among the civil society community and between civil society and the government concerning the draft legislations prepared by the FDRE’s Ministry of Justice. Moreover, there were forums in which CSOs and NGOs had an opportunity to make thorough discussions among themselves as well as with government representatives and other stakeholders. Before and after the draft proclamation was referred to the Council of Ministers, the civil society had been given sufficient time to launch a series of discussions among themselves and forward recommendations. Last but not least, the Prime Minister himself invited all CSOs and NGOs to his office for a discussion on the draft legislation.

As a result, the final legislation delivered several important developments that brought positive developments to CSO activities.

Among those:

a) The drafting of a separate legislation focusing on NGOs/CSOs by itself was an important development: As indicated earlier, despite general provisions for charities and associations, the previous legislation does not create an enabling environment for their operations because it was not formulated in such a way as to accommodate the diversity of civil society institutions, their operations, and unique characteristics. The government’s initiative to address these gaps was both timely and eagerly anticipated.

b) The incorporation of specific provisions for different types of NGOs/CSOs: The legislation has specific provisions about charities and societies, which didn’t exist in the old legislation. Moreover, the charitable purposes enumerated under sub-Article 16(3) fairly reflect the current status of the organizations and cover to a large extent the spheres of engagement of the NGOs and CSOs in Ethiopia.

c) The provision for the establishment of consortium of charities or societies: One of the difficulties encountered under the previous legislation is the lack of a provision for the legal status of CSO/NGO consortia. In this regard, the draft legislation’s provision in sub-Article 6(1) for the establishment of such a consortium is one of its main strengths.

d) Allowing charities and societies to engage in income generating activities: This is an important component of the legislation because it helps charities and societies to strengthen their internal capacity and ensure the sustainability of their activities.

e) Exemption from income tax for charities: This is another important step that was not available under the old legislation and that strengthens the civil society’s capacity to provide service to the public and enhances their financial capacity.

f) The establishment of the Charities and Societies Agency: Another positive feature of the new legislation is the establishment of an Agency to undertake the registration and supervision of civil society organizations and a council to handle issues related to charities and societies. The Charities and Societies Agency was established under the Proclamation as an autonomous administrative body to handle the registration of Charities, Societies and NGOs properly and assist them to achieve their goals with transparency and accountability.

The Charities and Societies Agency has been given the powers and functions to: To license, register, and supervise Charities and Societies; To encourage Charities and Societies to have better administration; To collect, analyze and disseminate information relevant to its powers and functions; To publish and distribute information about the registration of Charities and Societies in the newspapers; To organize consultative fora for governmental organs and Charities and Societies; To make proposals to Ministers on matters relating to meeting its objectives; To take decisions, in cooperation with the concerned sector administrator, on the application of Charities and Societies for registration and license; To exercise the powers of registration and authentication of documents with regard to Charitable Endowments and Charitable Trusts; To collect fees for the service it renders in accordance with rates to be approved by Government; To own property and enter into contracts in its own name; To delegate, when necessary, the powers and functions given to it by this Proclamation; and To carry out any such other activities necessary for the attainment of its objectives.

However, some choose to ignore all these developments and are hell-bent on tarnishing this important legal document based on one of its aspects. That is; the provisions of the legislation regarding the nationality of NGO/CSO institutions.

Indeed, the legislation specifies the limitations to the operations of Foreign Charities and Societies. These foreign charities and societies are not allowed to engage in domestic Ethiopian political activities as of right. This is normal practice in most countries, as political activities, by their very nature, are reserved for citizens. It is a sovereign state’s right to limit the influence of foreigners through any financing of political activities. Aside from politics, foreign charities and societies are free to operate and assist in any much-needed development activities and humanitarian needs of the country. It might be underlined that the Proclamation does not exclude the possibility of foreign Non-governmental organizations operating in Ethiopia to contribute constructively in activities otherwise totally reserved for local NGOs in accordance with Article 3 Sub-article 2(b) However this must be done through agreement with the Government of Ethiopia and also include regular evaluations.

In this regard, it might help to take a look at the distinctions set by the legislation with regard to Ethiopian associations and the Foreigners.

Sectors open for Foreign Charities and Societies and NGOs include, among others: a) The prevention, alleviation or relief of poverty or disaster; b) The advancement of the economy and social development and environmental protection or improvement;  c) The advancement of animal welfare; d) The advancement of education; e) The advancement of health or the saving of lives; f) The advancement of art, culture, heritage or science;  g) The advancement of amateur sport and the welfare of youth; h) The relief for those in need by reason of age, disability, financial hardship, i) The advancement of capacity building on the basis of the country’s long term development directions.

Whereas, Activities reserved to Ethiopian Charities and Societies and NGOs, are: The advancement of human and democratic rights; The promotion of equality of nations, nationalities and peoples, as well as the promotion of equality of gender and religion; The promotion of the right of the disabled and of children; The promotion of conflict resolution or reconciliation; and The promotion of improving the efficiency of the justice and law enforcement services.

Therefore, for any objective observer it is nothing but appropriate that political related matters are reserved for Ethiopian CSOs and NGOs, while there is plenty room left for any genuine foreign or foreign-funded organization to contribute in developmental areas.

In Conclusion:

Overall there’s no doubt this legislation have helped to advance clarity and predictability in the operations of all charities and societies and NGOs in Ethiopia. It has also significantly improved arrangements for the licensing, registration and operations of these organizations in the country.

During the more than half a century from the 1950s to 2009; the total number of registered Non-Governmental Organizations registered to operate in Ethiopia in various areas were less than 3800.  However, since the enactment of the new legislation and the establishment the new Charities and Societies Agency in 2009, more than 2000 national and international Non-governmental organizations have been registered. The difference is very easy to observe. It is also worth mentioning that the average registration rate for NGOs was 76 per year for the period from 1950s to 2009. However, only in the first three years since the Proclamation, the average annual figure has tripled. If the future rate of registration follows the same trend in the future, the number of NGOs operating in Ethiopia will certainly show a substantial increase.

It is indeed quite clear that the new Proclamation, in addition to its impact on speeding up the processes of registration and encouraging new NGOs to register is also providing a legal and conducive working environment for Non-governmental organizations encouraging and allowing them to discharge their duties in a responsible and transparent manner.

http://aigaforum.com/articles/eiti-cso-law-eth.php

.

Accuracy, Not Transparency, to Blame for Mining Sector Gaps

.

-  Ethiopia now has three years to comply with EITI standards, which help to ensure the transparency of resource management

.

The Midroc-owned Lege Dembi goldmine in southern Ethiopia.

Tolessa Shagi, Minister of Mines, middle, expressed his hope that the report helps to show the gaps in the industry.

.

The first published report by the Ethiopian Extractive Industries Transparency Initiative (EEITI), for the period between July 2009 to July 2010, reveals seven cases where differences in excess of five million Birr between amounts reported by the government and by each company remained without being reconciled.

The report, named the Ethiopia Revenue Transparency Reconciliation, was produced by a London-based auditing firm called Hart Nurse Chartered Accountants.

The report reveals that in the stated period the government managed to collect 549.3 million Br from companies engaged in the mining industry through different types of payments. Out of this, the Ethiopian Revenues & Customs Authority (ERCA) received 322.8 million Br in the form of mining income tax, while the Ministry of Mines (MoM) collected 65.5 million Br in royalties.

“We may have some problems relating to the accuracy of data in the report, but not with the wider subject of transparency,” Tolessa Shagi, minister of Mines said about the report released at an event held on Tuesday, March 18, 2014, at Desalegn Hotel, on Ghana Street.

Tolesa said the report, though not on par with international standards, still helps to describe the gaps in the industry.

“We will work to present more recent data in the future,” the minister said.

He, nevertheless, admitted that there is a four year lag time in the report.  The Extractive Industries Transparency Initiative (EITI) stipulates that financial information reports should not be older than two years.

The EEITI, which is organised by delegates from the Ministry, mining companies and members of the Civil Society (CSOs), authored the report with the aim of examining the transparency and credibility of certain mining sector payments and recipients in Ethiopia.

Midroc Gold S.C leads the pack with a 287.8 million Br payment to the government during the fiscal year under, while the Ethiopian Minerals Development S.C trails behind, paying 240.7 million Br.

The auditing service has been financed by the Multi-Donor fund administered by the World Bank (WB). The WB has also been giving other technical and financial support and  has promised to continue to do so, even if the international body did not accept the country’s bid for membership.

The report was released two days before the Oslo-based (EITI) approved Ethiopia’s application for membership.

“The timing of this launch is not accidental,” Tolessa said at Tuesday’s event. “In a couple of days the international EITI board will discuss Ethiopia’s application to become a candidate country and the launch of this report is an additional argument to demonstrate our commitment.”

On March 19, 2014, the EITI accepted the application by the Ethiopian government to be a member, along with the US and Papua New Guinea.

The EITI, which was established in 2003, promotes and supports improved governance in resource-rich countries through the full publication and verification of company payments and government revenues from oil, gas and mining.

An earlier effort by Ethiopia to join the EITI was rebuffed in 2010.

“We were rejected then because they thought the role of the CSO was limited,” Tolessa told Fortune. “But after seeing what the realityis, the EITI have asked us to apply again.”

Ethiopia now has three years to comply with EITI standards.

The EITI’s decision to accept Ethiopia is drawing swift criticism from human rights campaigners. Yet the initiative seems defiant.

“In its discussions, the EITI Board stressed the importance of ensuring civil society engagement in Ethiopia’s efforts to comply with the EITI Standard,” the group said on its website.

This is a big promotion for the sector and the country, officials at the MoM told Fortune. This clearly shows the transparency in the sector and provesto  international companies that there is a rule of law in place that fulfils international standards.

“We will work to collect more information at the grass roots level,” the minister said. “But first we will work on capacity building to see when and how we will prepare the next report.”

The EITI maintains a standard. Member countries are expected to implement EITI standards, which ensure the full disclosure of taxes and other payments made by mining companies to governments.

Benefits of implementing countries include an improved investment climate by providing a clear signal to investors and financial institutions that the government is committed to greater transparency.

The EITI, which has 25 compliant countries and 19 candidate countries, also gives technical and financial support to member countries.

http://addisfortune.net/articles/accuracy-not-transparency-to-blame-for-mining-sector-gaps/

.

.

Journalists drawn from the private and government media visited various eastern industries zone in Midjo, Adama and Dire Dawa in a field visit organized by Government Communication Affairs Bureau in collaboration with Industry Minister lasted for a week.

In the field visit selected factories hasve been visited by the journalists. Thus, journalists could witnessed the activities of the factories. Of which, the Modjo Tannery Factory and Else Textile Industrial Development Plc.

.

The Modjo Tannery Factory

.

Ethiopia is a country highly endowed with a large number of livestock population. This high volume and diversified type of cattle population makes the country one of the best places in the world to engage in tannery. Ethiopia’s export earnings from the sector has been growing in double digits for the last five years. Modjo tannery factory is one of the main actors in this sector.

In the field visit, the Modjo Tannery Factory Share Company said that there has to be due attention to solve foreign problems in foreign exchange, raw materials supply, illegal trade (contraband) in the tannery sector at the press conference at the compound held here recently.

Factory General Manager Redwan Bedada told journalists that problems in foreign exchange problems in foreign exchange, lack of quality raw materials (leather), illegal trade are currently the major constraints too the sector not to achieve the Growth and Transformation Plan (GTP) goals.

He noted that they are working with the governmental institutions in order to solve the problems and sustain the development in the sector.

He said that the country’s export was more focused on the raw leather supply and now has been starting finished leather to the foreign market, but the country has less experience that could be another threat to the sector.

Even though, the company has working with concerned governmental institutions to solve the problems mentioned, Redwan further noted that the government is strengthening its support for the sector to achieve the goals of GTP.

To make the sector development sustainable, factories in the sector need to work together at the national level, he added.

Redwan pointed out that Modjo Tannery Factory has a capability to produce 8,400 hides and skin but now forced produce 6,000 because of lack of raw material supply.

He further pointed out that many foreign investors become engaged in the sector and the government need to support local investors to be competitive with them.

It was in 1972 Modjo Tannery Factory established to produce crocodile leather, currently the factory has exporting 85 per cent of its finished skin and hides product.

.

Else Addis Industrial Development Plc

.

It is obvious that clothing and textiles sector is a fully global industry, with multinational companies continuously searching the world for new sources of supply. The country has indigenous raw cotton and the potential to produce other natural fibres plus an integrated textile supply chain, albeit in need of modernization and expansion. This means that the industry, while still in infancy, has enormous potential, both for exports and domestic consumption.

Similarly, Else Addis Industrial Development Plc also comlain a little bit about the raw material supply and power shading. The company said that there are problems of quality raw materials supply and energy in the investment in the country.

Briefing journalists at the press conference held at the factory head office organized by Government Communication Affairs Office here Monday, Factory Manager Nevzat Kerim Aydin said they are problems facing on the area of energy and raw materials in their production process.

He said that actually there is a potential of raw materials—cotton, labour and geographical option in this country that make them to continue their investment but there is also problems they are facing low quality and quantity of cotton.

Thus, in order to solve the problem they have discussed with government and the government supply them a land around Omo River to start their plantation there which costs 200 million USD and have their own input—cotton within two years, he added.

As to him, they already developed 400,000 hectares of land and would have a cotton production equal with total production of the country within five years.

Nevzat Kerim Aydin told journalists that apart from textile factory they would have different options of investment here in Ethiopia.

Regarding to strengthen exporting production in the country, he said that there has to be high quality of products then there would be a potential of exporting production.

He also said that apart from energy and raw materials, skilled work force is very important to have quality and cheap products that helps become competitive in the global market.

He pointed out that there is a market around Africa who can be our products user but they prefer Europe or America market because of the price offer there and for future they plan also involve in the Africa market.

He further pointed out that they are not using chemicals in the production process that affected the environment except the cotton dust which has no environmental affection.

Pertaining to the societal activity, he noted that the company creates a job opportunity as most of the workers are fresh graduates and they acquire their work of experience and of which 80 per cent of workers are women so this makes the company good in the community service.

He further noted that the company’s infrastructural development in and around its plants positively impacts the local community and contributes to its overall well-being.

Else Addis started investment in Ethiopia around in 2009. Their investment has two phases and currently they are operating phase one which covers 46, 000 square meter. They have 1,500 workers of which 95 per cent of workers are Ethiopian.

Now they do have 100, 500 tons of yarns production monthly and plan to increase their fabric total of textile production from 750, 000 metre per month to 1 million 700.

Else Addis Industrial Development P.L.C is a fully vertically integrated textile factory located in Nathret-Adama city on the land of 200, 000 m2 which has the covered area 120, 000 m2.

.

Sourced here

.

.

ERC to train 252 railway operators abroad

.

Addis Ababa, 26 March 2014 - The Ethiopian Railway Corporation (ERC) announced that it has finalized preparations to send 252 communication, computer network, rail traffic engineers, train masters and other light railway transport operators to China for training this week.

At a farewell ceremony yesterday, Corporation Board Chairperson and Adviser to the Prime Minister with the Rank of Minister Dr. Arkebe Equbay said that like other transport sectors railway transportation needs a proper care. “Thus, trainees have moral obligation to grasp all the necessary knowledge concerning to railway transportation.”
According to him, the railway transportation has key role for future economic transformation and integration. In this regard, having skilled manpower is significant.
Dr. Arkebe also said that as pioneer in light railway transportation, trainees must be responsible, committed and morally obliged to their mission. Besides safeguarding the safety of passengers in the future, trainees are expected to be image builders outshining in their training, he added.
Corporation General Manager Dr. Engineer Getachew Betru said: “Since the life of passengers would be in the hands of the future train masters, technicians, engineers; you have to be committed learners.”
Corporation Operation and Service Division Deputy CEO Tilahun Serka said that the recruited trainees will have different duties in the light railway.
According to him, the trainees would engage in driving, controlling, maintaining the locomotive and other activities.
Depending on the area of their engagement the trainees will take practical and theoretical courses for four – 11 months at the Tianjin Railway Technical and Vocational College.

http://www.waltainfo.com/index.php/explore/12775-erc-to-train-252-railway-operators-abroad

.

Ethiopian Investment Forum

.

 .

http://www.spyghana.com/ethiopian-investment-forum/

.

Ethio-South Africa Joint Commission emphasizes more dynamic, fruitful cooperation

.

Addis Ababa, 26 March 2014  - The 4th Ethio-South Africa Senior Officials’ Joint Commission Meeting aimed at reviewing and evaluating all areas of mutual cooperation to further strengthen the existing cordial relations in all sectors was opened yesterday at Ellily Hotel here yesterday.

Opening at the two-day meeting, Foreign Affairs Ministry African Affairs Director General Ambassador Solomon Abebe said: “Our two countries have witnessed development in all areas of cooperation and relations in light of the aspiration of our peoples for secure, stable prosperous present and future. Our bilateral political relations have been strengthened by mutual consultation and numerous high-level exchange visits have been further enhanced with the signing of numerous memorandums of understanding as well as protocols and agreements”.
Ethiopia and South Africa have signed various agreements in most sectors of mutual cooperation and already established broad -based bilateral cooperation. But much remains to be done, Ambassador Solomon said.
He further indicated that the two counties have great potential for economic cooperation and in forgoing strong economic ties in terms of trade and investment. “However, we have not yet fully utilized the existing potential. The level of economic cooperation is not yet commensurate with close political cooperation. Greater emphasis should be given to persuade our business sectors to work closely and strengthen their relation to make the cooperation more dynamic and fruitful,” he added.
South African International Relations and Cooperation Department East Africa Chief Director Tselane Mokuena on her part said: “Our gathering today presents us with a means to ensure that Ethiopia and South Africa stand together as partners as we traverse the route to development and prosperity in Africa.”
The meeting and discussions today need to take place within the context of the vision for Africa set by Africa’s leaders at the Africa Union ( AU) through agenda 2063. There is a need to ensure that the partnership remains geared towards not only the prosperity of sisterly countries but also of their respective regions and the rest of the continent, she added.
The meeting signals the realization that unity of purpose will lead to success. “As we begin to engage, it becomes imperative for us to closely, critically and thoroughly interrogate the status of our bilateral relations at various levels,” Mokuena said
The meeting will pave the way for the forthcoming ministerial meeting.

http://www.waltainfo.com/index.php/explore/12777-ethio-south-africa-joint-commission-emphasizes-more-dynamic-fruitful-cooperation-

.

Ethiopia gets business academy

.

Dubbed the “Chamber Academy”, the business center was launched in cooperation with the Center for International Private Enterprises (CIPE), an affiliate organization of the US Chamber of Commerce.

.

The Ethiopian Chamber of Commerce and Sectorial Associations on Tuesday launched a business center of excellence, the first of its kind in the Horn of Africa country.

Dubbed the “Chamber Academy”, the business center was launched in cooperation with the Center for International Private Enterprises (CIPE), an affiliate organization of the US Chamber of Commerce.

“The opening of the Academy would stimulate the Ethiopian private sector,” ECCSA President Mulu Solomon told the opening session.

“It would be vital to bolster the capacity of the private sector through training for business people and staff of relevant organizations,” she said.

“The private sector in Ethiopia should extricate itself from traditional ways of thinking and practices and should be led by modern theories and practice of doing business,” Mulu said.

Professor Mohammed Habib, a senior legal professional and instructor at the Addis Ababa University, said international partnership would be vital to disseminate up-to-date business knowledge.

“The center of excellence just launched would stimulate the activities of the private sector and ensures its steady growth,” Habib told Anadolu Agency.

“The Academy is topical in the Ethiopian context where the private sector has been growing as a major driving force of economic development and growth.”

The academy aims to strengthen leadership and management skills of the ECCSA and member organizations and building institution capacity, according to a press release issued on the launch.

It also aims to enhance communication, cooperation and networking among business institutions.

Tuesday’s opening ceremony was attended by a host of foreign ambassadors, representatives of government and international development organizations, ECCSA partners and other stakeholders.

ECCSA has been operating and helping the Ethiopian business community for more than 60 years.

http://www.worldbulletin.net/world/132039/ethiopia-gets-business-academy

.

Large land deals reportedly fruitless

.

A new report by the International Institute for Environment and Development entitled “Large-scale land deals In Ethiopia: scale, trends, features and outcomes to date,” states that allocating land to investors has not shown a lot of benefits.

“Ethiopian government representatives at both regional and federal level acknowledge that, while considerable amounts of land have been allocated to investors, performance to date in terms of production, employment, and development of land has been disappointing for the most part,” the report reads.
The report states that according to the Ministry of Agriculture, of 2.2 million hectares of land allocated only 17.6 percent has been developed.
There are several reasons why land is not developed as expected. According to the report these include: high costs and difficulty of developing land, security issues, poor capacity of investors, misuse of investment licenses and limited monitoring and evaluation capacity.
The report states that the Ethiopian Government has leased at least one million hectares of land for agricultural investments over the period from 01 January 2005 to 31 August 2012. This includes around 380,000 ha from the federal land bank, managed by the Ministry of Agriculture; 335,000 ha by regional governments; and 335,000 ha for state-run sugar plantations.
Land deals promise to contribute to improved food security, but the report suggests that in some cases that may not be the case.
“If people directly lose their land without compensation or adequate resettlement, including access to productive resources, they will likely be worse off and more food insecure. Where there is a loss of access to resources that are important parts of livelihood systems and coping mechanisms, such as forests, rangelands, and water resources, there are clear risks of pockets of greater food insecurity at the local level,” the report reads.
When it comes to the responsibility of allocating land, the report underlines that there is a lot of confusion with the exact boundary between regional and federal responsibilities. This is because a land deal previously agreed by a regional government was again revised by the federal government.
One case in point is an Indian agribusiness firm that was allocated 300,000 ha by the Gambella regional government in 2008 was subsequently reduced to 100,000 ha by the federal government.
The report also states that there needs to be a better information sharing system between the central government and the regional governments.
“There did appear to be some joint monitoring between federal and regional governments but federal officials seemed to go directly to the woreda government on occasion, bypassing the regional government. This lack of awareness in the region is problematic in terms of good development planning or strong regional ownership of agricultural development activities,” the report reads.
The report also says that there isn’t a lot of information regarding what is being produced on the massive lands that are being allocated for investors.
It states that much of the data only indicates the land use is a crop production, as opposed to livestock, without specifying categories of crops or particular crops. Sometimes data indicates that several crops are grown and the relative amounts are unclear.

http://www.capitalethiopia.com/index.php?option=com_content&view=article&id=4197:large-land-deals-reportedly-fruitless&catid=54:news&Itemid=27

.

Ethiopian Scientist wins UNESCO award

.

Ethiopian Scientist Doctor Segenet Kelemu has been named the 2014 African Laureate in the 16th annual L’Oréal-UNESCO For Women in Science Awards. Currently Director General of the International Center for Insect Physiology and Ecology based in Nairobi, Dr. Segenet is the first Ethiopian to win the prestigious award. She joins five exceptional women scientists from around the world, one from each continent, who were recognized for their contribution to science at an awards ceremony, held at the Sorbonne in Paris last week (March 19) before an audience of personalities from the worlds of science, economics, academia and culture.

The $100,000 award celebrates the outstanding achievements of women in science and is recognized as one of the premier international science awards. Dr. Segenet was honored for her research on how microorganisms living in symbiosis with forage grasses can improve their capacity to resist disease and adapt to environmental and climate change. Her work is providing new solutions for ecologically responsible food crop production especially by local, small-scale farmers.
Born in Fenote Selam, Gojam, Segent did her high school studies in Debre Markos and begun her college education in Alemaya university and later did her master studies in Addis University. She excelled in her chosen field, plant sciences, and after obtaining her PhD in the United States, she went to Cornell University as a post-doctoral fellow. After having worked in Colombia, she returned to Africa and is now at the heart of an impressive international scientific research network.
Dr. Segent said she was “absolutely delighted” to receive the award, and paid tribute to the “exceptionally talented” people she has collaborated with during her career.
Previously, Dr. Segenet has held position as senior scientist in the International Center for Tropical Agriculture in Cali, Colombia and was eventually appointed Leader of Crop and Agroecosystem Management of the Center.
She said it gives her a pleasure to win various awards because her country’s name is also mentioned.

http://arefe.wordpress.com/2014/03/26/ethiopian-scientist-wins-unesco-award/

.

Castel Introduces its new wine

.

Now a leading French wine maker has put Ethiopia on the international wine map, with its new products from its vineyard in southern Ethiopia.
After a deal was struck between the late PM Meles Zenawi and Pierre Castel, founder and President of the Castel Group and BGI International to establish Castel Winery in Ethiopia that faithful day in 2007, the company immediately assigned the best experts and consultants in the business from France to select the most suitable area for a vineyard which can meet Castel Family’s strict three generations old quality wine making standards and criteria. After a thorough investigation by the panel of experts, the town of Battu (Zeway), 163 kilometers south of Addis Ababa was selected.
And the birth of Castel Winery was officially endorsed on May 2007 with the ceremony of the first vine plantation.
This FDI that became fruitful after almost seven years officially introduced its international taste with a big celebration in the presence of officials including PM Hailemariam Desalegn on Saturday March 22 at Battu.
Through hard work, resilience and innovation, and under the guiding hand of founding President Pierre Castel, today the Group has become the largest wine producer in France and Europe and the third largest wine producer worldwide, and became the owner of the second largest beer and soft drink businesses in Africa.
Beer business
Castel Group, one of the first very few foreign based companies that has come to defy the Ethiopian market after the downfall of the Derg regime and its command economy, joined the Ethiopia beverage industry after it decided to erect a brewery at Kombolcha Amhara Regional State with a USD 25 million dollar investment in 1997 and then it bought the long established brewery, St George, in 1998 at a cost of USD 10 million.
Since then the French based giant, that is demonstrating the benefits of doing business in Ethiopia for other global investors, has played a big role to heat the beverage industry in the country and to be a specimen for other dominant foreign firms to be part of the country’s development by establishing their business in Ethiopia.
The St. George Brewery, established state of the art infrastructure, since Castel Group/BGI Ethiopia owned it with a big market share has been introducing new local and international brands for the beer industry and now it can easily change the market with international standards.
BGI, that leads the beer market in Ethiopia with over half of the market share has also invested a huge amount to expand the Addis Ababa brewery plant, with branches in north eastern and southern part of the country at Kombolcha and Hawassa (Awassa) towns respectively.
Castel Group was established in Bordeaux, France in 1949 by founder Pierre Castel and his 8 brothers and sisters. It is a good example of foreign direct investment (FDI) in Ethiopia. The family growing up in the vineyards of Bordeaux meant that wine was already an integral part of their daily lives. “Theirs truly is a family affair. Their driving principle was to share their love of wine and other high-quality products in a way, which fulfills every customer’s expectations. With this ethos firmly in mind, not even rapid expansions have been able to undermine the core values, which shape Castle’s businesses spirit and identity,” the company profile reads.
In the 50’s and the 60’s, the Group embarked upon an internal expansion by setting up bottling plants. Keeping intact their special attachment to the internationally acclaimed wine making region of Bordeaux, the Group expanded to other known wine making regions of France like the Loire, the Rhône, Burgundy, Provence, the Languedoc and the South West, and within few years it spread  all over the world with its dominant brands.
Meanwhile, Castel Group was also busy establishing a reputation in the beer and soft drink sector in many parts of Africa. The Group became one of the key players in the continent when they acquired BGI (Brasseries et Glacières Internationales) in 1990.
The company that joined the Ethiopian market 17 years ago is still a major market actor in the Ethiopian beer industry.
Officials of BGI Ethiopia told Capital that currently the brewery is investing millions of dollars every year to meet the growing demand of its brands in the country. Not only is the company expanding its business, but the biggest brewery in Ethiopia has also bought significant share on the under construction brewery, Raya.
Currently, BGI Ethiopia bottles St George, Castel, Bati and Amber (St George), which is the first amber beer product for the country, though it has a plan to introduce other new brands to the beer market.

Facts about the new winery

.

http://www.capitalethiopia.com/index.php?option=com_content&view=category&layout=blog&id=49&Itemid=48

,

.

Bale Mountains Eco region (pictured, above) is one of the two main tropical forest blocks remaining in Ethiopia

.

Forest in Ethiopia has strategic importance to the development of the national economy. This is particularly true for agriculture, energy and tourism. However, deforestation and degradation are posing a serious threat.

Sources indicate that deforestation is costing Ethiopia six per cent of its forest annually. If the trend continues, the country will loose 84,000 ha. forest within the next 20 years.

According to Ministry of Environment and Forest Ethiopian Reducing Emission from Deforestation and Forest Degradation (REDD+ ) Secretariat report, degradation and deforestation have a serious impact on the country’s surface and ground resources.

About 15 per cent of greenhouse gas emission is caused by deforestation and forest degradation, according to the report. Climate Change caused by human induce emissions of greenhouse gases is now recognized as one of the major challenges to human survival.

REDD+ Readiness Preparation Proposal of Ethiopia indicated that the forest sector in Ethiopia is responsible for the emission of 65 million tonnes of Co2.

As part of tackling this challenge, Farm Africa together with SOS Sahel and Oromia Forest and Wildlife Enterprise have introduced REDD+ Project in Bale Mountains Eco regions. The Bale REDD + is a pioneer initiative in Ethiopia with the aim of ensuring sustainable financing mechanism for Ethiopia.

At a discussion held with stakeholders in Shashemene last Wednesday, Project Coordinator Lulu Likassa said that sustainable forest management would be ensured with the active participation of the community.

According to him, the community are the owners of the forest and the beneficiaries of the resources. “Thus, through creating awareness and participatory forest management model, economic, social and ecological benefits could be sustained.”

Previously, it was believed that the government is the only responsible organ to protect the forest. However, it is proved that without the active involvement of the community sustainable results cannot be achieved, he said.

Lulu said that the Bale Mountains Eco-region REDD+ Project (BMERP) is, therefore, a pioneer initiative in Ethiopia to replicate REDD + implementation .

The country would earn six million USD every year upon properly managing and saving at least 65 per cent of the forest from deforestation and retaining Carbon emission within the next 20 years, he added.

Oromia Forest and Wildlife Enterprise Arsi Branch Manager Kedir Nino also said that the Enterprise together with Farm Africa and SOS Sahel is implementing Sustainable Livelihood and Forest Management Projects and the Bale Mountains Eco-Region REDD + Projects.

According to him, Participatory Forest Management has a key role in sustainable forest management. The projects, which are being implementing in the Bale mountains, are showing progress for the community now realizes benefits of sustainable forest management, Kedir added.

Ministry National Coordinator REDD + Secretariat Dr. Yitebitu Moges said that Ethiopia has climate change mitigation potential. According to him, the total forest carbon stock in Ethiopia is estimated 2.1 CO2e and 90 per cent of Ethiopian highlands form sustainable place for forest development. The Bale Mountains Eco region REDD + Project covers an area of 500,000 ha. of high forest which represents one of the two main tropical forest blocks remaining in Ethiopia. The project is funded by the Royal Embassy of Norway, Irish Aid and the Royal Embassy of Netherlands.

REDD+ is a climate change mitigation strategy introduced by the United Nations to help stop destruction of the world’s forests. Wildlife Works’ REDD+ projects protect threatened forests, wildlife, and uplift rural communities.

.

Sourced here: 

http://www.ethpress.gov.et/herald/index.php/herald/news/6400-bale-mountains-redd-project-a-pioneer-forest-management-initiative

.

Related posts

.

-     Ethiopia’s forest farmers work for a sweeter future: case studies

-     Government of Norway partners with World Bank to support Ethiopia in scaling up climate-smart land management

-     Ethiopia enlists help of forest communities to reverse deforestation

-     REDD Desk launches new REDD+ country profile for Ethiopia

.

.

Toronto, Ontario, March 19, 2014 —

Allana Potash Corp. (TSX: AAA) (“Allana” or the “Company”) today announced the commencement of technical cooperation activities with ICL pursuant to Allana’s previously reported strategic alliance with ICL. Senior technical and development teams from both companies have begun to define priorities for a development program to advance the Danakhil Potash Project.

As part of the activities, programs will be launched in Ethiopia and Djibouti in late March focused on hydrology and water supply design, solution mining and evaporation pond operations procedures and output, as well as on production transportation logistics and product staging/storage strategy refinements. These activities will be aligned with the project lenders due diligence program.

Farhad Abasov, President and CEO of Allana, commented, “We reviewed, and have been impressed by ICL’s excellent operations at its Dead Sea Works (DSW) facility in Israel and at Israel’s Ashdod port. Our assessment of ICL’s operations further validates our opinion that ICL will be an optimal partner for Allana. In our joint technical discussions, Allana and ICL identified significant similarities in our facilities and operations, and it is clear that we can replicate ICL’s operations.” Mr. Abasov continued, “We look forward to the next stage of our cooperation during which ICL’s experts will advise Allana in connection with its pre-construction work programs to refine our operating procedures for water extraction, solution brine management and transport facility and operations design, among other elements. ICL’s technical assistance, as well as its take-or-pay off-take and significant equity investment in Allana, significantly contributes to de-risking the project and will facilitate Allana’s construction and production activities.”

ICL is one of the world’s largest producers of fertilizers, supplying over five million tons of potash annually from production facilities located in a number of countries, primarily from solar evaporation ponds at ICL’s DSW facility. The DSW operation employs relatively low-concentration potassium chloride brines from the Dead Sea, produced in over 100 km2 of evaporation ponds with an annual average daylong temperature of around 26 ºC, to process its solid crystal raw material. Allana will benefit from ICL’s 60-plus years of technical expertise at its Danakhil operations which, in contrast, will employ approximately 10 fold higher potassium concentration brines from its solution wells, crystallized in 6 km2 of solar evaporation ponds with an annual average daylong temperature of over 35°C.

DSW’s operations also utilize in-house and contractor-operated trucking fleets to transport 1.5 to 2 million tons of potash annually to ICL’s storage and shipping terminal facilities at Ashdod and Eilat ports which are located 150 and 200 kilometers, respectively, from DSW’s facilities at the Dead Sea. These logistical capabilities are directly applicable to Allana’s operational plans to truck one million tons of potash 570 kilometers to Allana’s potash terminal located at the Tadjoura port in Djibouti.

Nissim Adar, President and CEO of ICL Fertilizers, observed, “Our strategic alliance with Allana to develop potash supply for Ethiopia and Africa — the market with the highest growth potential in the fertilizer world — is moving forward at a fast pace. We are pleased that Allana’s entrepreneurial approach fits well with ICL’s expertise and experience and we look forward to our joint technical teams driving this project to a successful completion as quickly as possible guided by a continual focus on safety, quality, cost-control and sustainability issues. Once in production, Danakhil is expected to become one of the world’s lowest cash cost potash projects.”

The Project secured environmental approvals in May 2013 and its Mining License in October 2013, and, having gained the cooperation of several major development financing institutions and export credit agencies in mid 2013, the Company continues to proceed with its project financing activities. ICL has also committed to purchase production of the Project up to 1Mtpa with a take–or-pay commitment on a minimum of 80% of output from the Project.

As previously announced, the Company has called a special meeting of shareholders on March 28, 2014 to authorize the issuance of a further 30,614,488 Units of Common Shares and Warrants to ICL for gross proceeds of approximately $14.4 million, (the “Second Tranche”) (see Allana press release dated February 12, 2014). Subject to the receipt of the required shareholder approval, closing of the Second Tranche is anticipated to occur on or about March 31, 2014. Directors and officers of Allana holding an aggregate of 1.4% of the outstanding Common Shares have agreed to vote in favor of the issuance of the Units pursuant to the Second Tranche to ICL.

About ICL

ICL, a global manufacturer of products based on unique minerals that fulfill humanity’s essential needs, primarily in three markets: agriculture, food and engineered materials. The agricultural products that ICL produce help to feed the world’s growing population. The potash and phosphates that it mines and manufactures are used as ingredients in fertilizers and serve as an essential component in the pharmaceutical and food additives industries. The food additives that we produce enable people to have greater access to more varied and higher quality food; ICL’s water treatment products supply clean water to millions of people as well as industry around the world; and other substances, based on bromine and phosphates help to create energy that is more efficient and environmentally friendly, prevent the spread of forest fires and allow the safe and widespread use of a variety of products and materials. ICL benefits from a broad presence throughout the world and proximity to large markets, including in developing regions. ICL operates within a strategic framework of sustainability that includes a commitment to the environment, support of communities in which ICL’s manufacturing operations are located and where its employees live, and a commitment to all its employees, customers, suppliers and other stakeholders.

ICL is a public company whose shares are traded on the Tel Aviv Stock Exchange (TASE: ICL). The company employs around 12,000 people worldwide, and its sales in 2013 totaled $6.3 billion. For more information, visit the company’s website
at www.icl-group.com.

About Allana Potash Corp.

Allana is a publicly traded corporation with a focus on the acquisition and development of potash assets internationally with its major focus on a previously explored potash property in Ethiopia. Allana has secured financial support from three significant strategic investors: ICL, one of the world’s largest potash producers, IFC, a member of World Bank Group, and LMM, a member of Liberty Mutual Group. Allana has estimated measured and indicated Sylvinite mineral resources of 327.4 million tonnes of 28.3% KCl; and an estimated inferred Sylvinite mineral resource of 90.8 million tonnes grading 27.8% KCl, In addition, the Project hosts estimated measured and indicated Kainitite mineral resources of 1,150.5 million tonnes at 19.4% KCl, an estimated inferred Kainitite mineral resource of 481.8 million tonnes of 19.8%KCl; estimated measured and indicated Upper Carnallitite mineral resources of 411.3 million tonnes grading 17.3% KCl, estimated inferred Upper Carnallitite mineral resources of 175.5 million tonnes of 16.5% KCl; estimated measured and indicated Lower Carnallitite mineral resources of 557.2 million tonnes of 9.2%KCl, and estimated inferred Lower Carnallitite mineral resources of 369.3 million tonnes grading 7.7% KCl. The foregoing mineral resource estimates are as at April 17, 2013. For more information with respect to the data verification procedures undertaken and the key assumptions, parameters and risks associated with the foregoing estimates, refer to Allana’s Technical Report entitled “Resource Update for the Danakhil Potash Deposit, Danakhil Depression, Afar State, Ethiopia” dated effective April 17, 2013 filed under the Company’s SEDAR profile at www.sedar.com on August 7, 2013.Allana has approximately 294 million shares outstanding. Allana trades on the Toronto Stock Exchange under the symbol “AAA”.

Dr. Peter J. MacLean, Ph.D., P. Geo., Allana’s Senior VP Exploration, is the Company’s designated Qualified Person and has reviewed and approved the technical information presented in this release.

 
Richard Kelertas
Senior Vice President, Corporate Development
514 717 6256 or rkelertas@allanapotash.com

.

Sourced here  http://www.allanapotash.com/s/News.asp?ReportID=642824

.

Latest Cantor Fitzgerald Research Update - March 28,  2014 - 

http://origin.library.constantcontact.com/download/get/file/1104247303359-493/AAA.pdf.pdf

.

.

Cairo Analyst Says Ethiopia Dam Won’t Hurt Egypt

.

VENTURES AFRICA – A water expert from the AUC University in Cairo has confirmed that Ethiopia’s hydroelectric dam will not hurt Egypt’s share of the Nile waters. According to the Egypt-based water resource management specialist Richard Tutwiler, the Ethiopian dam will never stop the flow of water downstream to Egypt.

“It is unlikely that Ethiopia will severely choke or stop the flow of water. Ethiopia needs the electricity…and hydroelectric dams don’t work unless you let the water through” said Mr. Tutwiler.

The Sudanese government has also supported the Ethiopian dam because “the dam would have minimal impact on its (sudan’s) water allotment…and the mega-project’s other benefits became clear. ”

Water experts have confirmed that the dam is expected to improve flood control, expand downstream irrigation capacity and, crucially, allow Ethiopia to export surplus electricity to power-hungry Sudan via a cross-border link. Some studies indicate that properly managed hydroelectric dams in Ethiopia could mitigate damaging floods and increase Egypt’s overall water share. Storing water in the cooler climes of Ethiopia would ensure far less water is lost to evaporation than in the desert behind the Aswan High Dam in Egypt.

Despite these assurances from the international community and water experts, some Egyptian warmongers and politicians have unnecessarily threatened Ethiopia and other upstream African countries. Some Egyptian generals have been seen undercover in southern Somalia and the Ogaden, arming rebels and agitating more anti-Ethiopia sentiment among the public. Analysts say that Egyptian military leaders want to distract the pro-democracy movement in Egypt from domestic problems by diverting their attention to a nonexistent external threat.

Some Egyptian politicians also claimed that Egypt deserves to eternally keep over 90 percent of the Nile even though it contributes less than 1 percent to the Nile. They cite outdated colonial agreements from 1959 signed between Egypt and Britain, which excluded eight out of ten Nile African countries. The Mubarek Cairo regime also took advantage of the civil war in Ethiopia to sign vague agreements in 1993. However, for the first time in history, the majority of Nile basin African countries signed in 2010 the binding international treaty, the Cooperative Framework Agreement (CFA), for the fair and equitable utilization of the Nile River among all countries.

Egypt ignored the 11 years of negotiations that led toward the CFA treaty, which was adopted by all other Nile African countries. Despite threats from Egypt, Ethiopian government has continued the dam construction. Analysts say that Ethiopia’s growing population need to utilize the Nile river since it can not depend on erratic rains to produce energy or to feed its people who have already suffered numerous famines over the last few decades.

http://www.ventures-africa.com/2014/03/cairo-analyst-says-ethiopia-dam-wont-hurt-egypt/

.

Ethiopian spice exporter discovers new markets in Africa

.

BY Kate Douglas

Senai Wolderufael is the 27 year-old Ethiopian entrepreneur behind Feed Green Ethiopia Exports. Prior to starting the company in 2012, Wolderufael was a customer service agent at Ethiopian Airlines where he noticed members of the Ethiopian diaspora carrying bags full of Ethiopian spice blends – such as Berbere and Shiro – when travelling back to the west.

Seeing the demand, Wolderufael had the idea to get his export business licence and produce Ethiopian spice blends to supply his countrymen living in the US and Europe.

Wolderufael and his business partner, Eyob Weldegabriel, started Feed Green Ethiopia Exports with less than US$2,000 startup capital. The company has since found new export markets for its spices and processed food products in Africa, and has also recently decided to start exporting Ethiopian coffee. How we made it in Africa speaks to Wolderufael about the potential he sees for the business in Africa, and what it is like to be a young entrepreneur in Ethiopia.

When you initially started your company, you were catering purely to the Ethiopian diaspora but have since started exporting your spices to other African countries. Tell us about this potential.

We were targeting Ethiopian restaurants all over the world, shipping them processed food products and spices. We then moved onto international clients who are not Ethiopians, shipping them internationally known spices like black cumin, caraway seeds, ginger and the like. We started to learn that some African countries actually import some of these spices from Asia, which we can easily supply at good quality and at a better price. We now know that even Africa is a huge market for our products. So this led us to [see] the huge potential market some African countries like Nigeria and Ghana possess, so we also started [focusing] on that too.

Where do you source your spices from?

We get our spices straight from farmers on their farms. We offer them good prices if they give us good quality. With this we developed a good business relationship with our suppliers; they understand us, as we understand them. We collect the spices and then process them further – we wash them, dry them, inspect them by hand, and then we pack them. For our dry food items, we have our own production in two of our production facilities in Addis Ababa. Production of our dry food items takes up to 20 days depending on the quantity.

What are some of the challenges you face as an entrepreneur in Ethiopia?

As a business in Ethiopia we faced many challenges. One of the main challenges we face every day would be a lack of information. Since Ethiopia is a developing country, rules and regulations change frequently, and we will learn of the changes when we face them, or when the rules apply to us, and that causes us to delay on delivery of shipments. We also face some challenges like price fluctuation, infrastructure and logistical problems which are understandable as we live in Ethiopia. But as an exporter we also get benefits from the government, as the government appreciates and helps exporters.

Do you think it is becoming easier or more difficult to be an entrepreneur in Ethiopia?

I believe it’s easier to be an entrepreneur in Ethiopia, as the country has a huge potential, and the country is developing very fast. This opens up many opportunities for young people like us to start something that can help themselves and their country.

What characteristics do you think make a good entrepreneur?

I believe an entrepreneur should be strong, hard working, patient, a risk taker, a person who can see things from a wide perspective, a person who can forecast the future and a person who is not afraid.

Where would you like to see you and your company in five to 10 years?

After 10 years, I see Feed Green Ethiopia Exports becoming one of the largest food companies on the continent. When we started in January 2013, we started with less than $2,000, but at the end of December 2013, we had a revenue of more than $100,000. This gave us a big morale [boost] to go further, and we are working hard to triple our revenue by the end of this year. And as of April 2014, we will enter into the huge coffee market. Ethiopian coffee is one of the best qualities in the world and the country is number one in Africa for exporting coffee… So currently, we have three projects at hand: international spices, Ethiopian processed food products and now coffee. I guess we will have to see what the next decade holds for Feed Green Ethiopia Exports.

http://www.howwemadeitinafrica.com/ethiopian-spice-exporter-discovers-new-markets-in-africa/37188/

.

New sesame warehouses to benefit smallholder farmers

.

The U.S. Government, through the United States Agency for International Development (USAID), inaugurated a new sesame warehouse in Dansha yesterday with the Ethiopian Federal Cooperative Agency._ This is one of four new warehouses constructed over the last 18 months in Tigray and Amhara states, Agency press release said.

USAID cooperated on the construction of two warehouses in Tigray with the Setit Humera and Dansha Aurora FCUs and two more warehouses in Amhara with the Metema and Selam Farmers’ Cooperative Unions (FCUs)._ The 20,000 metric tonnes storage capacity in the four warehouses will allow the FCUs to purchase more sesame from their combined 41,713 member farmers. USAID’s investment of 1.4 million USD and assistance in facilitating 611,605 USD in loans from the Commercial Bank of Ethiopia—a financing first for the bank and FCUs–was instrumental in the construction of the warehouses.

According to the release, USAID’s goal is to bring these four FCUs into the export market by delivering necessary support including providing technical assistance in good agricultural practices, post-harvest handling and quality inspection and grading._ Increased sesame production and better storage of the crop in a well-managed warehouse will improve quality so that these FCUs will meet the international market demand.

“Sesame farmers lose anywhere from 15 per cent to as much as 25 per cent of their product due to lack of proper and adequate storage,” the release quoted USAID/Ethiopia official Cullen Hughes as saying at the inauguration ceremony. “We are confident that the new warehouses will help reduce such post-harvest losses, increase exports, and contribute to the improved livelihoods of the farmers.”

“The sesame warehouses are an excellent example of the achievements possible with strong partnership and cooperation across important stakeholders,” said Usman Surur Siraj, Federal Cooperative Agency Director General._ “The warehouses will be vital to capitalize on an excellent export opportunity for the benefit of Ethiopia, the farmers’ cooperatives unions and the smallholder farmers.”

USAID will continue to invest in new technologies to benefit smallholder sesame farmers and expand agricultural export opportunities for Ethiopia including innovation grants to leading FCUs for sesame cleaning machines to enable entrance into U.S., EU and Japanese markets.

Developing the sesame value chain is an important part of USAID’s Agricultural Growth Programme-Agribusiness Market Development Project, known by its Amharic acronym AMDe, part of the U.S. Feed the Future initiative.

http://www.ethpress.gov.et/herald/index.php/herald/news/6467-new-sesame-warehouses-to-benefit-smallholder-farmers

.

House passes bill ratifying 50 mln. USD loan

.

The House of Peoples’ Representative at its 4th year and 20th regular session yesterday passed bill ratifying 50 million USD loan agreement between Ethiopia and Poland for the procurement of spare parts to assemble tractors.

The bill has been endorsed as Government of the Republic of Poland Credit Agreement for the Financing Modernization of Agriculture Ratification Proclamation No 831. The House thoroughly discussed a motion presented by the Finance and Procurement Affairs Standing Committee and approved it unanimously.

Presenting the report, Government Deputy Whip with the rank of State Minister Muferiya Kamil said that the agreement would enable farmers to increase productivity and create massive job opportunities. The money would be used to assemble 1,496 tractors and supply to the market. In addition, it would facilitate technology transfer and build the capacity of local agricultural mechanization enterprises, she added.

According to Muferiya, the expansion and application of modern agricultural technology is vital to promote productivity and sustain sector growth. Among other, tractor is the major agricultural implement to assist production. Accordingly, Metal and Engineering Cooperation as well as Nazareth Tractor Factory have been producing tractors and supplying to farmers. However, the supply does not meet the demand.

She, therefore, underlined that the loan would be contributing a lot to assemble and produce more tractors and meet the demand. In this regard, the Nazareth Tractor Factory would be financed to import more spare-parts used for assembling and providing tractors to beneficiaries.

The House has also unanimously approved African Statics Charter Draft Proclamation presented by Budgetary and Financial Affairs Standing Committee Deputy Chairperson Genet Tadesse.

Asked about the significance of the Charter, she said it is aimed at scaling up the role of statistic thereby assisting in the socioeconomic development of the country. She also noted that the Charter would be an important tool to coordinate an integrated statistical works at national and continental level.

http://www.ethpress.gov.et/herald/index.php/herald/national-news/6469-house-passes-bill-ratifying-50-mln-usd-loan

.

Enterprise set to establish permanent post offices in all woredas across nation

.

The Ethiopian Postal Service Enterprise is set to establish permanent post offices in all woredas across the country at the end of the Growth and Transformation Plan (GTP) period.
Enterprise Process Chief Officer, Ziyen Gedlu, told WIC today that the opening of the office would help farmers and pastoralists to get postal service within their reach.
Efforts are underway to open offices in 150 woredas this Ethiopian budget year, he said.
Currently, the enterprise is offering service through its 638 permanent post offices and 165,000 boxes across the country, the officer pointed out.
The enterprise has set a plan to collected over 300 million birr this Ethiopian budget year. During the first half of the budget year, it has collected over 131.3 million birr, it was learnt.

http://www.waltainfo.com/index.php/explore/12797-enterprise-set-to-establish-permanent-post-offices-in-all-woredas-across-nation

.

New Climate Innovation Center Launched to Jumpstart Clean-Tech

and Climate-Smart Agriculture Ventures in Ethiopia

.

.

A new World Bank-supported business hub, the Ethiopia Climate Innovation Center (ECIC), was launched today in Addis Ababa to support pioneering clean technology enterprises that address climate change while creating jobs and improving livelihoods. First of its kind in the country, the center will help over 3.1 million Ethiopians increase resilience to climate change and is expected to create more than 12,000 jobs in the next ten years.

Ethiopia’s agriculture, which is highly sensitive to fluctuations in rainfall, represents the basis of the national economy. It accounts for approximately 46% of the GDP and 80% of the jobs of the working population. According to the World Bank report ‘Economics of Adaptation to Climate Change,’ without a proper green growth strategy, the total climate adaptation costs for Ethiopia could range from US$1.22 billion to $5.84 billion per year.

To reduce climate adaptation costs and create opportunities of growth, the Ethiopia CIC will provide financing, mentorship, and advisory services to the growing number of local clean-tech entrepreneurs working in agribusiness, energy efficiency, renewable energy and biofuels.

“This initiative supports key components of the Government of Ethiopia’s Growth and Transformation Plan (GTP) and the Climate Resilient Green Economy (CRGE) strategy,” said Guang Zhe Chen, World Bank Country Director for Ethiopia. “The CIC is a unique initiative which will help to unleash the growth potential of local entrepreneurs, while at the same time enabling them to come up with innovative business solutions to challenges related to climate change. By employing emerging clean technologies – such as off-grid solar energy, green building design and agricultural waste to energy plants — these entrepreneurs will continue helping Ethiopia adapt to climate change while creating jobs and improving the livelihoods of local citizens.”

By supporting local entrepreneurs and ensuring the transfer of modern technologies, the ECIC is expected to improve access to energy for 265,000 Ethiopians and increase agricultural efficiency for 120,000 farmers. Furthermore, the center will promote Ethiopia’s climate resilience by mitigating almost one million tons of CO2 and avoiding the loss of 31,000 acres of forest.

“Injera cooking accounts for about 90% of all household energy consumption. I decided to develop an efficient biogas stove that drastically reduces fuel wood consumption,” said Getu Alemayehu, one of the innovative entrepreneurs supported by the center. “The ECIC is like a wake-up call for all small initiatives in Ethiopia: it stimulates us to keep on developing ourselves, to further improve our technologies, to establish a company; it calls us to be entrepreneurs.”

The Ethiopia CIC is part of infoDev’s Climate Technology Program (CTP), which is currently implementing a global network of innovation centers across seven other countries. The Ethiopia CIC is supported by the government of Norway, UKAid and the World Bank. It is managed by a consortium led by the Horn of Africa Regional Environment Center (HoAREC) – a regional institution hosted by Addis Ababa University (AAU) and other public and private sector partners.

http://www.ethiopiainvestor.com/index.php?option=com_content&view=article&id=4922:new-climate-innovation-center-launched-to-jumpstart-clean-tech-and-climate-smart-agriculture-ventures-in-ethiopia&catid=74:top-story

.

Forum deliberates on public private partnership in health sector

.

The Ministry of Health (MoH) has stressed the need to strengthen cooperation between stakeholders working in the health sector to improve health service in the country.

The remark came here yesterday at the opening of a two-day forum, which brought together public and private entities working in the health sector in the country.

The forum, aimed at creating awareness on the contribution and value of the private health sector, was held under the theme, “Optimize, regulate, and cement partnership with the private sector for sustainable universal access.”

“The cooperation between stakeholders active in the health sector has to be strengthened and intensified by exploring and developing new forms of partnership arrangements in order to improve the availability and quality of health services in the country,” Dr Keseteberhan Admasu, through his representative told participants of the forum.

The government of Ethiopia is committed to support the private sector in order to increase access and quality of health services to the public by creating enabling environment, he said.

The ministry of health has developed a strategic framework for the public private partnership in the health sector, he said, adding a policy guide line for the Public Private Partnership (PPP) to enhance the implementation of PPP is underdevelopment and will be realize it soon.

According to him, the forum will help draw attention on how to best harness the full potential of the private health sector by optimizing its effectiveness, rationally regulating it for equitable, high quality and affordable universal access to health care through sustainable public-private partnership.

Private Health Sector Program Chief of Party, Dr Tesfaye Gebrekidan, on his part said the private health sector has supported the private health facilities in 5 regions and 2 city administrations.

The forum would help to enhance partnerships between the government and the private health sector, rational regulation and health financing to assure equitable universal health coverage, he said.

http://www.waltainfo.com/index.php/explore/12805-forum-deliberates-on-public-private-partnership-in-health-sector-

.

Foreign Minister, Dr Tedros Adhanom holds talks with GlaxoSmithKline (GSK) Vice President

.

Foreign Minister Dr Tedros met and held discussions with the Vice President and the Director of the East African Region of GlaxoSmithKline (GSK), Dr Allan Pamba on Friday (March 28).

Dr Allan reiterated GSK’s commitment to invest in Ethiopia, noting that a feasibility study had already been completed. He said GSK planned to have a strong presence in Ethiopia by the end of the year. Dr Allan said that Ethiopia would be the lead market in the region to show GSK’s vision in Africa.

He added that GSK is already providing basic services to communities in education and had trained 3000 health extension workers so far. He added: “the company does not want to grow alone but with the society”. Foreign Minister, Dr Tedros, expressed his appreciation of the commitment shown by GSK and the concrete steps taken by the company in Ethiopia. He commended the community-based activities undertaken by GSK and reiterated the Ethiopian government’s support to GSK.

GlaxoSmithKline plc is a British multinational, pharmaceutical, biologics, vaccines and consumer healthcare company. It is the world’s fourth-largest pharmaceutical company and has a portfolio of products covering major diseases including asthma, cancer, virus control, mental health, diabetes and digestive conditions.

http://www.mfa.gov.et/news/more.php?newsid=3171

.

Reflections on the Past and Future of ECX

.

History is a curious thing.  You don’t quite know when something will stand the test of time and become truly the stuff of history, unlike the humdrum comings and goings, the projects, initiatives, and businesses, that are here one day and gone and forgotten the next.  It is not often, and a rather magical thing when it does, that an idea takes root, becomes reality, and then evolves into a dynamic, living, entity that is somehow placed firmly in the ethos of a society, becoming in effect a part of its history.  I often wonder, did the founders of Apple know they were creating a company that would forever be listed in the annals of the history of personal computing?  Did the creators of Kleenex feel their product would literally shape the vocabulary of millions?  Or, closer to home, did Tomoca Café know it would stand out from the crowd of cafes around our city to become the iconic brand it is today?

When we set out to create the first ever commodity exchange in Ethiopia, and indeed the first of its kind in Africa, we had no idea where it would go or what it would become.  Those were heady days back in 2006 and 2007, filled with fever pitch excitement, sleepless nights, hours of meetings and endless cups of coffee around meeting tables as step by step, plan by plan, we went from a simple, perhaps naïve, idea that something had to be done to make our agricultural marketing system more efficient, more transparent, less costly, and less risky.  For this country we felt so strongly about, we applied our best thinking, we sought lessons far and wide, we fought against skeptics, we argued against ourselves, we crafted, fine-tuned, negotiated, tested, re-worked, refined, in an endless cycle of learning and re-learning.   And when the Opening Bell rang for the first time on April 24, 2008, it rang in the aspirations of a nation, bearing our passion, our dreams, and all the love in our hearts.

Six years ago, it was an implausible idea that a country best known for famine, war, and a crippling bureaucracy, would dare to dream of creating a world-class commodity exchange in which products are stored and traded according to standards, market prices are transmitted in seconds, and payments are settled in hours between tens of thousands of clients and in tens of millions of dollars.  And the world stood by to watch just what we would do.

And not by the brilliance of our ideas, but rather by the sheer determination of our spirits, every day, day after day, year after year, we built a market that is today a symbol of what our beloved country can achieve with will, intelligence, and heart.  Today, ECX is recognized across the country by millions of Ethiopians, farmers, traders, processors, and exporters, as an institution that touches their lives everyday.

As importantly, beyond our borders, to far-flung corners of the world, ECX is hailed globally as an African icon, representing the new Ethiopia we all dreamed of shaping.   Today, ECX crops up in speeches by governors of Central Banks in countries like Nigeria and Kenya, it emerges in coverage by CNN of innovations in Africa, it is mentioned in analyses of the African investment opportunity in corporate boardrooms in Wall Street, Tokyo, and London.

As I have pursued my own dream of creating a new company to implement commodity exchanges across Africa and other emerging economies, I am humbled by the recognition that ECX has gained literally the world over and the respect and admiration for Ethiopia that ECX inspires. Put simply, ECX is no longer just an idea, nor an initiative for a few, nor can it be explained by what it does or what it is.  Rather, ECX has become a symbol of something greater, part of the historical forces shaping not just our nation, but also our continent, as it emerges to take its place in the global arena.

The answers to the above questions are that you can never know when you start something whether it will become history.  Nor can you plan for that to happen.  What you can do is simply to give your best, your heart, and keep on giving it over and over, in the honest hope that what you have to offer means something to someone else and makes this world a better place.

Like all living institutions, ECX today is in transition, facing its second change of leadership, as its chief executive has been forced to resign out of health considerations.   Just as during its first change of leadership, there is no doubt that, at this important junction, its resilience will be put to the test, as it once again goes to the drawing board to re-invent itself anew, as it has always done.  And there is no doubt in my mind that it will emerge stronger, better, responsive to the people and market it serves, and worthy of the hopes, dreams, and love of the Ethiopian people.

Eleni Zaude Gabre-Madhin CEO of eleni LLC and founder and former CEO of the Ethiopia Commodity Exchange [For Capital]

http://www.ethiopiainvestor.com/index.php?option=com_content&task=view&id=4923&Itemid=88

.

US-Based Investor Acquires 25% Stake In Ethiopia’s Telemed

.

VENTURES AFRICA – The Africa Group (TAG), a US-based boutique advisor and venture capital investor, has acquired a 25 percent stake in Telemed Medical Services (Telemed), an Ethiopian engineering services that designs health systems in Ethiopia.

With this investment, TAG will gain exposure to the continent’s fourth largest consumer market, with focus on a rapidly-expanding mobile sector.

Since its introduction in 2012, Telemed has launched innovative healthcare services including, Hello Doctor, which is in partnership with BelCash Technology Solutions PLC, Ethiopia’s leading technology provider. The facility allows patients call a short code number to access professional health services such as phone consultations, ambulance dispatch and homecare service.

Telemed’s work is geared towards optimizing and reinforcing health resources in Ethiopia, a country where the doctor-to-patient ratio is 1:30,000 and 80 percent of the population lives over 5 kilometres from the nearest health centre.

The Company follows a similar model to various developed-market ventures, including Doctor on Demand, a leading California-based telemedicine company launched around the same time.

A tranche of growth equity provided by TAG and a grant from a USAID and DFID-backed development fund will be used to increase service capacity across Ethiopia, build a remote patient monitoring system, and facilitate a major marketing campaign. In addition, TAG will provide technical assistance to buttress key areas including governance and compliance.

Founder of Telemed, Dr. Yohans Wodaje, explained that investment such as that of TAG’s, was crucial to an organisation that provides a critical service to the Ethiopian public.

“Venture capital is a crucial source of financing for start-up business like ours, having the potential of catapulting them to reach greater markets,” Dr. Woodaje said.

Elias Schulze, Managing Partner of The Africa Group, who serves as Africa CEO for Kaymu, an internet retail firm, hopes the deal marks the beginning of a healthy relationship with Telemed.

“The team, led by Special Operations Associate, Tim Burkly, worked tirelessly with Dr. Yohans’ team to complete this unique transaction and we are positioned well to scale together,” he said.

Asides Telemed, TAG is exploring the possibilities of further investments across the continent. Though Elias noted it was in no rush to complete any transactions, he made mention of opportunities currently being explored.

According to him, there is “One in Senegal (trading and advisory) and have just commissioned a study into a media and entertainment opportunity in East Africa.”

http://www.ventures-africa.com/2014/03/us-based-investor-acquires-25-stake-in-ethiopias-telemed/

.

Sugar corp, Amibara sign out-grower deal

.

The Ethiopian Sugar Corporation (ESC) signed a first ever out-grower agreement with a private company – Amibara Agricultural Development plc – for the latter to supply sugarcanes for Kessem Sugar Development Project.
Factory erection of the Kessem project, currently underway in Afar region, is entering its final phase. However, lags in sugarcane plantation, caused by low level of water flow to the irrigation dam, prompted ESC to look for other alternatives, according to project manager Kaba Merga.
The three year deal will see Amibara, whose farm is located in close proximity to the sugar project, develop 6,000 hectares of land with sugarcane plantations.
“The company is selected due to its close proximity, adequate infrastructure and capacity to undertake the task and as well as its keen interest to participate in the project,” Damene Darota, ESC deputy director general, said during the signing ceremony held today at the corporation’s headquarters in Addis Ababa.
“We want to avoid a gap in sugarcane supply when the factory begins operation. The deal will help us in smoothly carry out our operation,” Kaba said during the ceremony.
According to the project manager, the Kessem project assisted the private company by providing short trainings to experts and agricultural equipments and inputs. Since last month, 600 hectares of land has been covered with sugarcane plantation and the performance is evaluated every month.
Amibara had prior working relations with the corporation. The company had rented out a small portion of its plot in Woito area for cane plantation in connection with Omo Sugar Development Project.
Sheik Omer Yusuf Mohammed, owner and CEO of Amibara, expressed his delight to be working with ESC and appreciated the support from the corporation. He remained optimist the cooperation would continue.
“There could be a possibility of extending the deal. In any case, we may erect our own crushing factory in the future,” said Sheik Omer Yusuf Mohammed, who abandoned his cotton plantation in favor of sugarcane. His company estimates to fetch some five million birr from first cutting.
Although this is the first time for a private company to enter an out-grower deal with the corporation, the state owned sugar factories enter similar agreements with farmers. Last month, Wonji-Shewa Sugar Factory struck the ninth out-grower deal with farmers’ cooperatives agreeing to purchase a quintal of sugarcane for 50 birr.
“We are keen to participate the public and private companies in our sugar projects,” Shiferaw Jarso, ESC director general with the rank of minister, said. “This deal serves the interest of both the corporation and the company.”
Kessem Sugar Development Project plans to develop 20,000 hectares of land for sugarcane plantations in Kessem and Bolhamon areas. When completed, the factory is expected to produce 153,000 tons of sugar and 12,500 metric cube of ethanol annually at initial capacity.
Kessem is part of the government’s drive to increase the country’s sugar production capacity to 2.25 million tons during the GTP period. Current annual production capacity of the country stands at about 300,000 tons. Annual ethanol production is projected to reach 181.8 million liters, a massive leap from the current eight liters.
The output is not only expected to satisfy domestic demands but also elevate the country to a net sugar exporter. In a bid to achieve the ambitions target, the government is undertaking the construction of ten new sugar development projects and expansion works in the existing sugar factories.

http://www.waltainfo.com/index.php/editors-pick/12804-sugar-corp-amibara-sign-out-grower-deal-

.

.

Ethiopia closer to sign FTA to join other COMESA members

.

.

As part of the required deals in the regional integration, Ethiopia is closer to signing the Common Market for East and Southern Africa (COMESA’s)

http://www.thereporterethiopia.com/index.php/news-headlines/item/1796-ethiopia-closer-to-sign-fta-to-join-other-comesa-members

.

Lebu to be hub of nationwide rail network

.

.

The Lebu area, located in the south western end of the capital has been selected to serve as the hub of the up and coming nationwide railway network ultimately extending 5060kms and currently under construction.

Turkey Talks Business in Ethiopia With a Billion Br Textile Expansion

.

-  The expansion will create an additional 13,000 jobs and take the production capacity up to 100pc

.

The entrance gate of the textile factory, located at Alemgena town, 19km from Addis Abeba,

in Southwest Shewa Zone of Oromia Region.

.

Ayka Addis Textile & Investment Group is undertaking an almost one billion Birr expansion on six hectares of land. This could see its exports tripling to 150 million dollars and its employees increasing by around 13,000.

The Company moved from Turkey to Ethiopia with an investment of 140 million dollars. Its latest expansion – to take place in two phases, beginning as early as April 2014 – will consume 962.5 million Br, according to Amare Teklemariam, CEO of Ayka. Ayka has already received 3.6ha of land from the Kolfe Keranio District for its first phase, and is in the final stages of leasing an extra 2.6ha, he added.

The Company secured 3.6ha of land last year, through lease that will extend for 70 years, according to officials at the land management office of the Addis Ababa city administration.

The Company currently has five plants in Alem Gena town of the East Shoa Zone,Oromia Regional State(19km from Addis Abeba). These plants, now operating at 80pc to 90pc capacity, have the capacity to spin 40tns of cotton, knit 38tns of thread, dye 50tns of cloth and produce 80,000 pieces of garment – all in a day’s work, with 7,500 permanent and 100 temporary workers. The Company exports its produce mainly to Germany.

Now with a capital of 2.5 billion Br, the expansion projects are expected to boost the Company’s export earnings to 150 million dollars, from 56 million dollars in 2012/13.

“The expansion project will increase our present garment production capacity by 50pc, when the first phase of expansion is finalised and by 100pc when the second phase of expansion is finalised in 14 months,” the CEO told Fortune.  “Once finalised, the project will create job opportunities for 13,000 people.”

From the total project cost of 962.5 million Br, building and civil work is expected to consume 221.3 million Br and 623.2 million Br will be spent on machinery and equipment. The remainder will be used as working capital, he said.

Ayka’s construction wing will undertake the construction and installation works of the new factory itself, as it did with its five other plants in the country.

“We will commence construction as soon as we get the title deed,” Amare says.

The land that has been given to Ayka currently houses stores and pole treatment plants  of ethio telecom; these will move to new facilities to be set up by Ayka.    Currently, there are six other expansion projects ongoing in the textile industry.  Ten new additional factories with a combined production capacity of 100tns a day are also expected to start production during this fiscal year. An additional three new projects are expected to start production during the 2014/15 fiscal year according to Ethiopian Textile industries Development Institute (ETIDI).

Despite all this development, the industry that now comprises of 115 textile factories and 40,000 workers, was only able to earn 52pc of the 111 million dollars that it was supposed to achieve in the first half of the year, according to the Institute. The target for the year is set at 317 million dollars.

With a per capita fibre consumption of roughly one kilogram – far below the world average of 8.7 kg and the African average of 3.2 kg – the country has great potential, which needs to be used properly, according to a research conducted by the African Growth & Opportunity Act (AGOA), three years ago.

The underutilised capacity of existing factories is still a big problem in the industry, according to an expert, who talked to Fortune on condition of anonymity. Factories in the textile sector are currently only utilising around 60pc of their production capacity.

Around 99 million dollars worth of textile products was exported in the last fiscal year. This number is expected to reach one billion dollars by the end of the Growth & Transformation Plan (GTP) period, which is only one year away.

http://addisfortune.net/articles/turkey-talks-business-in-ethiopia-with-a-billion-br-textile-expansion/

.

Weaving a New Path with Ethiopia’s First Certified Organic Cotton Cultivation

.

-  It is an important step for the Ethiopian textiles industry, as the European market demands organic cotton

.

  .

AYCOOM Agricultural Development Plc has secured 10,000ha of land in the South Omo Zone of the Southern Region. It will now start the first certified organic cotton cultivation in the country at a cost of 815 million Br.

This company, formed by a 55pc share from Ayka Addis Textile & Investment Group and a 45pc share from Omo Valley Agricultural Development Plc, will largely supply Ayka’s demand for organic cotton. Omo Valley is a company owned by the Amibara Business Group, which has already been supplying cotton to Ayka for the past six years from its 13,000ha of land in different parts of the country.

AYCOOM signed a land lease agreement on Tuesday, March 25, 2014, with the Gnangato and Hamer woreda administrations. Construction work on the workers camps had, however, already begun, according to Amare Teklemariam, CEO of Ayka. The agreement will have AYCOOM pay 158 Br a hectare a year for 25 years.

The total cost of the project may depend on the technology to be deployed on the farm, but the feasibility study puts it at 815 million Br, according to the CEO.

The need for organic and quality cotton has pushed the textile company, which sells most of its products in Europe, to engage in such a venture, says the CEO. Currently, there is no certified organic cotton farm in Ethiopia, according to the Ethiopian Textile Industry Development Institute (ETIDI).

The other reason for this move is the increasing foreign exchange that the Company is spending on organic cotton imported from abroad. The Company spent 72.5 million Br for the import of organic cotton in 2013 alone.

“This will also enable the Company to be an end-to-end producer, integrating its production processes,” says Amare.

The Company will also get its cotton from the Cotton Made in Africa Project, through farmers in Metema – 900km from Addis Abeba, in the North Gondar Zone of the Amhara Region. Ayka signed an agreement with the Metema Cotton Producers’ Union and member associations on Friday, March 7, 2014, for the supply of 50,000qts of cotton in the 2014/15 harvest season.

Garment made from organic cotton has a greater demand in the global market and could fetch better prices, saysYared Mesfin, cotton and textile marketing director at the ETIDI.

“There was not enough market for organic cotton in the country and the process of certification is cumbersome and costly for small-holder farmers,” said Assefa Aga, general manager of the Ethiopian Cotton Producers, Ginners & Exporters Association (ECPGEA), explaining the reason for the absence of organic cotton farms in the country.

Organic cotton farms cannot use manmade fertiliser and pesticides above a certain threshold level.

AMIBARA has been engaged in agriculture for the last 15 years; it comprises of 11 different companies as subsidiaries, with around 700 million Br capital and 3,000 permanent and 10,000 temporary workers. Its subsidiaries include – Gelista Agricultural Development, Middle Awash Agricultural Development Enterprise, Amibara General Aviation Service, Addis Modjo Edible Oil Complex and Amibara Agrochemicals.

The business group has been supplying cotton to Ayka since the textile Company first became operational in 2008. This has led to the partnership, according to Amare.

“We have been using their cotton for the last six years and we are happy with their performance,”Amare said.”They run some of the biggest cotton farms in the country.”

The business group believes that its expertise in cotton production will enable it to effectively run the farm, says Yusuf Omer (Sheikh), directing manager of the business group.

Amibara is hoping to access loans from the Development Bank of Ethiopia (DBE) and the Commercial Bank of Ethiopia (CBE).

There seems to be a trend with big textile companies in the country investing in cotton cultivation, with the list including Adama Textile, Elyse Textile and Almeda Textile. Such companies are trying to minimise the risks in cotton market volatility, says Yared.

“In the short run, this kind of process integration can solve the raw material problem in the market,” he said.

Yet this development will not pose a threat to already existing cotton farms, according to Assefa.

“There will not be a problem for existing cotton producers, as there is shortage of cotton in the market,”he said. “Even though major textile companies are beginning cotton production to secure their input.”

In the last harvesting season, 2012/13, 55,000ha of land were covered with cotton and 35,000tns of produce was collected, according to the ECPGEA. Total cotton production stood at 79,710tns in the 2011/12 harvest season. Ethiopia expects to import around 20, 000tns of cotton in the current fiscal year, in order to cover the growing demand from the textile industry, according to the ETIDI.

The Institute is trying to rectify problems in the industry by increasing productivity and working on modernising marketing practices, according to Yared.

http://addisfortune.net/articles/weaving-a-new-path-with-ethiopias-first-certified-organic-cotton-cultivation/

.

New Draft Directive to Fertilise Ethiopia’s Flower Industry

.

The Ethiopian Horticulture Development Agency (EHDA) is in the process of drafting a new directive. This is designed to enable individual exporters, including those with no involvement in flower growing, to export horticulture products they have collected from various growers.

The draft – called ‘Consolidation Directive Proposal’ – will be referred to the Ministry of Agriculture (MoA) after a week’s time and eventually to the Council of Ministers (CoM) for approval, Fortune learnt.

The Consolidation Proposal was submitted earlier, to the National Export Council, at the end of January 2014. The Council then ordered the Agency to conduct research on consolidation and submit it to the CoM by the end of February.

“The research will be finalised within a week,” Wondweson Taddesse, Plan & Strategic Management director at the Agency, told Fortune. “The research team is in Kenya for a week-long visit, as part of the research.”

One of the major objectives of the visit is to take lessons and experience from consolidation in the Kenyan flower industry, Wondwosen said.

The consolidation directive was first initiated by the Ethiopian Horticulture Producers & Exporters Association (EHPEA) and the Agency two years ago. At the time, a group of American flower buyers came to Ethiopia, but could not source growers capable of supplying flowers in as large quantity as they required.

“The capacity of flower growers must be improved, so that they can become competitive in the international market,” Wondwosen said. “The biggest hindrance for Ethiopian growers in trying to become competitive is that they are growing on small plots of land.”

The consolidation directive is designed to give flower growers the opportunity to supply larger quantities of flowers to a wider market in Europe and the rest of the world, according to Wondwosen.

The directive is also meant to increase the quality of flowers by creating better packaging systems and the a greater variety of flowers to be included in a single market.

For Tsegaye Abebe, the owner of ET Highland, the directive will help growers to get additional market opportunities in Europe and the rest of the world. He, however, cautions that growers have to know the destination of their flowers.

Previously, few capable growers practiced consolidation, but the experience was far from widespread, says Wondwosen.

“With the involvement of exporters, who are not necessarily growers, now that a directive is going to be issued, change in the industry is expected,” Wondwosen said.

Based on the experiences of the other countries, the directive will give the task of the consolidation to market agents. The latter will also be consulting growers to grow new kinds of flowers.

According to the report of the Ministry of Trade (MoT), Ethiopia exported nearly 1.76 billion stems of flowers in 2011/12 and 2.25 billion stems in 2012/13. Despite the growth in exports, however, its revenue was down from 197 million dollars to 187 million dollars.

http://addisfortune.net/articles/new-draft-directive-to-fertilise-ethiopias-flower-industry/

.

Glaxo to Invest Millions in Factories and Jobs for Africa

.

.

GlaxoSmithKline is poised to announce a multimillion pound investment in Sub-Saharan Africa to step up its presence in the region, the Telegraph can reveal.

Britain’s biggest drugmaker will tomorrow unveil plans to build up to five new factories, creating hundreds of jobs. 

The company, which already manufactures drugs in Kenya, Nigeria and South Africa, is looking at sites in Ghana, Ethiopia and Rwanda for its new facilities.

Sir Andrew Witty, the chief executive, will make the announcement at the EU-Africa Business Summit in Brussels. He will also announce investment in research and development activities in Africa.

Sir Andrew, writing in the Telegraph, has underlined the importance of the region for GSK’s long-term business. “The transformation of Africa into a successful growth region is one area that we need to focus on,” he said. “There is a great opportunity for business to play a role, alongside governments and other agencies, to help deliver improved infrastructure and create prosperity to lift people out of poverty for good.”

GSK considers Africa to be at an economic “tipping point” and believes it will be one of the world’s most important growth drivers within 20 years.

GSK currently brings in around £500m in revenues from the Sub-Saharan region, a tiny fraction of its £26.5bn sales.

Sir Andrew said GSK had a “responsibility to use our scientific expertise and our global reach to develop innovative medicines and deliver them to people who need them around the world.”

He admitted many companies, including GSK, “haven’t always got it right”. He called for the private sector to use its “innovation, resources and reach to create prosperity, provide employment and deliver goods and services that people want and need.”

GSK’s sales model for much of Africa is based on volume rather than profit growth. For the countries that fall into its “least developed” category, the company sells its patented medicines for a quarter of the price they fetch in the UK. In 2013 it established a new unit dedicated to selling drugs in Sub-Saharan Africa, which it described in its annual report as “the first step in a broader growth strategy for Africa”.

The company also reinforced its presence in the continent last year by partnering with Save the Children to “save the lives of one million children” by broadening access to vaccines, investing in health workers, improving child nutrition and researching new medicines. Programs have been launched in the Democratic Republic of Congo and Kenya.

GSK is also in the advanced stages of developing the world’s first malaria vaccine, which could make a “significant impact” on the health of millions of young children.

It has already committed to selling the vaccine on a not-for-profit basis, but has not yet disclosed how much it will cost to manufacture.

http://www.ethiopiainvestor.com/index.php?option=com_content&view=article&id=4926:glaxo-to-invest-millions-in-factories-and-jobs-for-africa&catid=74:top-story

.

Ethiopia, America to launch farmers exchange program

.

The Ethiopian and united States governments  are set to launch a new farmer to farmer exchange program between the two countries to improve productivity and economic opportunity in priority sectors of agriculture, starting with the grains sector, and then expanding to other priority food security and export sectors.

.

USAID Ethiopia in collaboration with Catholic Relief Services and the Ministry of Agriculture will launch the program in Addis Ababa this week. 

The exchange program will bring 125 American farmers to work side by side with Ethiopian farmers, researchers, and educators, according to the press statement from the United States embassy in Addis Ababa, Ethiopia.

“USAID Ethiopia Mission Director Dennis Weller will launch the new program with Mathew Davis, Country Representative, Catholic Relief Services Ethiopia. Mr. Berhanu Gezahegn; Director, Training and Advisory Service Directorate will represent the Ministry of Agriculture. Dr James Worstell, an agronomist and new Farmer to Farmer Volunteer for Ethiopia will attend the launching.”

http://www.newbusinessethiopia.com/index.php/buss/99-agribusiness/720-ethiopia-america-to-launch-farmers-exchange-program

.

Rift Valley restoration project envisions restoring indigenous trees

.

 .

Rift Valley Restoration Project aka Shega Rift Valley Restoration is working with a view of reconnecting the missing culture of selecting , domesticating, propagating, and cultivating Ethiopia’s indigenous trees. The project has been endeavouring to restoring indigenous trees for the last eight years.

Shega organized a fund raising programme at the residence of former President Girma Wolde-Georgis here yesterday.

Speaking at the programme, Founder, Patron and Board Chairman of the project Girma Wolde-Giorgis said that the forest resources in the rift valley is dwindling devastating at an alarming rate. All tress are gone and the threat of desertification is real challenge to the area. “So, we are trying to restore the forest to its status,” said Girma.

Project Founder and General Manager David Valle on his part said that over the last 30 years, the landscape and ecosystem of the rift valley lakes area has undergone severe degradation.

“Much of the rift valley area shows signs of rapidly becoming a windswept desert as pressures from population charcoal production, agriculture, grazing and industry increase; soil erosion is extensive,” David said.

He added: “The Shega concept is developing, restoring, and preserving native tress, shrubs, herbs, grasses and wildlife , which are interwoven with people’s livelihoods and major determining factors for the success of true sustainable development in our nation.”

The project has planted over one million tress over the last seven years. And it is now developing 33 species of different indigenous trees. It also distributed over 90 million seedlings to local farmers from its nursery in Zeway.

http://www.ethpress.gov.et/herald/index.php/herald/news/6489-rift-valley-restoration-project-envisions-restoring-indigenous-trees

.

.

By Sarah McMullan

“Already, our samples are telling us that Ethiopia’s soil is deficient in as many as six essential nutrients.” -Samuel Gameda, IFPRI Senior Research Fellow

Meet Sam Gameda, IFPRI Senior Research Fellow who also serves as the Director of Soil Health and Fertility at the Ethiopian Agricultural Transformation Agency (ATA). Dr. Gameda launched one of the ATA’s flagship projects:  the Ethiopian Soil Information System (EthioSIS), which is aimed at creating a National Soils Database (NSD) and a digital soil map of Ethiopia. Soil specialists are harnessing technologies such as remote sensing, satellite imagery, and spectroscopic readings with a rich collection of soil samples—over 100,000 once sampling has concluded— to create this one-of-a-kind map in Ethiopia.

Ethiopia does have soil maps, but they are no longer useful, relying on soil surveys that are dated by three decades or more. These old maps contain information on the soil types dispersed throughout Ethiopia, but the new maps will take it one step further. “We are doing two types of soil sampling,” says Gameda. The first level will provide updated information on Ethiopia’s soil properties that can help to identify the soils that are best suited for farming and how to best manage them. The second level—focusing on woredas (counties) in Ethiopia’s agricultural belt— is soil fertility sampling, which will show what nutrients have been depleted from the soils. “Already, our samples are telling us that Ethiopia’s soil is deficient in as many as six essential nutrients,” says Gameda. These missing nutrients include Boron, Nitrogen, Phosphorus, Potassium, Sulfur, and Zinc.

Breaking Down the Science behind the Digital Soil Maps

There’s a lot of science behind developing a digital soil map. First, field teams collect soil samples at specific confluence points throughout the country. Then lab technicians perform a chemical analysis to identify the properties of the soil. A spectroscopic reading of the soil is also done by, in simple terms, shining a light on the soil sample. Scientists can then identify the properties in the soil, such as minerals, organic matter, and water-holding capacity, by registering the light signatures reflected back from the sample. All of this information is used to create the digital soil map.

To keep the maps up-to-date, the soil data has been linked with satellite imagery of Ethiopia. Changes in the soil composition will be visible in the spectral imagery collected through satellite imaging. “Satellite imagery correlated with the soil samples collected can show changes in soil’s properties, where there are still nutrient deficiencies, or areas [where soil fertility] is improving,” Gameda says. “It’s an evolving map, and the satellite imagery will help keep the soil maps up-to-date.”

Soil Fertility Mapping

To date, the ATA team has collected and evaluated soil and vegetation samples in 162 woredas. In 2014, soil teams will add an additional 198 woredas to the total. This information will allow soil specialists to pinpoint soils in the woredas that are, for example, nearly depleted of Phosphorous, Zinc, and other nutrients.  According to Gameda, using technology adopted from the African Soil Information Service (AFSIS), and the soils sampled from the woredas, soil scientists can make predictions of the soil needs of the rest of the country. So far, the picture isn’t pretty.  Ethiopian soils are severely lacking in many nutrients essential for plant growth. This revelation has led to an offshoot of the EthioSIS project: fertilizer blending facilities.

When it comes to fertilizers, farmers currently rely on two types: DAP and urea, which only supply Nitrogen and Phosphorus to the soil. Farmers apply the same amount of fertilizer, regardless of the crop grown or the soil fertility—or infertility— in their area. With the new soil maps, however, soil specialists will have the information needed to create fertilizer blends that target missing nutrients in specific locations and that are best suited for the type of crop being grown.  Together, soil scientists from the ATA, the Ministry of Agriculture (MoA), and the Ethiopian Institute of Agricultural Research (EIAR) have developed six fertilizer blends that can be adjusted according to the location of four major cereal crops in Ethiopia—maize, teff, wheat and barley. These blends can include up to six different nutrients.

Last year, the ATA, along with the MoA and the Regional Bureaus of Agriculture, introduced two of the six blended fertilizers formulas to over 25,000 model farmers and recorded impressive results. In 2014, the ATA will expand the rollout to an even larger number of farmers. The rollout will include several phases and will feature local trainings and free on-farm demonstrations.

Before the fertilizer blends can be introduced to farmers on a wide-scale, however, the blending facilities still need to be built. The foundation has been laid, and the parts and machinery for the first facility are already on their way to Ethiopia. The first in-country blending facility will be run by a cooperative union in Becho-Woliso, located about 100 kilometers south-west of Addis Ababa in the Oromia region. Over the next year, the ATA plans to set up four additional facilities, which will be operated by cooperative unions in Tigray, Amhara, and SNNPR. It is hoped that all of the facilities will be operational in time to produce fertilizer blends for the 2015 meher planting season.

IFPRI has been working with the ATA on Ethiopia’s soil issues for years

In 2009, IFPRI’s soil diagnostic study, commissioned by the Gates Foundation at the request of late Prime Minister Meles Zenawi, confirmed that Ethiopia’s soils are greatly degraded and in need of immediate soil health and fertility management. IFPRI’s report laid the foundation for the EthioSIS project, with researchers recommending a national soil information structure along with tailored soil fertility management across the country, based on local soil needs and types.

This year, IFPRI, along with the EIAR and a team of soil scientists from Cornel University, will evaluate the ATA’s blended fertilizer project. Researchers will study a set of 1,000 model farmers to measure levels of adoption and to identify factors that constrain farmers from adopting the ATA’s fertilizer recommendations. The team will also look at the Value Cost Ratio (VCR) of fertilizer use in different areas of the country. This information will help the ATA and the MoA target fertilizer distribution or set up blending facilities in areas where fertilizer use is most profitable and will reduce transportation costs.

According to Gameda, the next step in EthioSIS is to have Ethiopia’s research system carry out fertilizer response studies that will provide a third layer of information for the soil maps. It’s a very complex process, as Gameda points out. “In some areas, even where there is not an apparent Potassium deficiency, adding additional Potassium produces a bump in yields for cereals. So the research system will study these situations more closely and study the response rates for crops and soil types in the woredas.”

For policy makers, the new soil maps will have useful application beyond soil fertility management; it will help inform food security issues, land policy decisions, soil conservation policies, and the impact of climate change on land, along with providing information needed to better manage water resources. For farmers, the long-term vision is that they will be able to use their cell phones to login to servers that will capture their GPS coordinates and immediately show the soil composition of their land. “This is still conceptual,” says Gameda. But it’s a perfect example of how the marriage of agriculture and technology can help farmers better manage their land and, in the end, harvest bigger crops.

.

Sourced here: http://reap.ifpri.info/2014/03/24/samuel-gameda-talks-about-one-of-the-atas-flagship-projects-ethiosis/

This article appeared in the first edition of the REAP quarterly newsletter. Download the PDF here.

.

Related posts.

-     Tapping the potash deposit to boost productivity

-     Q1 2014 Market Analysis Report

-     Israeli Company Pumps 25 Million Dollars Into Afar Potash Project

-     Allana Potash Corp. Launches Technical Cooperation With ICL

-     The four winners from latest potash deal: Allana Potash, ICL, Ethiopia and Africa

-     Allana Potash Announces Strategic Alliance with ICL

-     1st IPI / MoA / ATA Joint SSA Potash Use Symposium Announced For September 3-4, 2014 In Addis Ababa

-     PDAC 2013: Ethiopian minister sees Allana project as catalyst

-     Ethiopian Agricultural Transformation Agency and Allana Potash Corp. Sign MOU to Promote Potash Use as Soil Nutrient in Ethiopia

.

.

Ethiopia attractive for retailers, says report

.

A new report by A.T. Kearney entitled African Retail Development Index says Ethiopia’s large population and growing economy makes the country attractive for retailers.
According to the report, despite the lack of a reliable supply chain and logistics companies, government control over some items (such as sugar and palm oil), and poor road infrastructure aggravating supply chain challenges, retailers are still eyeing Ethiopia.
Price-sensitive Ethiopian consumers usually shop for groceries at small local kiosks, where they buy small quantities, usually USD 15 or lower several times per week. While Ethiopian diets typically consist of commodities such as wheat, cereals and teff, consumption patterns are  changing as more urban and middle-class consumers seek packaged foods such as pasta, the report states.
Product availability and, thus, price stability remain major challenges as a few local producers and exclusive branded distributors dominate the market.
“Modern distribution is gaining momentum in Addis Ababa, the capital and largest city, and also a frontier market for many retailers. Alle, Ethiopia’s first modern cash-and-carry, is currently building what it hopes will be best-in-class operations and is planning to open three stores in Addis Ababa by the end of 2014,” the report reads.
At the same time, the report continues, local players on the retail scene are introducing into Ethiopia new innovative store concepts brought in from outside. The city now has more than 40 supermarkets, 100 minimarkets, and 18,000 kiosks (most family-owned). In addition, global consumer goods makers have started investing in Ethiopia such as Heineken’s with its USD160 million brewer investments and regional private equity firms such as Schulze GI are actively investing and seeking investments in local companies.
The report also underlines that Ethiopia is landlocked, and most products reach the country via neighboring Djibouti. Customs procedures can cause three-month backups before goods reach Addis Ababa. “Gray” imports, meaning legal yet unofficial or unapproved distribution channels, coming through Somalia have a detrimental impact on Ethiopia’s competitive retail environment.
The report says that what make the whole East African region attractive is that its fast-evolving retail dynamics; rapid population growth, increasing urbanization, macroeconomic stability and growth potential, and increasing foreign and regional investment in retail.
A limited but growing number of global Consumer Packaged Goods companies have a presence in the region or are currently operating there, including Unilever, Nestlé, Diageo, and Coca-Cola. These brands generally design products specific for consumers in the region.

http://www.capitalethiopia.com/index.php?option=com_content&view=article&id=4226:ethiopia-attractive-for-retailers-says-report-&catid=54:news&Itemid=27

.

Banks to provide tax free financing, trade on ECX floor

.

The government is working to ratify a new law allowing banks to be part of the trading floor at the Ethiopian Commodity Exchange (ECX) and exempting them from collecting VAT when they provide Interest Free Banking (IFB) services to clients.
The new law that targets financial institutions providing IFB has been in progress since the state giant Commercial Bank of Ethiopia (CBE), one of the two banks that introduced IFB after the National Bank of Ethiopia (NBE) issued a license, recommended the action to Sufian Ahmed Minister of Finance and Economic Development (MoFED) and made the issue known to relevant government bodies like the Ethiopian Revenue and Customs Authority (ERCA) and Ministry of Trade.
Oromia International Bank (OIB) is the other bank that is currently operating IFB. Officials at OIB said that MoFED has approached them for feedback as well.

Experts said the new law is expected to be tabled for discussions with stakeholders.
Since banks provide financing they are not expected to collect tax (VAT) from clients and they also don’t have to pay taxes on the loans they offer, financial experts said.  With the IFB scheme banks are not allowed to collect interest or provide loans because this kind of banking system is mainly focused on providing equipment or financing in-kind.
“But they are not expected to collect the VAT from the client, even if they provide the product for clients. Because the aim of banks’ is financing their clients on the basis of profit earning,” experts said. The new law is expected to impose VAT only on the original price of the equipment as opposed to including the profit that banks earn when they transferred the product for clients.
“If VAT is calculated on the final price of the product that the bank transfer to the clients, the product would be expensive compared with similar products in the market,” experts said.
Ephrem Mekuria, communication manager at CBE, told Capital that the issue had been discussed within CBE when the bank launched the Islamic banking scheme that follows the precepts of Sharia law.
Ephrem said that his bank has sent a letter to MoFED informing other government offices that providing equipment via IFB scheme is to be considered as financing and not selling products like other traders.
“If banks are expected to calculate the VAT from the entire amount (from the original price and the profit that banks earn), it make them [banks] like trader or playing a trader’s role and not banking service,” Ephrem said.
“We have also recommended that MoFED table the issue for discussion,” Nuri Hussein Indhessa, acting director of the interest free banking department of OIB, told Capital. The banks’ role is financing according to Nuri, “they are not traders.”
“We expect that MoFED will amend the law in the near future,” Nuri said.
He said that OIB is now focusing on introducing the new banking scheme but in the near future the bank will expand the program and commence financing.
The other issue expected to amended in relation with the introduction of Islamic banking is to consider banks to be part of the trading actors on the exchange floor of ECX. Currently, it is prohibited for banks to be part of the trading at ECX, which is the only trading scheme for major agricultural export items like coffee, sesame and haricot beans.
In the FIB scheme banks are not allowed to provide loans for exporters that earn interest, as a result of that exporters, who want to use the Islamic banking service, would not be able to get finance to buy products at ECX.
Ephrem said that currently CBE is meeting with relevant government bodies to see possibilities that allowed the banks to get a seat at the exchange.
“That is the reason banks are now requesting that the government permit them to buy products from the trading floor and transfer for their exporter clients,” experts said.
“Stakeholders including NBE, banks, Ministry of Trade, ERCA, ECX and its authority have to hold talks on the issues before it is amended,” Nuri said.

http://www.capitalethiopia.com/index.php?option=com_content&view=article&id=4227:banks-to-provide-tax-free-financing-trade-on-ecx-floor&catid=54:news&Itemid=27

.

U.S based aviation company to open office in Ethiopia

.

Addis Ababa, 01 April 2014 (WIC) – Universal Weather and Aviation Inc. announced it will be opening an office in Ethiopia next month. The Houston, U.S. based company provides products and services for general aviation. Its customers include owners and operators of business jets.
“We organized the trip for the recent visit of former president of the U.S. George Bush. He came here and traveled around Ethiopia. We have had five trips to Ethiopia with other high level customers since January already,” Stanley Joseph, General Manager of Universal Weather and Aviation Inc Africa office said.
The general manager stated that since there are frequent trips being made to Ethiopia by high level personnel, it was a natural step to open an office in Ethiopia.
Universal Weather and Aviation Inc has been in business for the last 50 years and among the several trips the company has facilitated for high level clients to Ethiopia include; Condoleezza Rice, Pfizer management team and founder of Econet Wireless,  Strive Masiyiwa.
“Our customers come from all over the world. High level clients use our services when they can just use their own jets because they want to remain under the radar for security reasons,” Joseph said. The company operates several aircraft including the Gulfstreem which is labeled to be one of the most advanced business jets on the market.
Stanly Joseph also stated that the company signed an agreement with Ethiopian Airlines regarding ground support with maintenance services.
According to Capital, Universal Weather and Aviation Inc is a company with 47 locations in 19 countries and over 1,700 employees worldwide.

http://www.waltainfo.com/index.php/explore/12862-us-based-aviation-company-to-open-office-in-ethiopia

.

Awash to Adopt MasterCard Partnership

.

MasterCard seeks to shift users away from cash to cards, in order to enable faster, more secure and reliable payments

.

Awash International Bank (AIB) has become the second private bank in Ethiopia, after Dashen Bank, to distribute MasterCard and branded payment cards to its clients.

The Bank – which entered the private banking industry after being licensed in November 1994 as the first private commercial bank, with 24.2 million Br capital and 486 founding members – has been certified as the principal member for accepting MasterCard branded cards by MasterCard International, as of March 18, 2014.

MasterCard is one of the major credit cards used regularly by people in the United States, second only in name recognition and worldwide billings to Visa, according to information from the MasterCard website. By marketing itself to ordinary men and women, in contrast to Visa’s efforts to capture an upper-income clientele, MasterCard is slowly chipping away at Visa’s market share in both the United States and other areas around the globe.

Awash became qualified as a principal member for accepting Mastercard branded cards, after going through business and technical compliance requirements, according to Tsehay Shiferaw, president of the Bank.

The official membership letter, along with the key exchange required for making the MasterCard International Network accessible for MasterCard branded cards at Awash’s Point of Sales (PoS) terminal and ATMs through Premium Switch Solutions S.C.(PSS), which has also been certified as a Third Party Payment Processor, was handed over to Tsehay Shiferaw, president of the Bank, by James Wainaina, vice president & Area Business head for MasterCard East Africa, at the Bank’s headquarters on Ras Abebe Aregay Street, on March 18,2014.

“I cannot tell you a definite date, but the service will be launched very soon,” Tsehay told Fortune.

The service could be accessed for customers with MasterCard through the Bank’s ATM machines, Fortune learnt.

The Bank says it is working closely with MasterCard East Africa to launch the system. The Bank’s staff has already been trained by the MasterCard East Africa on payment settlement and management in the new system.

“The launching of the service is part of Awash’s endeavour to meet customers’ demands by investing more in innovative technologies,” Tsehay said.

MasterCard sees Cash as the biggest competitor, rather than other global payment solution companies, and is among the leading global payment solutions companies committed to building a payment ecosystem where Cards replace physical cash. This will enable faster, more secure and reliable payments, according to its official website.

Awash, whose profit after tax grew by 11.3pc by June 30, 2013, according to its annual audited report, recorded profits close to 72pc. The Bank’s 438.61 million Br profit is far superior to that of newer banks.

The number of shareholders and paid-up capital has currently reached over 3,000 and 1.4 billion Br, respectively. Since July 2013, the Bank has opened 21 new branches, raising the total number of branches to 136 by end of February 2014. The oldest private Bank has also started installing an additional 100 ATMs and 400 POS terminals. This is on top of 60 ATMs and 300 POS terminals already deployed jointly with the NIB International Bank S.C and United Bank S.C.

http://addisfortune.net/articles/awash-to-adopt-mastercard-partnership/

.

Three Further Public Enterprises Approved for Privatisation

.

Those that received final approval were three from the five that attracted bidders during the last offer

.

  .

Ethiopian Pharmaceutical Manufacturing S.C, Hamaressa Edible Oil S..C and Bekelcha Transport S.C are all switching over to private ownership, following the final approval, by the Privatisation & Public Enterprises Supervising Agency (PPESA), of the offers made for them.

Only three of the five public enterprises that attracted bidders during the financial opening passed the technical evaluation and got the final approval of the Agency.

From the 11 enterprises offered for sale by the PPESA on February 10, 2014, only five attracted bidders. These included the three whose transfer was approved on Friday, March 29, 2014, in addition to Kombolcha Textile S.C. and Caustic Soda S.C.

The Ethiopian Pharmaceutical Manufacturing S.C will go to Medi Tech Ethiopia Plc, which offered 436.6 million Br – exceeding competing bids from Sachem Import & Export Plc, Bak Byte Industrial Plc, Beker General Business Plc and Horn Investment Plc, whose offers ranged from 236 million to 351 million Br.

Tikur Abay Transport S.C’s offer of 325.9 million Br for the purchase of Bekelcha Transport S.C was also approved. Ethio Asian Industries Plc has bought Hamaressa Edible Oil S.C for 50.5 million Br.

The rejected offers included a one million dollar bid from Metel Mohammed Enterprise Tanzania Ltd for Kobmolcha Textile SC, and Complay Industrial Plc’s one million dollar offer for Caustic Soda S.C.

In May 2012, MCC Imports Enterprise offered 14.8 million Br to acquire this factory. This offer was approved by the board of the Agency, but the buyer suddenly discovered all the debts the company had owed, which, if it paid, as the PPESA expected, would lift its payment up to 123 million Br. The documents at the company indicated that the factory not only had unpaid loans, but also income tax, withholding tax and Value Added Tax (VAT), which it should have transferred to the Ethiopian Revenue and Customs Authority (ERCA) but did not.

After that, the Agency floated tender for the privatisation of Caustic Soda three times, without being able to attract any bidder. When Caustic Soda was offered for privatisation for the fourth time in the last tender.

The enterprises that failed to attract any bidders were – the Ethiopian Minerals Development S.C, Bahir Dar Textile S.C, Weyra Transport S.C, Artistic Printing Enterprise, Agricultural Mechanisation Service Enterprise and Transport Construction Design S.C, auctioned for the fourth round of 2013/14 fiscal year.

Kombolcha Textile S.C was also auctioned with those companies.

http://addisfortune.net/articles/three-further-public-enterprises-approved-for-privatisation/

.

 Ethiopian Airlines Launches Nonstop Flight to Shanghai

.

Addis Ababa — Ethiopian Airlines, one of the fastest growing airlines in Africa, on Saturday launched its maiden nonstop flight to Shanghai, China’s largest city and commercial hub.

Addressing an inauguration ceremony held here, Tewolde Gebremariam, Chief Executive Office of Ethiopian Airlines, said by flying to 80 destinations in five continents in five continents, “we are the fastest growing African Airline, the most profitable African Airline and the largest international network African Airlines.”

Starting Saturday, “we will connect Shanghai with 48 African destinations and Brazil every single day. With 28 weekly flights to China, China is the single largest country network in our system,” he said.

Xie Xiaoyan, Chinese ambassador to Ethiopia, said with 28 direct flights per week, Ethiopian Airlines is the leading airline in Africa, linking the continent and China.

“Now the airline has extended its services to Shanghai, the industrial and financial center in China,” said the ambassador.

“I am sure Ethiopian Airlines will continue to serve as a star business in strengthening and further expanding the economic ties between our two countries and the friendship between our two peoples,” Xie said.

Ethiopian Airlines has been operating flights to Beijing, Guangzhou and Hangzhou and Hongkong. After Shanghai, the carrier will offer connectivity from five major cities in China to 48 cities in Africa.

http://allafrica.com/stories/201404010566.html

.

.

Ethiopia Launches Climate Innovation Centre

.

VENTURES AFRICA – Climate Innovation Centre (CIC), a clean technology revolution, has started operations in Ethiopia and is expected to deploy and develop climate friendly technologies.

Spearheaded by Infodev, a global innovation program by World Bank, Ethiopia CIC was established in December 2013 and launched with the support of a $5million grant agreement between the World Bank and the Addis-Ababa University.

The purpose of the centre is to drive innovative solutions to climate change through the provision of financial support and mentorship to local climate entrepreneurs specialized in energy efficiency, biofuels, renewable energy and agribusiness.

Over the next ten years, Ethiopia CIC is expected to support over 200 technologically driven climate ventures with the provision of about 12,000 jobs.

It is also expected to help over 3 million Ethiopians adapt to climate change, boost access to energy for 265,000 people and increase agricultural practices for 120,000 farmers.

According to experts, lack of proper green energy strategy will lead to adaptation expense that will cost Ethiopia $5.84 billion yearly. The Ethiopian government is expected to work closely with the CIC with respect to the strategies outlined by the Climate Resilient Green Economy (CRGE).

CIC is a brainchild of Infodev’s Climate Technology Program which is creating a network of CICs all over the world so as to encourage a pro-active participation of countries in the ongoing global clean technology, thus reducing harmful emissions.

The first CIC in Africa was opened in Kenya and others are being established in South Africa, Ghana and Morocco.

http://www.ventures-africa.com/2014/04/ethiopia-launches-climate-innovation-centre/

.

Research and Markets: Ethiopia Textiles Report 2014 – The Emerging Textile and Clothing Industry

.

DUBLIN–(BUSINESS WIRE)–Research and Markets (http://www.researchandmarkets.com/research/v6pw4z/ethiopia_the) has announced the addition of the “Ethiopia – The Emerging Textile and Clothing Industry” report to their offering.

.

“Ethiopia – The Emerging Textile and Clothing Industry”

Over recent years there has been an increasing amount of interest in Africa as a continent with immense resources and potential. Ethiopia in particular has been singled out as a land of growth and investment opportunity.

Ethiopia grows some of the world’s finest cotton and has a rich textile spinning and weaving history, yet its importance on a global scale remains insignificant. With several government incentives in place, a priority given towards developing the textile and clothing industry across the value chain, a viable business environment and duty free market access to both US and EU, Ethiopia is now beginning to attract international buyers and investors, as this report demonstrates. Having experienced approximately 8% GDP growth consistently since 2008 and a stable political framework since 1995, it still remains largely un-touched, un-explored and un-tapped.

The report sets the scene on one of the oldest countries in the world, now the fourth largest and second fastest growing economy in Sub Saharan Africa. It will show how the textile and garment sector in Ethiopia has set ambitious targets to expand rapidly by 2015. The textile and clothing sector is considered as the key priority sector of the Governments Industrial Development Strategy as part of the Growth and Transformation Plan. With a vision to become a world – class institute by 2024, TIDI’s mission (The Textile Industry Development Institute of Ethiopia) is to enable the Ethiopian textile industry to compete globally by providing sustained investment promotion, consultancy, training, research, laboratory and marketing support and services.

.

Key Topics Covered:

Chapter 1: Africa, a destination for apparel and textile?

Chapter 2: Ethiopia today, recent factsheet and profile

Chapter 3: Creating value across the value chain

Chapter 4: Emerging Ethiopia, on the global fashion platform

Chapter 5: SWOT analysis, what’s the verdict?

Chapter 6: Competition and comparison

Chapter 7: Made in Ethiopia, making it a reality

Chapter 8: Directory of Ethiopian textile and clothing factories

Visit http://www.researchandmarkets.com/research/v6pw4z/ethiopia_the

.

.

By David Wainer and Shoshanna Solomon Apr 3, 2014

Chart sourced here  http://www.4-traders.com/ISRAEL-CHEMICALS-LIMITED-6491698/

.

When Israel Chemicals Ltd. (ICL)’s Stefan Borgas addressed a conference in Beer Sheva this week, the German-born chief executive officer was assailed with shouts of “Go home” from dozens of his workers.

The clamor from employees of the Rotem phosphate mine, where jobs have been eliminated as ICL cuts costs, is “a sign of people alive and fighting for their company,” Borgas said in response.

While the CEO doesn’t plan to leave Israel, ICL does face a retreat. Its failure to gain permission for a new mining project in the Negev Desert may mean that, with declining reserves at Rotem, the company has to close its phosphate business in the country and lose more than 1,000 workers.

The Israeli Health Ministry today recommended blocking ICL’s proposed Sde Barir mine on concern the project may lead to radioactive pollution and damage the health of residents of the nearby town of Arad. If the ruling is implemented by the government, it may be the final nail in the coffin for the phosphate-mining division, according to the CEO, 49.

“If this is the opinion of the ministry, then we have to prepare the exit of this business in Israel,” Borgas said in an interview at ICL’s Tel Aviv headquarters. “Our executive committee has already asked the management team to develop the exit plan.”

The company has said any government decision to block the project, as well as the threat of tax increases in Israel, would spur a search for investment alternatives abroad.

Overseas Investments

Regulatory uncertainty may lead ICL to divert potential investments of $1 billion to other countries, resulting in a “long-term shrinking” of its operations in its home nation, Borgas said.

ICL has fallen 34 percent on the Tel Aviv Stock Exchange’s TA-25 index in the past 12 months, the biggest decline among companies on the gauge. It’s among fertilizer producers hurt by last year’s potash-industry collapse, when Russia’s OAO Uralkali abandoned a marketing venture that controlled 40 percent of global exports of the soil nutrient.

The breakup sparked a price war that contributed to a 37 percent decline in 2013 profit to $819 million, Israel Chemicals said last month. Now a risk of higher royalty payments to government coffers may worsen the company’s problems.

“We are telling our investors there is a maximum exposure of around $50 million to $60 million per year,” Borgas said of the potential tax increases. A government-appointed committee began reviewing natural-resources policies last year. Any move to increase royalty payments would come just two years after a previous government raised them.

Rule Changes

Prime Minister Benjamin Netanyahu and Finance Minister Yair Lapid aren’t doing enough to encourage investment in Israel and regulatory uncertainty is damaging, according to Borgas.

“The most important thing for ICL is for the government to make a decision,” he said. “If you change your rules or laws every 18 months how can we plan? We are building plants that last 30 years not 30 weeks.”

Last April, Potash Corp. of Saskatchewan Inc. scrapped a proposed takeover of the company citing regulatory uncertainty.

Borgas has already started to expand investments abroad. In February, the company invested $23 million in Allana Potash (AAA) Corp. to tap the Danakhil project in Ethiopia. It estimated then that the mine, which may take five years to develop, will yield 1 million metric tons annually, about a fifth of ICL’s global potash output in 2013.

Dual Listing

The company in November said it will dual-list its shares in the U.S. to attract more investors and raise funds for acquisitions. Parent company Israel Corp., controlled by billionaire Idan Ofer, is considering the sale of part of its 52.3 percent stake to increase trading volume.

“We need access to capital markets in order to grow,” Borgas said. “We need a lot of access to the international debt markets and in the long term we might have a few opportunities in which we need equity. The Israeli capital market alone is too small for our needs in the long term.”

While diversifying geographically, ICL also plans to expand in areas such as food additives and flame retardants in a bid to boost profit. At the same time, it’s cutting costs after potash prices fell.

“We will deliver a significant contribution already this year to the bottom line,” Borgas said.

ICL may report a 19 percent increase in profit in 2015 as costs drop and potash prices stabilize, according to the average estimate of analysts surveyed by Bloomberg. Ilanit Sherf, an analyst at Tel Aviv-based Psagot Securities Ltd. with a buy rating, expects at least $60 million in cost cuts by 2015.

To contact the reporters on this story: David Wainer in Tel Aviv at dwainer3@bloomberg.net; Shoshanna Solomon in Tel Aviv at ssolomon22@bloomberg.net

To contact the editors responsible for this story: Amanda Jordan at ajordan11@bloomberg.net Gwen Ackerman

.

Sourced here 

http://www.bloomberg.com/news/2014-04-03/israel-chemicals-besieged-at-home-as-ceo-looks-abroad.html?cmpid=yhoo

.

Related articles

.

-     Health Minister votes down phosphate mining at Israel Chemicals’ site near Arad

-     Treasury rejects arbitration on Israel Chemicals royalties

-     Allana Potash Corp. Launches Technical Cooperation With ICL

-     Haaretz Israel Chemicals related recent headlines

.

.

A Giant Basket That Uses Condensation to Gather Drinking Water

.

By Joseph Flaherty 

Around the world, 768 million people don’t have access to safe water, and every day 1,400 children under the age of five die from water-based diseases. Designer Arturo Vittori believes the solution to this catastrophe lies not in high technology, but in sculptures that look like giant-sized objects from the pages of a Pier 1 catalog.

His stunning water towers stand nearly 30 feet tall and can collect over 25 gallons of potable water per day by harvesting atmospheric water vapor. Called WarkaWater towers, each pillar is comprised of two sections: a semi-rigid exoskeleton built by tying stalks of juncus or bamboo together and an internal plastic mesh, reminiscent of the bags oranges come in. The nylon and polypropylene fibers act as a scaffold for condensation, and as the droplets of dew form, they follow the mesh into a basin at the base of the structure.

Vittori decided to devote his attention to this problem after visiting northeastern Ethiopia and seeing the plight of remote villagers first hand. “There, people live in a beautiful natural environment but often without running water, electricity, a toilet or a shower,” he says. To survive, women and their children walk for miles to worm-filled ponds contaminated with human waste, collect water in trashed plastic containers or dried gourds, and carry the heavy containers on treacherous roads back to their homes. This process takes hours and endangers the children by exposing them to dangerous illnesses and taking them away from school, ensuring that a cycle of poverty repeats.

Exposure to this horrific scene motivated Vittori to take action. “WarkaWater is designed to provide clean water as well as ensure long-term environmental, financial and social sustainability,” he says. “Once locals have the necessary know how, they will be able to teach others villages and communities to build the WarkaWater towers.” Each tower costs approximately $550 and can be built in under a week with a four-person team and locally available materials.

A more obvious solution to a water shortage would be digging a well, but drilling 1,500 feet into Ethiopia’s rocky plateaus is expensive. Even when a well is dug, maintaining pumps and ensuring a reliable electrical connection makes the proposition unlikely.

Instead of looking to Western technology for a solution, Vittori was inspired by the Warka tree, a giant, gravity-defying domed tree native to Ethiopia that sprouts figs and is used as a community gathering space. “To make people independent, especially in such a rural context it’s synonymous of a sustainable project and guaranties the longevity,” says Vittori. “Using natural fibers helps the tower to be integrated with the landscape both visually with the natural context as well as with local traditional techniques.”

The design has been two years in the making and though the final product is handcrafted, Vittori has used the same parametric modeling skills honed working on aircraft interiors and solar powered cars to create a solution that is safe and stunning. The 88-pound sculpture is 26-feet wide at its broadest point but swoops dramatically to just a few feet across at its smallest point. Vittori and his team have tested the design in multiple locations and worked in improvements that increase the frame’s stability while simultaneously making it easy for villagers to clean the internal mesh.

Vittori hopes to have two WarkaTowers erected in Ethiopia by 2015 and is looking for financial rainmakers who’d like to seed these tree-inspired structures across the country.

http://www.wired.com/2014/03/warka-water-africa/

.

Islamic banking booming in Ethiopia

.

Islamic banking was introduced in Ethiopia in 2013 in an effort to meet the demand of Muslim clients for usury-free banking services.

.

Chinese vice foreign minister visits Ethiopia

.

President Dr. Mulatu Teshome received the visiting Chinese Vice Foreign Minister Zhang Ming at the national palace on Thursday.

.

Ethiopia, China agree to cooperation framework deal

.

The framework deal is expected to focus largely on the aviation, space sciences, tourism and mining fields.

.

Chinese firm wins Ethiopian rail contract

.

CNR Corporation, a Chinese train manufacturer, has signed an agreement with the Ethiopian government to provide 41 custom-made locomotives for use on the Addis Ababa light railway, which is now under construction.

The company said: “They will be able to travel at a maximum of 70kph and will be sunlight-resistant, with special components for their glass, rubber, paint and cables.” The first batch of locomotives should be delivered by the end of this year, according to the Ethiopian Ministry of Transport.

CNR is one of the largest train makers in China. In addition to locomotives and high-speed trains, it makes linear-motor subway vehicles and light-rail vehicles, as well as railway cranes and industrial machinery.

http://www.machinery-market.co.uk/news/6072/Chinese-firm-wins-Ethiopian-rail-contract

.

NBE issues reinsurance establishment directive

.

The National Bank of Ethiopia (NBE) issued directive that allows licensing, supervision and establishment of reinsurance companies which provide services for direct insurers.

The Reinsurance Company Establishment Directive No.746/2014 would be put into effect beginning May 8, 2014.

Bank Insurance and Supervision Directorate Director Temessgen Zeleke told a press conference yesterday that the demand for insurance services has been increasing due to the rapid economic growth of the country which necessitated the issuance of the directive. Accordingly, the Bank has prepared reinsurance directive that would play an important role in laying foundation for the establishment of national reinsurance companies, he added.

Reinsurance companies render insurance services to direct insurance companies. These companies are instrumental in promoting the financial capacity of direct insurance companies, he added.

As the country has been undertaking a number of mega projects, the reinsurance companies are expected to provide financial security and better risk management systems, Temesgen added.

According to the Director, the establishment of national reinsurance companies promotes the existence of national reinsurance companies make treaty negotiation, settlement of claims and payment of ceded premium in domestic currency with the shortest time possible. Reinsurance companies enhance underwriting capacity and solvency of direct insurers by providing technical support and cover against accumulated and catastrophic losses, he added.

He further indicated that interested reinsurance companies should have the minimum paid up capital of 500 million birr which ought to be fully paid up in cash and deposited in blocked bank account in the name of the insurer under formation.

Temesgen also said that shareholders, except the Federal Government or public enterprises fully owned by the government, cannot exceed 5 per cent of the total subscribed capital separately or jointly. The reinsurance company should be wholly owned by Ethiopian nationals or organizations owned by Ethiopians.

Company organizers, managers, influential shareholders, CEOs are required to meet the competencies and skills stated in the directives.

Indicating the overall contributions of the reinsurance company in ensuring and sustaining the country’s economic growth, the Director said that the Bank is ready to serve and cooperate reinsurance companies as of the aforementioned time period.

Currently, Ethiopia has no single reinsurance company.

http://www.ethpress.gov.et/herald/index.php/herald/news/6540-nbe-issues-reinsurance-establishment-directive

.

UK companies’ complaints get PM’s attention

.

UK companies operating in Ethiopia stepped into the Prime Minister’s office on March 7 with complaints over logistics, transport and customs clearance and received an encouraging response from Prime Minister Hailemariam Desalegn. 

http://www.thereporterethiopia.com/index.php/news-headlines/item/1835-uk-companies’-complaints-get-pm’s-attention

.

Tullow starts drilling Shimela well

.

The Shimela drilling site

.

- Undertakes community development projects

The British oil company that is prospecting for oil in southern Ethiopia, Tullow Oil, on Tuesday started drilling the third exploration well in the South Omo basin, near Chew Bahir.

.

Ethiopia, Djibouti sign cross-border water supply agreement

.

Finance and Economic Development Minister Sufian Ahmed and his Djiboutian counterpart Ilyas Moussa Dawaleh signed an agreement for the construction of a water pipeline linking the two countries last Sunday, Djibouti’s La Nation reported.

Under the agreement, Djibouti will construct a pipeline to carry water from the Ethiopian town of Hadagala 70 kilometres to the Guelileh border crossing, then all the way to Djibouti City. Ethiopia will in turn share water without charge. The project will take an estimated 18 months to complete and will supply Djibouti with 100,000 cubic metres of water, an increase from its current rate of 20,000 cubic metres.

The agreement, signed during Sufian’s visit to Djibouti, is one of several co-operation accords to integrate the economies of the two countries, including the construction of a railway linking Makalle in Ethiopia and Djibouti’s Tadjourah Port and the rehabilitation of the railway linking Addis Ababa and Djibouti City.

http://www.ethpress.gov.et/herald/index.php/herald/national-news/1001-ethiopia-djibouti-sign-cross-border-water-supply-agreement

.

Institutions sign MoU to jointly work on good governance

.

The Institution of Ombudsman and the Ministry of Civil Service signed a memorandum of understanding (MoU) to jointly work in good governance.

Chief Ombudswoman Fozya Amin said on the occasion that the MoU would help improve good governance related problems jointly handled by the two sides and introduce accountability.

It could also make the works underway to consolidate the systems in civil service institutions entertain grievances effectively, she added.

Besides, it would create a situation whereby citizens can get solutions for their grievances within their neighborhoods, according to the Chief Ombudswoman.

Civil Service State Minister Temesgen Tilahun on his part said the MoU focuses, among others, on ensuring the supremacy of law and urged executive bodies to work in accordance with the law.

He said the MoU would help create an environment in which all citizens are served transparently and with accountability.

The State Minister said many citizens are suffering from red tape as the various organizations have failed to realize the Citizens’ Charter, adding that the MoU would help carry out efficient and productive activities.

http://www.ethpress.gov.et/herald/index.php/herald/national-news/6557-institutions-sign-mou-to-jointly-work-on-good-governance

.

Five consulting firms bidding to supervise Bole airport expansion project

.

The final draft design of the Addis Ababa Bole International Airport terminal expansion project

.

- Enterprise to negotiate with contractor on price

Five international construction consulting firms are bidding to supervise the Addis Ababa Bole International Airport passenger terminal expansion project and consult the planned new mega-airport that will be constructed outside Addis Ababa. 

A farmer in Woliyta area of Ethiopia (pictured, above). Concern is growing that not enough is being done to engage Africa’s youth – it’s largest workforce – in food production Credit: Ed McKenna/IPS

.

By Matthew Newsome

TUNIS/ADDIS ABABA, Apr 2 2014 (IPS) - Ketsela Negatu is the son of an Ethiopian goat farmer living close to the country’s capital, Addis Ababa, who refuses to follow in his father’s footsteps. The 19-year-old has negative perceptions about the family profession after seeing the dim prospects a farming livelihood has offered his father. 

“I will go to the city and try and find work. I don’t know what I will do but I want to find a job that pays more money so I can live a good life,” he told IPS.

But Ketsela’s thinking is just like that of other young people on the continent as poor financial returns and unglamorous prospects of Africa’s rural economy are spurring young people to leave the fields and migrate to urban centres.

And concern is growing that not enough is being done to engage Africa’s largest workforce – its youth – in food production as they are key to safeguarding food security on the continent, eliminating hunger and accessing global food markets.

“There is not enough stimulus for young people to participate in agriculture in African countries. The young farmers need good prices for good products, otherwise we will lose them to the urban areas. Why should they do the hard work and stay poor,” Gebremedhine Birega, Ethiopian representative of the NGO East and South African Food Security Network told IPS.

The share of youth in Africa’s labour force is the highest in the world with approximately 35 percent in sub-Saharan Africa and 40 percent in North Africa, compared to 30 percent in India, 25 percent in China and 20 percent in Europe. World Bank projections indicate that 60 percent of the world’s labour force growth will be in Africa between 2010 and 2050.

Although economic growth in sub-Saharan Africa is expected to reach 6.3 percent in 2014, well above the global average, agricultural leaders at the Food and Agriculture Organisation of the United Nations (FAO) regional conference held in Tunisa from Mar. 24 to 29 agreed that prodigious growth is not translating fast enough into employment for Africa’s youth.

Gerda Verburg, chairperson of the Committee on World Food Security, told IPS that increased commercialisation of agriculture will harness unemployed youth in rural Africa and create a productive and profitable agricultural sector. It will thus bolster food security and create decent income and employment opportunities for young people.

“We have to try and reverse the rural mentality that says farming is a last option. To prevent this loss of labour we need to look at how to improve the financial prospects of those who work in the agricultural sector.

“Private sector finance and agri-industries are helping to modernise agriculture by creating value adding chains that will pay a farmer more for his labour than the local market,” she said.

Economic growth on the continent, and the changing dietary trends of Africa’s emerging middle class, are also providing attractive and lucrative value chains for young agricultural producers to participate in, FAO director general José Graziano da Silva told IPS.

“There are emerging markets such as aquaculture where we are seeing good potential for growth. More investment in these growing markets will provide greater opportunities for youth employment,” he said.

Greater electrification of rural Africa is also expected to help retain the youth population in the countryside and satisfy an aspiration for a modern lifestyle that features telecommunication and Internet connectivity. Currently, less than 10 percent of sub-Saharan Africa’s rural households have access to electricity.

Cheikh Ly, secretary of the FAO regional conference, told IPS that a major contributing factor behind the decision taken by young people to migrate to urban areas was the lack of electricity in rural Africa.

“Electrification is a key need for Africa’s rural economy. Modern agricultural production is not possible without reliable access to power. We will also lose the young who want to be connected and communicate via phones and the Internet if these needs are not met,” he told IPS.

Greater investment in African agriculture seemed a fait accompli when African leaders met in Maputo, Mozambique in 2003 to commit a minimum of 10 percent of their national budgets to agriculture and to lifting agricultural growth to six percent of GDP per annum by 2008.

However, of Africa’s 54 countries, only nine – Ghana, Burkina Faso, Malawi, Mali, Ethiopia, Niger, Senegal, Cape Verde and Guinea - managed to uphold these commitments.

Low investment is causing low productivity and thwarting Africa’s agricultural sector, which employs close to 60 percent of Africa’s labour force but accounts for only 25 percent of the continent’s GDP. A deficit of political willpower from African leaders is delaying agricultural expansion on the continent, says Action Aid International’s David Adama.

“Empty words won’t feed empty stomachs. African governments must follow through on their promises and provide more money for agriculture and ensure it is better targeted to help the millions of smallholder farmers who make up most of their citizens and produce most of Africa’s food,” he told IPS.

The potential for the lucrative engagement of Africa’s youth in agriculture should be within grasp. Africa boasts over 50 percent of the world’s fertile and unused land, while foreign investment in African agriculture is expected to exceed 45 billion dollars in 2020, according to World Bank statistics.

However, Africa’s youth are yet to feel the pull of any new “agricultural renaissance” on the continent.

“I would stay and work in the countryside but only if things got better here; unless they do, I will leave for the city and see if there is something better,” Ketsela said.

Sourced here: http://www.ipsnews.net/2014/04/africas-youth-yet-lured-unglamorous-farming/

.

Allana Potash Corporation Plans a New Agricultural Paradigm for Africa

.

Canadian Company Seeks Bountiful Harvest From a Scorching Barren Desert

.

TORONTO, April 7, 2014 (GLOBE NEWSWIRE) — Ethiopia is fast becoming the focal point for a renaissance in African agricultural development. Allana Potash (AAA.TO) is one company that wants to be in the forefront of this change and is working towards starting up the first potash mine in Africa by 2017. This is very different from what has happened in the past as Allana Potash (a Canadian junior mining company) becomes part of the solution in solving the African hunger crisis.

Across Africa today, from Mozambique where an estimated 300,000 face famine to the pastoral lands of Sahel and the Horn of Africa where severe food shortages have left millions without basic nutrition, the continent is facing hunger pains almost everywhere you look. Once endowed with the planet’s most arable lands, a combination of conflict, outdated farming and irrigation techniques, erosion, degradation of soil quality resulting in low yields and trade barriers has many African nations facing significant food security challenges now and in the future.

To initiate change, The United Nations has declared 2014 as the International Year of Family Farming while the African Union affirmed this year for Agriculture and Food Security. The Director-General of the Food and Agriculture Organisation (FAO) of the United Nations, Jose Graziano da Silva said Africa has the economic, natural and human resources it needs to promote food security and sustainability in the continent.

“With political will, comprehensive programs bridging agricultural production and social protection, adequate funding, and by tapping into the potential of its youth, we can get there. We are in this together,” he said as FAO’s 28th Regional Conference for Africa opened in Tunis this month to boost increased investment and broad-based transformation in support of smallholder farmers.

One such project is unfolding in the most unlikely of places to help shift Africa’s agricultural paradigm.

The focus of this project in the Danakhil Depression around Ethiopia’s Dallol area is simple — use the potassium salt of Africa to feed Africans first.

Here in the land of ancient salt miners where rivers dry up under a merciless sun never to reach the Indian Ocean, Allana Potash Corp. (AAA.TO) has established a strategic alliance with Israel Chemicals Ltd. (ICL), the world’s sixth largest potash producer, to develop a potash mine. Potash, also known as potassium chloride, is a key ingredient in fertilizer that can replenish soil nutrients to provide higher crop yields and increase plant development.

The Government of Ethiopia and a number of international organizations including Allana are also focusing on introducing progressive technologies and improving infrastructure to reverse the demise of agricultural productivity.

Among these improved technologies include, better crop management of the unique native tef crop, public/private partnerships to fund development, the establishment of agricultural cooperatives to affect orderly and competitive pricing of inputs and marketing of farm products, and creating a robust Soil Information System as a basis for improving soil health and fertility.

Allana Potash has also committed annual financial assistance to the Government of Ethiopia’s Agricultural Transformation Agency (ATA) to support its country-wide program of on-farm balanced fertilizer demonstration trials. These trials show local farmers that proper nutrient supply applied in conjunction with other improved crop management techniques can increase economic opportunities.

The trials will also help create a soil fertility database and the information required for calibrating fertilizer nutrient requirements to achieve yield goals.

“Through combined, sustained initiatives such as this, the African paradigm can shift from a general lack of available food to becoming a large exporter of agricultural products, like Ethiopia is today,” said Richard Kelertas, vice-president of Corporate Development at Allana.

“Allana and Ethiopia are strategically located to serve the rapidly growing African demand for potash, where typically potash consumption has been low,” said Farhad Abasov, President and CEO of Allana Potash Corp.

“We believe that together with Ethiopia, one of the world’s fastest growing economies, Allana Potash can foster growth in potash consumption in East Africa over the next several years and the Ethiopian government is fully supportive of our project. They are also fully behind of our strategic partnership with Israel Chemicals Ltd (ICL).”

“The Danakhil mine will provide potash for Ethiopia and Africa, and combined with ICL’s agronomic fertilization know-how, our alliance will enable local farmers to increase agricultural output and food security for the region,” continued Farhad Abasov.

A feasibility study (FS) has indicated that Allana’s mine will have the potential to produce approximately one million tonnes of potash annually over 25 years commencing in a few years. The potash resource is large enough to significantly extend the life of the mine.

Allana plans a solution mining method and the use of the 45-degree Celsius sun-baked grounds of the Danakhil Depression for its solar evaporation process. This mining and processing method will be considerably less costly than the open pit or deep shaft mining done by its competitors. Allana’s FS has pegged its capital expenditure for the Danakhil project at about USD$642 million. Comparatively, capital expenditures necessary to build a solution mine in other parts of the world are estimated to cost billions of dollars.

The Allana-ICL alliance is very unique in the sector and includes a full off-take agreement. ICL will purchase and market the output of the Danakhil mine with a take-or-pay contract for 80% of the mine’s output every year it is in production.

Currently, ICL operates mines in Israel, Spain and Britain. In 2013, ICL sold over 5 million tonnes of potash worldwide.

This month’s gathering of African agricultural ministers in Tunis concluded that agriculture in the continent must literally return to its roots by rediscovering the importance of healthy soil, draw on natural sources of plant nutrition, and use mineral fertilizer wisely.

For Allana, that means getting potash from its Danakhil mine into the hands of African farmers quickly, effectively and efficiently. With ICL’s backing, Allana’s potash project in Ethiopia and its dream of producing critical potash fertilizer in Africa for the benefit of all Africans is one giant step closer to becoming a reality.

Legal Disclaimer/Disclosure: This document is not and should not be construed as an offer to sell or the solicitation of an offer to purchase or subscribe for any investment. No information in this article should be construed as individualized investment advice. A licensed financial advisor should be consulted prior to making any investment decision. Market One Media Group makes no guarantee, representation or warranty and accepts no responsibility or liability as to its accuracy or completeness. Expressions of opinion are those of the authors only and are subject to change without notice. Market One Media Group assumes no warranty, liability or guarantee for the current relevance, correctness or completeness of any information provided within this article and will not be held liable for the consequence of reliance upon any opinion or statement contained herein or any omission. Furthermore, we assume no liability for any direct or indirect loss or damage or, in particular, for lost profit, which you may incur as a result of the use and existence of the information, provided within this article. Therefore, in no case whatsoever will Market One Media Group Inc. be liable to anyone for any decision made or action taken in conjunction with the information and/or statements in this press release or editorial or for any related damages.

.

Richard Kelertas
rkelertas@allanapotash.com
+1.514.717.6256

http://finance.yahoo.com/news/allana-potash-corporation-plans-agricultural-150452558.html

.

Turkish textile group, Tesco and H&M invest in Ethiopia

.

Ayka Addis Textile & Investment Group, a subsidiary of Istanbul-based Ayka Textile, is planning to invest one billion Ethiopian birr (31 million pounds) in an expansion of its current RMG production unit in Alem Gena, 19 kilometers away from Addis Ababa. The expansion will create an additional 13,000 jobs, thus tripling employment, and take production capacity up to 100 percent. The company is also expecting exports to triple to 150 million US dollars from currently 56 million US dollars (2012/13).

“The expansion project will increase our present garment production capacity by 50 perccent, when the first phase of expansion is finalised and by 100 percent when the second phase of expansion is finalised in 14 months. Once finalised, the project will create job opportunities for 13,000 people,” confirmed Ayka CEO Amare Teklemariam when speaking to Fortune.

Expansion to take place in two phases

The expansion will take place in two phases and the first one will begin this month itself. Ayka has already received 3.6 hectare of land from the Kolfe Keranio District for its first phase and is in the final stages of leasing an extra 2.6 hectare according to Teklemariam. Of the total project cost of 962.5 million birr (29.9 million pounds), 221.3 million birr (6.88 million pounds) will be spent on building and civil work, to be carried out by Ayka’s own construction wing; 623.2 million birr (19.37 million pounds) on machinery and equipment. The remainder will be used as working capital, so Teklemariam.

In view of the global competition, ready-made garment manufacturer and exporter Ayka Textile, founded in 1988, decided on Ethiopia for its vertical expansion and made an initial investment of 140 million US dollars in 2010 when the Ayka Addis Group was founded.

The company currently employs 7,500 permanent and 100 temporary workers in five plants in Alem Gena, which operate at 80 to 90 percent capacity and have the capacity to spin 40 tons of cotton, knit 38 tons of thread, dye 50 tons of cloth and produce 80,000 pieces of garments. The company exports its garments mainly to Germany.

According to the Ethiopian Textile Industries Development Institute (ETIDI), ten new additional factories with a combined production capacity of 100 tons a day are expected to start production this fiscal year (2013/14) and an additional three new projects in the next fiscal year (2014/15).

Tesco and H&M sponsor training for Ethiopian garment workers

Industry giants Tesco and H&M are currently sponsoring training courses for Ethiopian garment and textile workers, a move that shows Ethiopia’s growing importance as a sourcing base for international brands and retailers.

“They are here transferring knowledge and skill to many of our textile and garment companies,” confirmed Bantihun Gessesse, communications director at ETIDI. Having learned their lesson in Bangladesh and other Asian garment-producing nations, the companies also invest in safety from day one.

“The business objective is first to improve quality and safety and finally make clothes in Ethiopia. They are now engaged in training on employee and working hour management, quality of products, growth in productivity, as well as environmental protection,” said Gessesse. He confirmed the growing demand for Ethiopian textiles and garments in Western markets, citing Germany as an example with 47 percent of the national production being exported to Germany in 2013. Over the last eight months, Ethiopia has earned 75.28 million US dollars from textile export and is aiming for 317 million US dollars for the whole year.

http://www.fashionunited.co.uk/fashion-news/fashion/turkish-textile-group-tesco-and-hm-invest-in-ethiopia-2014040720665

.

Ethiopia, China to boost bilateral ties

.

Addis Ababa – Ethiopia and China have agreed to prepare and implement a new comprehensive co-operation framework to further boost bilateral ties.

This was agreed when Ethiopia’s Deputy Prime Minister Demeke Mekones and Chinese vice Foreign Minister Zhang Ming held discussions on the issue recently.

New partnership areas such as aviation, space science, tourism and mining are to be included in the new 10-year co-operation framework.

During the discussions, Mekones said the incorporation of the new areas of co-operation would help Ethiopia learn from best practices of China in those areas.

The Chinese vice-minister told journalists that the new framework would enable the two countries to expand their areas of co-operation.

The two countries’ finance ministers are expected to discuss various provisions under the framework later this month. –

http://www.sanews.gov.za/world/ethiopia-china-boost-bilateral-ties

.

Export promotion, diversification emphasized in the remaining GTP period

.

Over the past two decades, there had been significant progress in key human development indicators: primary school enrolments had quadrupled, child mortality had been cut by three quarter and the number of people with access to clean water had more than doubled. These gains, together with more recent moves to strengthen the fight against malaria and HIV/AIDS, paint a picture of improved well-being in Ethiopia.

More so, the past three years of the Growth and Transformation Plan (GTP) (2010/11-2012/2013) had witnessed a strong and broad based average economic growth of 10 per cent and significant expansion in social services and infrastructural development. Gross primary education enrolment rate had exceeded 95 per cent while the country had already achieved the MDGs target of reducing under-five child mortality last year, two years ahead of the target year of 2015.

Th agriculture sector registered a rate of 7.1 per cent, the industry 18.5 while the service industry spotted a 9.9 growth. Over 10,000 km roads were built and rural Ethiopia had over 30,000 km of roads. Not only that, the country had managed to secure 107 billion birr from that of 43 billion in 2010 which showed a 17 per cent growth.

The economic growth has brought with it positive trends in reducing poverty both in urban and rural areas. In today’s Ethiopia extreme poverty has declined from 45.5 per cent in 1995/96 to 27.8 in 2011/12. A trend which represents a significant reduction of 38.9 per cent over the last sixteen years. This includes increasing access to quality health and education services; enhancing the resilience of vulnerable households to food insecurity; increasing adoption of Disaster Risk Management (DRM) systems and strengthening sustainable natural resource management and resilience to climate change. Ethiopia is set to achieve MDG2- reducing poverty level to 22.2 per cent by 2015. Expanding and improving services such as health, education, potable water, agriculture and road development on both urban and rural levels are also part of the set goals. The government is already devoting a very high share of its budget-over 69 per cent- to pro-poor programmes and investments.

There is no doubt that the country is growing rapidly. One has to look at the number of construction sites and new roads being built across the country. The GTP achievement so far has been impressive given its ambitious nature. The second year progress evaluation report indicates that many of the targeted achievements were nearly met but remain slightly off target. Export promotion and diversification had declined last year by 2.5 per cent. One of the factors for the low performance of the sector is the decline in international market prices of some export commodities while, the key factor is limited supply and lack of product diversity to significantly expand the sector.

Hence, emphasis has to be given to revitalizing the export sector in the remaining two years with focus placed on increasing the production of diversified export commodities and creating a better competitive manufacturing sector.

The emphasis should also be on enhancing foreign exchange revenue generation via improving the domestic production capacity in general and further boosting agricultural and industrial production in particular. Improving the effectiveness of the implementation of the various export promotion policies is essential to accelerate export trade. The government and the private sector need to enhance their collective efforts to make a break through in the country’s export sector as well.

Despite the considerable expansion and provision of power and telecom services, the significance of addressing the lingering challenges of quality and reliability in the remaining period must be also underlined.

The agriculture and other related sectors should be fully developed. Creating more jobs in the non-agricultural sectors for the country’s youth must be made a point. For this to happen in the remaining period the private sector should be supported with more adequate credit provision. It is recommended too.

It is to be recalled that Ethiopia’s economy had grown by 11.4 per cent during the first year of the GTP. The 10 per cent economic growth in the first two years is slightly lower than the 11.1 per cent annual average growth rate target set for the first two years of the GTP and the 11.2 per cent annual average growth rate target set for the entire GTP period.

Experts are enthusiastic that this marginal difference can be compensated through accelerated growths in the agricultural and industrial sectors in the remaining GTP period.

http://www.ethpress.gov.et/herald/index.php/herald/editorial/6558-export-promotion-diversification-emphasized-in-the-remaining-gtp-period

.

 Ethiopia once again looks to Indian teachers 

.

Ethiopia, where Indian teachers have long been revered, is again looking at Indian teachers and trainers in various fields as the ancient East African nation, where one of the earliest traces of human existence has been found, shifts its economy from an agrarian to an industrial one.

“In 1950-60 when we were expanding our education system, India came to our rescue because we did not have any teacher training colleges. Later, when our capacity grew, we started training elementary and high school teachers. Today, we are expanding our higher education and have close to 500 Indian professors in our colleges and universities,” Ethiopian Ambassador Gennet Zewide, who completed eight years in India this month, told IANS in an interview.

“Our tryst with education has further diversified. Not only we take teachers from here but also we bring our Ethiopian students to India. The Ethiopian government consciously gives scholarships to train its would-be professors and instructors at universities in India. So we have close to 500 Ethiopian instructors studying in India,” said the amiable envoy who, before her stint in New Delhi, served as the country’s education minister 1992-2005. She is an academic who taught business education courses and designed administration programmes.

Ethiopia has already tied up with institutes like the South Indian Textile Research Association (SITRA), the National Institute of Fashion Technology and the Footwear Design and Development Institute. “These institutes train people for the industry in our country,” the envoy said.

“They give technical assistance as well. They travel to give short-term training to our people and we also bring our students here,” she added.

“A team from the Metal and Metallurgy Institute of Ethiopia will be coming in a month’s time to talk with the Council of Scientific and Industrial Research (CSIR). This tie-up will help in knowledge and technology sharing,” she said.

The team will be visiting the three CSIR institutes – the National Metallurgical Laboratory, Central Mechanical Engineering Research Institute and the Central Electronics Engineering Research Institute.

(Aparajita Gupta can be contacted at aparajita.g@ians.in)

http://www.business-standard.com/article/news-ians/ethiopia-once-again-looks-to-indian-teachers-114040600189_1.html

.

Tendaho One Sugar mill to start operations in this month

.

Ethiopian Sugar Corporation has announced that massive efforts are being undertaken to start the operation of the Tendaho One Sugar mill by the end of April. Asrat Kebede, Director of the Sugar Corporation’s follow-up plans told reporters that upon completion the Tendaho One Sugar project will have the capacity to produce 750,000 tons of sugar annually. Tendaho One and the recently upgraded sugar mills at Fincha, Metahara and Wonji are expected to produce annually 5 million quintals of sugar. With the completion of all the 12 sugar projects now under construction, Ethiopia will beome a major exporter of sugar.

http://addisstandard.com/tendaho-one-sugar-mill-to-start-operations-in-this-month/

.

Can Assela Malt Factory cope up with the trying challenges it is facing ?

.

The state-owned Assela Malt Factory was established with the aim of producing and providing malt for breweries in the country with a total capital of 9.3 million birr and 14.7 hectares of land in 1984. The factory was established in the region of potential malt barley producing zones namely: Arsi, western Arsi and Bale zones. The initial capacity of the factory was 100,000 quintals per annum where the demand of the breweries during that time was also nearest this capacity.

After the down fall of the Derg in 1991 and the followed free market expansion of the then existing breweries create a rising demand of malt products. In response to this growing demand, the factory went through its expansion to increase the annual production capacity from 100,000 quintals to 150,000 quintals in 1995. This production capacity can cover 35 – 40 percent of the breweries demand at the time whereas the remaining 60-65 of malt requirement had been fulfilled by the import which exhausting the country’s foreign currency reserves.

With the aim of satisfying domestic demand of malt, the factory had been implemented its second and third expansion projects during 2010-2012 to increase its production capacity from 150,000 quintals to 360,000 quintals per annum and begin its production with full capacity since 2012. The expansion project increased the production capacity of the factory by about 140 per cent than before.

Even though the production capacity of the factory has increased to this extent, it can cover only 55 per cent of domestic breweries malt demand because of contentious expansion of domestic breweries and their ever increasing production.

At present, the factory needs more than 600,000 quintals of raw malt barely to produce 360,000 qintals of malt per annum. But it is not getting the aforementioned amount in the local market. Hence, the factory has been undertaking various measures in collaboration with stakeholders to curb the problem.

Even though the factory has been trying to give technical support for malt producers since 2007, it is still facing shortage of malt barley both in quality and quantity which is essential to further boost its production, according to Amare wakjira, General Manager of the malt factory.

This year, for example, due to the heavy rain that hit the barely crop fields, farmers could not harvest and supply sufficient malt barley to the factory. Besides, the traditional cultivation methods like dependency on rain-feed agriculture is also another factor contributing to shortage of the raw material. As of January 2014, the factory has bought 170,000 quitals of barley from farmers which shows an increase by 100,000 quintals as compared to the same period last year.

The factory purchases malt barley from merchants, unions and farmers. “We encourage farmers by covering their transport fee, providing seeds and also paying over the actual market price. But the farmers seem not motivated to produce malt barley as they are more inclined to producing the edible barley. The factory, thus, plans to collect selected seed for distribution to the farmers,” Amare said.

Though it is facing shortage from local market, the factory doesn’t import malt barley. “As we know, barley is a staple food in Arsi and its environs. Hence, we are lobbying the community to substitute their consumption with other options so that they could increase malt barley supply to the factory.

Since the factory has a great shortage of barely supply from local suppliers in the required quantity and quality, it is becoming forced to import from abroad. This demands a large amount of foreign currency. Using what we have in store, we can run the factory up to July 10, 2014. Otherwise, we will look into foreign market options,” Amare said. But now the malt factory will be looking to increase its raw materials supply from domestic options, he added.

According to the general manger, the factory has long term loan borrowed from commercial bank of Ethiopia to finance its expansion projects. It also used the dividend which was to be paid for the government to finance the same project since 2008. Due to this, the factory facing financial shortage as it has been utilizing the profit and bank loan for expansion work instead of transferring it to the government as dividend for the last four years. Now, the organization has run into huge debt.

Fluctuation of fuel price is also one of the challenging factors cost of production as the factory uses high amount of furnace for kilning process. Therefore, the shortage of malt barley from the local market, loan and state dividends are the current factors which negatively influencing financial state of the factory. “We are now in fear that the factory would stop at some point unless appropriate measures are taken to redress” Amare said.

Malt is the second largest use of barley after food, and it is an important crop for farmers in the cold highlands of Ethiopia. Beer production in Ethiopia has increased from 1 million hectoliters in 2003 to roughly 4 million HL in 2011, growth of nearly 20 per cent annually. This growth has led to corresponding growth for malt barley demand, which is the key raw in-put for beer production. At present there are six breweries in Ethiopia, and the sector is attracting overseas companies including the global giants Heineken and Diageo, and more new ones are under construction. It is estimated that about 16,000 tons of malting barley are produced annually in Ethiopia, while the demand is at 48,330 tons, and this is expected to double in a few years owing to the expansion of breweries. Most of the demand for malt is met through imports, which accounts for 67 per cent of the total annual requirement. The country spends over 120 million birr (USD 14 million) per annum to import malt which is putting pressure on the already scarce foreign currency. To satisfy the ever increasing national demand for malt barley and to ensure dependable and higher cash returns to the farmers, it is necessary to expand the production of malt barley.

BGI Ethiopia, Harer Brewery Share Company, Bedele Brewery Share Company are among the major customers to the factory. Even though the factory is a sole producer of malt in the country, it is expected to supply quality products for its customers. On the other hand, in order to retain its existing customers, and to stay in the market, the factory should work hard to improve its product quality.

Cognizant of this fact, Assela Malt Factory (AMF) has already started to set out growing scheme with smallholder farmers to increase its malting capacity. But, the supply still remains low, and the quality standards do not often satisfy the requirements of the malt factory.

The expansion project can help the factory to produce with high capacity. The demand for malt is increasing year to year as domestic breweries are expanding and this can create high selling performance. If the factory gets enough malt barely supply from the local market , during the coming three to four years, it will be in a good financial position, Amare noted.

In order to retain its existing customer base and to stay in the market the factory should work hard to improve its product quality. To attain these strategic aims, the factory has been conducting different types of reforms such as total quality management(TQM), total productivity maintenance(TPM), Integrated Performance Management System (IPMS), continuous productivity improvement programme (Kaizen) and business process re-engineering (BPR), and management information systems to improve its system.

With in all these trying challenges, the question that “can it attain its goals and sustain itself for the better future?” remains to be answered in the coming few years. The factory’s fate, which affects the fate budding new breweries and the old ones in the country either positively or negatively remains uncertain. Concerned stakeholders should extend their support to rescue it.

http://www.ethpress.gov.et/herald/index.php/herald/development/6561-can-assela-malt-factory-cope-up-with-the-trying-challenges-it-is-facing

.

Rural Infrastructure investment a government matter

.

The need for infrastructure development in rural areas to link farmers to markets, featured prominently during the Regional Trade and Infrastructure Work Stream discussions at the 10th CAADP Partnerships Platform held in Durban, South Africa from 17 to 21 March 2014.

Convened by the African Union Commission (AUC), NEPAD Planning and Coordination Agency (NPCA), COMESA and the East African Community (EAC), the session on regional trade and infrastructure highlighted the need for rural farmers to have easy access to markets in order to reduce post-harvest losses.

While chairing the March 20th session, COMESA CAADP Coordinator Dr Sam Kanyarukiga said the issue of infrastructure in rural areas should be addressed at a higher level by African governments.

He added that rural infrastructure development should be addressed beyond the line ministry of agriculture as well as the National Agriculture Investment Plans (NAIPs). “We urge countries to see this as a government matter. The Ministers of Agriculture alone cannot address the issue of rural infrastructure development. COMESA works with Member States on all issues of policy in all development areas, and we encourage them to implement their commitments to the CAADP agenda,” Dr Kanyarukiga said. He added that COMESA has been working, with the support of development partners, the EAC and SADC, within the tripartite framework, to facilitate regional trade and investment.

“One of the milestones within the tripartite framework in the quest for regional trade facilitation was the establishment of one stop border posts. These have helped to ease the flow of goods and between countries, and has reduced clearing times at border posts,” he said.

EAC’s Livestock and Fisheries Officer, Mr Timothy Wasonga said the REC was developing a regional policy on aflatoxins to harmonise standards by coming up with Maximum Residue Levels (MLR) for aflatoxins in the region.

The work stream on infrastructure, market access and regional integration made several recommendations to the AU Summit of Heads of State and Government in June 2014. These included the need to increase volumes of intra-regional trade and the need for RECs to work together towards the establishment of the intercontinental free trade area.

The session was attended by participants from the United States Agency for International Development, Department for International Development (DfID), European Centre for Development Policy Management (ECDPM), the Government of Netherlands, and World Bank among others.

http://www.comesa.int/index.php?option=com_content&view=article&id=1103:rural-infrastructure-investment-a-government-matter-&catid=5:latest-news&Itemid=41

.

What investors think about private equity in Africa

.

BY Jaco Maritz

In 2010, private equity firm The Abraaj Group, through one of its funds, bought a stake in Ghana’s HFC Bank. During Abraaj’s investment, HFC greatly expanded its lending and branch network. Last year, Abraaj sold its stake in HFC to a Caribbean bank. It didn’t disclose details of the sale, but one would assume it was for much more than it bought the stake for originally.

Private equity firms usually try to improve the financial results and prospects of the companies in which they buy a stake, in the hope of reselling the business to another firm or cashing out via an initial public offering (IPO). The value created is then passed on to the investors in the fund.

However, private equity managers, such as Abraaj, live and die by their ability to convince investors – such as pension funds, development finance institutions, sovereign wealth funds or high-net worth individuals – to back their funds. These investors, also known as limited partners (LPs), generally have a variety of other options in which to invest their money, including stock exchange-listed companies, bonds and properties. Private equity fund managers therefore need to provide a compelling case to attract their capital.

Supported by strong economic growth, Africa’s private equity industry is fast evolving and a number of new fund managers have emerged in recent years. But how willing are LPs to invest in African-focused private equity funds?

Recent research by Riscura, AVCA and SAVCA seeks to answer this question. The authors spoke to a diverse mix of 48 LPs based across four continents, from pension funds to insurance companies to development finance institutions. The resulting report, titled The search for returns: Investor views on private equity in Africa, aims to provide stakeholders with views on private equity in Africa from the LP’s perspective.

Below are some key takeaways from the report.

1. Growing interest in African private equity: African private equity fund managers have reason to be optimistic about the future, as 85% of LPs indicated they plan on increasing their percentage exposure to private equity on the continent over the coming two years. It should however be noted that Africa-based LPs have a greater appetite to increase allocation to African private equity than international respondents.

2. Africa vs. other emerging markets: Seventy percent of respondents indicated that they think Africa is more attractive compared to other emerging markets. However, 10% of LPs believe Africa is less enticing due to the relatively nascent stage of the private equity industry.

3. Backing the consumer story: LPs believe the consumer goods and financial sectors will be the most attractive over the next three years. Some respondents also highlighted energy and power/utilities as appealing sectors.

4. Outperforming the stock market: Some 80% of LPs believe African private equity will outperform locally listed equity over the next decade.

5. Barriers to investing in African private equity: When asked about the specific challenges facing African private equity, the relative youth of the industry was the main concern.

LPs are also worried about the weak exit environment. Elsewhere in the world, many private equity funds exit their investments by putting their shares in a company up for sale on a stock market, an IPO. However, because of Africa’s relatively undeveloped stock markets, this has been a less attractive option.

Political risk in Africa was only cited as the third biggest challenge.

6. The preferred route to accessing African private equity: Just over half of LPs listed regional funds as their preferred route in the near term, followed by funds-of-funds (23%) and country-dedicated funds (13%).

7. Factors affecting the selection of fund managers: When evaluating an African private equity fund manager, LPs consistently cited track record and operational expertise among the most important considerations.

However, the majority of the respondents said they would be willing to back a first-time fund manager in Africa, especially if the team had other experience to draw on or if the team has a background in executing transactions from investment through to exit.

http://www.howwemadeitinafrica.com/what-investors-think-about-private-equity-in-africa/37565/

.

Tigray Intersects 28.2 Metres at 8.50 Grams per Tonne Gold at Mato Bula, Adyabo Project, Northern Ethiopia

April 07, 2014 06:00 ET

http://www.marketwired.com/press-release/tigray-intersects-282-metres-850-grams-per-tonne-gold-mato-bula-adyabo-project-northern-tsx-venture-tig-1896449.htm

.

IFPRI launches 2013 Global Food Policy Report

.

The International Food Policy Research Institute (IFPRI) yesterday launched the 2013 Global Food Policy Research report. According to the report, ending hunger and under-nutrition by 2025 should be a top priority in the post 2015 development agenda.

Launching the report, Shenggen Fan IFPRI Director General said that with less than two years to go, the deadline of achieving MDGs is fast approaching as progress in halving hunger is not on track, he added.

Citing UN Food and Agricultural Organization report, he said, close to 840 million people or one in eight people worldwide go hungry to bed. And more two billion people suffer from “hidden hunger” or shortage of essential micro-nutrients in the food they consume, he added.

“ Much work need be done. The fight to end hunger and under nutrition must continue beyond 2015.”

According to him, despite significant global progress in reducing the number of hungry and malnourished people, in Africa south of Sahara and south Asia high level of hunger and malnutrition remain a stubborn and tragic stain on the fabric of thriving and vibrant world.

According to the Director General, the goal of eliminating hunger and malnutrition sustainably by 2015 is an inspirational one as experiences of several countries have shown remarkable progress, most notably China and Brazil, they can get close to it. Meeting this ambitious goal will require viable policies and programmes as well as right agricultural investment supportive legal fameworks.

In addition, he said, the communties need to be monitored to guide actions and to hold duty bearers to account. The world’s hungy and malnourished people cannot solve their plight on their own, they need support from goveremnts and interantional communities, he added.

Agriculture State Minister Prof. Tekalign Mammo on his part said that the reoprt is timely and excellent for which Ethiopia has been mentioned in the report as working aggressivley to end hunger and malnourishment befor the deadline.

To heed steadliy in meeting the goals, Ethiopia has developed food securty programme thereby improving the liveliohood and decreasing hunger vulnerablity of its people which is part of the intervention international organizations have been doing, Prof. Tekalign added.

According to him, close to two million people are food secure under the programme developed to relieve hunger vulnerable population.

http://www.ethpress.gov.et/herald/index.php/herald/news/6553-ifpri-launches-2013-global-food-policy-report

.

 .

Sorting the beans by hand ensures the quality prized by speciality consumers. Photo©Per-Anders Pettersson/Corbis

 

 

 

 

 

 

 

 

 

 

 

.

The coffee sector is beginning to resemble the wine market, with buyers willing to pay a premium for crops that reflect local climates and harvesting techniques.

Stumptown Coffee Roasters from Portland, Oregon is one of a growing number of speciality coffee traders beating a path to Ethiopia in search of the world’s best beans.

“The flavours that you find in the cup are flavours that you can’t find anywhere else in the world… Combinations of floral and different types of fruits.

It’s essentially where everything began, so you have amazing evolutionary adaptation of the plant

“A really beautiful balance between liveliness and acidity. Good body. Good sweetness,” raves Adam McClellan, a green coffee buyer for the company.

McClellan’s use of language more often associated with viticulture is not mere pretence.

With more than 1,200 identified chemical compounds in coffee, connoisseurs argue that the flavours and aromas of the very best coffee are equal to those of the finest wine.

Cafe clientele around the world are enjoying the pleasures of a good cup of coffee and are willing to pay a premium for it.

“For consumers to have something that tastes quite different with those floral aromatics and really sweet interesting flavours, it allows them to really see coffee as being something other than an everyday cheap commodity,” McClellan insists.

The term ‘speciality coffee’ was coined in 1978 and refers to beans grown in climates that have a distinct and superior taste.

This is related to the winemaking concept of terroir, at the core of which is the assumption that the characteristics and qualities of individual wines are derived from local conditions.

Ethiopia, long considered the birthplace of Coffea arabica, is thought by many to have some of the best growing environments.

“It’s essentially where everything began, so you have amazing evolutionary adaptation of the plant,” says Phil Robertson, the co-founder of the Calgary-based Phil & Sebastian Coffee Roasters.

“The varietals have had so much time to adapt and that just gives them an incredible leg-up.”

High altitude beans

Gedeo Zone in southern Ethiopia is considered by some to be where the world’s best coffee is found.

Types like Sidama and Yirgacheffe – made popular by coffee giant Starbucks – grow there.

“The reason great coffee comes from here is because of its extremely high altitude,” Robertson explains, adding that the complex and dynamic flavours are due to the wide variation between day and night-time temperatures, which can double the length of maturation of the fruit.

But many traders say Ethiopian coffee has not yet reached its full potential in terms of quality and the volumes supplied to the speciality sector.

It is estimated that just 1% of Ethiopia’s coffee exports are sold as speciality coffee.

Robertson says he would like to see a 10-fold increase in the figure.

To achieve this, problems and inefficiencies in the processing and traceability need to be addressed.

The example of the Duromina cooperative – formed in south- west Ethiopia by about 100 of the country’s estimated one million smallholder coffee farmers – shows what a focus on quality could do for the industry at large.

Ansha Yassin, marketing manager at TechnoServe, explains that before the non-governmental organisation started working with Duromina in 2010, coffee from the area was fetching some of the lowest prices in country.

By improving agronomic practices, harvesting only the ripe, red coffee cherries and installing a wet mill, Duromina was able to sell its 71tn harvest of green coffee in 2012 for an average of $3.86 per pound – 65% above the average international price.

Traceability

One of the additional advantages Duromina has over other Ethiopian coffee is its traceability.

The ability to pinpoint a healthy, responsible and sustainable supply chain is highly prized in the speciality sector.

The Ethiopia Commodity Exchange (ECX), launched in 2008, transformed the way in which most Ethiopia coffee is traded.

This has been to the detriment of the speciality sector.

For the ECX, all coffee from Jimma is interchangeable, making it impossible to identify unique varieties.

By selling through the Oromia Coffee Farmers Co-operative Union, Duromina sells directly to roasters.

Under the ECX system, the farmer loses out.

Many of them are now switching to growing the stimulant khat because it gener- ates larger incomes.

“You’ve got togivefarmersanincentive,”says Michael Mamo, managing director of Addis Exporter, a long-established green coffee trader.

“If I’m working really hard and preparing a top-end coffee, then I should get rewarded for that.”

Mamo is confident that change will come: “The ECX is working towards a direct speciality trade, and the government is definitely trying to address it because coffee is very important to the economy of Ethiopia.”

.

Sourced here  http://www.theafricareport.com/East-Horn-Africa/coffee-ethiopias-speciality-sector-blossoms.html

.

More posts

.

-     The world’s growing love affair with the most wasteful form of coffee there is

-     Why Coffee Futures Could Keep Going Up

-     Coffee isn’t just getting more expensive. It’s likely to start tasting worse, too

-     Ethiopia: The Effect of Climate Change On Coffee

-     ECX on YouTube

-     How An Ethiopian Bean Became The Cinderella Of Coffee

-     United States Set to Support Ethiopian Coffee Trading

.

As I sit on the plane from Addis Ababa to London, I am gathering my thoughts and impressions of Ethiopia. My trip made me realise just how complex a place it is. Ethiopia is different. Or at least, that’s what everybody keeps telling me. “The first mistake foreign businesses make, is to think that Ethiopia is part of East Africa. Ethiopians are not really Africans, nor are they Arab,” a leading distributor for the healthcare industry told me.

BY Anna Rosenberg | 8 April 2014

Ethiopians count time differently. It is currently the year 2006. Midnight is 6pm according to “Habesha time”. Unlike its neighbours, Ethiopia has long been closed to foreign exposure. It was famously never colonised, if one ignores the five years of Italian rule in the 1930s and 1940s – enough to introduce pasta to the national cuisine. From 1974-1991, Ethiopia was under communist influence. Today, Ethiopia is only at the very beginning of opening up to the world.

Yes, Addis Ababa has been the capital of international diplomacy in Africa since the early 2000s. Home to the African Union (AU) headquarters and other international organisations, the city also hosts diplomats from around the world in its swanky hotels and remarkable Chinese-built AU building. Diplomats are easily spotted – they drive big cars and wear expensive suits.

It seems odd. The majority of the population earns about US$60 per month and cars have a 240% import duty. The result is a stark contrast between rich and poor, diplomat and local. Most shops sell cheap Chinese imports or second-hand clothing. As a result, you can find the odd Ethiopian walking around in a Marks and Spencer shop assistant jacket. Russian Ladas from the socialist area, today widely used as taxis, contrast with the diplomats’ 4x4s. The high import duty means that cars, no matter how old, appreciate in price.

However, not all Ethiopians have low income levels. The number of dollar millionaires rose from 1,300 in 2007 to 2,700 people last year. GDP grew by 7.1% in 2013 and the government is implementing reforms to improve the operating environment. Ethiopia is therefore increasingly attractive for multinationals that want to tap into a large population estimated at around 90m people.

This population figure is nonetheless misleading. Local distributors in the fast moving consumer goods sector keep telling me that, “the addressable market is more like 10m when you count the people living in cities”. Some argue that the addressable market is even smaller. Contrary to other African countries, urbanisation is not very pronounced in Ethiopia as about 85% of its citizens live in rural areas. Despite low urbanisation, consumer goods companies present in the market are experiencing dramatic growth rates of between 20%-50%. It seems that growth, while from a low base, is happening fast.

I have come to see that doing business in Ethiopia is a long-term game. Companies must understand it will take time for income levels, and consequently consumption, to grow. It will take time for the government to build the required infrastructure to connect rural to urban areas, so that the addressable market will approach 90m and not 10m people.

State intervention

The government’s main objective is to transform Ethiopia first and foremost into an export market before it becomes a consumer market. Industrialisation, job creation and poverty reduction are also major priorities – and indeed, it has already made major strides in reducing poverty. The government also wants to tackle the recurrent problem of forex shortages, which is only possible by having more US dollars come in through exports rather than by importing more. For example, the high import duty on cars has been implemented because the country spends a large amount of its export earnings on importing fuel. The government wants to change this trend.

According to many local and international business leaders, the government differs from other African governments in that it delivers on many of its promises. It has created various industrial zones, given preferential treatment to investors keen on producing locally, such as access to land and tax exemptions. The amount of infrastructure being built across the country is nothing less than remarkable.

The government also wants to keep a tight grip on the economy. It will only allow foreign companies to invest in sectors that have a true need. As Minister of Foreign Affairs Tedros Adhanom Ghebreyesus told me: “Multinationals need to bring something we don’t already have, either technology or innovation.”

As a result, some sectors are still closed to international companies. These include retail, telecommunications and banking, among others. The government wants to protect local industries and strengthen them before international players come in. There is nonetheless mounting pressure for these sectors to open up and, as many say, it is only a matter of time.

Some companies are in fact already sneaking in through the back door. Leading international telecommunication providers are allegedly acquiring stakes in BelCash and M-BIRR, two companies that provide the technology infrastructure for mobile banking. Telecom giants are therefore already positioning themselves for preferential access to the market.

Great potential for multinationals

Ethiopians want international brands, and they want them now. The odd coffee shop uses a similar logo to Starbucks, and I saw several shoe shops that call themselves Aldo and Clarks. “But Ethiopia was long closed to foreign influence, and they don’t have a direct association with international brands. So, a no-name brand from Turkey for example, can become very successful here, because consumers don’t know the multinational brand. Companies are on a level playing field, and it all comes down to marketing,” a distributor whose Turkish nappies enjoyed a much larger market share than P&G’s Pampers, told me.

Understanding the “local code” is crucial when trying to reach the consumer, as I have been told repeatedly. To give you an example, an international consumer goods company endorsed a local musician. However, it turns out this musician was not well-liked by the 30m-strong Oromo people because of his praise of a former emperor who committed manslaughter of the Oromo many decades ago. The company had planned to send this musician on a tour into the Omoro tribal area, which caused a massive outcry. The marketing mishap reveals how companies must understand cultural sensitivities to succeed in Ethiopia.

Several international companies are already tapping into Ethiopia’s opportunity very successfully. They include the typical pioneers for doing business in Africa; namely Coca-Cola, Pepsi, Diageo and Heineken. General Electric (GE) has already paid various visits to the country and is planning to set up an assembly factory. Coca-Cola has a long history of being in the country; apparently Emperor Haile Selassie owned shares in the company – and at a time, Coca-Cola was traded for gold.

The pioneers are already here. Their success partly rides on the back of what the head of GE for East Africa described: “In Africa, we are working backwards, we create the infrastructure that will lead to the demand for our products.”

I can see that this approach takes time and is expensive, but ultimately, the “working backwards approach” leads to success not just for the companies, but for the socio-economic development of countries.

Given the realities I have seen in Ethiopia, this model makes perfect sense to me.

Anna Rosenberg, head of sub-Saharan Africa at Frontier Strategy Group, is currently on a research trip to Kenya, Uganda and Ethiopia.

Sourced here  http://www.howwemadeitinafrica.com/ethiopia-cracking-the-local-code/37674/?fullpost=1

.

Ethiopian oil marketer says Africa needs to refine its oil

.

Tadesse Tilahun, CEO of National Oil Ethiopia, said untapped crude deposits in Kenya and Uganda handed governments and investors the opportunity to construct a refinery able to compete with cheap imports from India, the Gulf and beyond.

Doing so would help African countries extract more value from their resources and cut their import bills, Tadesse said.

“Africa’s demand for refined products is growing hugely because of its economic growth. The crude findings are also increasing. That is the opportunity,” Tadesse said in Addis Ababa as part of the Reuters Africa Summit.

“We want to (build) a refinery. We have already discussed this in principle with our shareholders, who are very much committed.”

National Oil’s (NOC) shareholders include Saudi billionaire Mohammed Hussein Al Amoudi, whose investment portfolio in construction, gold, hotels and energy has helped amass an estimated fortune of over $15 billion, according to Forbes.

Tadesse said other private and public investors would need to come on board.

Eastern Uganda has become the latest frontier in the global hydrocarbon hunt after gas finds off Tanzania and Mozambique and oil discoveries in Uganda and Kenya.

Even so, Sub-Saharan Africa faces headwinds supplying more of its own refined petroleum products. Regional cooperation and funding for oil-related infrastructure are proving slow, while foreign oil refiners and traders are flooding the $80 billion market with imports.

Existing pipelines also tended to run to the coast, Tadesse said, either for the export of crude or the import of refined products from small-scale refineries found near ports.

“That has to change,” Tadesse said. “Refineries are now needed inland so that Africa can supply itself.”

CONSTRAINTS

Tadesse acknowledged the price tag was problematic for many African countries. Oil production in Uganda has been delayed in part due to a row between the government and investors over the size – and thus cost – of a refinery in the country.

“It would be in our own interest, for all countries in this area, to have a common refinery, a joint facility, where we can take our own product,” Tadesse said.

Kenya plans – but has made little progress towards – a new $2.8 billion refinery on its northern coast. Industry experts say Ugandan and Kenyan oil exports could reach 500,000 barrels per day – oil Tadesse would rather see stay in the region.

Founded in 2004, NOC now claims a 35 percent share of a market tightly controlled by the Ethiopian state. So too are other key sectors including banking, retail and telecoms, which the government says need shielding from foreign investors while the economy diversifies away from its agricultural base.

Tadesse said NOC had secured a license for fuel stations in neighboring Djibouti and targeted expanding its downstream operations into Kenya within five years. Plans to enter South Sudan have been shelved due to the four-month conflict there.

“We want to be a regional player,” Tadesse said.

Oil consumption has doubled in 10 years in Ethiopia, one of Sub-Saharan Africa’s fastest-growing economies and now the region’s fifth-largest after leap-frogging Kenya.

Demand for oil in Ethiopia is seen tripling by 2025, indicative of the economic transformation under way in Africa’s second-most populous nation which is still better known abroad for the famine of 1984 and communist-era purges.

But the pace of NOC’s expansion at home hinges on the government relaxing its grip on the industry.

Tadesse said the government imported all fuel products and set the market price, allowing fuel stations a margin of just 4 U.S. cents per liter. Land rights issues also hindered growth.

“In no way can that be attractive to investors,” he said.

(Writing by Richard Lough; Editing by Susan Fenton)

http://www.reuters.com/article/2014/04/09/us-africa-summit-noc-idUSBREA3815Z20140409

.

IMF recommends sugar, logistics be open to foreign investors

.

.By Muluken Yewondwossen 

The International Monetary Fund (IMF) recommends that Ethiopia expand its private sector.  Jan Mikkelsen, the IMF resident representative to Ethiopia, who met with selected journalists on Wednesday April 2, said that the government should support  the private sector financially and promote domestic savings by activating a securities market with flexible interest rates.
He said that while there is general recognition that supporting the private sector is important, it is constrained by a lack of financial resources. “The large GTP financing requirement crowds out credit for the private sector. As a result, in real terms, the allocation of credit from the banking system to the private sector has remained roughly unchanged over the last four years while credit allocation to the public sector has risen steadily,” the IMF representative said.
On several other occasions IMF officials have called for carefully considering the balance between public and private sectors in the economy.
Ethiopia is one of the global leaders in public investment. According to the World Bank data, Ethiopia’s public investment is the third highest in the world, but its private investment rate is the six lowest.
The international financial institution has said the private sector is suffering from lack of finance.
In the past couple of years even though the country has registered economic growth and inflation remains in single digits export competitiveness and performance remains disappointing.
For instance the country’s export performance during the previous fiscal year was lower than the exceeding trend. In the past few year’s excluding the 2008 financial crisis, Ethiopia experienced significant growth in exports, but the past year saw lower results compared with a similar period of the previous year and was very far from targets.
During the first six months of this fiscal year Ethiopia’s exports also did not meet expectations. Price decreases of the nation’s major commodities in the international market and a disappointing performance in the manufacturing sector has contributed to the decline.
In his report Jan Mikkelsen wrote that lowering the cost of trade, by making logistics more efficient and the exchange rate more flexible would increase competition and strengthen exports. He also recommended allowing more foreign direct investment.
He stated that standardizing the way the foreign exchange market operates would make hard currency more available and eliminate harmful waiting time for businesses to purchase foreign exchange.
The IMF resident representative also mentioned several structural policy challenges. He agreed that the state should continue to play a vital role in economic development but argued that more sectors should be opened up for private investment.  “This alleviates the capacity problem both in terms of performance and accessing financing,” he said.
“In particular, gradually opening up key sectors like telecom, trade logistics, and finance, and withdrawing from sugar production could attract new investments and improve efficiency and delivery of services,” he added.
On many occasions international organizations have called for the government to privatize telecom and open the banking sector for foreigners  and just as often the government has reaffirmed its strong disagreement. This latest IMF recommendation added trade logistics to that list.  A recent law gave the sole multimodal scheme to the state owned Ethiopian Shipping and Logistics Services Enterprise.
This issue has created disagreement between the government and Ethiopian logistics companies who with the monopoly would be broken. The government has said that eventually it will ease the law and allow other private firms to provide logistical service. However, over the past two years the Enterprise has had no competition in the multimodal transportation scheme.
The IMF representative also wants the government to withdraw from sugar production. Currently, the government is undertaking several sugar factories and plantations throughout the country with the goal of ending sugar imports and eventually exporting sugar to other countries.
Ten sugar factories are scheduled for inauguration in the coming fiscal year, by the time the GTP ends.  Sources claim there has been some revision in some of those targets and not all the projects will be finished by that time.
The IMF representative also lauded the focus on infrastructural growth.
“I would like to commend the government’s continued efforts to improve infrastructure around the country-undoubtedly, the public investments in power, roads, and the Djibouti railway are key to sustaining economic growth in Ethiopia,” he said.
But he said that withdrawing from sugar production could attract new investments and improve efficiency and delivery of the service.
He pointed out that the planned USD 5.5 billion investment in sugar is more than the USD four billion spent on the Grand Ethiopian Renaissance Dam.
“Why not let for foreign and domestic investors spend their money on sugar, it is very attractive to them,” he said.
The government disagrees saying the needed investors do not exist.
“The sector requires huge capital, so the private sector is not very interested in investing in sugar,” the government argued.
Like previous IMF recommendations the representative also mentioned that the financial sector should be strengthened by promoting a well functioning securities market with flexible nominal interest rates and by phasing out the 27 percent National Bank of Ethiopia (NBE) bill holding requirement on private commercial banks. In the past few years the government has imposed the 27 percent NBE bill on private banks to buy bonds from the amount they lend. On several occasions the local financial intuitions have asked that the government to lift the requirement.

http://www.capitalethiopia.com/index.php?option=com_content&view=article&id=4245:imf-recommends-sugar-logistics-be-open-to-foreign-investors-&catid=35:capital&Itemid=27

.

Amibara Rotates Crop Focus From Cotton to Cane

.

The farm will supply cane to Kessem – one of six new government-led Sugar Factories to start production next year

The Amibara Business Group has halted cotton production on its 6,000ha Middle Awash Agricultural Development farm, in favour of supplying sugarcane to the Kessem Sugar Factory, which is currently under construction.

The Factory could be completed sometime in 2014/15. It is one of a total of six sugar factories the government plans to make operational next year. These six factories could increase sugar production from 500,000tn to 1.85 million tonnes, according to the plan.

The Middle Awash farm is located 33 kilometres from the factory site, in an area where there are no other commercial farms, according to Kaba Mergia, general manager of kesem Sugar Factory. Once a state farm, Amibara purchased the business from the Privatisation & Public Enterprises Supervising Agency (PPESA) for 351 million Br in 2010/11.

The offer for the supply of sugarcane came from the Factory, which already has a 20,000ha farm of its own. According to the agreement Amibara signed with the factory, the business group will supply a total of 840,000tns of sugar at a price of 50 Br a quintal. Yusuf Omar, managing director of Amibara and Kaba Mergia, signed the agreement on March 27, 2014, at the office of the Ethiopian Sugar Corporation (ESC), located next to the Ministry of Trade (MoT) on Marshal Tito Street.

This rate is the same as what the Wonji Sugar Factory is paying to local farmers, who have switched from other crops to sugarcane production, in order to supply the factory. Amibara’s agreement will give it three years of guaranteed sales, which could be more lucrative than the more unreliable cotton market.

Cotton enjoyed prices of 1,930 dollars a metric tonne in the international market, in 2011, only to go down to 1,694 dollars in 2013. Latest figures for 2014, according to Index Mundi, indicate an international price of 2,073 dollars a tonne. With cotton yields varying between 19qt and 30qt a hectare, Amibara’s farm could yield on average around the same revenue as it does from its latest sugar cane deal, if not more. It could make 540 million Br from the sale of sugarcane, if production goes ahead as planned.

Amibara, which owns a portfolio of 11 companies, including Gelista Agricultural Development, Amibara General Aviation Service, Addis Modjo Edible Oil Complex and Amibara AgroChemicals, with a combined capital of 700 million Br, opted for the deal with the Sugar Corporation because of its desire to move into the sugar production business, says Yusuf, explaining his company’s decision to turn this particular farm away from cotton just two years after acquiring it. The Business Group, which employs over 3,000 permanent and 10,000 temporary workers, cultivates mainly cotton from around 13,000ha of farms in different parts of the country.

The Company began planting sugarcane a month ahead of the agreement, covering 60ha a day, says Yusuf, expecting its harvest in 14 months.

The construction of Kessem, located in the Awash Fentalle and Dulecha woredas of Afar Region, started in the 2012/13 fiscal year and is planned to be finalised next year, according to Zemedkun Tekle, corporate communications head of the Corporation.

Kessem is cultivating sugar cane on 20,000ha of land it owns, encircling areas known as Kessem and Bolhomon. The plantation field gets its water supply from the Kessem-Kebena Dam, built on the Kebena River. This has a capacity to hold 500 million cubic metres of water.

The factory is expected to start production in the next fiscal year, with a capacity of 153,000tns, gradually pushing towards its potential of 260,000tns. It could also produce up to 30,000 cubic metres of ethanol.. The overall project cost is around 4.2 billion Br.

The other state sugar factories in the making include – Kuraz One (in South Omo Zone of the Southern Region), Tana Beles One and Two (in Amhara), Tendaho One and Two (in Afar) and Arjo Dedessa (in Oromia). These are all expected to begin production during the coming fiscal year. The sugar corporation says that “Wolkait, Beles 3, as well as the Kuraz 2 and 3 sugar factories, are expected to enter production in the first year of the second chapter of the GTP – 2008, in the Ethiopian calender.”

Ethiopia’s production will jump up from 232,000tns a year, in the 2012/13 fiscal year, to nearly 1.6 million tonnes by 2014/15, the Corporation says on its website.

http://addisfortune.net/articles/amibara-rotates-crop-focus-from-cotton-to-cane/

.

Intensifying national sugar projects

.

As part of its Growth and Transformation Plan, the government of Ethiopia laid out strategies few years ago for the implementation of its ambitious grand sugar development plan. The contribution of sugar industry to the overall economic development can be explained in so many ways. Apart from saving the country’s foreign exchange which otherwise could have been spent for importation of sugar, and boosting its export revenue, the industry expected also to make significant contribution to employment creation. For the realization of the objectives set to be achieved by way of strengthening the industry, human resource development, industrial capacity building and promotion of research and technological capacity are all crucial.

The construction of new sugar industries and the expansion of existing ones is now found at various stages.

In fact, the government has given focus to sugar development, today the existing sugar factories are producing sugar with doubled capacity while some extra factories are under construction. Ethiopia is doing this with a view of becoming one of the top 10 exporters. The reason for this target is that Ethiopia has big potential in terms of climate and in terms of soil and water resources, which is very favourable for sugar production, according to available sources.

Needless to mention, sugar is consumed by households as well as different industries such as confectioneries, food processing and beverage industries, institution like colleges and universities, military, hotels, restaurants and bars. Due to its wide application in different sectors the demand for sugar is very huge in the domestic as well as international markets.

Ethiopia has been meeting most of its sugar requirement through local production. However, due to the shortages created in the past few years nearly 20 per cent of sugar requirement is met through import. But since recently the domestic demand is fully met with domestic production.

On the other hand, be it newly built or the expanded sugar factory has got manifold advantages beyond meeting sugar demand. Previously impoverished communities, for instance, will be far better off as they will benefit from irrigated land, improved social services, support from agricultural experts and job opportunities.

The Wonji Shoa Sugar Factory is a good example for such facilities for the local people. People get involved in and benefit in many ways. They are engaged in sugar-cane production which they supply to the factory that can maximize their earnings.

In some places local people get organized as sugar-cane out grower associations so that they will benefit more from the sugar development project by providing cane for the factories. Similar trend need to be expanded to other areas where sugar factories are and are to be built. It should also be underlined that the need to hold successive discussions with local communities to create awareness on the benefit of the project as a whole and their advantages in engaging in cane out grower associations.

In addition to sugar yield, sugar factories are also so important in producing fuel energy such as ethanol. Wonji Shoa, for instance, has a daily 30MW generating capacity out of which two-third would be sold to Ethiopian Electric Power consuming the rest in sugar production. Basically, sugar plant utilizes its own electrical power generated within the plant at the power generation station. This is done by producing steam in the steam generating plant, utilizing the by-product from sugar-cane as a main fuel and furnace oil as an auxiliary fuel. The generated steam is let to the power steam turbines and generators to produce the required electrical power.

In sum, though exporting sugar is vital to the country’s export earnings, the government need to prioritize the domestic demand as it is rising year-in-year-out. The misconduct among the retailers must also be corrected since they deliberately create shortages in the market. Stiff measures should be taken against such irresponsible and greedy individuals in order to safeguard the public interest towards this end.

http://www.ethpress.gov.et/herald/index.php/herald/editorial/6600-intensifying-national-sugar-projects

.

Ethiopia aims to boost food reserves

.

By Abebech Tamene, Wednesday, April 09, 2014

ADDIS ABABA – Ethiopia is working to increase its national food reserves six times over, from a current 460,000 metric tons to three million metric tons, the Ethiopian Strategic National Food Security Reserve Agency said.

Agency PR Officer Gizaw Abute told Anadolu Agency that the U.N. World Food Program (WFP), Sudan, Turkey, Germany and the U.K. were all involved in the agency’s efforts to achieve this objective within the next three years.

“Through a program organized by the WFP, our experts have managed to draw experience from Sudan and Turkey on ways to increase [food] reserves,” said Abute.

“Consultants from Germany and Britain have also been working during the last three years for the same purpose,” Abute added.

“A budget of 13 billion birr [roughly $670 million] has been allocated for construction and the expansion of silos as part of the plan to increase reserves,” the official asserted.

Ethiopia’s current food reserves are sufficient to feed seven million people for a six-month period, Abute pointed out.

“When reserves reach 3 million metric tons as planned, they will be enough to feed 40 million people for six months,” Abute added.

Ethiopia’s food reserves include maize, sorghum and wheat, he said, pointing to a short-term plan to add edible oils, oil seeds and legumes to the reserve stocks.

Copyright © 2014 Anadolu Agency

http://www.turkishpress.com/news/399821/

.

Ethiopia: New stadium Deal goes to Qatar, Australia consortium

.

.

Ethiopia’s FIFA/Olympic-standard stadium is to be built by a Qatar and Australia consortium, the Doha-based Australian company Designsport said in a statement.The company, in partnership with local Ethiopian architects JDAW, won the bid based on its design for a sunken arena for a new national stadium and sports village in the Ethiopian capital, Addis Ababa.
According to TradeArabia news, the stadium evokes “Ethiopia’s world-famous excavated architecture and the ‘Mother womb’, the skeleton of one of the first humans, Lucy, who is about 3.2 million years old.”

The stadium will be designed and erected in the likeness of a coffee bean, highlighting the country’s main source of income.

“The façade material that wraps around the stadium was similarly inspired by Ethiopian culture, modeled on the Massob, an Ethiopian communal serving basket made from woven grass,” the companies’ said. Construction is scheduled to begin in 2014 and will be the largest sports structure in the country.

Samantha Cotterell, CEO of Designsport, a consultancy specializing in sport architecture and event design, who led the bid, said: “The brief was to design a center that would revitalize sport in Ethiopia. The result is a sports venue which can be used by all. It is for community use at a grass roots level right through to providing a high performance training center for elite athletes and a location for major international sporting events.”

Chris Bosse, who led the design team, and is a director of Lava, said: “We have gone back to the very origin of stadium design with the sunken arena surrounded by grandstands formed from excavated material.

“The man-made crater is a clever remodeling of the existing terrain, integrating facilities within the landscape. It is an efficient use of space which optimizes the site’s environmental performance while minimizing construction costs.”

http://geeskaafrika.com/?p=2188

.

Construction sector should contribute 20% of the country’s GDP

.

.

By Groum Abate 

Construction should contribute 20 percent of the total Gross Domestic Product (GDP) in the coming few years according to State Minister of Urban Development, Houses and Construction Hailemeskel Tefera.

According to the United Nations 2012 report Ethiopia is placed 85th from a total of 193 countries with an estimated GDP that amounts to USD 41,605 million.
This was said at the event organized by the Association of Ethiopian Class one Contractors (AECOC) to honor participants and sponsors of the second “Construction for Ethiopian Renaissance” exhibition that was held at the Addis Ababa Exhibition and Market Development Center from March 21- 25, 2014.
During the event held at Elilly International Hotel on Tuesday April 1, the State Minister said that the exhibition is one of a kind and  will help the industry players to work more closely and effectively.
“Many exhibitors were present with their work and this kind of event will help the industry grow better.” “We want many firms in the construction industry and this is how we can overcome the problems in the sector,” he said.
Over 150 companies participated in the event to showcase their work.
Mulugeta Gessese General Manager of AECOC told Capital that the exhibition was a unique occasion that demonstrated the progress  construction has made. “It has been growing at an unprecedented rate recently and we demonstrated that,” Mulugeta said.
In the exhibition which was officially inaugurated by Mekuria Haile Minister of Urban Development, Houses and Construction, major players in the industry such as the Metal and Engineering Corporation (MeTEC), Ethiopian Railway Corporation and Ethiopian Roads Authority, showcased their achievements and future goals.
“This exhibition was a place where leading builders can network,” Hailemeskel said. Construction companies brought tons of equipment and displayed cutting-edge technology.
The state minister also presented awards to the sponsors of the event.
Architects, contractors, importers, insurance firms and others working in the construction industry   participated in the trade fair.
Capital Newspaper was the official media partner of the event.

http://www.capitalethiopia.com/index.php?option=com_content&view=article&id=4243:construction-sector-should-contribute-20-of-the-countrys-gdp&catid=35:capital&Itemid=27

.

Ethiopia, Uganda to strengthen business ties

.

There is wide room for Ugandan investors to work in Ethiopia

.

African to African business and investment cooperation is a yet not grown trend though regional economic blocs like the Common Market for Eastern and Southern Africa (COMESA) are currently working for a preferential arrangement to boost trade and investment between African countries. It is usually the Western investors that took over the intra-regional trade.

Currently, however, the interest of African investors is growing to transact with neighbouring states. Accordingly, over 20 Ugandan investors and businessmen yesterday discussed with Ministry of Foreign Affairs State Minister Dawano Kedir and Ethiopian Investment Agency Director General Fitsum Arega possible investment and business opportunities in Ethiopia to which the Ugandans can go for.

State Minister Dawano said there is wide room for Ugandan investors to work in Ethiopia as there is a similar culture and demographic nature between the two countries. The State Minister told the investors that Ethiopia is a country with a population of more than 90 million of which the majority is young and productive.

He also briefed the investors on duty free incentive for prioritized areas of trade and investment such as importing capital goods and participating in the manufacturing industry and irrigation development.

Ethiopian Investment Agency Director General Fitsum Arega also explained the group the areas of investment opportunities in Ethiopia. He said the investors are warmly welcome if they have interest in leather industry as there is a huge livestock population, agro-processing, food packaging, commercial farming, pharmaceuticals and textile industry.

The Ugandan investors are expected to meet with Ethiopian private sector representatives today to discuss possible investment areas.

http://www.ethpress.gov.et/herald/index.php/herald/national-news/6597-ethiopia-uganda-to-strengthen-business-ties

.

$8.5 Million Contract Will Foster Development of Agriculture and Nutrition Policy and Programming in Ethiopia

.

With award, researchers at Feinstein International Center at Tufts University will lead project supporting USAID Feed the Future Initiative

Newswise — BOSTON (April, 9 2014) ─ The Feinstein International Center at Tufts University is the recipient of an $8.5 million USAID contract to help advance rural development in Ethiopia. The Agricultural Knowledge, Learning, Documentation and Policy Project (AKLDP) will support evidence-gathering from a wide range of agriculture, livestock, nutrition and food security projects as part of USAID’s Feed the Future initiative.

“One of our main roles is to help USAID and partners to better understand the impact of agricultural development projects,” said Andrew Catley, Ph.D., research director for policy process at the Feinstein International Center and principal investigator of AKLDP. “As agriculture grows and commercializes, we need to understand who benefits and who doesn’t, and look at alternative livelihood options for people moving out of agriculture.”

Working with the government of Ethiopia (GoE), aid donors, USAID and local universities and research institutes, the AKLDP will conduct real-time analyses, evaluations and reviews and provide coordination support, The evidence will be used to guide improvements to programming and to support development policies and strategies, particularly those geared towards assisting poorer households to benefit from various agricultural growth programs.

“The Feinstein International Center has led the way on researching just what really happens to people’s livelihoods and economies in crises and disasters, said Peter Walker, Ph.D., the center director of and the Irwin H. Rosenberg Professor of Nutrition and Human Security at the Friedman School of Nutrition Science and Policy at Tufts University. “What we are learning now is that universities also have to play a role in ensuring that the knowledge from that research gets to the farmers, government policy makers and aid workers in a form they can use.”

Previous FIC research conducted through the USAID-funded Pastoralist Livelihoods Initiative in Ethiopia helped set the foundation for the current project. In the last decade, Catley and other FIC researchers have conducted impact assessments on USAID development and humanitarian projects ranging from irrigated agriculture to emergency drought response, with the results contributing to the establishment of good practice guidelines and policy reform.

The $8.5 million AKLDP contract is the largest in the 17-year history of the FIC and expands the center’s presence in Ethiopia. A separate team of FIC researchers is providing the research and evidence-gathering component of another USAID project, Empowering New Generations to Improve Nutrition and Economic opportunities (ENGINE). Implemented by Save the Children International, ENGINE targets Ethiopian mothers with children age 5 and under in an effort to lower the maternal, neonatal and child mortality rates.

The Gerald J. and Dorothy R. Friedman School of Nutrition Science and Policy at Tufts University is the only independent school of nutrition in the United States. The school’s eight degree programs, which focus on questions relating to famine, hunger, poverty, and communications, are renowned for the application of scientific research to national and international policy.

http://www.newswise.com/articles/8-5-million-contract-will-foster-development-of-agriculture-and-nutrition-policy-and-programming-in-ethiopia

.

 Bako gets modern water supply

 .

The two treatment plants together have a potential of screening 2400m3 water per day

 .

Known for its agriculture investment and research, Bako is located in West Shoa Zone of Oromia State. The town got a modern Potable Water Treatment Plant which serve 40,000 population treating 300m3 water daily.

Installed by the German-based MENA Water FZC, the plant has started treating water from Gibe river. The project, which was completed in nine months at a cost of 28 million birr, is an alternative water supply for town residents and its environs.

Oromia Water, Mineral and Energy Bureau Deputy Head Ibrahim Haji Hussen told The Ethiopian Herald this simple and new technology would also be installed in other areas of the state. “We have assessed demand in areas which have no access to potable water. For instance, we have planned to extend the same project in Oromia and Somali the border areas particularly Bale,” he added.

MENA Water East Africa Area Manager Mengistu Getaneh also said that though Ethiopia is known for its ample water resource, it has not effectively utilized it. “This is mainly due to failure in applying modern technology. MENA Water is working to fill that gap by introducing new treatment plants which can screen surface water in short period of time. The treatment plant installed in Bako is part of that project,” said Mengistu.

MENA Managing Director Eng. Atif Gafar on his part indicated that the company’s priority ahead is introducing small package plants in the country’s major towns and cities like Bako. As to the Managing Director, the company is participating in the sewerage system management of condominiums in Addis Ababa.

MENA Water is an engineering and manufacturing company that provides innovative solutions and services in the fields of water and waste water treatment.

http://www.ethpress.gov.et/herald/index.php/herald/news/6581-bako-gets-modern-water-supply

.

 And a couple current analyst reports for those interested in Allana Potash….

.

http://www.marketonemediagroup.com/cantor-fitzgerald-reaffirms-positive-view-allana-potash-icls-strategic-alliance/

http://www.marketonemediagroup.com/raymond-james-ltd-reiterates-recommendation-accumulate-stocks-allana-potash-corporation/