By Eskedar Kifle    

A Singapore business delegation visited Ethiopia with the aim of assessing investment opportunities in the country.

At a press conference held on Tuesday, the business delegation along with the Ethiopian Chamber of Commerce and Sectoral Associations (ECCSA), discussed several investment opportunities which would benefit both countries. “We haven’t exactly pinpointed specific areas where we will have investment agreements, but there are companies willing to invest in the areas the Ethiopian government is promoting such as Agro-processing and others,” said Mulu Solomon, President of ECCSA. The business delegation is from International Enterprise Singapore, which is a government agency that follows and spearheads the growth of overseas investments of Singapore-based companies. In addition to promoting export of goods and services, IE Singapore also entices commodity traders to establish their global or Asian base in Singapore. The leader of the delegation, Rahul Ghosh, Division Director of Middle East and Africa Group, stated that Singapore is a thriving trading hub with a complete ecosystem for energy, agri-commodities and metals & minerals trading clusters. “Besides investments, we can share a lot of experiences with Ethiopia, especially in the urban planning area. Urban planning has been integrated in our development strategies and we have been very successful.  Planning is very important,” said Ghosh. He said planning for urban city development, for industrial zone development or planning for economic development matters, and needs to be done before any investment is made. Through the agency’s Global Company Partnership, it works with Singapore-based companies in various stages of growth, towards being globally competitive. It customizes solutions in capability building, market access and financing for these companies as they start competing on the international market.  According to the press conference, IT, education, health as well as hospitality could also be areas in which different companies will be interested in investing. Ethiopia has USD 15 million worth of trade exchange with Singapore. According to the ECCSA President, this number can significantly grow, if Ethiopia is able to send other exports and not only agriculture produces. “Singapore is a country we can learn so many things from. It is a country that took itself from a third world country to a developed one. Even though their population is a little over 5 million and don’t have natural resources, they have the right view and vision for their country,” Mulu stated. IE Singapore has a global network of overseas centers in over 35 locations and provides the necessary connections in many developed and emerging markets.

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By  YETNEBERK TADELE

Addis Fortune source: http://addisfortune.net/articles/manufacturing-sector-seeks-boost-in-new-institutions/

Country hopes training workers will bridge gap between target and actual earnings.

Tadesse Haile, state minister for Industry.

 

In a bid to uplift the manufacturing industry, the Ethiopian government is set to establish two new institutions, once the Council of Ministers grants its approval.

The institutions will be formed for the food and beverage as well as the pharmaceutical and chemical sectors, which are currently managed at the Directorate level under the Ministry of Industry (MoI).

The institutes that will be expected to be operational in the coming fiscal year are the Food, Beverage & Pharmaceuticals Industry Development Institute and the Chemicals & Construction Materials Development Institute.

“This is the result of the government’s plan to transform the manufacturing sector,” Tadesse Haile, state minister of Industry told Fortune. “It does not fare well even in neighboring countries.”

Despite the notable growth trends in basic manufacturing figures recorded over the last decade, the sector essentially remains weak. The level of industrialization in the country is very low, with the shares of the manufacturing sector accounting for hardly five percent of Gross Domestic Product (GDP). Manufactured exports account for a meager 0.5pc.

This is according to the findings of a draft study conducted by the Ministry of Industry (MoI) in January 2012. The purpose was to assess the competitiveness of Ethiopian firms for participation in the Common Market for Eastern & Southern Africa (COMESA) Free Trade Area.

The government needs the institutes, according to Tadesse, in order to help the manufacturing sector strengthen its weaknesses.

In an effort to turn the vision of the government for the manufacturing sector into a reality, as was envisioned by the late Prime Minister Meles Zenawi, the Ethiopian government established the Leather & Leather Products Technology Institute (LLPTI) in 1999. It was created with the main objectives of training professionals, conducting research, rendering consultancy services, and providing technical support.

Two years letter, the government established the Textile Industry Development Institute (TIDI) to seize the competitive advantage and potential of the country to further develop the textile industry.

When it became further alarmed by the weak state of the manufacturing sector, the government established the Ethiopian Metal Industries Development Institute (EMIDI), in 2010. This too, was initiated to help in the development and improved competitiveness of the metal and engineering industries.

Despite their good intentions, however, the three institutes, which have lacked trained professionals as well as capacity, were unable to bring about the changes officials were expecting.

The government’s ambitious plan for the manufacturing sector received heavy blows in the 2011/12 fiscal year, according to the export performance report published by the Ministry of Trade (MoT). It shows textiles registering the lowest export figures at 49.4pc bringing in 84.6 million dollars while leather and leather products which brought 112 million dollars, achieved 54.5pc of the plan.

The pharmaceuticals and chemicals sectors are no different.

Pharmaceuticals and chemical products earned seven million dollars out of a targeted 11.9 million dollars, which is 58.7pc during the 2011/12 fiscal year.

“The three institutes the government established to boost the manufacturing sector are really not expected to be effective mainly because of lack of skilled manpower and technological transformation, said Mebrahatu Meles, (PhD), director of the Private Sector Development Project at MoT.

“Since we learned so much from previous failures we will improve in the future,” he added.

The Meat and Dairy Technology Development Institute, which currently is under the Ministry of Agriculture (MoA), will be merged with the Food, Beverage & Pharmaceuticals Industry Development Institute once it becomes operational, added Mebrahatu.

The Food, Beverage & Pharmaceuticals Industry Development Institute, will be tasked with uplifting the most dominant branch within manufacturing sector and along with the Chemicals & Construction Materials Development Institute, will be accountable to the MoI.

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By Yetneberk Tadele Fortune Staff Writer

Speaking at the launching of the program, Jason D. Fraser, deputy mission director of USAID Ethiopia, left, Gary Robbins, chief officer of Economic Growth and Transformation Office, centre, in the presence of Tadesse Haile, state minister of Industry, confirmed that Ethiopia will see the benefits of increased quality of processed as a result of the project.

USAID, in collaboration with the Ministry of Industry (MoI), launched the African Alliance for Food Processing Project in Ethiopia on Thursday, April 18, 2013.

The project is designed to increase the quality and competitiveness of Ethiopia’s food processing sector and to expand the availability of affordable and nutritious foods.

Food processing is among the oldest of the country’s manufacturing industries. Bakeries, grain and oil mills have been operating since as early as 1906 and the first processing plant, Kaliti Food Factory, was established in 1938.

In 2007 there were 330 large and medium scale firms in the food processing industry. There are about 200, mostly large scale, flour mills supplying the local consumer market and pasta and biscuits factories.

The project will offer customized technical assistance to 20 medium and large millers and wheat processers “to implement quality management systems, meet national standards and certification requirements, develop processes and products tailored to market demand, strengthen financial systems and improve business efficiencies,” according to a USAID press release.

“The project complements the policies of the Ethiopian government, especially the wheat value chain highlighted in the government’s Agricultural Growth Program and the promotion of safe fortified foods emphasized by the National Nutrition program,” said Jason Fraser, deputy mission director of USAID Ethiopia.

Although Ethiopia has the potential to produce a surplus of agricultural crops, the government is importing millions of quintals of wheat every year to satisfy demand from processing industries and household consumption.

In 2011,Ethiopia imported 728,487tns of wheat for 259.3 million dollars, and in 2012, 548,484tns for 162.3 million dollars. Its production in the 2010/11 fiscal year was 2.8 million tonnes and in 2011/12, 2.9 million tonnes.

“The food processing industries are facing a number of challenges like capacity under-utilization due mainly to raw material sourcing and lack of technical skills,” said Tadesse Haile, state minister for Industry.” The Africa Alliance for Improved Food Processing Project plays a great role in addressing the capacity constraints not only at company level but also at a sector level.”

The African Alliance for Improved Food project is supported the US government‘s 250 million dollar Feed the Future Initiative.

The project is already being implemented in Kenya,Zambia,Tanzania, and Malawi.Ethiopia’s the fifth country in Africa for the Alliance.

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A young man uses a sewing machine during vocational training for street children in Ethiopia. Photo: Panos/Robin Hammond

By: Andualem Sisay, in Addis Ababa

In Hawassa City in southern Ethiopia, 250 kilometres from the capital Addis Ababa, 24-year-old Mitike Paulos, her younger sister and three friends are busy producing leather bags and belts for sale. Mitike and her sister learned the craft from their brother, who teaches at the government-run Leather Industry Development Institute in Addis Ababa. They started business in 2011 with a 35,000-birr ($2,000) loan from a small-loan lender. Today their business employs 10 people and as they plan to expand production, they also hope to hire more workers. “The more we work, the more we grow,” says Mitike.

The Ethiopian government is encouraging young people to start small businesses in order to reduce the rate of youth unemployment, officially estimated at more than 50%. With 90 million people, the country is the second most populous in Africa, producing over 150,000 graduates each year. The government now wants to channel skilled labour into the massive-scale construction projects that have been springing up across the country in such areas as hydropower, railway lines, roads, housing, water supply and irrigation.

Government’s approaches

Young Ethiopians who want to become entrepreneurs are encouraged to organize themselves in groups in order to access microfinance. They are then trained by the state-run Federal Micro and Small Enterprises Development Agency in business start-up and management skills. The agency also gives financial support to youth starting small and medium-size enterprises in areas such as textiles, leather, agriculture, trading, wood and steel.

Abozenech Negash, the agency’s public relations officer, says its focus is to address unemployment challenges, rev up the economic engine and ensure fairness in allocating national resources.

Improving youth employment

Ethiopia’s ambitious five-year Growth and Transformation Plan (2010–2015), which includes developing industrial cluster zones and constructing 10,000 miles of road networks, is expected, upon completion, to reduce unemployment considerably. The plan also includes increasing power generation from its current level of 2,000 megawatts to 8,000 megawatts, and building a 1,500-mile standard-gauge rail line. These projects have already employed hundreds of thousands of young people and further recruitments are ongoing, according to officials.

Official data shows that in both formal and informal sectors, over 1.4 million jobs were created between 2006 and 2010, and over 1.2 million between 2011 and 2012. Many of those hired were young people.

More efforts needed

But not everyone is satisfied with the government’s efforts to reduce joblessness. Samson Wolle, a senior researcher at the Access Capital Services Share company, an Addis Ababa–based business and research firm, faults government’s “massive projects”: he says these often require years to complete and that once they are completed their operation requires less labour. The result is that thousands will once again go into unemployment. He would like to see sustained financing of existing small businesses in order to promote their expansion and growth.

Mr. Wolle believes there must be an investment-friendly climate to attract domestic and foreign investors to labour-intensive technology industries. Improved access to electricity and clean water, and to quality education, hospitals and other social services, is a starting point. Such interventions, he further argues, will mitigate urban migration and encourage young graduates to work in the rural parts of Ethiopia, which are currently in dire need of educated and skilled workers.

Despite such criticisms, analysts generally agree that Ethiopia is on the right course in tackling youth unemployment.

Source

Ethiopia

Deutsche Gesellschaft für Internationale Zusammenarbeit logo

GIZ has been working in Ethiopia on behalf of the German Federal Ministry for Economic Cooperation and Development (BMZ) since 1964, operating as GTZ until the end of 2010. With 111 international and 634 local staff, Ethiopia hosts one of our largest in-country teams worldwide (as at March 2013). 14 development advisors are working in various bilateral programmes. In addition, 19 CIM experts are deployed in various institutions and programmes in Ethiopia.

Three times the size of Germany, the Federal Democratic Republic of Ethiopia is a landlocked country in the Horn of Africa with a population of around 87 million. Despite average economic growth of 10% since 2005, an estimated 40% of Ethiopians are still living below the poverty line. In UNDP’s Human Development Index (HDI 2011), Ethiopia ranks 174th in the list of 187 countries (category: low human development). For decades, the rural population in the Ethiopian highlands has suffered from increasing food insecurity stemming from high population growth, deforestation and unsuitable agricultural production techniques. At the same time, the private sector shows little diversity.

In response to these challenges, the Ethiopian Government has adopted an ambitious Growth and Transformation Plan, its aim being to achieve the Millennium Development Goals and double value added in agriculture – the country’s economic mainstay – within the next five years. As declared objectives of the Ethiopian Government, combating poverty and promoting economic growth are therefore high on the political agenda.

In line with the Ethiopian Government’s objectives, German development cooperation with Ethiopia currently focuses on the following priority areas:

• Education
• Sustainable land management

Urban governance and decentralisation, quality infrastructure, renewable energies, and conflict management together with the Civil Peace Service (CPS) are other fields of activity for GIZ in Ethiopia. GIZ also participates in eight development partnerships with the private sector in Ethiopia. We work for a number of international clients in addition to the Ethiopian Government. These contracts are executed under the responsibility of GIZ International Services (IS) and include the building of infrastructure of Ethiopian universities for the Ministry of Education and project management for the construction of the African Union Peace and Security Building.

Projects and Programmes

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By Asayehgn Desta, Ph.D. Sarlo Distinguished Professor of Sustainable Economic Development Dominican University of California Tigrai Online – June 04, 2013

Introduction

Faced with emerging global competition and substantial changes in consumer needs, desires, and tastes, a number of enterprises today are rapidly making adjustments to re-engineer their manufacturing processes to meet these needs. The dynamic kaizen strategy is an activity of continually revolving cycles of Plan, Do, Check and Act (PDCA) which focuses on customer-driven processes to improve productivity and quality of products and services by amassing marginal improvements over time. A number of enterprises in Ethiopia are using kaizen to retain their market share, and satisfy their domestic and prospective international consumers (Ministry of Industry, 2011 and See Desta, 2013).

Using kaizen to help them thrive, firms believe that using the kaizen organizational structure will enable them to create a bottom-up type of employee-friendly team. This team would be cross-functional to include engineers, shop managers, operators, and frontline-line employees working together on a targeted work problem.  Making workers the leading actors, the kaizen process involves learning by doing through a series of brainstorming sessions to raise awareness of specific actions which are fundamental to developing kaizen capability for the improvement of productivity that could take root and make a company grow endlessly.

In short, when well established, kaizen strategies help companies to control cost, minimize workers motion, focus on zero defects and, more fundamentally, improve worker’s skills by creating a cooperative atmosphere where everyone becomes fully aware of the key goals. Each step in the process is mapped out and measured to ensure economic value to their customers. As stated by Glover et al (2008) kaizen “…event teams apply structured process tools and human creativity with a goal of substantially improving the performance of the work area, process or product.” The team workshop is purposely designed to make jobs easier by taking them apart, studying them, and making improvements, creating a culture of continual improvement with outreach to everyone in the organization (Thessaloniki (2006).

The conventional method of Total Quality Management (TQM) of production techniques is challenged for “…like obtuse principles, staff were sent back to their regular duties and told to improve the quality of their work process. No one typically thought their process was broken so there wasn’t much incentive to change anything (EPA, November 2007). Thus, while the conventional approach emphasizes individual work and mainly watches to see if the worker meets the performance objective of an industry, the kaizen techniques of production challenge the status quo and help workers internalize the work, with creativity and emphasis on institutionalizing the productivity process.  In short, while the conventional approach emphasizes each worker’s performance, in kaizen, everyone is encouraged to contribute to job improvement. While being process-oriented, kaizen is based on the assumption that a company’s overall competitiveness will improve in the long run if individual variations are reduced.

Thus, the purpose of this article is to map out awareness, institutionalization of process factors and economic, social and environmental effects of the newly introduced kaizen techniques on continuous improvement and the production of quality products and services at the Wonji Sugar Company in Ethiopia.

1. The Wonji Sugar Company . 

After taking over the lands of the Nomads in 1951, the Ethiopian Government granted a concession of 5,000 hectares in Wonji in the upper reaches of Awash Ethiopia, 100km. Southeast of Addis Ababa, to a Dutch Company known as HVA (Handlers –Vereenging Amsterdam) for the establishment of a sugar estate and white sugar production (Ethiopian Investment Agency, May 2008). As the demand for sugar increased in Ethiopia, the Wonji Estate expanded to include an additional 1,600 hectares of land from Shoa, about seven km. from Wonji. The Wonji/Shoa Sugar Company then started sugar production in 1962.

At the formal inauguration of the Wonji/Shoa Factory on November 10, 1962, the late King Haile Selassie described magnanimously this first large-scale commercial investment in Ethiopia that could very well make Ethiopia self-sufficient in sugar production, as well as creating an Ethiopian export market for sugar products to its neighboring countries. In addition, Emperor Haile Selasie further claimed that with the crushing capacity of 1600 tons of cane per day (TCD), the establishment of this industry would become vital to the development of the nation with improvement of the standard of living of its people. As a source of foreign exchange it is now sold as consumer goods to the global world (The Church of Haile Selassie I, 1962) to satisfy the cravings for sweetened food (sucrose). It must be noted that though the sugar project started as a joint venture between the Dutch (HVA) firm and the Ethiopian government, the HVA owned about 90 percent of the sugar plantation and sugar factory while Ethiopia owned only 10 percent. In addition, in its operation of the sugar factory, HVA remitted 10 percent of the invested capital and 15 percent of the annual profits to its headquarters (Bondestam (1974).

With the change of government in 1974, under Proclamation No.31 of 1975, all the sugar factories in Ethiopia became nationalized and administered under the centralized bureaucratic administration of the new Military Government. Though the Wonji Company was very productive until the 1980s, it eventually stagnated because of the atrocities and red terror committed by the Military Government causing competent and effective workers to leave the factory and run for their lives.

Finally, in 1991, as the ensuing civil war completely devastated the authoritarian apparatus of the military administration in Ethiopia, the sugar corporation was dissolved by law and all existing factories were reestablished as public enterprises to be run by the Ethiopian Sugar Development Agency starting in 1992.  To revive the sugar industry, the Ethiopian Sugar Development Agency was formed as a share company of the Development Bank of Ethiopia, Ethiopian Insurance company and the then existing three sugar factories (i.e., Wonji, Shoa and Metehara ) in 1998. Furthermore, under the Council of Ministers Regulation No.192/2010), in 2010, the current Ethiopian Sugar Corporation was then formed replacing the former Sugar Development Agency. The most conspicuous reasons for the establishment of the Sugar Corporation were to: 1) grow sugarcane and other sugar yielding crops, 2) process and produce sugar, sugar products, and sugar by-products, 3) sell the products and by-products in domestic and export markets, 4) encourage and support the sugar cane growers who supply their cane, and 5) cooperate with educational institutions to produce the required type, number and quality of trained manpower for the sugar industry (Sugar Corporation & Ethiopian Sugar Industry Profile, March 12, 2013).

As stated by Davison, the Sugar Corporation is currently carrying out expansion projects within the existing sugar factories at Methara, Finchaa, Tendaho, and the modernization of the Wonji/Shoa sugar factory.  In addition, the government is in the process of constructing new sugar factories (i.e., at Beles in the central Amhara Region; Wolkait in the Northern Tigray area; Kesem in the Northeastern Afar regional state; and six more factories in the South Omo Zone of the Southern Nation, nationalities and Peoples’ region) by 2015 as part of the five year Growth and Transformation Plan (GTP) (September 13, 2011).

Furthermore, to become self-sufficient in sugar production by the end of 2013, and diversify the products of sugar cane into ethanol, electrical power, fertilizers, and build tissue culture laboratories, the corporation is visualizing creating the sugar industries to be competitive enough to maintain a sustainable growth pattern at the international level. In order to develop trained and disciplined employees the Ethiopian Sugar Corporation is instructing its employees in the use of the Japanese philosophy of continuous improvement by applying kaizen’s processes and technology to improve the company’s production culture and leadership.  Kaizen corporate culture is a continuum off revolving cycles of “… continual, dynamic and self-motivated practice in the quest of improvements towards ever higher quality and productivity. The practice of kaizen is conducive to recreation of self-disciplined and self-innovating organizations. It also is conducive to realization of human potential of all members of the organization” (Ministry of Industry, 2011).

To implement kaizen, “Close to 7,537 members of leadership at various levels and staffs of the corporation and sugar factories have been trained on  kaizen, quality control circle (QCC), the seven types of waste, their causes and their preventive measures and also on the 5S,  and their application methods. The country plans to increase the sugar production of sugar from 314,000 tons in 2009 to 2.25 million tons in 2015 of which 1.25 million tons of sugar and sugar related factors are to be exported (Ministry of Industry, June 2011, and http://www.etsugar.gov.et/en/news/items/).  Therefore, now that the Ethiopian Sugar Corporations have been reinstated to a high-priority on the national agenda, the specific question of this study is: How efficient and effective are the kaizen strategic management initiatives, tools and methods that are used at the Wonji Sugar Manufacturing Company for improving and implementing its capacity?

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ROSES HARVESTED AT THE ET HIGHLAND FLORA FARM OUTSIDE ADDIS ABABA ARRIVE NEXT DAY IN EUROPE/PHOTO©REUTERS

By Elissa Jobson in Addis Ababa

Government incentives have given horticulture a growth spurt. But every rose has its thorns: now there’s greater scrutiny and more red tape.

At the fifth biennial HortiFlora Expo Ethiopia in March, nearly 90 exhibitors gathered in Addis Ababa’s Millennium Hall.

Representatives from all sectors of the industry were there: breeders, growers, auctioneers and investors, as well as producers of fertiliser, cold storage equipment, irrigation systems and greenhouses.

That the number of buyers and visitors was down this year, according to some of the exhibiting organisations, belies the strength of the country’s horticultural exports, which have grown year-on-year over the past decade.

A total of 120 companies – 73 of them foreign-owned, 36 local and 11 joint ventures – are producing flowers, potted plants, fruits, vegetables and herbs.

They are providing employment for 184,000 people, 70 percent of whom are women. According to figures from the Ethiopian Horticulture Development Agency, the sector generated about $266m in 2011/2012, which equates to roughly 10 percent of Ethiopia’s export earnings – up from just $28.5m in 2004/2005.

The fastest growth has been in floriculture, where Ethiopia, the second-largest flower exporter in Africa, is beginning to rival well-established Kenyan producers.

Eight years ago Ethiopia shipped 83m stems worth $12m abroad, principally to Europe. Production reached 2.1bn stems valued at $213m in the last financial year.

EUROPEAN PRESENCE

Companies like De Ruiter, a Dutch flower breeder, say it is essential that they have a presence in the country.

“In terms of the international market, flowers from Ethiopia are now becoming accepted by most of the buyers,” says Tigist Gizaw, sales manager for De Ruiter.

“Putting your varieties [here] will also give you the privilege of diversifying your market. So it’s important for us.”

Good weather, inexpensive labour and a plentiful supply of land attract foreign investors.

The Ethiopian Horticulture Sector Statistical Bulletin says that 12,552ha of land is under cultivation for flowers, vegetables and fruit, but the government claims a further 115,146ha could be made available for horticultural development.

When asked why Belgian-owned Desa Plants invested in Ethiopia, farm manager Ben Depraetere replies: “Two main reasons: climate and availability of labour. We try to supply the best quality, and that is labour intensive.”

Proximity to the European market and the stability of Ethiopia were also a draw, he says, adding: “And of course the government attracted us here with incentives!”

The Ethiopian government‘s Growth and Transformation Plan prioritises horticultural exports.

To kickstart the industry, the government offered five-year tax holidays, waived import duties on capital goods and lowered duties on exports. It also initially offered rent-free land, but Desa Plants arrived too late for this particular perk.

Even so, the government helped facilitate the leasing process, says Depraetere.

These inducements also attracted opportunists and the inexperienced.

“There were a lot of cowboys in the beginning who didn’t know about the sector and took very big loans and ran off with a lot of money. It’s getting tougher to get your business started [...]. The support is still there, but you have to prove that you are a valid investor,” Depraetere explains.

Bezuayehu Amlake, commercial manager at Tinaw Flowers, a private Ethiopian company, agrees that the government has become stricter.

“Now policies are coming, some of which are discouraging the industry,” she laments.

“When you want to expand, you can’t get land where you wish. Previously the government was so free to give it to you.”

Rights campaigners have pressured the government to limit the mass relocation of populations to free up land for investors.

Bezuayehu also says that bureaucracy has increased and that the cost of freight on Ethiopian Airlines is high and rising.

Even so, business is growing for Tinaw, which currently exports 20m stems per year and plans to add 11ha to its 15.6ha now under cultivation.

Related articles

• Vegpro to join horticulture exports (allanapotashblog.org)

 

BY NEW BUSINESS ETHIOPIA REPORTER

Sur Construction Private Limited Company has revealed that it plans to finish and hand over 2.07 billion birr (around 110 million US dollars) worth of road projects this year, which includes the 800 million birr 76 kilo meters asphalt concrete from Dedebit- Adi Remets in Tigray Region of Ethiopia. 

 

 

 

 

 

 

Tadese Yemane, pictured, General Manager of Sur Construction, told newbusinessethiopia.com that the project, which has taken so far three years, has had 80 percent of its plans completed, with an additional 10 kms later added on in the project, expected to lead to the Welkayit Sugar project.

The Welkayit Sugar scheme, one of the big sugar projects envisaged by the Ethiopian government, to make the country self-sufficient and eventually be an export item, is also being conducted by Sur, with a total projected cost of four billion birr, and with a duration period of four years, with one year so far elapsing.

The project is expected to irrigate 50,000 hectares of land, and an adjacent sugar factory also being done by the same company, is expected to be completed in 2015.  Another project mentioned by Tadese with completion date of end of 2013 was the 63 kms Asphalt Concrete AbaAla –Shaigube, with a total expenditure of 708 million birr.

The project, which is unique in that it’s a Design and Built (DB) one, is expected to facilitate the extraction of the potash reserves in the Danakil depression area of Ethiopia. Yet another project, on the completion list of Sur for this year is the 60 kms Seret-Wer’eie, with an expenditure of 460 million birr.

The last of the major projects being done by Sur, with completion date being this time this month of 2013 is the 106 kms Durebete-Shawra gravel road project. Sur took over from another local company, who was unable to finish the project, but had finished 66 kms of it until then, and then finished the rest 40 kms, with an expenditure of around 100 million birr.

This particular project will connect to another road project that was finished by it on earlier date, the 147 kms Shawra-Gelego gravel road linking this part of the country known for its sesame production, and as being one of the most fertile areas of the country.

Among the Other major projects being done by the company is one linking it to a sugar factory, is the 70 kms asphalt concrete Menebegna- Lemlem Bereha with a total cost expenditure of 637 million birr, expcted to be finished in june 2015.

Sur Construction PLC which was formed two decades ago back, was recently in the news after the completion and handover of the nation’s to date largest sports academy at a total cost of more than 316 million birr.

The academy which gives training in nine major sports field was inaugurated by Prime Minister Hailemariam Desalegn on May 28th. Tadese indicated that the project, which was slated to cost 208 million birr to finish, and is to be handled by the federal sports commission, cost the extra expenses from the company’s pocket due to a host of factors including the September 2010 devaluation of the Ethiopian birr.

Sur in total has about 10 billion birr worth of projects, currently running under its portfolio, with 10,000 employees under its wing, and possessing over 1,500 construction machineries.

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ERA Contracted Chinese Companies for Road Upgrade Project

Written by Meraf Leykun Monday, 10 June 2013

Ethiopian Roads Authority last week signed agreement with two Chinese construction companies to upgrade the Kombolcha-Bati road to asphalt concrete level. The 133 KM road project is estimated to cost the Authority close to 2.8 billion Ethiopian birr.

Construction of the road, which is scheduled to be completed in three years time will be fully financed with a fund secured from the World Bank. The project is part of the fourth Road Sector Development Program (RSDP IV) of the Authority, for which implementation costs are estimated to reach 125.3 billion birr. Out of this, 84.5 billion birr is allocated for federal projects, 14.4 billion birr for regional and 26.4 billion for weredas, the smallest administrative subdivision.
The RSDP is part of the Ethiopian Government’s Road Sector Development Program (GTP), tasked to upgrade 728 KM of trunk and link roads and construction of 4,331 KM of new link roads.
The Ethiopian Roads Authority  is planning to achieve a nation wide road network of 136,044 KM in 2015 from the 48,793 KM the country has in 2010.

TCDD to Assist Ethiopian Railways Corporation

Last Updated on Monday, 10 June 2013 15:52 Written by Meraf Leykun

Ethiopian Business News – Latest Business Alerts The Turkish State Railways (TCDD) has agreed to assist Ethiopia in technology transfer, restructuring its railways system and to give training to its personnel.

Ethiopia has asked for assistance from TCDD via the Turkish Cooperation and Development Agency (TIKA) in order to reactivate its railways between the capital Addis Ababa and Djibouti, which has been stopped since 1997.

In a meeting held at TIKA’s office in Addis Ababa, Ethiopia, the TCDD and Ethiopian Railway Corporation (ERC) has agreed on cooperation on numerous areas.

According to the agreement, TCDD will prepare operational regulations, help in ERC’s structuring and give technical support in railway building, supervision, observation, projects and agreement, give training to the personnel and build capacity for human resources, give technical support in transfer of technology and share knowledge and experience in the administration of immovables.

The TCDD has sent a panel of experts to Ethiopia in April, 2013 upon the request of ERC, for assessment.

Officials from the Ethiopian railway officials will be in Turkey between June 10 and 14 to visit the high-speed train lines of Marmaray project.

MoT to Entrust Trade Name Registrations and Licensing Services to Sub-cities

Last Updated on Monday, 10 June 2013 15:28 Written by Meraf Leykun

The Ethiopian Ministry of Trade is to entrust its trade name registrations and licensing services to sub cities in Addis Ababa and regional states.

Previously businesses are required to approach the headquarters of the Ministry of Trade to get their trade names registered and obtain business license.

“By providing the service in all sub cities in Addis Ababa and regional states, we hope to become more accessible and give efficient services,” Deressa Kotu, Acting Director of the Ministry’s Business Licensing and Registration Directorate, told Walta Information Center.

He added, the entrusting those service to sub-cities and regions will reduce unnecessary loss of time and money.

“For instance, there is no need for those in other regions to come to the capital just to get the service, thereby avoiding needless loss of time and cost,” Deressa said.

It take four business days to register a trade name and acquire a business license; the ministry expects the service could be delivered in less than half an hour under the proposed arrangement.

MoUDC Drafted Directive on Gov’t Projects Construction Pricing

Written by Meraf Leykun

The Ethiopian Ministry of Urban Development and Construction had finalized a draft directive to make changes on the fixed rate pricing system currently applicable to all contractors working on government projects.

The directive will shorten the revision period of prices of construction materials and labor to three to six months, unlike the current practice where adjustments takes between nine month to a year and half.

The ministry is expecting to approve the directive in a month time, according to Wubshet Kibebew, Construction Contracts Management Officer with the MoUDC.

The price revision time table in the draft directive will not cover projects already underway. Projects currently underway will only be subjected to price revision after 18 months.

“It is to encourage contractors to finalize the construction within 18 months, rather than starting a project and waiting for the revision of price increment, which some contractors do” Webshet told Fortune.

The draft directive has been a year in the making.

IMF Call for Increased Loan Availability for Businesses

Written by Meraf Leykun

The International Monetary Fund advised the Ethiopian government to to make more credit available to private businesses to boost employment and build on its economic gains.

While the country’s government-led development model has improved lives and expanded the economy, public enterprises that are involved in building more houses, dams and factories are draining banks of loans, Ethiopia Representative Jan Mikkelsen told reporters in Addis Ababa.

“The private sector is struggling to get credit for its projects and that’s a problem for economic growth and job creation,” he said on June 5.

Economic growth in Ethiopia, Africa’s second-most populous nation, is expected to slow to 6.5 percent in the 12 months to July 7, the end of Ethiopia’s fiscal year, and next year, according to the Washington-based lender. Annual growth averaged 7.7 percent in the previous three years, it said. In the last fiscal year, 68 percent of non-government loans went to state-owned enterprises and that ratio increased to 81 percent in the nine months to February, Mikkelsen said.

Ethiopia’s “capital constrained” economy cannot meet all credit demands, State Minister of Finance Abraham Tekeste said. Loans are available for companies in priority areas including export-oriented manufacturing and agriculture, he said.

The government is trying to increase the amount of credit for industry by boosting “domestic resource mobilization” and promoting foreign investment, according to Abraham.

Ethiopia: Benishangul People’s Liberation Movement Abandons Arms

By Zeryhun Kassa

The self-styled group, Benishangul People’s Liberation Movement (BPLM), has agreed to abandon its anti-peace moves to become a development force.

It was indicated that the government will provide support to BPLM to help engage them in development activities. The Benishangul People’s Liberation Movement (BPLM) which has been engaged in anti-peace activists with the support of the government of Eritrea has agreed to come to peaceful life, following negotiations with the party.

Commander of West Command Major General Berhanu Jula announced that the organization has been urged to participate in the development endeavors by the Ministry of Defense, the Benishangul Gumz region and the federal government.

After a peaceful discussion, the party has accepted the peace deal to join the normal course.

The Commander added the party has agreed to abandon its anti-peace activists and be abided by the law of the land.

Admiring the effort of the Defense Ministry, Nigatu Abdisa, who is Conflict Control and Resolution Senior Consultant of the Federal Affairs Ministry, expressed the government’s readiness to provide the necessary support for members of the movement.

Benishangul Gumuz Administration and Security Bureau Deputy Manager, Albashir Ahmed reassured the region’s interest to create conducive environment.

Government Supporting Research Projects

By Zeryhun Kassa

The Ministry of Science and Technology on Friday 7 June 2013 signed agreement with researchers from a number of universities and research institutions to support research projects.

On the occasion Science and Technology State Minister Mohamouda Ahmed Ga’as said a total of over three million Birr is allocated to support such research projects. Some 1.4 million Birr of the amount is for 18 researches signed to be conducted during the ceremony.

ERTA learned the projects are in the areas of textile, agriculture, leather, metal work, ICT and medical equipment, among others. The agreement is intended to help enhance innovation capacity and technology transfer.

Sudan reiterates support for Renaissance dam

Addis Ababa, June 10 (WIC) – Sudan’s information minister and government spokesperson Ahmed Bilal Osman insisted today that Sudan would benefit from the controversial Ethiopian renaissance dam and stressed that Ethiopia has engaged Sudan in all operations associated with the dam building.

At a press conference in Khartoum, Osman announced that Sudan’s minister of water resources and electricity Osama Abdalla Mohamed al-Hassan will travel for Cairo early next week. He said that the ten-member committee which includes representatives from Sudan, Ethiopia and Egypt as well as international experts has dispelled all concerns raised about the dam, adding that Sudan is ready to send experts and technicians to help in the construction of the dam.

The Sudanese official also downplayed fears of a possible collapse of the dam which could lead to flooding Sudan and said that construction technology has improved and added that the Italian company which is building the dam would not risk its reputation, noting that Khartoum is keen on strengthening relations with Cairo and Addis Ababa. Osman mentioned that several dams such as Al-Rusairs dam in East Sudan and the Aswan dam in Egypt which accommodates 162 billion cubic meters of water have survived for tens of years and did not crumble.

He said that Sudan sacrificed 22 villages and a million palm trees and an entire civilization in the far north in order to allow the Egyptians build the Aswan dam in 1964. Osman demanded those whom he said do not comprehend the sanctity of the relations between Egypt and Sudan to stop “muddling”. The Grand Ethiopian Renaissance Dam, formerly known as the Millennium Dam is being constructed on the Blue Nile 40km from the Sudanese border. Egypt and Sudan had previously argued that the construction of the dam would negatively affect their water shares and insisted the project should be blocked, calling on international donors against funding it.

However Sudanese president Omer Hassan Al-Bashir announced his support to the project in March 2012, saying his government understands the mutual benefits the project could offer Ethiopia and Sudan.

Khartoum’s stance have aggravated Egypt in recent weeks with many political figures blasting Sudan’s “treachery”. Egypt believes its “historic rights” to the Nile are guaranteed by two treaties from 1929 and 1959 which allow it 87 percent of the Nile’s flow and give it veto power over upstream projects.

But a new deal was signed in 2010 by other Nile Basin countries, including Ethiopia, allowing them to work on river projects without Cairo’s prior agreement. The first phase of construction of the $4.2 billion dam is expected to be complete in three years, with a capacity of 700 megawatts. Once complete, the dam will have a capacity of 6,000 megawatts. (Sudan Tribune)

Benishangul Gumuz, Gambella, Afar to open radio stations

Addis Ababa, June 7 (WIC) – Ethiopian Broadcasting Authority (EBA) is providing support to Benishangul Gumuz, Gambella and Afar regional states to enable them operate their own radio stations.

According to Workineh Tafa, EBA public relations acting head, the authority has been providing technical support to the regions which would allow them to meet the legal requirements to operate their own radio stations.

So far, EBA has issued license to nine state owned radio stations, five FM radio stations and two medium and short wave radio stations.

The authority has also licensed 16 community radios across the country, out of which 11 are providing regular service while the remaining five are finalizing preparations, according Workineh.

Prime Minister Hailemariam visiting China this week 

Prime Minister Hailemariam is scheduled to pay an official visit to the Peoples Republic of China from June 12^th to June 15^th at the invitation of the Chinese Government. The Prime Minister will be holding discussions with President Xi Jinping, and with the Chairman of the Standing Committee of the National people’s Congress of China. Prime Minister Hailemariam and his delegation will also be holding official bilateral talks on issues of mutual, regional and global significance with China’s Prime Minister, Li Keqiang. Prime Minister Hailemariam as Chairman of the African Union will also brief the Chinese government on the recent AU Summit in Addis Ababa. During his visit, Prime Minister Hailemariam will also deliver a speech at the Beijing Foreign Studies University on the theme of China-Africa: New Strategic Partnership and Friendship for Development and Transformation, as well hold various meetings with Government and Party officials and business executives to further strengthen economic and business ties between Ethiopia and China.

IMF projects Ethiopia’s GDP growth at 6.5%

By Muluken Yewondwossen

‘Inflation will continue to drop’

In its latest report, the International Monetary Fund (IMF) projected that Ethiopia’s Gross Domestic Product (GDP) will remain around a modest 6.5 percent for 2013/14 with inflation continuing its downward trend, contesting the government’s official projection of 11.4 percent. The report entitled ‘Regional Economic Outlook: Sub-Saharan Africa – Building Momentum in a Multi-Speed World’ was released this week at the headquarters of the IMF Ethiopia regional office.  The report states that with 5 percent growth in 2012, economic activity in sub-Saharan Africa remained strong, slowing only marginally from the 2010-11 rate. The report also notes that annual average consumer prices will decline to 8.3 percent in 2013 and 9.6 percent in 2014, down from the past year’s 22.8 percent indicating that inflation will continue to ease to a single digit. “Inflation declined in most regions, reflecting more stable global commodity prices, improved local climate conditions, and tight monetary policies,” the report states. Accordingly, with food inflation declining as the year proceeded, disinflation was particularly marked in eastern Africa, including Ethiopia slumping down from 36 percent in 2011, to 13 percent by end of 2012. The Central Statistics Agency (CSA) on its part announced in its March 2013 report that year-on-year inflation rate dropped to 7.6 percent in March, from 10.9 percent in February. The report also indicated that the country’s reserve coverage ratio will stagnate at 1.7 months of imports in 2013, which is similar to the past year’s, but will grow to 1.8 months in 2014. The challenges, which the country’s economy faces have also been stated in the report. The large GTP financing requirement has consumed the biggest share of the GDP. The report indicated that about 15 percent of the GDP annually goes to the five-year GTP plan and it has put immense pressure on the economy. IMF Resident Representative, Jan Mikkelson, offered options to narrow the gap of insufficient GTP financing by increased savings, raising tax revenues, printing more money, using foreign exchange reserves and more foreign and domestic borrowing. “Borrowing money from abroad has been mentioned as the best alternative and the option of printing money is considered the least desirable,” experts explained. Domestic financing is the preferred path to follow under the current situation. For the first 2 years of the GTP, domestic public financing amounted to an estimated 6.5 percent of the GDP. The IMF also indicated that the government should facilitate more loans from local financial institutions for the private sector, as it will help in creating employment. Maintaining tight monetary policy and ensuring a competitive foreign exchange system, a moderate pace of public spending, a reduction in the crowding out of the private sector, prioritising public investments in areas of expertise and greatest growth impact, plus strengthening the financial sector and key service sectors, IT and logistics, were also stated as policy options for faster growth.

African middle class rising: report

A third of all Africans are now classified as middle class. Their incomes allow them to inhabit an economic bracket that is variously defined, but by any definition is growing, African Review reports.
With this growth comes greater political clout, as larger numbers of Africans with possessions from cars to homes to stock portfolios seek social stability and good governance to ensure the continuing comfort of their lifestyles. For a continent long perceived as economically challenged, the rise of an African middle class represents laudable progress. According to the African Development Bank (AfDB), 34 percent of Africa’s 326 million people were earning middle class incomes in 2010, compared to 27 per cent of Africans in 2000.
The past decade’s increase in the number of middle class Africans continues a decades-long trend. A generation ago, in 1980, 70 percent of Africans lived in poverty and only a quarter could be considered middle-class.
(ERTA)

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Three Egyptian projects worth $50m will be launched in Ethiopia’s first industrial zone over the next month in an attempt to strengthen Egyptian-Ethiopian ties, according to the head of the Badr Investors Association.

Alaa Alsokti highlighted the “role the economy plays in strengthening relations between the two countries,” and urged the government to give Egyptian businessmen and companies the opportunity to play a political role in calming growing tension with Ethiopia.

The plants, owned by Egyptian investors and companies, specialise in electrical transformers, office furniture and medical equipment.

Rising population, pollution and environmental degradation have caused increasing water scarcity for Egypt. The country is facing an annual water deficit of around 7bn cubic metres, with the United Nations already warning that Egypt could run out of water by 2025. Alsokti stressed that many Ethiopians are keen that the dam not worsen Egypt’s water situation.

“There has been a significant boost in ties between us and the Nile-based countries in the past two years,” President Mohamed Morsi told the Conference on Egypt’s Rights to Nile Water this month, adding that there has been a 50% increase in trade, with Egyptian investments in Ethiopia now amounting to $2bn.

According to a statement by the Ethiopian government: “The Nile basin has been tying the two countries and their peoples together for millennia.” It noted that while the river could represent a source of cooperation for the two countries, this has not always been the case, calling the issue of Nile water a “sticking point in the relationship, a major stumbling block to any sort of robust bilateral link that might have enhanced the interests of both countries.”

According to the statement, successive Egyptian governments have sought to ensure their continued control of the Nile water, and because of this, it has not been possible to establish a strategy for the river based on mutual agreement, adding that upper riparian countries, including Ethiopia, for a long time suffered from a lack of sufficient resources to develop their legitimate claims to usage of the Nile water.

“The policies pursued by Egypt on this didn’t help the confidence of the upper riparian countries towards this issue. There is a strong conviction in Ethiopia, which has been well-founded, that efforts have been made to prevent Ethiopia from accessing support for the purpose of obtaining the necessary financial support for hydro-electric projects, even where these projects would pose no harm whatsoever to Egypt.”

According the Egyptian Embassy in Ethiopia, the Ethiopian government offers Egyptian investors exemption from import duties on construction materials needed to create new projects or to expand and develop existing projects. Capital goods may be imported without payment of customs duties and other taxes.

The government also allows giving out loans to investors by Ethiopian banks and provides all appropriate land investment and infrastructure services such as electricity, water and telecommunications, provided that the investor meets the conditions and requirements of national investment.

Part of Ethiopia’s geology resembles the oil and gas fields of the Middle East and, indeed, natural gas fields were first discovered as far back as 1972. Despite the fact that commercially viable volumes of gas are present, the Ethiopian government has so far been unable to put together an arrangement to extract the gas. Kaleyesus Bekele looks back on an astonishing series of missed opportunities.  African Business reports:

The history of oil and gas exploration in Ethiopia dates back to the 1950s. After several oil field discoveries were made in the Middle East, hopes were high for similar results in Ethiopia as some of its geological formations, particularly in the Ogaden basin, a vast arid land in southeast Ethiopia, resemble those of the Middle East. But so far, the gas has remained undisturbed under the ground despite the fact that many international oil companies were engaged in oil and gas exploration projects in the Ogaden basin’s 350,000 sq km of land. It was an American company, Tenneco, that hit the jackpot in 1972. The company discovered a natural gas reserve in Calub, a locality 1,200 km southeast of Addis Ababa, estimated at 76bn cubic metres. Tenneco also discovered a non-commercial crude oil reserve with a thickness of one metre at Hilala.
Tenneco was not lucky enough to reap the fruit, though. In 1974, a socialist revolution swept the country, which ousted the imperial regime with whom Tenneco had signed a 50-year concession agreement. Tenneco was expelled by the former socialist government of Ethiopia in 1977, together with many other Western companies.
Following the expulsion of Tenneco, a former USSR company, Soviet Petroleum Exploration Expedition (SPEE), started working on the Calub and Hilala gas fields. SPEE drilled more wells in Calub and Hilala, and confirmed the natural gas reserve in Calub. SPEE discovered a gas condensate at Hilala 4 at a depth of 4,750 metres. However, SPEE’s contractual agreement was also terminated in 1994 after the fall of the military regime.
After SPEE pulled out of Ethiopia, the Ethiopian government signed several agreements with different companies that pledged to invest millions of dollars in the gas fields. The American company Secor, the Russian companies Methanol Joint Stock and StroyTrans Gas, the Jordanian company SITech International and Petronas, the Malaysian oil and gas giant, all signed memorandums of understanding (MoU) and petroleum development agreements to develop the gas fields.
However, Secor, which signed the agreement in 2000, vanished into thin air, while Methanol and StroyTrans Gas, which had signed an MoU in 2002 with the government-owned company, Calub Gas SC and the Ministry of Mines, demanded that the government should come up with the funds required to execute the project while they would provide the technology.
SITech International, which had pledged to invest $1.7bn in 2003, was unable to raise any significant capital. The company said it was unable to commence work on the project until 2006. Alemayehu Tegenu, former Minister of Mines, revoked the petroleum development licence given to SITech and decided to offer the project to tender.
The Ethiopian government had tried to develop the gas fields in collaboration with the private sector by establishing Calub Gas SC and was selling shares of the company to the public. The World Bank, which agreed to finance the small-scale gas development project designed by the company, signed a loan agreement for $66.3m. However, in 2001, the World Bank suspended the loan, insisting that the project should be privatised. Repeated attempts to jointly develop the gas fields with the company were not successful. Later on, the government liquidated the share company.
“The bank’s move surprised everyone,” says a senior official of the defunct Calub Gas SC, “because the bank usually does not suspend loans once it signs an agreement. Second, the well-completion work was done with the first round of payment secured from the bank. The gas reserve was made ready for production and it was made to rise to the surface. So production was supposed to start as soon as possible.
“Only a gas treatment plant is required to start production. The fact that the gas was made ready for production could cause pressure build-up and that is a big risk for the wellbeing of all the gas wells,” the veteran geologist said.
In 2006 the Ministry of Mines put up a tender inviting international oil and gas companies interested in developing the gas fields. Petronas won the tender and in June 2007 signed a petroleum development and production sharing agreement with the Ministry.
Petronas made an upfront payment of $80m to the Ethiopian government. The company planned to build a gas treatment plant and to construct a gas pipeline all the way from the gas fields to the port of Djibouti. The total investment was estimated at $1.9bn. Petronas has been analysing and interpreting the petroleum data collected from the gas fields. However, due to a managerial decision, Petronas relinquished all its concessions and pulled out of Ethiopia in 2010.
Following the withdrawal of Petronas, the Ministry of Mines put up a tender to select a company that would take over all the concessions held by Petronas in the Ogaden in March 2011. Subsequently, in July 2011, the Ministry awarded the Calub and Hilala natural gas fields and eight exploration blocks (that belonged to Petronas) to a Chinese oil and gas company based in Hong Kong, PetroTrans, which had won the tender.

Furious reaction

After a year, in July 2012, the Ministry cancelled the petroleum development agreement it had signed with PetroTrans, saying the company has failed to commence work on the project according to schedule. In a letter dated 1st July 2012 and signed by Mines Minister Sinkenesh Ejigu, the Ministry notified PetroTrans of the termination of the petroleum development agreement. The company had agreed to develop the gas fields within three years. PetroTrans furiously protested the Ministry’s decision. The company claims that it was analysing and interpreting old data collected from the concessions. It explained to the Ministry that it hired specialised companies that would collect seismic data and drill exploration wells. PetroTrans said it was negotiating with companies that would construct the gas pipeline and gas treatment plant.
In a letter signed by president and CEO of PetroTrans, John Chin, and addressed to Sinkenesh, the company listed the works it had undertaken and asked the Minister to revise her decision. The company had spent more than $18m on the project. It paid $11m in signature bonus to the Ministry.
It had also paid for land rent and community development projects. The company said has been working on the paperwork required to do the field work, adding that it was about to commence field work at the time of the termination of the contract. The Ministry did not accept the explanations, saying that PetroTrans is a broker company.
Executives of PetroTrans said they want to resolve the problem with the Ministry in a round table discussion and resume work on the project. However, they said, if the Ministry refuses to do so, they want to be compensated for the loss they incurred. Sinkenesh admitted that PetroTrans has spent a significant amount of money for the project. However, she said, the Ministry would not pay compensation to the company.
PetroTrans, which entered into a tug of war with the Ethiopian government, filed its complaint to the International Chamber of Commerce (ICC) based in Geneva on 28th December 2012. The Ministry has responded to the complaints lodged by PetroTrans at the ICC and currently the case is being overseen.
The Ethiopian government recently established a new company called Ethiopian Petroleum Development Enterprise that will engage in developing the gas fields in collaboration with an international oil and gas company. “Our government this time shows a firm commitment to extract the gas reserves. We are looking for a reputable international petroleum company that is committed to jointly develop the gas fields,” Sinkenesh said.
However, PetroTrans said there is no company that will take over the projects before the disagreement is settled. “There is no company that will acquire the concessions, whose case could be presented to an international arbitration court. If there is any company that attempts to take over our concessions, we will sue it,” a senior official of the company said. Sinkenesh downplayed the warning, saying that the concessions belong to the Ethiopian government. “The concessions belong to the Ethiopian government and people. And they are in our hands. No one can prevent us from utilising them,” the Minister said.
Ethiopia is probably the only country on this planet that has been unable to develop a proven gas reserve for four decades.

http://www.africanbusinessmagazine.com/features/oil-gas/ethiopia-a-lot-of-hot-air-over-gas

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Fortune: After conducting three rounds of negotiations for its accession to the WTO, Ethiopia is preparing to submit its service offers to members of the WTO. Are you hoping that the accession process will be concluded in 2014?

Anarcha Gonzalez: The short answer would be whenever Ethiopia feels it is ready to do it. The longer answer, on the other hand, will be that any accession is a process.

Accession to the WTO is a process which mirrors the opening up of a domestic economy. If a country quickly opens its economy, it can become a member of the WTO quickly. If it does so gradually, then the process of becoming a member drags on.

For an accession to be successful, the best recipe is to make sure that a nation anchors up its accession to a set of multilaterally agreed rules. The most important thing is that you synergise the accession process with your own view of where you want to go.

Q: According to some political observers, the Ethiopian government is taking time to open up for fear of losing some of its political leverage. How committed do you think the government is to opening up?

It is committed to the accession, I would say. But the difficulty for the Ethiopian government, in my view, is not whether or not it is committed.

The difficult question is rather how it manages the process of opening up with the process of strengthening the industrial base in the country. The government has to work with two parameters.

One is opening up its economy to international competition. This is good, if done in a smart way. That is because it helps to ensure quality, improve standards and ensure there is access to imports. It is also good for consumers because it lowers the cost of purchasing goods.

But all of this can be successful if there is another component, which is a process of making the Ethiopian industry more competitive in the national economy.

What does this mean?

The Ethiopian government has to make sure that if it exposes the industrial sector to greater competition, there is a proper programme to help industries in Ethiopia, most of which are small and medium enterprises, to be more competitive in order to sustain the greater pressure that comes through the opening up of the  national economy. Another is to make sure that they receive benefit from the opportunities that come from abroad.

Q: Opening up needs more skills, compliance with global rules and becoming competitive. Even more than that, it needs giving up some sectors.  To what extent do you say that the Ethiopian government has met these conditions?

They are met only to a certain extent. That is exactly what the Ethiopian government is engaged in at the moment.

A bigger portion of what Ethiopia can do in the coming years is working on a programme that targets boosting the competitiveness of the economy. I think what they have done in terms of infrastructure is also part of the competitiveness drive.

But you do not build this in one year. You do not build this in five years either.  It is a longer term perspective.

Q: One prominent issue in the accession to the WTO is the negotiating capacity of countries. It is natural for these countries to feel weak when they are small. The ITC is also involved in upgrading capacity among African countries. How do you assess the negotiating capacities of countries? Do you feel they are capable of negotiating while still maintaining their safeguards?

If I look back at the first time I came to Ethiopia, which was during the end of the 1990s, and if I compare the capacity of trade negotiators then and now, it has significantly improved. This is because there has been a concerted effort from the side of the international community to ensure that there is training to those who are involved in negotiating.

The WTO spends 20 million dollars every year training civil servants from national governments. The ITC also trains an incredible amount of trade supporting institutions every year. We are improving the negotiating capacity of negotiators, in order to participate meaningfully in any negotiations.

But, having said this, it is pretty obvious that we are far from reaching a point where everyone is embraced. It is a gradual process. We are better than 10 or 15 years ago, but much more remains to be done.

Q: Is Ethiopia benefitting from such initiatives?

Yes, I just spent two hours in the Ethiopian Chamber of Commerce & Sectoral Association (ECCSA). I was discussing with officials about the ITC Reference Centre. It is a centre that contributes to building these capacities. They get materials and resource on trade promotions.

That would be very helpful to them in their negotiating capacity. The answer is very clearly, yes. We are contributing every year with different means and through different products to helping build the capacity of governments, institutions and SMEs.

Q: Certain sensitive sectors often become difficulties in trade negotiation processes. The telecom sector in the case of Ethiopia could be taken as an example. How could countries open them up, when the sectors matter most to them?

In every country that is undergoing the process of accession, or even bilateral negotiations, it is a problem. I myself was a negotiator in Europe and I can tell you that certain sectors are very sensitive.

Agriculture proved very sensitive at the time. So did the automobile industry. This is because these were sectors that were more protected than others, since there is either a vested interest or political interest to protect that sector from international competition.

Ethiopia is no exception. Like every other country, there are sectors of the economy that are more sensitive. Telecommunications is an area that the Ethiopian government is very sensitive about opening up.

Generally, the way it would work is through a process of accommodation on both sides. The principle of the WTO is opening trade. It is by no means trade closing or maintenance of the status quo.

People understand that in this process of trade opening, you have to understand the other party. So you agree to open in a more gradual manner, of course, not fully opening it up. But you assert a certain degree. I do not see anything surprising about Ethiopia’s stance on sectors like telecom.

At the end of the day, what governments need to do is to weigh up the different interests at stake. There is the interest of consumers, that of producers and that of the state.

So, my message is that it is not an impossible thing to do. You certainly can do it. But you have to weigh up the different interests. In any negotiation, it is about explaining to the other side why you draw a red line on the sand and convincing the other party about why you are drawing it and where you are drawing it.

Q: Some opine that it is a matter of ideology and opening up forces countries to cede even their safeguards. Do you agree?

No! I certainly do not agree. The WTO is a sufficiently flexible organisation, housing many different ideologies provided you accept one condition, which is that trade opening is good. That is what unites all members of the WTO.

If you look at their ideologies, some are more conservative, some are more liberal, some are more left-wing and some are more right-wing. In spite of these differences, all fit in to the WTO.

We do not exclude anybody. You have got China, Vietnam, Russia and many others together. Provided you accept that trade opening is good, ideology certainly does not matter. The WTO’s very first article says members believe that trade opening is good for employment, improving living standards and sustainable development. If one does not agree with this, then it is better not to knock at the door of the WTO. But a glance at those who have so far knocked the door reveals that it is not at all difficult to adhere to these principles.

Q: More and more governments in the developing world seem to prefer bilateral trade agreements. Some experts say this trend is outcompeting that of WTO.

Well, I think there is certainly a greater acceleration of bilateral agreements. Where I am not clear is with whether or not this is good for business, SMEs and the like.

Any trade agreement that contributes to levelling the playing field must, in principle, be good for small businesses. But, if these bilateral trade agreements result in scattering up of the playing field, then in my view that is a problem.

And why is it a problem?

The real obstacle to business in today’s world are not tariffs, which are becoming smaller and smaller. The real obstacles are rather non-tariff measures, barriers and certifications.

I hear from many business circles in several countries that their biggest obstacles are regulatory non-tariff measures. If bilateral agreements regulate these non-tariff measures, this is certainly not going to help level the playing field.

This will make the life of SMEs shorter. This is because with bilateral agreements they may have 10 standards to meet.

Is this good news for business?

No, I do not think so. In principle, I support bilateral trade agreements so long as they help to level the playing field. You know, the Chinese have a saying – “The colour of the cat does not matter as long as it catches the mouse”. That’s my view on bilateral agreements.

Q: The SMEs need to sprout and be more competitive. But for this to happen, capacity is crucial. In most African nations, the SMEs are the burden for governments. What is the ITC doing to ensure that SMEs receive their fair share of assistance in building capacity?

We are a unique development organisation in that we provide support for SMEs. We do essentially three things. One is what I call market intelligence.

We map the market for these enterprises; we locate the market opportunities; we indicate the standards and the competitors; we provide them with plenty of information about the market, competitors and standards; we also tell them how prices fluctuate.

We support trade and promotion organisations and we support their associations on the ground. In the Ethiopian context, for instance, it is easier for us to deal with the Chamber since we cannot reach all of the 250,000 SMEs.

Another is working directly with the SMEs. So we work with a group of SMEs in a particular sector in one country to help improve their export competitiveness. Women empowerment, youth employment, improving coffee quality and creating e-platforms to sell products directly to export markets, among others are some of our intervention areas in SMEs.

Q: Although there have been candidates from Africa bidding for the top WTO position, the world has so far not been able to see any African at the helm of the WTO. How representative do you think is the leadership of the WTO?

If I look at the head of the WTO, it has traditionally been from developed countries. But we have also have had two developing countries.

We are now on the second one, from Brazil. Before that it was Asia. But it is true that there has never been a director general coming from Africa.

There were two candidates this time around. They were very good candidates. One was from Ghana and one from Kenya. One is a man and the other was a woman. But they did not make it to the final.

At the end of the day, you can see that the process of selecting a WTO director general is a member-driven process. It ends up where the members want it to end. Time has progressed and that is a good sign.

Sourced here:  http://addisfortune.net/interviews/world-trade-what-it-takes-for-ethiopia-to-join/

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• Ethiopia’s Grand Plans for Regional Power distribution (appablog.wordpress.com)
• Ethiopia: The African tiger (allanapotashblog.org)
• An African Manufacturer? Ethiopia Gears Up To Emulate China, Vietnam And South Korea In Factory Output (allanapotashblog.org)
• The Manufacturing Sector: mature enough to compete internationally (allanapotashblog.org)
• Ethiopia – Next Stop for Textile Industry? (allanapotashblog.org)
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The United States Government, through the United States Agency for International Development (USAID), signed a partnership agreement on November 13 to improve urban emergency preparedness and response in Addis Ababa.

14 November 2013

USAID will provide technical assistance to the city government of Addis Ababa that will make a significant difference in minimizing the effects of a disaster, including saving lives, protecting property, and helping the city recover more quickly from a disaster.

USAID and the Government of Ethiopia are expanding their partnership to include a focus on urban disasters in Addis Ababa through the city’s Fire and Emergency Prevention and Rescue Authority (FEPRA).  The partnership will include training on the U.S. National Incident Management System (NIMS) for managers and first responders to increase capacity for preparedness and response for urban disasters including firefighting, urban search and rescue and earthquake scenarios.

NIMS, a framework for disaster response and preparation currently used in the United States, makes it easier for governmental and private sector agencies to work together to prevent, respond to, recover from, and mitigate the effects of disasters.  Through this agreement, USAID will help the city government of Addis Ababa to develop city-wide emergency operation plans, establish disaster management teams, develop standard operating procedures for effective resource management, and develop a more integrated communication system for city-wide emergency preparedness and response.

“We are extremely happy to see this expansion of our cooperation with the Ethiopian Government in disaster management,” said USAID Ethiopia Mission Director Dennis Weller.  “We believe that FEPRA will be a strong and capable partner in improving disaster preparedness and response, benefiting all residents of the City of Addis Ababa.”

NIMS uses the Incident Command System which is globally recognized as a best practice for emergency response, providing organizational structure and processes at the field level to help regional and local governments more rapidly and effectively respond to disasters.  The Incident Command System functions in disasters of any type or size, allowing personnel from a variety of agencies to fit rapidly into a common management structure.

Since 2008, USAID has supported a technical assistance partnership with the Government of Ethiopia to improve disaster response and preparedness capacity.  The U.S. Forest Service has been implementing the partnership in collaboration with Ethiopia’s Disaster Risk Management and Food Security Sector Early Warning and Response Directorate and this agreement expands the partnership to the City of Addis Ababa.

Related articles

• East African Infrastructure Development, Part 3: Ethiopian Surface Transport – Stratfor (allanapotashblog.org)
• Addis Ababa has potential for up to 20 new supermarkets, says research firm
• From Addis Ababa: A Power[ful] Africa Message
• Addis plays the long game
• Addis Ababa is the showcase for Ethiopia’s economic great leap forward
• New Site for New Addis International Airport
• Chuan Hui International Tower and Park Hyatt Addis Ababa
• The Next Shanghai May Be in Africa

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Authority signs road project  contract agreements

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The Ethiopian Road Authority (ERA) signed 6.5 billion birr three road project contract agreements with China Communications Construction Company Limited (CCCC), China Railway No.3 Engineering Group Co. Ltd of Ethiopia Branch and China Railway Seventh Group CO. LTD.

Speaking at the singing ceremony held at the ERA Head Office yesterday, Director General Zaid Wolde-Gebriel said that ERA signed a contact agreement with CCCC to design and build the Addis Ababa- Adama Toll Motorway Phase II, Lebu-Akaki- IT Park Outer Ring Road, with China Railway No.3 to build Gashena -Lalibela– Sekota Road, Contract-1: Gashena-Bilbala, and with China Railway Seventh Group to undertake the construction of Zagora- Gassay road projects.

The Director General said: “We have already completed three and half of the Five-year Growth and Transformation Plan ( GTP) progarmme. We are doing our level best. At this time ERA has accomplished about 62 per cent of the GTP in three years and six moths.”

He expressed conviction that these projects would be completed ahead of schedule.

CCCC representative Zhou Yongsheng on his part said that the Addis- Adama road project would be completed within two months time.

China No.3 Engineering Group General Manager, Zhao Sanbao said: “Lalibela is very important town and so is the road to local development. Our company would do its level best to mobilize more resource to complete the project on time.”

http://www.ethpress.gov.et/herald/index.php/herald/national-news/5637-authority-signs-road-project-contract-agreements

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Ethiopia, WB sign $110m financing agreement

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Corporation confident of achieving 70 percent of its GTP

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The Ethiopian Sugar Corporation is confident that it would achieve 70 per cent of its Growth and Transformation Plan (GTP).

The five-year GTP of the sugar sector eyes building 10 new sugar factories and raising nation’s average annual sugar production capacity to 2.25 million tons.

In order to attain the target, the Corporation is undertaking expansion projects on the existing sugar factories while it is constructing new sugar factories at various parts of the country.

After assessing its three years performance in the GTP, the Corporation is convinced that it would attain 70 per cent of the high case scenario in sugar development sector.

“The Corporation would achieve 70 percent of its GTP through commencing sugar production in seven of its factories under construction,” Corporation’s director general, Shiferaw Jarso, said while opening a meeting organized to evaluate this Ethiopian fiscal year’s 6th month performance of the Corporation. According to him, the first phase of Tendaho sugar factory is expected to enter production in the current Ethiopian budget year while the second phase of Tendaho, Beles 1 and 2, Kuraz 1, Kessem and Arjo Didessa sugar factories would commence production in 2007 E.C. Over 92,000 job opportunities would be created in the remaining two years of the GTP period, the director general said. On the other hand, Wolkit, Beles 3, as well as Kuraz 2 and sugar factories are expected to enter production in the first year of the second chapter GTP which is in 2008 E.C, he said. The Corporation has now reached a stage of saving the foreign currency the nation was using to import sugar and is eyeing to earn 376 million US dollars annually by starting export of sugar as of 2007 E.C. In addition to the sugar development, the Corporation is working to generate 197MW energy and produce 134,000 cubic meters of ethanol from the sugar factories by the end of the GTP period. Heads of the corporation, sugar factory and sugar projects are in attendance of the two-day meeting organized to evaluate 6th month performance of the Corporation.

http://www.waltainfo.com/index.php/editors-pick/12019-corporation-confident-of-achieving-70-percent-of-its-gtp-

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Ethiopia working to harness 5.3 mln hectares irrigation potential

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The Ministry of Water, Irrigation and Energy said it is striving to harness its massive 5.3 million hectares of irrigation potential.

The Ministry’s public relations and communication director, Bizuneh Tolcha told WIC that the government has given due attention to its irrigation potential which lacked policy and strategic direction two decades before.

Before 1992, not more than 61 thousand hectares of land were developed through irrigation schemes. A change in government and policy direction meant the sector witnessed a huge transformation. In just two decades, the country managed to develop over 298 thousand hectares of land through irrigation schemes.

By the end of the growth and transformation plan (GTP) in 2015, the country expects to harness 14.5 percent of its irrigation potential, a big leap compared to the 2009/10 budget year where the country managed to harness just 2.4 percent of its irrigation potential.

Bizuneh said the ministry is currently undertaking 15 irrigation development studies, design preparations and construction projects, out of which the ministry expects to finalize nine during the current budget year and four within the GTP period. The remaining two are expected to be finalized within two years after the end of the GTP.

http://www.waltainfo.com/index.php/explore/12017-ethiopia-working-to-harness-53-mln-hectares-irrigation-potential

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Training provided for farmers to improve agricultural productivity

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Training has been provided for more than 325,000 farmers in Arsi Zone of Oromia State in a bid to improve agricultural productivity, the Zonal Agriculture and Rural Development Office said.

Office Head, Gosa Tsegaye said recently that the training was focused on water and soil conservation, land management, irrigation development, input utilization and seedling care, among others.

The zone is undertaking various activities to improve agricultural production and productivity, he said.

Helping the farmers utilize better inputs, such as select seed, fertilizers and compost as well as modern technologies are among the measures the zone took.

http://www.ethpress.gov.et/herald/index.php/herald/national-news/5644-training-provided-for-farmers-to-improve-agricultural-productivity

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ECAA expecting quality assurance certificate from FAA

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The result of the International Aviation Safety Assessment conducted on the Ethiopian Civil Aviation Authority (ECAA) by the United State Federal Aviation Administration (FAA) is expected to be official soon, the Authority said.

Authority Director-General Wosenyeleh Hunegnaw (Col.) said that the Authority is expecting a quality assurance certificate from FAA based on the recent audit, which will enable the Ethiopian Airlines continue to fly to the U.S.

An FAA team of experts spent five days in Addis Ababa assessing the Authority’s working procedures and the qualifications of its experts.

FAA grants permits to airlines of a country to fly to the U.S. if the regulatory body of that country qualify the FAA audits.

Ethiopian Airlines started flying to the U.S in 1998 after ECAA was certified by the FAA as category one.

There are three categories of permits, category one means passing the audit without a remark. Countries in this category comply with the International Civil Aviation Organization’s operational safety standards.

Category two permit will enable airlines to fly with restrictions. The deficits should be rectified within a specific period. Airlines based in countries listed in category three will not be able to fly to the US.

If the regulatory body of a country fails to meet the requirements of FAA, all carriers based in that country will not be able to fly to the US.

http://www.ethpress.gov.et/herald/index.php/herald/national-news/5642-ecaa-expecting-quality-assurance-certificate-from-faa

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Libya keen to re-establish ties with Ethiopia

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The transitional government of Libya is desirous to re-establish the bilateral ties with Ethiopia, the visiting Libyan parliamentary delegation led by the Deputy Speaker Dr. Ezzidine Mohammed Al -Awami said.

While conferring with the Speaker of the House of Peoples’ Representatives Abadula Gemeda here last Wednesday, the Deputy Speaker said the transitional Libyan government is keen to re-establish the partnership with Ethiopia.

He also expressed his country’s keenness to work together with other African countries on peace and security issues.

The Speaker appreciated Ethiopia’s efforts exerted to build peace and stability in the region.

Speaker Abadula Gemeda on his part appreciated Libya’s willingness to renew ties with Ethiopia.

He affirmed that Ethiopia is willing to share its best practices on good governance and democratic system building to Libya.

http://www.ethpress.gov.et/herald/index.php/herald/national-news/5646-libya-keen-to-re-establish-ties-with-ethiopia

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Commission steps up Nat’l Human Rights  Action Plan implementation

Finnish delegation, local stakeholders and media personnel discussing human right and democracy

The Ethiopian Human Rights Commission ( EHRC) says it is stepping up efforts in implementing the National Human Rights Action Plan in all federal and state governments’ organs.

Opening a half-day discussion on human rights and democracy yesterday, Commissioner Ambassador Tiruneh Zena informed Finnish delegation, local stakeholders and media personnel that EHRC is not only playing enormous role in the preparation and implementation of the first ever action plan of the commission, but also engaging in setting up the national human rights forum across the country.

As to the progress that has been achieved so far by EHRC, he noted that all federal and states have drawn their respective action plan in a bid to discharge their responsibilities and a steering committee has been established by the Prime Minister to oversee the implementation of the plan.

Citing the importance of getting involved all stakeholders such as governmental, non- governmental organizations, mass organizations, among others, he underlined that this huge organization would enhance awareness creation campaigns to eliminate harmful traditional practices like early marriage , FGM, polygamy and the like that still prevail in Ethiopia.

Regarding challenges encountered in implementing the national and international human rights law, Ambassador Tiruneh pointed out that disproportionate use of force, delay in bringing the suspect to the court, human rights abuses in some detention centres of the country and the like have been observed through monitoring practices of EHRC.

Finnish Ambassador Ms. Sirpa Maenpaa on her part said that her country would provide every assistance to Ethiopia in its endeavours of respecting and promoting universal and national human rights as well as creating democratic and accountable societies across the nation.

During the discussion, representatives of Federal Ethics and Anti-Corruption Commission, the Office of Ombudsman and others have briefed participants about their respective activities with regard to ensuring and protecting human rights to the delegation and a number of questions were raised in line with human trafficking, election, free use of media and others by the delegation.

The National Human Rights Action Plan was launched at a meeting held at UNECA last October.

http://www.ethpress.gov.et/herald/index.php/herald/news/5616-commission-steps-up-nat-l-human-rights-action-plan-implementation

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Finnish delegation lauds nation’s commitment to improve citizens  well-being

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Under-Secretary of State Anne Sipiläinen

Finnish high level decision-makers and opinion leaders visiting Ethiopia said they are very impressed with the government’s pro-poor investment.

At a reception held at the Ambassador’s residence in honour of the delegates yesterday, Under-Secretary of State Anne Sipiläinen said: “I am really impressed by what I saw in Bahir Dar as well as in Addis Ababa. The changes are positive because the government’s expenditure, the polices and programmes are all pro-poor.”

Girls and boys are going to school, the health situation is improving, access to clean water and sanitation is very high and then what is really important is young girls and boys are being educated better than earlier times as well as a lot of job opportunities for the youth, for instance in agribusiness, have been created, added Sipiläinen.

“I had never been out of Addis Ababa, but what I saw up North is wonderful. I am really impressed, it is so beautiful. I have been to Ethiopia many times and can tell the difference. Every time I am here, the change I am witnessing is amazing. The country ‘s potential to grow is huge. ”

“Ethiopia is an African power. And I believe it will be a very active player in regional as well as global politics. Finland values the country’s relations. Hence, our Prime Minster and a high-level delegation will visit Ethiopia soon.”

MP Riitta Myller also said: “Though it is only three days I am here, I am impressed with what I saw. Almost all children are going to school which is the basic for any country’s development. Access to health services, water and sanitation is also there. Finnish experts working in Ethiopia told me that the government budget gives priority to education and health care services. I also heard that there are big differences between city and rural schools.”

She said that the water and sanitation projects the delegation visited are doing well and witnessed that the communities are part and owners of the projects. It is not like somebody is giving them. It is rather they are making it but get some support, which is a very good idea.

“We visited the women shelter for Saudi returnees. It is sad that happened. But I appreciated what is being done to rehabilitate the returnees. ”

Durate Company CEO Kari Karppinen on his part said: “I am here representing the Finnish private sector. This is my first visit to Ethiopia and I am enjoying every minute of it. I didn’t expect to see this much hotel, transport and other construction to be going on.”

To have a rapid development you need infrastructure, education, conducive investment atmosphere as well as transparency, among others. Most of all quality of education. “I think the Ethiopian government understands that.”

The two countries have a lot of business opportunities. “We have an experience in manufacturing. I am actually convinced about the ample business opportunities here. There are several Finnish companies already here whom I can partner to enter the market.”

The 19-member delegation is comprised of parliamentarians, students leaders and journalists. The four-day visit is organized by the Ministry of Foreign Affairs of Finland with the aim to provide the delegation a comprehensive picture about Ethiopia and the opportunities and challenges it faces with the promising economic growth and challenging social problems.

The delegation had the chance to have a close look at grass-roots experiences and the conditions under which Finnish-funded programmes and projects are being carried out in Amhara State. They visited Amhara CoWASH, Tana Beles Watershed, REILA (Responsible and Innovative Land Administration in Ethiopia and Agro-BIG (Agro-Business Induced Growth) programmes as well as primary schools, trade and entrepreneurship schemes. In the capital, they met with key representatives of Human Rights Commission and discussed democracy, equality and equity situation in Ethiopia and also visited the AU.

http://www.ethpress.gov.et/herald/index.php/herald/national-news/5623-finnish-delegation-lauds-nation-s-commitment-to-improve-citizens-well-being

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Investment booming  in Gondar

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The investment is booming in various sectors, specially in hotel and service sector construction in Gondar

The favourable conditions created by the government added to its vicinity to Ethio-Sudan border, both local and foreign tourist inflow, investment, specially hotel and service sector are booming in the historical city of Gondar. To speedup the city’s all-round development, its administrators, developers, service sector and other stakeholders are working inexhaustibly and jointly to sustain its development, City Mayor Getnet Amare said .

In an exclusive interview with The Ethiopian Herald, Mayor Getnet said that 119 investors have received land from the city administration over the last three years. Some of the investors have entered production phase while some are under construction and some of them are at the initial stage.

Getnet further indicated that 84 investors have shown interest to engage in the manufacturing sector but are not provided land. According to him, the City Administration has reclaimed land from 71 investors who failed to launch their projects.

The City Administration prepares industrial zones paying compensations and laying the necessary infrastructure facilities, he said. “So far, it has facilitated and created conducive investment climate for investors to develop land according to their project proposals. Hence, the investment is booming in various sectors, specially in hotel and service sector construction, Mayor Getnet said.

So far, three industrial zones have been prepared. The fourth is identified and readied for use. As land is very expensive, the administration considers the investors’ land use proposal and early engagements whenever a request is submitted by investors.

Furthermore, most investors are engaged in milk and agro-progressing, plastic, detergent factories in the City.

Meanwhile, Getnet said the city is hosting the 4th Ethiopian Cultural Festival Week January 14 -17, 2014. ‘Timket’, Ethiopian Epiphany, which is one of the biggest and most fascinating annual holiday’s celebrations of the year in Ethiopia would ”also be celebrated January 19, 2014. Apart from its religious significance, ‘Timket’ has a great significance in attracting tourist from all over the world.

The modern city of Gondar is popular as a tourist destination for its many picturesque ruins in the Royal Enclosure, from which the Emperors once reigned. The most famous buildings in the city lie in the Royal Enclosure , which include Fasilides Castle, Iyasu’s Palace, Dawits’ Hall, a banqueting hall, stables, Mentewab’s Castle, a chancellery, library and three churches. Near the city lie Fasilides bath, home to an annual ceremony where it is blessed and then opened for bathing; the Qusquam complex built by Empress Mentewab, the 18th century Ras Michael Sehul’s Palace and the Debre Berhan Selassie Church.

Downtown Gondar shows the influence of the Italian occupation of the late 1930s. The main Piaza features shops, a cinema and other public buildings in a simplified Italian modern style still distinctively of the period dispute later changes and, frequently neglect villas and flats in the nearby quarter that once housed occupation officials and occupiers are also of interest.

Currently, its population has reached about 300,000 and administrated by 12 Sub-cities, a satellite town and 11 rural kebeles.

http://www.ethpress.gov.et/herald/index.php/herald/news/5629-investment-booming-in-gondar

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Dry land food, water security project launched

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World Vision Ethiopia and the World Agroforestry Centre yesterday launched a 15 million USD Food and Water Security project aimed at improving the livelihood of dry land community.

Speaking at the event, World Vision Ethiopia Director Margaret Schuler said that the five- year project will be implemented focusing the most vulnerable communities of Tigray and Rift valley areas.

“We are thrilled with this project because World Vision’s programmes are designed to improve the well being of children and strengthen household and community resilience.”

According to her, the project would focus on semi-arid regions of Ethiopia to transfer rural households from subsistence farming to sustainable rural development by increasing food and water security, better access to markets.

Speaking through his representative, Agriculture State Minister Sileshi Getahun said concerted efforts are being made in Ethiopia to expand watershed management and carry out effective water and moisture retaining works.

According to him, these efforts have significantly contributed to cope with the challenges of climate change. Sileshi also said taking the threats of climate change to its development, Ethiopia is implementing a green economy strategy.

“By implementing the green growth strategy, Ethiopia avoids locking in old technologies and ensure its economy grows in a sustainable manner.”

Sileshi further noted that the active involvement of development partners in the area of environmental protection has a long lasting effect. As part of this joint initiatives, programmes like Tree for Food Security, Africa Rising Sustainable Intensification of Trees are worth mentioning.

“The harmonization of new and ongoing development initiatives and projects into a comprehensive nation wide strategy will help in avoiding redundancy of activities and the misuse of resources,” he added.

Presenting his research, Dr. Denis Garrity, UN Dry lands Ambassador Distinguished Board Research Fellow, World Agroforestry Centre, indicated that the project will have a long term effect in selected areas to increase productivity of commercial staple crops, water use efficiency, decrease food dependency and increase the availability of nutritious food.

According to him, if proper action is taken, the African dry lands have a great investment potential.

The project is funded by the government of Netherlands via the General Directorate of International Cooperation (DGIS).

http://www.ethpress.gov.et/herald/index.php/herald/news/5617-dry-land-food-water-security-project-launched

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Ethiopia,  Ghana sign General Cooperation Accord

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-  The General Cooperation Agreement covers a wide range of political, economic and social spheres including foreignpolicy, trade, investment, agriculture, science and technology.

Foreign Minister Dr. Tedros Adhanom and his Ghanaian counterpart Mme. Hanna Tetteh signed a General Cooperation Agreement in Accra Monday.

According to the Ministry of Foreign Affairs, Dr. Tedros and his delegation arrived in Ghana Sunday on a working visit to strengthen Ethio-Ghana relations. The General Cooperation Agreement covers a wide range of political, economic and social spheres including foreign policy, trade, investment, agriculture, science and technology.

In a welcoming address, the Ghanaian Foreign Minister noted that Ethiopia and Ghana had pioneered continental unity in post-colonial Africa. She said the common positions taken by the two countries at the international arena had contributed to peace, security and conflict resolution.

Mme. Tetteh also underlined the need for focusing on areas of mutual interest and to share best practices. In this regard, she mentioned the Ethiopian Commodity Exchange which, she, said was a continental success story that Ghana is keen to learn from.

Dr. Tedros thanked Mme. Tetteh for the invitation to visit Ghana and for the hospitality he and his delegation had received. He recalled the fruitful discussions they had on the sidelines of the AU Summit in Addis Ababa during the 50th Anniversary celebrations of the OAU/AU and how those discussions had now led to the General Cooperation Agreement, and he underlined the importance of taking appropriate measures to implement the agreement.

Dr. Tedros also stressed the need for further action to take the agreement to a higher level and said the agreement should serve as a basis to form a Joint Ministerial Council and facilitate the engagement of the two country’s respective institutions. He said that he and his Ministry was ready to facilitate an experience sharing visit to have a look at Commodity Exchange operations.

Dr. Tedros also said that relations between the two countries was driven by their common desire to promote peace, security, stability and development in Africa.

On Monday, Dr. Tedros visited the Kwame Nkrumah Memorial Park and the burial ground of Former President John Ata Mills. He and his delegation were also driven to the Akosombo Hydro Electric plant inaugurated in 1966 to generate 500MW. Since then, it has been upgraded on several occasions and now generates 1,020MW.

On Monday evening, Foreign Minister Hanna Tetteh hosted a dinner in honour of Foreign Minister Dr. Tedros and his delegation.

http://www.ethpress.gov.et/herald/index.php/herald/news/5602-ethiopia-ghana-sign-general-cooperation-accord

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Japan reaffirms fulfilling TICAD-V commitments

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Japanese Prime Minister Shinzo Abe

Prime Minister Haile-Mariam Desalegn 

 Chairperson of the AU Commission – Dr. Nkosazana Dlamini Zuma

Japanese Prime Minister Shinzo Abe reiterated that his government, without fail, would carry out each and every one of the commitments made at Fifth Tokyo International Conference on Africa Development (TlCAD- V) which took place in Yokohama in June 2013.

During a visit to the African Union Headquarters yesterday, Prime Minister Abe said that through the entire TlCAD process, many Japanese have acquired a predisposition to conjure up images of Africa in bright colours and a considerable number of Japanese believe that Africa is the hope for Japan.

Pertaining to fostering Africa’s private sector development, Abe noted that in a bid to realize the continent’s brilliant future, within five years, Japan would double loan which currently stands at 1 billion USD .

Capitalizing on Kaizen approach, he underscored that it is a managerial technique for Africa to rediscover its indigenous state. In due course of time the Ethiopian Kaizen Institute would expand the content of its programmes and be launched as the first human resource development centre for business and industry in Africa.

“ If Africa interacts deeply with Japan and Japanese companies, it will surely be easy for it to leverage its original strength thus Africa will be able to acquire definite seeds towards the future,” he added.

With regards to Japan‘s diplomacy towards Africa, Prime Minister Abe indicated that the axis would focus on two groups: young people –who with no doubt will shoulder the responsibility for the future Africa – and women, who will give life to Africa’s future generations.

Japanese industrialization

Prime Minister Haile-Mariam Dessalegn on his part said that Africans have always looked with keen and deep interest at the industrialization of Japan. The strong link between education and industrialization in Japan has attracted African intellectuals since the early 20th century. He went on saying that one such scholar was the well-known Ethiopian author, Dr. Kebede Michael. He found the history of your country so interesting and relevant to developing countries like Ethiopia that he wrote in the early 1950s a book entitled The Modernization of Japan.

According to him, Dr. Kebede depicted the key elements of Japan’s development strategy and argued that countries like Ethiopia should learn from Japan and concentrate on basic education and technical training to build local technological capacity.

Chairperson of the AU Commission Dr. Nkosazana Dlamini Zuma also recalled that during the TICAD V meeting of June 2013, the Prime Minister promised to visit the continent, a sign that Japan values its relationship with Africa and recognizes its potential. “This potential is expressed in the continent’s over one billion people, the majority of whom are youth and women, as well as its abundant natural resources in the form of land, water, forests and oceanic resources.”

She said during the occasion of the 50 th Anniversary of the OAU/AU in 2013, Africa committed to speed up investment in people, science, technology, research and innovation and infrastructure; and to benefit natural and mineral resources, and to invest in agriculture and agri-businesses.

Japan plays an important role in global affairs, as an example of how a country can develop, using its most precious resource, which is its people, she said. “In its relations with Africa, we cooperate on human resource development, in particular the generous support Japan gives to the Pan African University,” the Chairperson said.

Press briefing

Meanwhile, Abe told journalists: “50 years ago, Athlete Abebe Bikila come over to Tokyo all the way for Africa where in the Tokyo Olympics and he achieved two consecutive victories which no-one a person has accomplished. Here we are half a century later Africa is no longer somewhere far away. African countries are about to blossom the world greatest potential as we speak. Africa has really changed not only in sport but other aspects such as culture and economy and other aspects.”

The Prime Minister also said: “Japan is here in Africa in protecting the environment, creating industries, developing human resources not only to access resources but to be as a partner to grow together with Africa for the future and this is the Japan way also here in Ethiopia.”

Abe pointed out that Ethiopia and Japan have more than 80 years historical relations. “Recently, Ethiopia has been enjoying a spectacular growth close to 10 per cent and it is in the process of rapid development,” Abe added.

He further pointed out that Japan would like to transfer some know-how working together with Africa and this would lead to a bright future for the continent as well. In addition, Japan contributes to regional and world peace and stability as well.

Regarding the South Sudanese conflict, Abe said that his country is pleased with the mediation by neighbouring states including Ethiopia and hopes this effort should be supported and Japan is ready to provide additional assistance. “We are preparing and continue to undertake the initiative to uphold the efforts of all the African themselves to bring about peace and stability in the continent.”

Prime Minister Abe reaffirmed that Japan would continue to assist in Ethiopia’s development endeavours, sharing experiences through the Ethio-Japan Industrial Policy Dialogue.

The Japanese Prime Minister paid a two -day official visit to Ethiopia as a part of his week- long visit to Africa and Middle East.

http://www.ethpress.gov.et/herald/index.php/herald/news/5601-japan-reaffirms-fulfilling-ticad-v-commitments

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Italian business delegation hold talks with Ethiopian counterparts

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A delegation of Italian business persons held talks with Ethiopian counterparts here last Wednesday.

During the occasion ,the Ethiopian Chamber of Commerce and Sectoral Associations Secretary General Gashaw Debebe said the prevailing conducive investment atmosphere is attracting more Italian companies to Ethiopia.

The number of Italian companies investing in Ethiopia is increasing, he said, adding, the Ethiopian Embassy in Rome is contributing quite a lot in this regard.

The trade relation between the two countries has also increased, he said.

He said the trade flow between the two countries has reached 391 million USD in 2011.

The Italian companies that are visiting the country are desirous to invest in various sectors in Ethiopia, delegation leader Gerardo Mario said.

He said they are interested to invest in manufacturing, leather and leather products, textiles, exploration of mines and agro-processing areas.

http://www.ethpress.gov.et/herald/index.php/herald/national-news/5641-italian-business-delegation-hold-talks-with-ethiopian-counterparts

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 First National Model MSEs Exhibition opens in Addis Ababa

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The First National Model Micro and Small Enterprises Exhibition and Bazaar was opened yesterday in Addis Ababa, Ethiopia, The Ethiopian Herald reported.

The objective of the expo is to create market link and share experiences among federal and state micro and small enterprises, according to the paper.

Over 168 model micro and small enterprises from Southern Nations, Nationalities and Peoples, Tigray, Oromia Amhara, Harari regional states and Addis Ababa and Dire Dawa city administrations are participating in the event.

Artifacts, agro-processing products, designs, textile products, beverages, consumer products, wood and metalworks are on display at the six-day exhibition.

The exhibition and bazaar was organized by the Federal Micro and Small Enterprises Development Agency.

http://www.2merkato.com/news/alerts/2802-ethiopia-first-national-model-mses-exhibition-opens-in-addis-ababa

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Can agriculturally-based direct foreign investment promote sustainable development? A review  of African cases

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Three-quarters of the world’s population living below the $2 per day poverty line not only live in rural areas but also depend on agriculture for their survival. Given such global poverty, it is sad to note that the Official Development Assistance (ODA) given by foreign governments and international financial institutions, particularly for the agricultural sector of the developing countries, have declined by almost 70 percent between 1970 and 2007. More recently, due to expectations of rising food prices, demand for biomass for energy use, and the agricultural commodities needed for industry, the inflow of Foreign Direct Investments (FDI) for agriculture in developing countries has increased substantially. More particularly, private investors from industrialized and emerging countries have become very active in using long-term leases to secure large areas of agricultural land (also known as land grabbing, which has also led to water grabbing) in Africa.

An analysis of the existing literature indicates that two contrasting perspectives, through which investigators tend to view agriculturally-based investment in developing countries, are emerging. Optimists tend to put a premium on foreign investors as a vehicle for promoting infrastructure, environmentally sound technologies and who contribute to spillover effects on local economies of developing countries. Pessimists on the other hand argue that agriculturally-based foreign investments are exploitative and give little benefit to local populations. More specifically they argue that large-scale foreign industrial agriculture not only victimizes pastoralists and small scale farmers in developing countries, but also severely degrades the quality of topsoil, damages local waterways and ecosystems as a result of using detrimental fertilizers and intensive farming techniques.

The issue is not whether or not FDI is on board. What is crucial from a policy-making point of view is whether or not FDI agricultural projects are meeting the sustainable developmental needs of the developing countries. Based on these assumptions, the purpose of the study was to review the literature and establish the effects of agriculturally-based foreign direct investment on sustainable development in some African countries. A review of the literature indicates from a socio-economic perspective that FDI in nine African countries not only created manual jobs at a very low rate but also the foreign investors have diversified the agricultural production by introducing new mono-crop varieties.

In addition, some investing companies have operated more efficiently than domestic companies in terms of asset utilization. Environmentally, the export earnings of the African case studies have increased because the investors added values with the dissemination of technology to produce more efficient, safe and clean products. On the other hand, the FDI in agriculture have rented the land to large cooperatives at a very low rate so that the local people have lost access to resources such as land, water, wood, medicinal plants and the common areas that were used for grazing. The natives were pushed from higher-value lands into marginal lands. The compensation given to the displaced villagers was insufficient to restore livelihoods lost due to dislocation. The land under FDI contributed to loss of a critical biodiversity and the local people living adjacent to foreign leased lands have been contaminated by all forms of pesticide, herbicide, and chemical fertilizer filtering into the ground water. Thus, to ensure that the investors’ agricultural production practices are in line with the goals of sustainable development as designed by the host country, a well-planned, transparent assessment structure needs to be mapped out by both the host country and investing company.

  (Taken from a study abstract which was published)

http://www.ethpress.gov.et/herald/index.php/herald/development/5612-can-agriculturally-based-direct-foreign-investment-promote-sustainable-development-a-review-of-african-cases

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Belarusian Amb. Presents credentials to Amb. Berhane

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Land bill endorsed after record debate

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The House of Peoples’ Representatives (HPR), on Thursday, finally endorsed the land bill, almost eight months after it was first presented to the House.

Organisation: Department for International Development

Delivered on: 12 December 2013 (Transcript of the speech, exactly as it was delivered)

Page history: Published 10 January 2014

Policy:Helping developing countries’ economies to grow        Topic:International aid and development        World location:Ethiopia

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‘Trade barriers hinder growth of African economies’

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The Director of the Ethiopia Investment Agency, Mr Aklilo Kedebe, has attributed the slow pace of the African economy to the trade barriers existing among them.
According to him, one of the key ways to boost business activities among African countries is to remove the trade bottlenecks that prevent African countries from trading among themselves.

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Speaking at a forum organised by the agency in Accra, Mr Kebede said until the issue was properly addressed, it would be extremely difficult for economic activities on the continent to grow.
Mr Kebede said the economic atmosphere in African gave countries on the continent advantages to expand their trade activities. He added: “By so doing we pave the way for mutual trade to exist, which would lead to the creation of employment for the people of Africa”.
The purpose of the forum, according to the organisers, was to highlight economic and investment opportunities in Ethiopia.

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Ethiopian economy

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According to Mr Kebede, agriculture, energy, mining and tourism sectors have enormous benefits and opportunities for Ghanaian investors to tap into, “Each of these sectors has been designed to create a favourable business environment for investors.”
“The Ethiopian government has put in place effective measures to ensure that investors who plan to invest in the country will receive the needed incentives and support to grow their business,” he said.

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Why invest in Ethiopia

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Mr Kebede said apart from the excellent climate and fertile soil, abundant trainable labour force, competitive incentive packages, the current political and social stability in Ethiopia would pave the way for foreigners to do their business.
“It is only Ethiopia that has the lowest crime rate in the world. The level of security of persons and property is high,” he added.
According to him, with a population of over 80 million people, investors can expand their business without having to face any internal or external hindrances.

http://www.ghanaweb.com/GhanaHomePage/business/artikel.php?ID=298333

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Ethiopia prepares 50,000 hct of land for horticulture development

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Ethiopia has readied 50,000 hectares of land to be leased for horticulture development, according to the Ethiopian Horticulture Producers Exporters Association (EHPEA).
Despite its huge potential for the development of horticulture, the size of land developed with flower, vegetables, and fruit until 2011/2012 is 12,552 hectares.
However, during the past five or six years, the industry has been growing significantly. Currently, over 120 companies are engaged in the cultivation of horticulture products.
Due to the prevailing investment environment, attractive incentive, by the government and cheap labor, Ethiopia has now become a center of attraction for foreign direct investment (FDI) in horticulture development.
“In order to meet the increasing flow of investment in the horticulture sector, the government has identified five corridors consisting of 50,000 hectares of land,” Tewodros Zewdie, Executive Director of EHPEA told WIC.
According to him, these corridors are found in Oromia, Amhara, Tigray, SNNP and Eastern region where there is huge potential of land, labor and infrastructures.
Though horticulture development in Ethiopia started a decade ago, the industry has been playing a key role towards generating foreign exchange and creating labor.
The sector has generated some 265 million US dollars in 2011/12 and created million of jobs, Tewodros said. According to him, the revenue is expected to increase in the just conclude fiscal year.
Flowers made up the biggest share in export value, according to the executive director. Ethiopia is the second largest supplier and exporter of flowers in Africa.
Europe is the major market destination of Ethiopia’s horticultural produces, especially flower. But activities are underway to search other market destinations.
“Efforts are being made to export Ethiopia’s horticulture products to North America, Japanese and African countries’ markets,” Tewodros pointed out.

http://www.waltainfo.com/index.php/explore/12039-ethiopia-prepares-50000-hct-of-land-for-horticulture-devt

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Stratex Int’l issues Megenta project drilling results

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Stratex International has issued results from its second round of drilling at Megenta, saying the relatively high gold content of the narrow veins intersected to date is encouraging.

Executive director David Hall noted the company had yet to intersect true bonanza mineralization within cohesive quartz veins.

Highlights of the drilling included:

- Continuing definition of gold-bearing conduits at a high crustal level;

- 2,162 metre diamond drilling programme completed across 8 holes at Megenta gold project, within the Tendaho licence in Ethiopia, as part of earn-back to majority stake in the Project;

- Wider zones of lower-grade gold mineralization host multiple narrow higher-grade quartz veins. Best results include:

* 10.45 g/t Au over 0.5 m and 9.88 g/t Au over 0.6 m within 4.39 g/t Au over 2.6 m (MGDD13-03);

* 2 m @ 1.34 g/t Au, including 1 m @ 2.24 g/t Au (MGDD13-03);

* 0.7 m @ 3.56 g/t Au (MGDD13-05);

* 0.34 m @ 4.4 g/t Au (MGDD13-06);

* 6.67 m @ 0.77 g/t Au, including 0.64 m @ 1.15 g/t Au, 0.64  m @ 2.28 g/t Au and 0.7 m @ 2.14 g/t Au (MGDD13-07);

* 1.5 m @ 1.2 g/t Au (MGDD13-08);

* 4.15 m @ 0.72 g/t Au, including 0.8 m @ 2.73 g/t Au (MGDD13-08).

- The presence of calcite within many of the veins suggests that peak gold deposition, if present, will be at greater depths than those tested to date;

- Akehil and Lakeside discoveries still untested.

http://www.iii.co.uk/stockmarketwire/142086/stratex-intl-issues-megenta-project-drilling-results

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Ethiopian Air Seeks Fleet Upgrade as It Studies U.S. West Coast

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Ethiopian Airlines Enterprise is looking to add single-aisle and wide-body planes to feed an expansion as it studies Los Angeles, Madrid and Jakarta for future destinations, its chief executive officer said.

The airline has asked Airbus Group, Boeing Co. (BA:US) and Bombardier Inc. (BBD/B) for proposals for the purchase of 10 to 20 single-aisle planes, and is also considering twin-aisle planes, either the Boeing 777X or Airbus’s A350, of which it has already ordered 14, CEO Tewolde Gebre Mariam said today.

The Addis Ababa-based airline has 62 aircraft in its fleet, including 13 Boeing 737 new-generation planes and five 787 Dreamliners and wants to increase its stable in part to replace older Boeing 767s on lease and to expand across the globe, Gebre Mariam said in an interview at an aircraft finance conference sponsored by Airline Economics in Dublin.

“We’ve got Tokyo, Shanghai and Vienna coming this summer, and we’re studying flights to the West Coast, to Los Angeles,” he said. In the U.S., the airline already serves Washington with its large Ethiopian population, the CEO said.

In the single-aisle category, the airline is looking at Boeing’s 737 Max, Airbus’s A320neo, and also Bombardier’s CSeries. Gebre Mariam said it would be difficult to run a mixed-fleet of both Boeing and Airbus single-aisle planes, as there is no commonality in pilot training or spare parts.

“We’ll have to see what’s in the proposals,” he said. The airline needs new single-aisle airliners from 2015 or 2016. Airbus has said its A320neos are sold out until about 2019. Boeing’s first 737 Max aircraft are set to begin service in 2017.

Of the 12 Boeing 767s operated by Ethiopian, three are owned and the rest are leased. Gebre Mariam said he wants to replace the older leased planes with either 787s or Airbus A330s, which he would also lease.

http://www.businessweek.com/news/2014-01-20/ethiopian-air-seeks-fleet-upgrade-as-it-studies-u-dot-s-dot-west-coast

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Addis Ababa listed on The New York Times ’52 Places to go in 2014′

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The New York Times has listed Addis Ababa as one of the 52 places that should be visited in 2014.

The travel section of one of the biggest daily newspapers in the US labeled Addis Ababa as an ambitious art scene that is heading toward the international stage.

“Building on a strong historical legacy (Addis boasts one of East Africa’s oldest art schools) are a host of events scheduled for 2014: a photography festival, two film festivals and a jazz and world music festival. Thanks to the city’s diverse art institutions and galleries, including the artist-in-residence village Zoma Contemporary Art Center and the Asni Gallery (really more an art collective than a gallery), there is an art opening at least once a week. Even the local Sheraton puts on “Art of Ethiopia,” an annual show of new talent. But it’s the National Museum that, in May and June, will host this year’s blockbuster exhibit, “Ras Tafari: The Majesty and the Movement,” devoted to Emperor Haile-Selassie I and Rastafarianism,” The New York Times stated.

Apart from Addis, other African countries and specific cities and locations like Cape Town, South Africa, Laikipia Plateau, Kenya and Dar es Salaam, Tanzania are also picked by the newspaper.

http://www.ethiopiainvestor.com/index.php?option=com_content&view=article&id=4739:addis-ababa-listed-on-the-new-york-times-52-places-to-go-in-2014&catid=74:top-story

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Controversial Dividend Tax Finally Settled

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- The introduction of the tax was met with anger, after businesses were ordered to pay tax in arrears -

Ethiopian Customs and Revenue Authority (ERCA)’s head office which is located around Megenagna

The Ethiopian Revenues & Customs Authority (ERCA) expects all share companies and private limited companies that have recapitalised their profit to report to it with supporting documents, up until February 7, 2014.

Businesses are required to pay 10pc of the dividends of their profits, according to Income Tax Proclamation No. 286/2002. They are required to make the payments from the time the proclamation first became operational, which is 2012.

Dividend tax is an income tax payable on dividend payments distributed to the shareholders of a company. It became functional inEthiopiain 1979 and has been amended several times.

But it was when the ERCA asked those companies who have not shared the profits to pay dividend tax that complaints were brought forward.

The ERCA argued that companies should collect the tax whether profit is paid to shareholders or not, commenting that income includes all sorts of gains that a person acquires, whether it is paid, credited or received, according to the Commercial Code of 1960.

The Authority also argued that sub-article one of Article 10 of the Income Tax Proclamation entitles it to regard credited income as an income for tax purposes.

They then concluded that since the shareholders have rights over the profit, it falls under what is stated as “credited income” in the Income Tax Proclamation.

Another cause for complaints from taxpayers was that the Authority neglected the issue of collecting dividend tax for several years, allowing it to pile up. This accumulated tax was beyond the capacity of some companies to pay, taxpayers claimed,at a meeting held on Thursday, January 16, 2014 with officials of the Authority.

Part of the complaint revolved around the fact that some companies had recapitalised their profits, butfailed to present the supporting documents to the ERCA within the right timeframe. They were thus being subjected to paying dividend tax.

The Ministry of Finance & Economic Development (MoFED) reviewed all of these complaints and introduced some changes, which were sent to the Authority on August 6, 2013. The latter adopted the changes and began implementing them on August 26, 2013.

Four changes were introduced: Every company, both private limited companies and share companies, that have recapitalised their profits into any investment sector – beginning from the issuance of the income tax proclamation – would be exempted from paying dividend tax.

Secondly, share companies that present supporting documents stating that they have recapitalised profits, should be free from dividend tax, irrespective of the time of recapitalisation.

Companies that have neither distributed dividends nor recapitalised profits are given a three-year grace period, upfrom only one year.

Share companies are required to report to the ERCA within 12 months after the end of every fiscal year. This change, which will take place from the 2013/14 fiscal year, is irrespective of whether the companies have recapitalised dividends or distributed themto shareholders.

The ERCA sent a letter to its branch offices on October 12, 2013, explaining details of the changes. This was with the view of filling gaps in these offices. Share companies should have a certificate from Document Authentication and Registration Office (DARO) that clearly shows how much the capital raised  and also have a document that clearly show their capital from Ministry of Trade (MoT) or Regional or City administration trade bureaus.

The Authority, which plans to collect 116 billion Br during the 2013/14 fiscal year, has collected 24.5 billion Br, in the first quarter, from business profit tax.

http://addisfortune.net/articles/controversial-dividend-tax-finally-settled/

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Addis Fortune gossip: Prime Minister Hailemariam Desalegn is known by…

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Prime Minister Hailemariam Desalegn is known by those frequenting the power corridor on Lorenzo Te’azaz Road for his favourite adage – a developmental state will always remain cash strapped – gossip disclosed. Indeed, he runs an administration besieged by a massive funding gap between what it needs to pay to accomplish its objectives by the end of 2015 and the amount of money the national treasury can access, gossip observed.

Nothing of this apparent deficit is more visible than in a dispute that erupted between heads of three federal agencies, gossip reveals.

Sufian Ahmed’s Ministry of Finance & Economic Development (MoFED) is responsible for managing the fiscal expenditure of the state. But it needs to do this in tandem with Teklewold Atnafu’s National Bank of Ethiopia (NBE), which is the custodian of federal government’s wealth. Among several sources of revenue that end up with their funds at the NBE, there are proceedings that come from the sale of state-owned properties to private investors, as well as money collected from lease fees from those who manage state-owned industries.

However, the man in charge of these funds, Beyene Gebremesqel, director general of the Privatisation & Public Enterprises Supervisory Agency (PPESA), was clever in persuading the administration to redirect these funds to the recapitalisation of companies under his watch, gossip says. The intent is to beef-up the asset base and books of these enterprises, hoping that they can then generate a lot more money for the public coffer.

This is a tried and tested approach in the case of the brewing and textile industries, gossip observed.

To Beyene’s disappointment, someone at the Central Bank was undercutting him, transferring funds from his agency’s account to the MoFED, without first getting his consent, gossip disclosed. Over the past few months, funds amounting to no less than 1.1 billion Br were taken out of the PPESA’s account with the NBE and handed out to Sufian’s Ministry, which is under enormous pressure from every direction to release funds to finance public infrastructure projects, gossip disclosed.

One of these major projects that will forever remain a signature for the rules of the Revolutionary Democrats is the national railway. When they are completed, hopefully in two to three years, close to 5,000km of rail network is planned to crisscross the entire country. If there is any hurdle to this national ambition by the Revolutionary Democrats, it can only be limitations in funding, claims gossip.

Even the generous Chinese government’s appetite to find viable projects overseas to sterilise its abundant foreign exchange reserve has become wary of the stock of Ethiopian foreign debt, according to gossip. Unsurprisingly, the official version seems to want to maintain that the stock of foreign debt is 13 billion dollars. However, those at the gossip corridors inflate this figure by as much as seven billion dollars and call for caution.

Despite the dispute over the size of the national debt stock, the administration has the drive to get financing from wherever it is available. Although financiers in the western hemisphere tend to scrutinise the standing of their borrowers – appearing to be the most stringent in their requirements and expensive in their interest rates – Sufian is now actively pursuing an option of accessing a little over 800 million dollars from a bank in Switzerland, Swiss Bank, gossip disclosed.

But first, he has to take the country through the arduous process of listing it with one of the international rating agencies, which will put their mark on whether or not Ethiopia has an economy that is worth the risk to lend, gossip claims.

For now though, his Ministry is busy exchanging letters with those at the Central Bank and the PPESA in a bid to redress the withdrawal of billions of Birr from the latter’s account, gossip disclosed.  [ Addis Fortune ]

http://sodere.com/profiles/blogs/addis-fortune-gossip-prime-minister-hailemariam-desalegn-is-known

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WASH capacity building project to benefit 20 towns

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The project gives emphasis to hygiene and sanitation

as well as capacity building to ensure quality water supply

The WASH Capacity Building Project signed last Friday between the Ministry of Water, Irrigation and Energy and Water Aid Ethiopia targeted to benefit 20 selected towns in Oromia, Amhara, Tigray and Southern Nation, Nationalities and Peoples states.

Signing the partnership agreement, State Minister Kebede Gerba said that the project gives emphasis to hygiene and sanitation as well as capacity building to ensure quality water supply. Acknowledging Water Aid’s contribution in hygiene, sanitation, and providing pure water over the last 25 years, the State Minister said that the project would also contribute to minimizing water wastage.

Water Aid Ethiopia Country Director Teferi Abebe on his part noted that the 28 million birr project aims at increasing the efficiency ,effectiveness and relevance of the WASH service provision in the 20 towns through strengthening their capacity.

According to Teferi, the project also has specific objectives: improving water supply, towns’ sanitation and hygiene service providers performance by 20 per cent, as well as modernizing the documentation system to share experience, knowledge between towns in Ethiopia, East Africa and beyond.

Regarding the budget, Teferi said that besides the technical support, the project needs 28 million birr but would reach 33 million birr including various technical support for capacity building.

The findings of a baseline recently conducted by Water Aid indicate that the total population of the 20 towns targeted for this project is estimated at 914,847 people (169,596 Households).

http://www.ethpress.gov.et/herald/index.php/herald/national-news/5667-wash-capacity-building-project-to-benefit-20-towns

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Nation working to harness 5.3 mln.hectare irrigation potential

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The Ministry of Water, Irrigation and Energy said it is striving to harness its massive 5.3 million hectares of irrigation potential.

Ministry’ Public Relations and Communication Director Bizuneh Tolcha told WIC that the government has given due attention to its irrigation potential which lacked policy and strategic direction two decades before.

Before 1992, not more than 61 thousand hectares of land were developed through irrigation schemes. A change in government and policy direction meant the sector witnessed a huge transformation. In just two decades, the country managed to develop over 298 thousand hectares of land through irrigation schemes.

By the end of the Growth and Transformation Plan (GTP) in 2015, the country expects to harness 14.5 per cent of its irrigation potential, a big leap compared to the 2009/10 budget year where the country managed to harness just 2.4 per cent of its irrigation potential.

Bizuneh said the ministry is currently undertaking 15 irrigation development studies, design preparations and construction projects, out of which the ministry expects to finalize nine during the current budget year and four within the GTP period. The remaining two are expected to be finalized within two years after the end of the GTP.

http://www.ethpress.gov.et/herald/index.php/herald/national-news/5668-nation-working-to-harness-5-3-mln-hectare-irrigation-potential

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Healthy, sustainable  food systems key to  fighting hunger: FAO

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Strong and resilient food systems are the most cost-efficient

and sustainable way to prevent all forms of malnutrition

Healthy people need healthy and sustainable food systems, the United Nations said Friday that calling for agricultural research and development to become more focused on nutrition, as well as local biodiversity and diversified farming systems.

“Our common approach to food production is simply not sustainable today, or in 2050, when we will have to provide food for a population of 9.6 billion people,” said FAO Deputy Director-General Helena Semedo in a news release.

“We need to produce nutritious food for all people today while also protecting the capacity of future generations to feed themselves,” she added.

Food production has tripled since 1945 and average food availability per person has risen by 40 per cent, FAO said.

Despite the abundance of food supplies, there are still 840 million people that go hungry every day, according to FAO. The health of another two billion is compromised by nutrient deficiencies.

This, as another 1.5 billion people are overweight or obese, consuming more food than their bodies need and exposing them to greater risk of diabetes, heart problems and other diseases.

Much of the high food output achieved in the past has placed great stress on natural resources, Ms. Semedo said. These include degraded soils, polluted and exhausted fresh water supplies, encroached on forests, depleted wild fish stocks and reduced biodiversity.

Intensive farming systems, combined with food wastage on a massive scale, have also contributed to greenhouse gas emissions.

Among the challenges highlighted in FAO’s news release is the management of sustainable livestock. Demand for livestock products will grow 70 per cent by 2050, the UN agency noted. Consumption of meat, milk and eggs is growing rapidly in developing countries, providing nutritious diets to previously food insecure populations.

Consumers also need help to make healthy food choices, requiring “better governance, based on sound data, a common vision and, above all, political leadership,” Ms. Semedo said.

“If the global community invested $1.2 billion per year for five years on reducing micronutrient deficiencies, the results would be better health, fewer child deaths and increased future earnings,” she added. “It would generate annual gains worth around $15 billion – a benefit to cost ratio of almost 13 to 1.”

http://www.ethpress.gov.et/herald/index.php/herald/national-news/5671-healthy-sustainable-food-systems-key-to-fighting-hunger-fao

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Wollega Stadium first phase 80 per cent complete

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Wollega Stadium will also become the first fiberglass-roofed

stadium in East Africa. The natural grass was brought from

Italy. It makes  green and white pattern as European football

pitches

NEQEMTE- Neqemte, a burial place of Onesimos Nesib – a famous Oromo who pioneered in translating the Bible into Afan Oromo in collaboration with Aster Ganno – the most known supplier of Ethiopian coffee, a host town to the recently built Wollega University, is now getting additional attraction – Wollega Stadium – that will take the town to another height of growth.

The Wollega Stadium boasts of Olympic standard running track and field, FIFA standard football pitch, gymnasium swimming pool, tennis court, basket and volleyball fields.

It as well houses administration offices , a gymnasium, a public library, restaurants, shops and other service facilities such as first aid offices, stores, dressing rooms with massage centres, studios for live transmission, shops and public toilets.

The first phase construction work of the stadium, which was expected to be completed two years back, is now 80 per cent complete.

Asked about the delay in the construction work, Dr.Eng Mesele Haile, Stadium Construction Committee Addis Ababa Branch Chairperson and Designer of the Stadium told The Ethiopian Herald that the construction fund was not effectively raised. That is why it couldn’t be completed according to schedule. According to Dr. Eng. Mesele, the participation of the public is high since its inception. “We are constructing the stadium in three phases. The first phase, which includes the construction of bureaus, shops, players’ room and gymnasium, is 80 per cent through.

The remaining task, which makes 20 per cent of the first phase, includes the laying of the synthetic track, finishing the shops and setting work of the long jump and discus throwing areas. So far, 108 million birr has been expended on the overall construction work, he added.

According to Dr. Eng. Mesele, the second phase includes seat installation, volleyball and basketball court as well as swimming pool construction, which requires 87 million birr. He also said that the third phase would see covering the roof with fiberglass at a cost of 210 million birr.

Responding to mechanisms they apply to speed up the construction work, Dr. Eng. Melese said that they are trying to raise more funds approaching various organizations to cover the cost. In this regard, Sheikh Mohammed Hussein Ali Al-Amoudi provided 18.6 million birr to the first phase via his company MIDROC-Ethiopia Technology Group. The business tycoon has also promised to give one million USD grant for the fiberglass roofing work.

Regarding the quality of the fiberglass roof and the standard of the football pitch grass, Dr. Eng Mesele said that with Bahir Dar and Hawassa stadiums (both under construction) Wollega Stadium will also become the first fiberglass-roofed stadium in East Africa. The natural grass was brought from Italy. It makes green and white pattern as European football pitches.

Wollega Stadium ,which is expected to have 29,000 seats, was first launched by Dr. Eng. Melese and other few people to protect youth from HIV establishing sports recreational centre. But now, showing impressive progress the former field has been transformed into a stadium capable of hosting international competitions.

Taking his contribution into consideration, the Neqemte Town Administration has named one of the main roads in the town after Dr. Eng Melese Haile. He is on his part expressed gratitude to the town administration, especially the residents of Wollega.

Sadly, Wollega does not have at least one football club that would represent the zone either in premier or national leagues. If the stadium does not have a home club that represent it at national level, the case will be similar to like a delicious meal without a person to enjoy.

Regarding this issue, Neqemte Town Youth and Sports Bureau Head Wendimu Taye has something to say. “Currently, the town has a club competing in Oromia league with promising performances that would enable it join the National League next year. He said that the club is leading the group in Oromia League.”

“We plan to join the national league next year. The stadium itself says, ‘I need a lot of players!’. We have four youth projects in different age categories. We have teams of under 17,15,13,10 which are supported by the government, Oromia State and Neqemte Town Administration,” said Wendimu.

The Ethiopian Herald learned from Tolossa Wegari, Mayor of Neqemte,that Wollega is striving to establish competent club that can represent all four zones – East Wollega, West Wollega, Qellem Wollega and Horro Guduru Wollega.

The design of the stadium reflects local culture (both tangible and intangible heritages) like Gada system and natural resources of Oromia State. For instance, the design of the Public Library is generated from Oda tree in simplified and abstract form.

The form of the roof is analogous with the deep foliage of fully grown Oda tree; whereas the windows and the walls represent trunk and branches of the tree.

The stadium, with its accompanying facilities being constructed by Oromia Water Works Construction Enterprise on seven hectares of land. Excluding the cost of the fiberglass, the overall construction work is expected to consume 240 million birr.

http://www.ethpress.gov.et/herald/index.php/herald/news/5657-wollega-stadium-first-phase-80-per-cent-complete

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Colourful ‘Ketera’ celebration 

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Ketera, the eve of Timket –Ethiopian Epiphany, was colourfully celebrated at Jan Meda in the presence of Ethiopian Orthodox Church (EOC) Patriarch His Holiness Abune Mathias, the clergy and the faithful.

Resident ambassadors, members of the diplomatic corps, Adiss Ababa City Administration representatives, and tourists from various countries have also attended the religious celebration.

Tabots – replica of the arch of covenant – were carried to Jan Meda wrapped in brocade or velvet on the head of a priest with colourful ceremonial umbrellas to shade them it. Sunday school Students were in the procession chanting religious songs along a huge crowd of the faithful. The students adored in their colourful uniforms, cantors of different monasteries and churches in their ceremonial robe singing chants gave the celebration a bold seen.

On the occasion, chanters of Debri Negodguad St. John delivered the hymn, “ God the son has descended from the heaven’s to the baptismal site in joy and in peace,” for 20 minutes.

In his benediction His Holiness Abune Mathias blessed the faithful.

Over 300 corded instrument of religious music or locally known as Begena were brought into the event and were also played in group.

“ Carrying out of the Tabots from different churches to Jan Meda shows the fact that Jesus had moved to the River Jordan to be baptized by John the Baptist leaving his holy seat,” Megabi Haile -Sillasse Ze Mariam said.

Memehir Fantahun Muche said every Ethiopian citizen should assist in various means to get Timket celebration registered in UNESCO as it was for Meskel celebration.

Timket is the greatest festival of the EOC falling on the 19 of January (or the 20th of January once in every four years), it celebrates the baptism of Christ in the River Jordan by John the Baptist.

http://www.ethpress.gov.et/herald/index.php/herald/news/5656-colourful-ketera-celebration

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Also:

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-     18 January 2014 News Round Up

- The Ethiopian Shipping & Logistics Services Enterprise (ESLSE) has increased its freight carrying capacity at least threefold -

By  Girma Feyisa

One way of improving the foreign exchange earnings of Ethiopia is believed to be expediency. To this end, the government is leaving no stones unturned in its attempts to upgrade its transportation capacity, including shipping.

A recent report reveals that the Ethiopian Shipping & Logistic Services Enterprise (ESLSE) has acquired eleven new vessels, increasing its freight carrying capacity at least threefold. In what seemed to be an augmentation to this ocean breaking measure, the surface transport sector has issued a new directive to penalise heavy duty freight transporters if they fail to make their shuttle period within a given period of time. This is based on the assumption that transporters may deliberately drag their wheels in the Addis-Djibouti corridor.

At a time when the country depends very much on the export of agricultural products for its foreign exchange earnings, an expedient mobilisation of all its exportable products becomes of paramount importance. That course of action brings back memories I had during inspection trips I made to the two ports, Assab and Massawa,  before the political course of the country was changed.

The port, as a whole, was predominantly under the Maritime Transport Authority (MTA). The loading and unloading, as well as the stevedoring activity under the Port’s Administration, deployed thousands of workers who were also working in collaboration with the shipping lines and maritime transit companies. The freight transporters were being streamlined to load freight in turn. Businesses outside the ports were booming.

Things have changed, since I presume that the Port Administration activity is no longer under the jurisdiction of the MTA. Once Ethiopian vessels are permitted to anchor at the port, all the loading and unloading, or stevedoring activity, is carried out by the Djiboutian authorities or the company that might have been given the contract to manage the transiting activity. Our freight transporters cannot have any access to the Port where the goods are stored, unless they are invited to.

The timing element is important here. The goods and commodities can only be loaded after clearance of customs duties are finished and the necessary accounts are settled. The recording of shuttling time commences at the time when the freight trucks start their journey to Addis Abeba or any other place.

It goes without saying that the speed with which import and export activities are carried out very much depends on the transiting operation that takes place in the port itself. The delay is bound to have its impacts on the costing of goods and commodities involved.

Unlike in previous times, Ethiopian importers and exporters have to pay import/export taxes to the Djiboutian Maritime Authority, or the company that it delegates, unless a special agreement is concluded to exclude such taxes. Hence the sharp commodity price index increases over the last 20 or so years. When the transport authority decides to penalise trucks for the delay in their shuttle frequency, it could be an unjust retribution levelled on those parties unless the facts are scrutinised cautiously and free from any sort of corruption.

Another measure taken recently by the surface transport sector is the grading of trucks according to their load capacity. This decision will automatically stratify associations, based on their capacity and subsequent ability to be time efficient.

In effect, this will amount to the trucks being polarised into more privileged and the less privileged groups. This trend is expected to extend from the import/export corridors to other parts of the country. This will be particularly true after the completion of the railway line, which may well take the lion’s share of the import/export traffic, in due course.

The other day, I met Kidane G.Tensai, 38, an Eritrean driver who lives in Brussels, and asked him about the possibility of engaging the two countries in a peace process. Alleging the Assab case as a desire to simply grab land is just a hostility of some short-sighted perpetuators via social media, he said. There is nothing to prove that malicious allegation, he argues.

There seems to be a lot of hypocrisy in this line of thought. These people do not realise that Eritrean leaders are using the leverage of government power to self-impose economic sanctions when they see that the once prospering port is now being turned into ruins, with its oil refinery rotting and its buildings rusting (so much that these resources have become mere scarecrows).

There is, however, a glimmer of hope among the members of the Ethio-Eritrean Youth Association established in the Diaspora. They discuss the future of the two countries in the spirit of socio-economic integration without having to intrude into their respective sovereignty.

Here, we are talking about a mutual interest to bring employment and economic growth for the people of the two countries, and a breathing outlet, not grabbing land. The Ethiopian government, through its prime minister, on its part, has expressed time and again its readiness to restart the peace process. But one cannot clap with only one hand, as the saying goes.

The country is on good terms with its other neighbours. The hydroelectric power export to Djibouti can be repeated in Sudan, South Sudan, Kenya and even Eritrea, if the political obstructions could be resolved through mature and tangible discussions.

Going back to the subject of penalising the truck drivers for being unable to make it on time, there is another issue that has to be looked into.

What will happen if a truck faces a mechanical fault on the highway, given the poor situation of telecommunications?

At any rate, all the stakeholders involved in the transportation and transiting services should sit together and try to find a middle ground for agreement.

Sourced here:  http://addisfortune.net/columns/myths-of-expediency/

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Related articles

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-     Djibouti Backs Down from Ultimatum on Cargo Clearance

-     East African Infrastructure Development, Part 3: Ethiopian Surface Transport – Stratfor

-     COMESA’s Electronic Cargo Tracking System for Djibouti, Ethiopia in Limbo

-     Efficient Shipping, Logistics Need Competition: End Monopoly!

-     Ethiopia confident of completing Ethio-Djibouti rail project in GTP period

-     Djibouti expands its ports’ facilities to five

-     Is the private sector to blame for cargo sitting for so long in African ports?

-     Djibouti to Raise $5.9 Billion From Investors for Infrastructure

-     Nearly Half a Billion Br Profit for Shipping Enterprise Despite Mammoth Expenses

-     Ethiopian Shipping to Expand to New Ports

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ERCA set to reduce income tax

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The Ethiopian Revenue and Customs Authority (ERCA) is going to revise the current income tax proclamation by next year.
Girma Taffese, director of inland taxes at the Ethiopian Revenue and Customs Authority (ERCA) says that ERCA will consider revising income taxes and developing an improved tax code after the Growth and Transformation Plan sunsets in 2015.
ERCA officials fielded many complaints from around 1,000 business owners that are considered high tax payers who contribute 40 percent of the Nation’s tax income, on Thursday January 16 at the National Cultural Center, in Sidist Kilo. They responded by validating some of their concerns and promising that federal officials were working on revising tax laws and procedures.
One participant said that the decades old income tax proclamation should be revised in light of Ethiopia’s rapidly changing economic conditions. Currently anyone with a salary of 5,000 birr and above pays a tax rate of 35 percent. An individual making 3,500-5,000 pays 30 percent.  After that the tax rates are 25, 20, 15 and 10 percent respectively. At one time a 5,000 birr monthly salary was considered to be upper income but inflation has gone up dramatically since the tax rates were first imposed and as a result the government should revise them, they said.
Grima told Capital that some tax proclamations will be replaced by the end of the 2015 fiscal year.
Another speaker voiced concerns with the turn over tax (withholding tax) imposed when business owners provide ‘freelance’ services for other companies.
A person with a business license will have a tax identification number (TIN) that they receive from ERCA, they then have two percent of their gross income deducted by the company they provide services for and are responsible for paying a 30 percent profit tax at the end of the year. However, if the person providing the service does not have a business license and thus does not have a TIN number the company has to pay income tax for that individual which can run as high as 35 percent.
“The government needs to have some flexibility with these rules,” they said.
ERCA spent the day responding to many complaints and saying that they are only doing their job trying to make sure people pay the taxes they legally owe on time.
“We are not trying to hurt tax payers or scare people but we are implementing assessments on selected tax payers to make sure they are not evading taxes,” officials said.
But the business people in attendance said they have had a different experience.
“The business people cannot operate if they always have to be looking over their shoulder scared that they might make some mistake, to develop the country we have to be able to fearlessly invest, the government must respect the business community as we are all trying to help the country prosper,” one person said.
Participants at the discussion said that ERCA has to find another way to enforce tax laws besides frightening traders.
“We understand that there are individuals who evade tax but ERCA is taking a guilty until proven innocent approach on almost all businesses even though most people want to comply with the law and pay their taxes properly,” one of the participants explained.
Another said that they doubt ERCA will successfully end tax evasion by operating like they currently are.
“It is very hard for us to survive this way,” the participants said.
The business people also complained that the auditors who work for ERCA are either incompetent or corrupt.
“They only want to impose penalties on companies, they have no interest in educating tax payers or explaining the proper procedure,” one person said.
Some say that ERCA tax from profit that gose to raise their company’s capital. When tax penalties are levied they are often exaggerated, the participants said.
“These penalties may force companies out of business,” one participant said.
Participants also were concerned about a new management system where one staff member leads a group of five other staff members. This meeting, termed ‘one to five’ is seen as taking time that could be used providing services.
“ERCA should say when the meetings are being held so we do not waste our time waiting at their offices,” one person said.

http://www.capitalethiopia.com/index.php?option=com_content&view=article&id=3949:erca-set-to-reduce-income-tax&catid=35:capital&Itemid=27

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GE Chairman to talk oil

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General Electric Company (GE) Chairman and CEO Jeffrey R. Immelt is to visit Ethiopia in two weeks Capital learned.

It will be the Chairman’s first visit to the country and he is expected to hold talks with Prime Minister Hailemariam Desalegn along with a number of other high government officials. During his visit, Immelt is expected to talk about potential investment areas such as energy and the health sector. There are also expectations that there will be discussions regarding oil production in Ethiopia. GE operates as an infrastructure and financial service company. It’s Oil and Gas segment provides surface and sub-sea drilling and production systems, compressors, turbines, reactors, and industrial power generation. The company is engaged in the oil sector in several countries including Brazil and Nigeria. Reports show that GE businesses in Nigeria represent the biggest GE platform in Africa. It is involved in the Nigerian oil sector through its partnership with giant oil companies.

As Ethiopia’s potential oil findings spark attention, last week GCL Poly Petroleum, a Chinese petroleum company that signed a petroleum production sharing agreement (PPSA) with the Ethiopian Ministry of Mines (MoM) to develop the gas filed at Ogaden, also signed a Memorandum of Understanding (MoU) on Wednesday January 8, with the government of Djibouti that will allow the company to construct two pipe lines stretching from Ethiopia to Djibouti. GCL Poly Petroleum Investment that signed a deal with Ethiopia in November 2013 to develop gas reserves at Calub and Hilala has signed a MoU with the Ministry of Energy in charge of Djibouti’s Natural Resources that will allow the company to transport gas and oil products to the port.

Besides possible oil discussion, GE is also expected to make an investment in the health sector. The company’s health sector segment provides medical imaging and information technologies, medical diagnostics, and patient monitoring systems; and disease research. General Electric reported net income of USD 4.2 billion for the fourth quarter of 2013 on revenue of USD 40.38 billion. Reports show that profit in the company’s aviation, oil and gas, and appliances divisions all rose 20 percent or more in the last quarter.

http://www.capitalethiopia.com/index.php?option=com_content&view=article&id=3948:ge-chairman-to-talk-oil&catid=35:capital&Itemid=27

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Agriculture investors laud increased honey, milk consumption

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Twenty Ethiopian entrepreneurs in the sesame, dairy and honey sectors came together for the first Ethiopian Agribusiness Investment Forum, a presentation intended to entice investors to their business at the Sheraton Hotel on January 16, 2014.  The program, funded by USAID through its Ethiopia Sustainable Agribusiness Incubator activity, was implemented by Precise Consult International as part of the U.S. feed the future initiative. The investment requirements of the companies vary from USD 10,666 for B Honey, a company that produces pure and infused honey to USD 791,263 for Select Honey and Products Inc. which makes honey and honey by-products.

The twenty companies have average sales ranging from USD 33,627 to USD 2.4 million. “There are scientists, entrepreneurs, financers…in short all the relevant stakeholders in the value chain of agri-business here,” said Fitsum Arega, Director General of the Ethiopian Investment Agency. “Ethiopia has a lot of natural resources. We just need the technical expertise and financing,” He continued to say that the agency is interested in strategic investments, especially those in agro-processing and cotton farming.

The agency’s interests seem to be aligned with that of the U.S. Feed the Future Initiative which plans on transforming the Ethiopian agriculture industry by increasing the competitiveness of the entire value chain. “Investment in agriculture is 2.5 to 3.0 times more effective in increasing the income of the poor than non-agricultural investment,” said Gary Linden, Deputy Mission Director of USAID. Agricultural development is given precedence in the Agricultural Growth Program (AGP) of the Ethiopian government, he further elaborated.  Therefore in the next five years, USAID will invest USD 250 million in support of the AGP.

State Minister of Agriculture, Mitiku Kasa, who opened the event, said that the Ministry of Agriculture has been making a concerted effort to develop every type of commercial agriculture by private investors. This is why selected sectors that are labor intensive and use domestic raw materials like those in the agro-industry get special access to credit, land and tax incentives. “The current development plan of Ethiopia, the Growth and Transformation Plan (GTP) envisages continued and rapid growth of agriculture with an even faster growing industrial sector,” said Mitiku. “When we speak of industrialization we envision it to take place on the back of  strong agriculture.”

Ethiopia is the fourth largest sesame and beeswax exporter in the world. It is also the 10th largest exporter of honey in the world and the largest exporter of livestock in Africa. Ethiopia has a milk consumption of 24 liters per year for every person. The rise of income, population growth, increasing availability of production and a growing culture of milk drinking were said to be positive indicators of the dairy industry’s growth.

http://www.capitalethiopia.com/index.php?option=com_content&view=article&id=3942:agriculture-investors-laud-increased-honey-milk-consumption-&catid=35:capital&Itemid=27

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Addis Light Rail Project 50 per cent complete

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The Ethiopian Rail Way Corporation announced that Addis Ababa Light Rail Project is 50 per cent complete.

Briefing journalists about the current status of the project yesterday, Corporation Public Relations and Communication Directorate Director Abebe Meherete said that the construction of bridges, laying of grades and sideways has been undertaken in an accelerated manner in four directions of the city.
Presently, over six-km grades has been laid. On the other hand, other infrastructural development–telephone and electric lines as well as water pipelines are being laid side by side with the railway project.
In some project sites, the contractor, China Railway Engineering Corporation (CREC) has been working day and night to complete the task according to schedule, he said.
“Unless the project faces unforeseen challenges beyond the capacity of the corporation, the ongoing construction will not stop even for a minute and the contractor has been making utmost effort to finalize the project ahead of the schedule.”
Currently, the difficult part of the civil work is nearing completion. In some areas, 17- 22m depth excavation task has been taking place to erect bridges. Side by side, the corporation has been working with various stakeholders to prepare sideways both for pedestrians and vehicles, Abebe said.
To date, the project faces no financial and technical constraint. It is being undertaken at a cost of $475 million USD of which, 15 per cent of the cost is covered by the government.
The country is constructing nearly 2,400-kms of national electric railway and 34-kms of light rail in Addis as part of Growth and Transformation Plan ending in 2015.

http://www.waltainfo.com/index.php/explore/12066-addis-light-rail-project-50-per-cent-complete-

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Ethiopia passes law banning smoking in public

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Ethiopian House of Peoples’ Representatives pass a new tobacco control proclamation.

The proclamation prohibits smoking in public places and it also includes putting enormous taxes on and increasing the price of cigarettes.
The proclamation also enforces for the cigarette packages to have a notifying message as to the health dangers of tobacco.

Moreover, the proclamation forbids advertising and promoting tobacco products on the media.

http://www.waltainfo.com/index.php/explore/12063-ethiopia-passes-law-banning-smoking-in-public

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Ethiopia saves 2.3 mln. USD by blending ethanol with benzene

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Ethiopia has managed to save 2.3 million US dollars in the first quarter of this budget through blending 2.5 million liters of ethanol with benzene, the Ministry of Water, Irrigation and Energy (MoWIE) said.

Public Relations and Communication Director at MoWIE, Bizuneh Tolcah, told WIC today the 2.5 million liters of ethanol was produced by the existing Fincha and Metahara sugar factories.
According to Bizuneh, Fincha and Metahara sugar factories have the capacity of producing 20 million and 12.5 million liters of ethanol per year, respectively.
Ethiopia envisaged increasing the amount of ethanol production to 181 million liters when the new sugar factories planned to be constructed in the Growth and Transformation Plan (GTP) is completed, he said.
He said Ethiopia can save 57 million US dollars at current price by the end of the GTP period through blending only 64.4 million liters of the total ethanol produce.
Since it commenced blending benzene with ethanol in 2009, the country has supplied 41.77 million liters of ethanol blended benzene to the local market, thus saving 33.23 million US dollars, he said.

http://www.waltainfo.com/index.php/explore/12065-ethiopia-saves-23-mln-usd-by-blending-ethanol-with-benzene

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Meeting of Permanent Representatives Committee launches the 22nd AU Summit

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The 27th Ordinary Session of the Permanent Representatives Committee of the AU opened on Tuesday (January 21).
Opening the session, Dr. Dlamini Zuma, Chairperson of the African Union Commission, called for the strengthening of the working relationship between the AU Commission and the PRC in order to build a strong and efficient continental institution.
She expressed appreciation to the PRC and its sub-committees on multilateral affairs and other partnerships for working with the AU Commission.
The AUC Chairperson expressed worries over the conflict situations in Central African Republic and Southern Sudan while acknowledging progress made in Mali, Somalia and Madagascar which she said should make the Commission more resolute than ever to fulfill the pledge of the 50th Anniversary Solemn Declaration not to bequeath to future generations of Africans the legacy of wars and conflicts and silence the guns by 2020.
The Chair of the PRC, Ambassador Kongit Sinegiorghis of Ethiopia, called for deliberation on ways to enhance the institutional capacity of the Commission.
She expressed satisfaction with the progress made in the advancement of the peace, integration and development agenda as reflected in the Commission’s report for 2013 as well as the successful celebration of the Golden Jubilee of the Organization of African Unity, now the African Union. Ambassador Kongit stressed the need of the PRC and the AU Commission to improve their working relations.
The PRC will discuss items on the agenda in preparation for the 24th Ordinary Session of the Executive Council (January 27-28) which will in turn pass on recommendations to the Assembly of Heads of State and Government (January 30-31).
The PRC discussions are taking place against the backdrop of the launch of 2014 as the year of Agriculture and Food Security.
This year also marks the 10th anniversary of the adoption of the Comprehensive Africa Agriculture and Development Program.
The PRC meeting on Tuesday observed a minute of silence in memory of famous Ghanaian- born journalist and BBC broadcaster, Komla Dumor, who passed away Saturday.

http://www.waltainfo.com/index.php/editors-pick/12062-meeting-of-permanent-representatives-committee-launches-the-22nd-au-summit-

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Active public engagement to develop Abay    

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The Office of National Council for the Coordination of Public Participation on the Construction of Grand Renaissance Dam said the labour contribution of 28 million people in natural resource development and protection both during Kiremt and Bega seasons is valued at 35 billion birr.

In an exclusive Interview with The Ethiopian Herald Office Deputy Director General Zadig Abrha said the people have carried out natural resource conservation and drainage development in the river course of Abay thereby protecting the sedimentation threat of the dam and soil erosion. Accordingly, close to 7.7 million indigenous seedlings have been transplanted on the course of the river covering nearly 4.8 hectares of land over the last two years.

Apart from the significant role the people are playing in natural resource and drainage development, he said a huge sum of money has been collected from people in all walks of life who pledged at different times with their own will and aspiration for the realization of the construction of the Dam.

According to him, the promise and actual payment on the part of the business community is significant. Some made 100 per cent payment in time while others 50 per cent of their pledges. And of course, civil servants have a great share in this regard, he said.

He noted that the construction of the Dam would be further strengthened backed by vibrant public diplomacy to show the Egyptian people that their government is deluding them regarding the issue of Abay.

As the Dam is part and parcel of the country’ development drive, the momentum of public participation should be kept said Zadig.

In this regard, Water, Irrigation Development and Energy Minster Alemayehu Tegenu recently noted that Ethiopia is building a huge dam on the river course of Abay solely to meet its hydroelectric demand and this could be made feasible with the proven fact that the Dam wouldn’t cause any damage on the riparian countries.

He said the result which the study of panel of experts uncovered this past May 2013 depicted the building of the Dam creates no harm yet Egyptian are adamant in renouncing the project. “We will build the Dam to eradicate poverty not to harm Egypt.”

Sudan’s stance on feasibility of the Dam and its positive negotiation on the trans-boundary river are appreciable. Sudan will benefit from the Dam as it contemplate from Tekeze Dam, according to him.

It is learnt that the Dam construction is more than 30 per cent complete.

http://www.ethpress.gov.et/herald/index.php/herald/national-news/5688-active-public-engagement-to-develop-abay

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Zone harvests 8 million quintals

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Some eight million quintals of agricultural output was harvested in Kembata Tembaro Zone of Southern Nations, Nationalities and Peoples State during the main crop season, the Zonal Agriculture Department said.

Department Head Elias Wollencho told ENA that the stated amount was harvested from more than 80,000 hectares land.

The stated amount exceeds the previous year by 1.2 million quintals.

He attributed the success for timely and effective distribution of rainfall, utilization of inputs and modern technologies.

http://www.ethpress.gov.et/herald/index.php/herald/national-news/5691-zone-harvests-8-mln-quintals

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 Over the last four years, each household had got three to five hectares of land for farming and irrigation. They as well could plough mainly in rain-fed area as much as they can

“The image tainting report that was released by some institutions or groups like Human Rights Watch about the commune programme is merely a propaganda of ultra neo-liberals and a subtle way of imposing their political agenda on us. The reality is completely different. Indirectly, they opt to dissuade us from fighting poverty and backwardness, though the programme is being implemented on the will of the people. We have already carried out the commune programme in Gambella and Benshangul-Gumuz states.”

So said Federal Affairs Ministry Ensuring Equitable Development Directorate Director General Shanko Delelegn, in a recent exclusive interview with The Ethiopian Herald regarding the Commune Center Development Plan and Livelihood Strategy Programme in the four emerging states of Afar, Ethiopian Somali, Benshangul-Gumuz and Gambella.

Shanko said that these so-called whistle blower institutions and groups serve the interests of ultra neo-liberal political ideology and they want to inculcate their orientation contravening the overall economic growth of the country. They are fanning neo-liberal political orientation. The commune programme is aimed at ensuring equitable development and has nothing to do with the issues whose objective is encumbering development, he added.

Shanko said: “Had the programme been disrupted, there would have been a widespread poverty and backwardness in the states less favoured by the successive previous regimes. Hence, flourishing and sustainable development in these states would have been out of question.”

Shanko noted that the emerging states get support from the Federal Government based on Article 89 of the Constitution which acknowledges their rights to get support. The Federal Affairs Ministry has been supporting them and executing the commune programme jointly with the Federal Special Support Board. He further noted that the board was re-organized and re-established in 2003 E.C.

As to him, since these emerging states are found at the peripheries of the country and as such for ages they were not benefiting from any infrastructural development and capacity building programmes, among others.

According to Shanko, these states still face acute shortage of skilled manpower, well-organized structure and working system. As a result, their implementation capacity is very low in comparison with other states.

“The Federal Special Support Board is providing them support based on three conditions: constitutional enactment, capacity and development gap and request from them. The Board focuses on filling capacity and implementation gaps,” he added.

Regarding the programme, Shanko pointed out that the requisites for commune are the will of the people, the presence of underground water or water bodies where there is enough water for the community and their animals as well as the preparation of fertile land for farming at a walking distance from communal areas. Social institutions like schools, health stations and others are also among the requisites.

He further indicated that over the last four years, each household had got three- five hectares of land for farming and irrigation. They as well could plough mainly in rain-fed area as much as they can.

In addition, Shanko said the commune programme is backed by agricultural experts to enable the beneficiaries apply modern technology.

Supported by agricultural experts, farmers have adopted agricultural technology and improved seeds and began sowing in a row over the three -four years, he said. Even some have begun using tractors. In so doing, they have managed to boost production and create a viable market link, he added.

Regrading livestock trade, he said to put into effect a modern market system it has to be done taking into consideration cross boarder trade practices. But lack of market linkage and access remain the major problems in these areas.

“There is an ongoing effort in the areas under discussion. Establishing trade centres, organizing market information, creating market linkage and maximizing community’s benefit by selling their crop and heads of cattle,” Shanko added.

Moreover, the Ministry of Agriculture is establishing market centres, preparing veterinary facilities and quarantine services. Now, realizing the benefits of legal trade, pastorals are turning their face to the local market rather than going for contraband trade, he said.

Shanko noted that the implementation of the programme began in 2003 E.C with the launching of the GTP. Some 275,000 households were embraced in the commune programme from 2003- 2005 E.C in the four states. The programme benefited 1.5 million people in general.

Capacity limitation and failure to carry out projects according to schedule are slowing down the implementation of the programme. “We are determined to address the problem through time working with the states,” Shanko said

The Commune Centre Development Plan and Livelihood Strategy Programme was designed to bring scattered rural populations closer to schools, health clinics, roads, and other public services.

Sourced here:  http://www.ethpress.gov.et/herald/index.php/herald/news/5687-gambella-benshangul-gumuz-commune-programme-target-met-ministry

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