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 12th to June 15th 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)
Related articles
- 07 June 2013 Ethiopian Business News Round-up (allanapotashblog.org)
- 06 June 2013 Ethiopia Business News Round-up
- 05 June 2013 Ethiopian Development News Round-up
- 3 June 2013 Development news round-up
- 31 May 2013 Development news round-up
