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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.
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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.
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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.
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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).
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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.
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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.”
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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.
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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
Filed under: Ag Related, General Economic Updates, Infrastructure Developments, News Round-up Tagged: Agriculture, Business, East Africa, Ethiopia, Ethiopian government, Investment, Millennium Development Goals, Sub-Saharan Africa, tag1
