(Updated) 12 March 2014 Development News


Eshet invests $200 mln in Kombolcha industrial zone



By Fitsum Abera    

An Israeli company, Eshet Engineering Ltd, and the Ministry of Industry (MoI) formed a company through a joint venture to set up an industrial zone in the town of Kombolcha, Amhara National Regional state. Eshet invested USD 200 million in these JV.

The Kombolcha Industrial Zone will be constructed on 1,000 hectares and will be used to host prioritized export-oriented sectors, such as textile and garment, leather and leather products, agro-based industries, among others. The government has prepared about 1,123 hectares for industry zone development in Kombolcha.

According to the Memorandum of Understanding (MoU) the two parties signed, MoI will own 5 percent of all the rights of the industry zone while Eshet will own the rest. According to their agreement, MoI will provide the plot at its own cost, facilitate the evacuation of users of the land, settle compensation for those evacuated, and will provide the infrastructure for the area such as electricity, telecommunication and water supply.

In a related development  Israeli business delegation is the latest to join the constant stream of business to business meetings, with representatives from 16 Israeli companies coming to meet their Ethiopian counterparts on March 5 and 6. The delegation, which was led by the Israeli Minister of Agriculture and Rural Development, Yair Shamir, consisted largely of companies working in aquaculture, irrigation and agro-industry.

Agriculture Minister Tefera Derbew encouraged the Israeli companies to invest in Ethiopia saying the country’s large livestock numbers will be a good source of hides and skins. This is the major sector that the ministry wants the Israeli delegations to invest in. “Livestock has been underperforming for many years,” Tefera said. “However, during the GTP period, because we focused on developing this sector, especially this year, we are witnessing a significant improvement as far as breed  enhancement, forage development and animal health are concerned.  This is our future hope as far as high value agricultural commodity exchange is concerned.”

The minister said natural development and irrigation activities have performed well above the target set by the Growth and Transformation Plan (GTP). According to Tefera, currently there are 50 Israeli companies working in Ethiopia and there are more than 150 others in the pipeline already registered that haven’t started work yet. Shamir said that most Israeli business people prefer to open Ethiopian companies while using Israeli technology.

“Ethiopia is a huge country that is an island of stability and democracy,” Shamir said. “Around you very few are up to this standard. For us as a country to be able to give guarantee to companies that want to invest in this kind of land that is managed so well by the government is impressive.” Shamir said that Israel will give assistance to Ethiopia if matters of instability arise.

The companies that want to invest in Ethiopia are not only in the agriculture sector but also IT, medicine and technology.

On the subject of the Ethio-Egypitian conflict over the construction of the Grand Ethiopian Renaissance Dam (GERD) though, the minister stated that the government of Israel will not take sides. Shamir met with Tewedros Adhanom (PhD) Minister of Foreign Affairs and Alemyehu Tegenu, Minister of Water, Irrigation and Energy before departing. This is his second state visit to Ethiopia.



Reykjavik to Start Drilling on $2 Billion Ethiopia Power Project


By William Davison

Reykjavik Geothermal, the Icelandic power-plant builder, plans to begin drilling in Ethiopia by July as part of a $2 billion project to develop the renewable energy source, Chief Operating Officer Gunnar Orn Gunnarsson said.

Ethiopia’s government signed a deal with the Reykjavik-based company in October to build a power plant on an imploded volcano in the Rift Valley that will generate 500 megawatts of electricity by 2020. The licensing of a large-scale private power-generation project marks a shift from the Horn of Africa state’s previous reliance on domestic investment and Chinese loans to finance infrastructure development.

“We think we have a project that can have a return on equity that is acceptable by the investors,” Gunnarsson said in an interview on March 7 from Iceland. The company plans to begin closing financing deals this month worth as much as $80 million and expects to eventually raise $500 million from equity partners, he said.

Ethiopia’s government has operated a state-dominated market economy since rebels overthrew a socialist military regime in 1991. While private investment has been encouraged in areas including agriculture and manufacturing, government enterprises control or monopolize financial services, transport, energy and telecommunications.

The deal between the government and Reykjavik Geothermal “signals a more open policy toward foreign direct investment in key economic sectors currently dominated by public enterprises,” International Monetary Fund country representative Jan Mikkelsen. It should be replicated in other state-controlled industries to alleviate “infrastructure bottlenecks,” he said.

Growth Surge

Ethiopia’s economy is projected to expand 8 percent in the fiscal year to July 7, the end of the year in the Ethiopian calendar, after increasing at an annual average rate of 9.3 percent for the past four years, according to the IMF. That growth rate is convincing companies to invest in producing electricity from ample resources of wind, geothermal, water and sun, Prime Minister Hailemariam Desalegn said Feb. 10. General Electric Co. (GE) is considering investing in the power industry in the country, the government said in January.

Ethiopia is investing in infrastructure as it seeks to become a regional electricity exporter and manufacturing center, and is using its low-cost labor and cheap power from Africa’s second-largest hydropower resources to attract investment. Reykjavik Geothermal will sell power to the national grid, once it begins producing, Gunnarsson said.

“All the industries here are screaming for power,” he said. “It’s dragging their development of everything to have no power.”

Power Projects

The Ethiopian Electric Power Corp., a government utility, is building the 6,000-megawatt Grand Ethiopian Renaissance Dam on the Blue Nile River. The 80-billion birr ($4.1 billion) hydropower project will be paid for by domestic bond sales and government funds and is scheduled for completion in 2018.

The Export-Import Bank of China is primarily funding a $1-billion transmission line from what will be Africa’s largest power plant. Chinese banks are also financing new railways and roads on Ethiopia’s main trade route to the Port of Djibouti.

On top of the collapsed volcano, or caldera, steam seeps from cracks between rocks in an undulating, dusty patch of Ethiopia’s Rift Valley about 20 kilometers (12 miles) west of the town of Shashemene. Residents have propped up meshes of branches to trap the condensing steam. A few kilometers away, hundreds of head-scarfed women, children and donkeys gather with yellow jerry cans to collect water from a rare well.

‘Huge Resource’

The caldera, which formed tens of thousands of years ago, is suitable for using steam to turn electricity turbines as tests shows that a “huge resource” of water vapor at temperatures of well over 250 degrees Celsius (482 Fahrenheit) lies near the earth’s surface, Gunnarsson said.

Similar sites in Iceland produced significant amounts of energy, “so we are very, very confident that we will be successful,” he said. The addition of 500 megawatts of power would increase current generating capacity by 25 percent. The company is also working on projects in Mexico and the Caribbean and considering Kenya and Tanzania, Gunnarsson said.

The U.S. government is supporting the project, which is known as Corbetti, as part of the six-nation Power Africa initiative, a $7 billion commitment by U.S. President Barack Obama to increase access to electricity on the continent.

Experts from the U.S. Agency for International Development have held workshops for Ethiopian officials on Power Purchase Agreements and the agency is paying for a “transactions adviser” to help the government negotiate with Reykjavik, Earl Gast, USAID’s assistant administrator for Africa, said in a Feb. 2 interview.

“The government sees this as a critical project because they want to demonstrate that Ethiopia is open for business,” he said in Awassa.

To contact the reporter on this story: Willian Davison in Addis Ababa via Nairobi at  pmrichardson@bloomberg.net

To contact the editor responsible for this story: Paul Richardson at  pmrichardson@bloomberg.net Alastair Reed



Ethiopia to join COMESA Free Trade Area by December



Ethiopia and Uganda have pledged to join the Comesa free trade area (FTA) by December, raising hopes of higher trade volumes for Kenya and the region.


Although the two countries are members of the Common Market for Eastern and Southern Africa (Comesa), they have not ratified a special FTA arrangement. Under FTA a designated group of countries agree to eliminate tariffs, quotas and preferences on most (if not all) goods that they trade among themselves.

However recent research states that Ethiopian electrical and plastic product manufacturing industries will be affected severely if Ethiopia decides to eliminate tax completely on imports from COMESA member states. The research paper, entitled ‘The Impact of Joining the COMESA FTA on The Ethiopian Economy: The Case of the Manufacturing Industry’ by Yasmin Wohabrebbi, states that Ethiopia will lose almost three percent of the total tariff revenue that would have been collected from trade with COMESA member states if it joins the COMESA Free Trade Area. Nevertheless, the research further states “this policy measure (if Ethiopia decides to completely eliminate tariffs from COMESA member states) will bring welfare gains to the consumers”. The research also suggests that the major sources of revenue loss and consumers’ gain will focus on manufacturing products. “This gradual liberalization will also bring a negative effect on textile and leather manufacturing industries but these two industries have the relative potential to withstand their competitors in the COMESA market unlike those of electrical and plastic manufacturing industries,” the report says.

Experts said the plans by Uganda, DRC and Ethiopia to join the Comesa FTA would boost commerce in the region. “Ethiopia has shown a lot of protectionism in its market which makes it unpopular with traders in many neighbouring countries and the wider Comesa. We hope they change this by adopting the FTA status making  it easier for trade,” Joshua Ndegwa, a textile export dealer said.

Ethiopia has found itself at loggerheads with other partner countries over trade controls and restrictions to its markets. Only recently it introduced price curbs to tame runaway inflation, triggering protests among Comesa partners such as Kenya who favour free market policy. Two years ago, Kenya also raised the red flag on Ethiopia’s restrictive trade practices and urged the Comesa secretariat to arbitrate in a dispute over a list of products eligible under a special cross-border trading scheme. Kenya took issue with Ethiopia for failing to honour its pledge to reach a deal with Kenya on a list that would be covered under a newly instituted Comesa Simplified Trade Regime (STR).

Other partners of the 19-member bloc also protested against Ethiopia’s adamancy of adopting the STR, prompting a special mission from the Comesa to hold talks with Addis Ababa. Under the new Comesa STR, traders will be granted simplified certificates of origin to enable them enjoy duty and quota free access as long as their goods appear on a list of agreed products. The certificates would be filled in by traders at designated border posts and stamped by customs officials upon verification. For purposes of health and safety, those carrying chemicals, foodstuffs, plant and animal products would, however, have to report to offices of the ministries of Health, Environment and Agriculture for clearance. Kenya’s trade with Uganda has however been relatively smooth thanks to their membership in the East African Community.



East Africa PC shipments rise


by  Stuart Wilson,  Monday 10 March 2014

IDC reckon that PC shipments to East Africa were up 3% year-on-year in the fourth quarter of 2013

IDC reckon that PC shipments to East Africa were up 3% year-on-year in the fourth quarter of 2013

The number crunchers at IDC reckon that PC shipments to East Africa were up 3% year-on-year in the fourth quarter of 2013, hitting a total of 140,251 units. Strong gains in the markets of Uganda, Tanzania, and Ethiopia helped offset soft demand in Kenya, where the introduction of new VAT legislation resulted in a slide in PC shipments.

HP took top spot in the fourth quarter with 33% market share, followed by second placed Dell with 27%. Toshiba, Lenovo and Samsung completed the list of top five vendors with market shares of 18%, 14% and 6% respectively.

James Mutua, a research analyst at IDC East Africa, said: “As forecast by IDC, the new VAT law had a debilitating impact on the PC market in Kenya, with shipments contracting 10.7% year on year in the fourth quarter of 2013.”

“The bill’s introduction, which sees a levy of 16% added to all ICT products, resulted in a huge loss of business due to logistical issues caused by the hasty implementation of the new regulations by the Kenya Revenue Authority,” Mutua added.

“However, Ethiopia, Tanzania, and Uganda all performed much more strongly, recording impressive year-on-year PC shipment growth of 31.7%, 18.7%, and 20.1%, respectively, thanks to an improved and continually expanding business environment and increased consumer spending,” Mutua explained.

Fourth quarter desktop PC shipment slipped 3.3% year-on-year to 48,562 units as more and more users switched to notebooks. IDC remains optimistic that the market share of all-in-one desktop PCs is set to grow sharply in 2014 as more vendors enter this category.

Notebook PC shipments into East Africa hit 91,599 in the fourth quarter of 2013 – up 6.8% year-on-year. This rate of growth was slower than expected, according to IDC, as Samsung opted to reduce its shipments into East Africa amid a change in its business model that will see the vendor increase its focus on high-margin PC products, smartphones, and tablets.

IDC claimed that Samsung’s new approach has been heavily influenced by the cutthroat competition that exists in the consumer notebook segment, where margins are very low and consumers are increasingly shifting to tablets.



SatLink chosen as global TV distribution partner for Ethiopian Television


SatLink Communications, a teleport, Content Management & HD Playout Centre, has announced that SatLink has been selected by the Ethiopian Radio and Television Agency (ERTA) for the global distribution of its ETV news channel. The Ethiopian Government owned television channel, whose broadcasts include news, entertainment, music and sports content, will extend its audience reach across Africa, North America, Europe and the Middle East over SatLink’s Global Satellite and Fibre Network
SatLink will broadcast ETV, whose aim is to broadcast informative, educating and timely information of the development of Ethiopia utilising state-of the-art technology, to the African market utilising SatLink’s capacity on AMOS -5 C-band to allow them to effectively distribute their content easily to Africa’s multi-channel platforms. As ETV’s partner, SatLink worked closely with the broadcaster in order to help design the uplink capabilities for the channel from ETV’s facilities in Ethiopia on to Amos 5 and ensure the network of satellite’s chosen specifically met the broadcasters needs and achieve the international reach that was required.
ETV will also be transmitted across Europe and the Middle East on Hot Bird 13.0° East on the Ku-band. For distribution into the North America market, ETV will take advantage of the Galaxy 19 at 97.0° West Ku-band, which hosts the largest ethnic video platform in North America, to reach the Direct to Home (DTH) ethnic market in the US.
ETV is the latest news broadcaster to select SatLink for the global distribution of content joining international news broadcasters such as France 24, i24 News, NTV-MIR and euronews and leading news agencies including Thomson Reuters and APTN.
Worku Gachena, Deputy Director General for Media Technology at ETV commented: “We were looking for a global provider to not only distribute our content but to work alongside us as a partner to help us extend our global reach further than before. We needed a provider who had the experience to help design our uplink capabilities and also obtain satellite space on Amos-5 so we could meet the multi-channel platforms in Africa, a rapidly growing a prosperous broadcasting region. SatLink’s strategic location coupled with its extensive knowledge and experience in this market meant that we knew that they would be able to assist us as we extend our reach further and address our growing audience’s needs across the globe.”
David Hochner, CEO of SatLink, commented: “We are thrilled to work with ETV to extend its audience reach to different corners of the globe using our Global Satellite and Fibre Network. By working closely alongside ETV we gained a real understanding of their broadcasting requirements and were able to tailor a reliable and effective solution, help them uplink their signal directly from Ethiopia and be on the world’s most popular satellite TV platforms. As a result we have been able to proactively assist ETV meet the objective of reaching their audiences, much of which is scattered across multiple continents, so they are able to connect with the news that is happening back home in Ethiopia and share the success stories of the country.”



Boosting Ethiopia’s economic growth with building boom


By Jenny Vaughan

Above Addis Ababa’s concrete skyline, cranes tower high amid blasts from nearby drills and diggers. At the feet of buildings shrouded in bamboo scaffolding, excavators dig up dirt tracks, to be replaced by paved roads and a modern railway.

It is a scene common to most neighbourhoods in the Ethiopian capital, which has turned into a giant building zone and a city in transformation.

“It looks like a construction site when we compare from the previous time,” said Berhanu Kassa, manager of B.B. Construction in the Ethiopian capital.

“Especially in the past five years, it’s a really big change,” he added, speaking at the site of his latest project, a mixed-use commercial building on one of the city’s main thoroughfares where workers offload concrete slabs from a delivery truck.

Addis Ababa’s construction boom — funded both from private and public coffers — is being driven by the country’s recent rapid economic growth.

But the government hopes it will attract further investment and help industrialise the economy in order to reach middle income status by 2025.

The public works projects, worth billions of dollars, include new roads, railways and massive power generation schemes across the country.

Meanwhile the majority of new buildings are owned by private investors, who by law must be Ethiopian citizens.

The development promises to boost Ethiopia’s economic growth, officially 9.7 percent last year, though the International Monetary Fund (IMF) pegs it at closer to seven percent.

“The basic engine blocks of economic transformation are the infrastructure,” said Zemedeneh Negatu, managing partner and Ernst & Young in Ethiopia.

“The Achilles heel of Africa is power, lack of power, lack of road networks, lack of the basic needs that you need to transform your economy.”


– Few other opportunities –


But analysts point out that the boom in construction is also a symptom of the weakness of the financial system, which leaves the business community with few investment opportunities outside of the sector.

“This is the most attractive investment opportunity in the country for the time being since we do not have a financial market that is working properly,” said the head of the IMF mission in Ethiopia, Jan Mikkelsen.

“There’s no financial markets, no stock exchange, so real estate investments seem to be the most attractive from that point of view,” he added.

The majority of the new buildings are hotels, apartments and offices.

Most are being built by Ethiopian-owned construction firms, though foreign-owned contractors from China or Turkey are cashing in too.

The government said the big push in the sector — which is bolstered by state-led incentives such as tax breaks and ready access to land — is driven by the need to create jobs for Ethiopia’s 91 million people, about one in four of whom are unemployed.

“We are struggling to eradicate poverty and create jobs,” said Desalegne Ambaw, state minister for urban development and construction.

Officials say four million jobs have been created in the last three years, including an increase in construction sector employment.

But Mikkelsen warns that resources should not be pooled too heavily into infrastructure projects, no matter how crucial for development.

“There is a need for construction, but of course there’s a limit to how much you can get out of that and these are potential resources that could have been used for other means and maybe more export-oriented businesses as well given that there is an urgent need for more foreign exchange,” he said.

Imports outweigh exports by a factor of four, according to IMF data, which starves the country of foreign exchange.


– A city transformed – 


The ambitious state-funded infrastructure projects also threaten to strain public finances in Ethiopia.

IMF forecasts see the public deficit possibly swelling to 44 percent of gross domestic product within several years, nearly double the current level that means the country is borrowing a fifth of what it spends.

As it is, the financing shortfall for public works projects is already ten percent of GDP.

But for now, Berhanu said he is grateful for the government’s focus on the construction sector, since his business is booming.

“From a business perspective we are busy, sometimes it is even beyond our capacity,” he said, adding that his company has grown from three people to over three hundred over the last 20 years.

Berhanu said Ethiopia’s economic growth is fuelling the expansion of his business by creating a demand for new infrastructure, and he in turn was contributing to this by creating employment and supporting local industries.

“I hire a lot of workers here, I use a lot of local materials, I use a lot of subcontractors and because of that all we grow together and the country benefits,” he said.

Zemedeneh is confident it will continue to attract investors from abroad who witness the country’s growth for themselves and said he only expects the city’s transformation to continue.

“The bottom line is you will not recognise Addis if you come 10 years from now, it will be a completely, completely different city,” he said.



Ethiopia plans to double sugar output


Ethiopia plans to double sugar output

“Sugar consumption that dated back to the BC epoch found its way into Ethiopian households only lately; people had to be convinced,” Zemedkun Tekle, communications director at the state-run Ethiopian Sugar Corporation, said.


World Bulletin / News Desk

Sugar has not been long present on Ethiopian tables. In fact, producers say that sugar production and consumption is only 60 years old in the African country – but they also believe their country has the potential to become one of the continent’s major producers of cane and sugar.

“Sugar consumption that dated back to the BC epoch found its way into Ethiopian households only lately; people had to be convinced,” Zemedkun Tekle, communications director at the state-run Ethiopian Sugar Corporation, told Anadolu Agency.

“Local [national] consumption currently stands at 500,000 tons per year,” Tekle said. “But this amount is small compared to that consumed in neighboring Kenya.”

With its 48 million-strong population, about half of Ethiopia’s population size, neighboring Kenya consumes some 800,000 tons of sugar annually, according to Tekle.

“Affluence, culture and awareness determine the amount of sugar a country’s population consumes,” Tekle believes. “The more developed a country is, the more sugar its population consumes.”

But Ethiopia’s recent accomplishments – both in terms of sugar cane production and sugar manufacturing and refining – are “nothing short of impressive,” said Tekle.

Today, sugar in Ethiopia is a multibillion-dollar industry, with a 25 billion birr budget (some $1.3 billion) this year alone. In the coming few years, the country hopes to become one of Africa’s leading sugar exporters.

“Sugar Corporation is working to realize the country’s plan to export 658,200 tons of sugar next year,” Tekle said, referring to Ethiopia’s five-year development roadmap – dubbed the Growth and Transformation Plan (GTP) – the first phase of which will expire in 2015/16.

The GTP-I envisaged construction of ten sugar farms and refineries in different parts of the country.

“We will have completed seven of the ten sugar manufacturing plants by the end of the plan period,” Tekle said. “The remaining three will roll over to the GTP-II.”

“Upon completion of the ten sugar plants, the country will have a production capacity of 1.5 million tons of sugar, residue from which will be used to produce 212,000 cubic meters of ethanol,” he said.

The GTP forecasts that these sugar industries will employ 200,000 people directly, while creating numerous indirect job opportunities.

But the plan will come at a cost. Recent reports suggest that the plant in the Kuraz Sugar Development Project in the South Ethiopian Peoples’ State – still under construction – had caused the displacement of local people, an allegation dismissed by Tekle.

“The people there are pastoralists who go from place to place in search of water and pastures,” he said.

“In fact, whenever there was a need to resettle people from sugar development sites in other regions, it [resettlement] was conducted in close consultation with affected societies,” he added.

According to Tekle, they were resettled to “better” areas in which there were irrigation schemes, schools and clinics.



Is Ethiopia Ready for Fast Food and Name-Brand Soap?



Shoppers and vendors make their way down a street in the Merkato, in Addis Ababa, Ethiopia

Shoppers and vendors make their way down a street in the Merkato, in Addis Ababa, Ethiopia

Photograph by Rebecca Blackwell/AP Photo


Ethiopia is a largely agricultural nation of 94 million people that endures frequent droughts and famine, with a per-capita income of a bit more than $100 per month. Is it ready for Heineken beer and KFC chicken outlets?

The companies behind these global brands think it may be. Amsterdam-based Heineken (HEIA:NA) is scheduled to open a $127 million brewery in mid-2014 on the outskirts of Ethiopia’s capital, Addis Ababa. Unilever (UN), the British-Dutch consumer-products giant, announced plans this month to open a factory near Addis Ababa that’s expected to produce detergents such as Omo. Louisville-based Yum! Brands (YUM), which owns KFC, is also considering a move into Ethiopia.

As Africa’s second-most-populous country, behind Nigeria, “Ethiopia is the one that stands out,” Bruce Layzell, Yum’s general manager for new African markets, told Bloomberg News. “We don’t want to go to a country where we can only build four or five restaurants,” he said. “We want to go in and build 50, 100. Our business is the scale game.” Besides the size of its population, what attracts multinational consumer groups to Ethiopia is robust economic growth, averaging 9.3 percent over the past four years, according to the International Monetary Fund.

Unilever says it’s trying to emulate its success in Vietnam, where over the past 20 years it has invested some $300 million and enjoyed average annual sales growth of more than 10 percent from brands that include Lipton tea and Dove soap. As in Vietnam, “we’ve taken a long-term investment decision in Ethiopia,” Dougie Brew, Unilever’s head of corporate affairs for Africa, told Bloomberg. Unilever plans to develop a “comprehensive consumer-goods manufacturing business,” he said, as well as a network of Ethiopian suppliers and distributors.

Heineken made its first big move into Ethiopia in 2011, when it acquired two state-owned brewers, Harar and Bedele, for $160 million. The new brewery scheduled to open this summer will produce Harar and Bedele as well as Heineken, according to local press reports quoting company officials.

Even if they can afford beer and soap, do Ethiopians really have enough disposable income to dine out regularly? Yum’s Layall admits the company is “nowhere near pushing the go button” for KFC in Ethiopia. “It’s still at that explore stage, to find the right partner, to see if the business model will work.”

But the company has reasons to be optimistic: It already operates in more than a dozen sub-Saharan African countries, including at least two, Malawi and Zimbabwe, that are even poorer than Ethiopia.



Tigray Resources Inc.: Drilling at Da Tambuk Identifies a Second Discovery on Mato Bula Trend-Intersects 19.53 Metres at 3.51 Grams Per Tonne Gold, Adyabo Project, Northern Ethiopia


Tigray Resources Inc.

VANCOUVER, BRITISH COLUMBIA–(Marketwired – March 11, 2014) – Tigray Resources Inc. (TSX VENTURE:TIG) (“Tigray” or the “Company”) is pleased to announce diamond drill results from an initial program designed to test 160 metres of strike length at the Da Tambuk Gold Prospect on the Adyabo Project in Ethiopia. Diamond drilling on 80 metre sections has intersected gold mineralization in each of four holes completed, with results including 19.53 metres at 3.51 grams per tonne gold (ADD001) and 5 metres at 40.97 grams per tonne gold (ADD002). These results follow on from the successful first pass drilling at Mato Bula (refer to Tigray’s news release dated July 16, 2013), located approximately 4km along strike to the SSW. Additional diamond drilling was also completed at Terakimti, and a suite of trench results were received for Da Tambuk and additional Tigray prospects.

Drilling at Da Tambuk has tested the down dip extent of surface gold mineralization defined by geochemical and trench sampling (trench sampling [ADT004] at Da Tambuk yielded 16 metres at 3.95 grams per tonne gold, including 4 metres at 14.53 grams per tonne gold – refer to Tigray’s news release dated July 16, 2013). The drill results include:

  • Section 23680N – ADD002 drilled the most northern section tested and intersected 12.00 metres at 17.34 grams per tonne gold and 0.32 percent copper including 5 metres at 40.97 grams per tonne gold and 0.59 percent copper, from 52.75 metres drill depth.
  • Section 23600N – ADD001 intersected 19.53 metres at 3.51 grams per tonne gold and 0.1 percent copper, from 41.30 metres drill depth (50 metres vertically beneath trench ADT004).
  • Section 23600N – ADD004 intersected 9.69 metres at 3.96 grams per tonne gold including 2.00 metres at 13.25 grams per tonne gold from 86.21 metres drill depth (86.00 metres vertically below trench ADT004 and 40.00 metres vertically below the intercept in ADD001).
  • Section 23520N – ADD003 drilled on the most southern section, intersected, 3.00 metres at 4.2 grams per tonne gold from 83.42 metres drill depth (80 metres vertically below surface).

The system remains open along strike in both directions and at depth.

Da Tambuk is part of the Mato Bula Trend, a mineralized corridor now defined over 8km in strike length, and exhibiting a strong porphyry style Cu-Au association. Da Tambuk is hosted in an altered porphyry (intense pyrite-sericite-silica alteration), and the host assemblage, mineralization, and alteration are similar to that of the key target tested at Mato Bula.

Da Tambuk diamond drill Intercepts

Hole ID From                     (m) To                     (m) Interval                     (m)1 Gold                     grams/                     tonne 2,3 Copper                     % Local                     Azimuth Dip
ADD001 41.30 60.83 19.53 3.51 0.10 90 -47
ADD002 52.75 64.75 12.00 17.34 0.32 91 -44
including 52.75 57.75 5.00 40.97 0.59
ADD003 83.42 86.42 3.00 4.20 0.02 90 -48
ADD004 86.21 95.90 9.69 3.96 0.26 90 -46
including 87.21 89.21 2.00 13.25 0.09
1 True thicknesses are interpreted as 65-85% of stated intervals.
2 Intervals use a 0.3 g/t cutoff value.
3 No top cut has been used on assay values.

Key new trench results, located on the target horizon at Da Tambuk, include:

Trench ID From                     (m) To                     (m) Interval                     (m)1 Gold                     grams/                     tonne Project
ADT005 20 38 18 0.43 Da Tambuk
ADT011 42.00 48.00 6.00 0.67 Da Tambuk
ADT012 16.00 23.00 7.00 1.80 Da Tambuk
ADT013 60.00 65.00 5.00 0.29 Da Tambuk
84.00 90.00 6.00 0.48
ADT014 0.00 8.00 8.00 0.38 Da Tambuk
1 True thicknesses are undetermined.

The target horizon has been defined by trenching over greater than a 500 metre strike length to date (between trenches ADT011 and ADT013) and remains open. Similar to results at Mato Bula, trenching results at Da Tambuk, in an area of high topographic relief, appear subdued in gold tenor (interpreted as leached) compared to underlying grades encountered in unweather bedrock, however the anomalous zones identified at surface create an accurate guide for tracing gold target horizons for drill testing.

Exploration Update

Trenching has also identified new gold mineralization for follow-up work at Hanbassa and Mugnae Andi, and include:

Trench ID From                     (m) To                     (m) Interval                     (m)1 Gold                     grams/                     tonne Project
WST016 46.00 48.00 2.00 2.56 Hanbassa
68.00 69.00 1.00 3.02
WST017 114.00 118.00 4.00 7.37 Hanbassa
WST021 34.00 36.00 2.00 4.19 Mugnae Andi
1 True thicknesses are undetermined.

A complete list of project trench results is located on the project website.

Terakimti Update

Trenching at the Terakimti deposit has been conducted, to assist in oxide resource definition (listed in project trench table).

A deep hole diamond drill test (TD069) completed to 340 metre drill depth, targeted mineralization plunging to depth on the central lens, and is interpreted to have undercut the VMS mineralized zone. The hole encountered zinc and barium anomalism profiling downhole from 277 metres depth to 297 metre drill depth, and copper, zinc, gold, silver, and sulphur anomalism profiling from 297 metres drill depth to 330 metres drill depth. No significant base or precious metal intercepts were encountered.

Presently, Tigray is continuing diamond drill exploration as outlined in Tigray’s news release of December 4, 2013 with current emphasis on follow-up drilling at the Mato Bula prospect at Adyabo. Eleven holes for a total of 2350 metres are planned at Mato Bula. Six holes have been completed, with assays pending.

Quality Control

The planning, execution and monitoring of Tigray’s quality control programs at the Harvest project are under the supervision of Jeff Heidema, P.Geo., Tigray’s Vice President Exploration. Mr. Heidema is a Qualified Person as defined by National Instrument 43-101. Diamond drill core samples and trench samples have undergone preliminary preparation at the Acme Laboratories facility in Ankara, Turkey, and are crushed to 80% passing 10 mesh, and pulverized to 85% passing 200 mesh (Acme R200-1000package). Analyses are conducted at Acme Laboratories in Vancouver, Canada, utilizing Aqua Regia digestion and ICP-ES for base metal and silver analyses. Gold analyses are conducted via Fire Assay Fusion with AA finish, and gravimetric analyses are completed for over-limit samples. Blanks and certified reference standards are inserted into the sample stream to monitor laboratory performance. For core, duplicate samples are inserted into the sample stream to both monitor laboratory performance and also characterize potential mineralization.

Qualified Person

Mr. Heidema has reviewed and approved the scientific and technical information contained in this news release.

About Tigray

Tigray is a Canadian mineral exploration company focused on discovery through advancing early-stage mineral projects in Ethiopia. Tigray’s key property is the 70%-owned Harvest polymetallic VMS exploration project, which covers 155 square kilometres in the Tigray region of Ethiopia, 600 kilometres north‐northwest of the capital city of Addis Ababa. The company has an option to earn an 80% interest in the Adyabo property covering 418 square kilometres immediately west of the Harvest project. Tigray’s shares trade on the TSX Venture Exchange under the symbol TIG.

Tigray and East Africa Metals Inc. (“East Africa”) (TSX VENTURE:EAM) have jointly announced that they have entered into a definitive agreement pursuant to which East Africa has agreed to acquire all of the issued and outstanding common shares of Tigray (other than the Tigray shares East Africa currently owns). The transaction will be implemented by way of a statutory Plan of Arrangement under the Canada Business Corporations Act (refer to Tigray’s news release dated February 24, 2014).

More information on Tigray Resources Inc. can be viewed at the company’s website at www.tigray.ca.

On behalf of the Board of Directors:
Andrew Lee Smith, P.Geo.
President, CEO and Director

Cautionary Statement Regarding Forward-Looking Information

This news release contains “forward-looking information” within the meaning of applicable Canadian securities legislation. Generally, forward-looking information can be identified by the use of forward-looking terminology such as “anticipate”, “believe”, “plan”, “expect”, “intend”, “estimate”, “forecast”, “project”, “budget”, “schedule”, “may”, “will”, “could”, “might”, “should” or variations of such words or similar words or expressions. Forward-looking information is based on reasonable assumptions that have been made by the Company as at the date of such information and is subject to known and unknown risks, uncertainties and other factors that may cause the actual results, level of activity, performance or achievements of the Company to be materially different from those expressed or implied by such forward-looking information, including but not limited to: risks associated with mineral exploration and development; metal and mineral prices; availability of capital; accuracy of the Company’s projections and estimates, including the initial mineral resource for the Harvest Project; interest and exchange rates; competition; stock price fluctuations; availability of drilling equipment and access; actual results of current exploration activities; government regulation; political or economic developments; environmental risks; insurance risks; capital expenditures; operating or technical difficulties in connection with development activities; personnel relations; the speculative nature of strategic metal exploration and development including the risks of diminishing quantities of grades of reserves; contests over title to properties; and changes in project parameters as plans continue to be refined, as well as those risk factors set out in the Company’s listing application dated August 18, 2011. Forward-looking statements are based on assumptions management believes to be reasonable, including but not limited to the price of gold, silver, copper and zinc; the demand for gold, silver, copper and zinc; the ability to carry on exploration and development activities; the timely receipt of any required approvals; the ability to obtain qualified personnel, equipment and services in a timely and cost-efficient manner; the ability to operate in a safe, efficient and effective manner; and the regulatory framework regarding environmental matters, and such other assumptions and factors as set out herein.

Although the Company has attempted to identify important factors that could cause actual results to differ materially from those contained in forward-looking information, there may be other factors that cause results not to be as anticipated, estimated or intended. There can be no assurance that such information will prove to be accurate, as actual results and future events could differ materially from those anticipated in such information. Accordingly, readers should not place undue reliance on forward-looking information. The Company does not undertake to update any forward-looking information that is included herein, except in accordance with applicable securities laws.

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this news release.

Contact Information



Kenya’s President visit Ethiopia to boost economic ties


Starting his visit to Ethiopia last night (March 10, 2014), Kenya’s President Uhuru Kenyatta indicated his government’s plan to boost economic ties between the two neighboring countries through bilateral trade and investment. “We are here to see how we can fast track the implementation of Special Status Agreement between our two countries, which will open the door for much and increased economic activities,” Kenya’s President Uhuru Kenyatta said this morning (March 5, 2014) at the press conference held at Ethiopian national palace with Prime Minister Hailemariam Desalegn of Ethiopia. 


“We have respective comparative advantages. Our visit here is aimed at further strengthening the cooperation between our two countries. I do hope during my tenure we will be able to achieve much higher level of specifically economic engagement between our two countries,” President Kenyatta said.

Arriving last night for three days visit with his business delegation, they are expected to hold business talks and visit to Defense Engineering and Leather products manufacturing in Ethiopia as well as Ethiopian Airlines, among others.

While Kenyan parliament has already ratified the Special Status Agreement that aims to ease trade and investment between the two nation avoiding obstacles such as double taxation, Ethiopian Parliament is expected to follow the suit soon.

Stating that the partnership between the two countries is complimentary and not competitors, “We have signed the power purchase agreement to purchase power from Ethiopia and drive our economic development,” said President Uhuru.

Agreeing with statement of the president, Prime Minister Hailemariam Desalegn of Ethiopia added that the Ethiopia and Kenya will work together to integrate the two nations in telecommunications, power, roads and railways infrastructures.

The Prime Minister further noted that Ethiopia and Kenya can be a pillar in the horn of Africa to pacify the region fighting terrorism.  “We need peace and stability in the Horn of Africa. Ethiopia and Kenya are closely working to pacify the region, be it in Somalia or South Sudan,” he said.



ERCA modifies transport tax


By Muluken Yewondwossen   

The Ethiopia Revenue and Customs Authority (ERCA) says the new directive issued under Proclamation No 94/2006 encourages multimodal transportation to save expenses when importing materials from the Djibouti Port.

“Even though the new notice, posted Friday February 28 at Mojo Dry Port was a clarification it also modified a 45 day old edict,” an ERCA representative said. “This is because the note includes additional issues not originally listed in the rule,” the representative added. In the new notice ERCA set a new rate for tax, based on the distance for cargo transportation from ports to the country. According to experts, the new tax scheme will replace the customs duty that was previously 5 percent, and calculated from the FOB. The Ethiopian Shipping and Logistics Services Enterprise, the nation’s sole multimodal provider, is now calculating the freight charge based on the load of the cargo.

The current arrangement will reduce the cost of the cargo when companies use multimodal transportation, (when one provider moves freight using two or more different methods, remaining responsible for it the entire time),  because the previous 5 percent charge was calculated from the invoice (free on board), which is a pricing term that includes the costs of the goods, all transportation, and insurance costs from the manufacturer to the port of departure and loading the vessel, as well as the expense of loading and unloading the vessel and safety precautions), which are calculated from hard currency. “However, the current rate is only being calculated from the charge of the shipping enterprise inland freight tariffs,” experts told Capital.

Mojo is 13.15, 64.89 and 27.89 percent respectively.The port handling payment of 5 percent is exempted for the cargo being transported by multimodal means because it is included in the cost of ocean freight.experts said.

Capital last week reported that ERCA issued a new directive imposing an additional 12 percent levy on imported goods, while ERCA denied imposing any new tax. According to a new directive signed by Beker Shale, director general of ERCA, on January 23, 2014, importers have to pay an additional 12 percent tax when they are importing goods into the country, but the authority said that this was already mentioned in the directives issued a decade ago.

The new rule is based on a previous customs proclamation known as 622/2009. The new directive; ‘Imported Goods Customs Duty and Tax Value Price Tariff: No 94/2006’ requires importers to pay three duties during the process of importing goods into the country.

According to article 14 sub article 3 of the new directive: if imported goods do not have an original document and information about additional customs value and port handling fees, based on article 39 of the 2009 proclamation, customs and tax values will be included in the new tariff imposed on the directive. According to the directive, when goods first enter Ethiopia, transportation costs declared on imported goods must pay an additional 5 percent on top of the customs tax they already pay.

The value of the tax they have to pay is determined based on FOB. Based on that, 5 percent tax is calculated from the FOB price, and it is included in the customs and tax value, which becomes the new levy for import. The other new fee added in the new directive is the fee calculated for the cost of insurance. The directive indicated that based on the accepted FOB price importers have to pay 2 percent of the insurance cost for imported goods that are transported to the first entry of the Ethiopian territory located at Galaffi or Dewale.



Chasing rainbows


By Muluken Yewondwossen      

Ministry hopes lower profit tax encourages exports


Even though the Ethiopian government established an ambitious plan to expand the manufacturing sector during the five year Growth and Transformation Plan (GTP), the actual performance continues to be below expectations.

The first half of the current fiscal year’s manufacturing sector export achievement fills only 13 percent of the full year’s target. In the current fiscal year the government plans to earn about USD 1.3 billion from exports from the manufacturing sector, while the GTP Policy Matrix stated that the 2013/14 export generation would be USD 1.6 billion. However, the Ministry of Industry (MoI)  has a goal of earning about one third of the GTP target in the current fiscal year, but the first half year achievement is by far lower than needed to meet the target. In the first six months of this fiscal year the country has earned USD 175 million from the manufacturing sector, which is about 13 percent of the ministry’s target for the full year and about 11 percent of the GTP’s original target. Even though the performance is not as high as hoped Ahmed Abetew, Minister of Industry is ambitious to meet the goals. At a press conference held on Tuesday March 4, the minister said that there was a possibility  they could still meet their targets. “There are new companies that will begin exporting in the coming year so we have a big opportunity to meet the target that we set in the beginning of the GTP,” he explained.

“Our evaluation has shown that that we can achieve the target if these new companies get on the system based on the project,” he added. He argued that one of the major challenges in meeting the export targets is the challenge of a wide market in the country for textiles, which is the major manufacturing sector that is expected to generate the largest amount of hard currency in the GTP. “Our production track record is very close to targets but export achievements are not as high because there is a large demand in the local market for textiles,” he said. According to the Ahmed, the government is strongly working to encourage foreign based textile manufacturers to export their product. Based on the performance of this fiscal year’s first six months, the ministry has evaluated the result and held discussions with people involved in exporting goods. Sources told Capital that the ministry talked to exporters, sectoral associations, chamber of commerce’s and other stakeholders to get the performance back on track. Early this fiscal year the ministry organized a similar event with stake holders to meet the target after it evaluated the performance over the past three years.

Sources indicated that export based companies have taken quotas from the government after discussions held with every sector. MoI had also ordered the private sector to submit their export plan for the current budget year. According to different sources from the private sector, early in the budget year the institutes that are responsible for manufacturing goods under MoI have imposed a yearly minimum export quota on every company in the sector. Employees at the ministry have also received an industrial strategy and management training after the end of the first half year, according to sources. “The employees’ strategic training occurred following the evaluation that suggested the ministry staff needs to take a new training about the strategies of the government and the ministry,” sources added. The latest training is the first that was given for leaders at the ministry after the beginning of the GTP. The GTP matrix indicated that the country will generate USD 2.5 billion from the manufacturing exports by the end of the GTP (2014/15), which is quarter of the total target in exports.

From the total 2.5 billion the government planned to generate USD 1 billion from textile and garments, leather USD 500 million, sugar USD 662 million and agro processing USD 300 million. According to the minister, the government is working to develop the tax/customs and commercial law, which is expected to encourage new investments. The minister also said that the new law may consider minimizing the current 30 percent profit tax for the manufacturing sector. Currently the ministry office is taking different measures to boost the manufacturing sector, even though the sector’s growth has been lower than expected. Currently the ministry has established an industrial zone at Bole Lemmi and has also transferred notable foreign manufacturers there. It is also constructing another industrial zone in a similar location. The previous government strategy has been focusing on private actors to develop industrial zones, but it has now revised that and the government by itself or in a joint venture with private companies will develop an industrial zone.

The World Bank is also expected to finance another industrial zone development that will be built in the outskirts of Addis Ababa. The Minister also stated that the final approval of the board of the bank is expected in the coming May. The ministry is also working with the Chinese, China Association of Development Zone (CADZ) to develop the first special economic zone in Dire Dawa, in the eastern part of the country. The minister said that the CADZ final study about for the formation of the economic zone is expected to come in May this year. “We will see who will develop the economic zone after we evaluate the study, but we have companies that are interested to develop the project on a JV basis,” he said.

Even though the government is developing an industrial zone in Addis Ababa, the ministry plans to develop industrial zones in four areas based on the five year plan, three areas have not yet had an industrial zone developed in them. At the press conference the minister also stated that government will never change its stand on guaranteeing local manufacturers to secure loans from external financers. Currently local companies, especially share companies who want to invest in the manufacturing sector have a chance to obtain finance from international loan providers, but they cannot get the opportunity to secure a loan in hard currency because those loan providers are requesting a  guarantee from the Ethiopian government.



African, Turkish women entrepreneurs merge at B2B conference


MoU will make it easier for African women to access finance


By Teguest Yilma      

Over three hundred fifty women, from thirty nine African countries converged in Istanbul, Turkey for a Business to Business meeting with 400 of their Turkish counterparts.

The WOWHOTEL Convention Center was the place to be, during February 26th to March 1 as it hosted the first ‘Turkey-Africa Women Entrepreneurs Trade Bridge Conference’.

The event was hosted by TUSKON, a non-governmental and non-profit umbrella organization representing 7 business federations, 211 business associations and over 55,000 entrepreneurs from all over Turkey, in collaboration with the African Union Commission, one of the largest non-governmental trade and business organizations in the Asian-European region.

Ethiopian business women were also among those who attended the conference. Nigist Haile, Founder and Executive Director of the Center for African Women’s Economic Empowerment (CAWEE) facilitated the trip. She said she was delighted with her visit and thrilled to see the Ethiopian business women, who took part in the B2B meeting, successfully obtain trade deals and valuable contacts, useful not only for importing and exporting their products to Turkey.

The Ethiopian businesswomen Capital spoke to at the event were also pleased with the results, Sara Mohamed, founder and owner of Next Design and Bethelehem Tekeste, Marketing Manager of Entoto Beth Artisan were both glad they came because they managed to attract new business opportunities, shared experiences with global players and gained contacts giving their companies new suppliers and clients to enhance their imports and exports.   At the event, a Memorandum of Understanding [MoU] was also signed between the African Union Commission (AUC) and TUSKON, forming a strategic partnership which would focus on trade between female entrepreneurs on the continent with their counterparts in Turkey. After signing the agreement on behalf of Africa, the Deputy Chairman of the AUC, Erastus Mwencha, said it would enhance the investment of Turkish companies in Africa. “It is difficult for women in Africa to access capital for investing and what we have done here will also address this.”

Mwencha said that women represent over 50 percent of Africa’s population; and not including them in the economy is like flying with a one engine plane. The Vice President of TUSKON, Rana Tetcan, agreed with Mwencha, she feels women bring special qualities to management. “One might think that when it comes to business, it does not matter if it’s a woman or a man in charge, but we know women have skills that contribute to better business.” Mwencha says under the new partnership African businesswomen will come together with Turkish businesswomen and act as marketing and distributing agents for Turkish as well as African products. “This joint venture is important,” he stressed as it will enhance investment opportunities to boost trade between Turkey and Africa.

Tetcan, said Turkish women were ready to share their know-how and experience with their African counterparts in a quest to become global players. “We strongly believe that women entrepreneurs in the emerging and developing world are important because women can truly make a difference; women entrepreneurs bring a unique approach to business,” she added. According to Mwencha the one billion strong population of Africa represents a vast potential for both global traders and investors. As it is expected that half of Africa’s population will live in cities by 2030 and the top 18 cities would have a combined spending power of USD 1.3 trillion, this makes Africa the home for future prospectors, he said.

Agriculture, tourism, mining, infrastructural development and Information and Communication Technology (ICT), are potential areas, he listed, that Turkish investors could consider. Although Turkey’s trade volume with African countries has increased from USD 4 billion in 2000 to USD 20 billion in 2012, the trade balance is very much in favour of Turkey. AUC’s Deputy Chairman reminded Turkish businesses. “We believe the prevailing commercial ties between Turkey and Africa should be strengthened to assume momentous growth.” Turkey is a strategic partner and a friend because they share a common vision with Africa for a prosperous future, Mwencha said.

Doing business with Turkey opens doors to the European market, said Litha Musymu Ogana, Director General Women, Gender & Development at the African Union Commission. However the trade imbalance is mainly caused by the developed world importing cheap raw material from Africa which, in turn, leads to Africa importing processed, finished goods at a very high cost. “What African businesses should now focus on is value addition, producing high quality processed products that are good for export,” Ogana noted. She pointed out that the role of African women in leadership positions are rising, with three women head of states – Malawi, Liberia and Central Africa – as well as the first woman to head the AUC – Dr. Nkosazana Dlamini Zuma. “Our women are organized, resilient, grounded and that is what it takes for a good business,” she said.

Turkey’s exports to East Africa are worth USD 813 million per year, while imports from the region to Turkey amount to USD 160 million annually, according to 2013 figures. The country also announced it is planning to invest up to USD 400 million in Africa just this year. In Ethiopia, five, export oriented Turkish textile companies have already been set up, creating significant employment opportunities. President of TUSKON, Rizanur Meral was inspired by what he saw. “TUSKON has hosted several business conferences over the years with many partners and countries, but this one is the most colorful, and the most focused on obtaining tangible business results,” he said.

Africa is the most promising continent in the world, according to the economic growth record of 5.6 percent in 2013. There has been a remarkable amount of foreign direct investment channeled to the continent to take part of a market volume of USD 1.2 trillion, with a population also ranked the fastest growing middle class in the world, said Meral. The African countries represented at the conference include; Ethiopia, Liberia, Ghana, Senegal, Mozambique, Zimbabwe, Congo, Angola, Sudan, Gambia, Zambia, Guinea, Cote D’Ivoire, Burkina Faso, Togo, Nigeria, Somali Land, Uganda, Niger and Benin. Their delegates represented textiles, clothing, manufacturing, information, communication technology, tourism, interior designing and leather sectors. The second ‘Turkey-Africa Women Entrepreneurs Trade Bridge conference’ is expected to be held in Africa.

Tuskon is now organizing the next trade bridge to be held in Istanbul in June this year, gathering businesses from all over the world. The focus this time will be on construction, machinery and related areas. Over 3,000 participants are expected from 140 countries and 25,000 B2B meetings are planned. TUSKON has hosted several regional and worldwide trade fairs in the last few years alone. Besides organizing trade shows and bringing companies together, TUSKON also encourages Turkish companies to come and invest in Africa. TUSKON has five representative offices in Brussels,Washington, Moscow Beijing and Ethiopia as well as partner organizations in 140 countries.

The recently opened Ethiopian office works in partnership with Nejashi Ethio-Turkish International Schools.



First barley harvest for HEINEKEN partnership


The recent barley harvest in Ethiopia is special for HEINEKEN. The first crops have been gathered from a local sourcing partnership we jointly initiated last year. The project aims to improve the livelihood of smallholder farmers whilst securing a reliable supply of quality barley, and is part of HEINEKEN’s pledge to source 60% of raw materials in Africa locally by 2020.

In Arsi and Bale, two central regions of Ethiopia, smallholder farmers have just finished harvesting brand new crop. The seeds for this new supply were sown last year, as part of a four-year public-private partnership programme, with HEINEKEN as a key partner.

The partnership project, known as CREATE (Community Revenue Enhancement through Technology Extension), aims to benefit 20,000 local farmers and the surrounding community. “HEINEKEN is proud to be a leading party in the CREATE project,” says Johan Doyer, General Manager HEINEKEN Ethiopia. “We are committed to the African continent and aim to be a partner for growth for local communities.”

It’s early days for the project, but farmers are starting to reap the benefits. “Since I have been part of this project, I have been able to expand my business, I own my own mill house and I have future plans for expansion,” says local farmer Mohammed Nure.

CREATE-ing opportunity CREATE, running from 2013 – 2017, is based on a Public-Private Partnership between HEINEKEN N.V, the Dutch Government and the NGO EUCORD (European Cooperative for Rural Development). By improving both the quality and quantity of local crops, the programme hopes to revitalise the barley sector in Ethiopia.

Public-Private Partnerships are instrumental in overcoming bottlenecks in the entire malt barley chain, said Dutch Minister for Foreign Trade and Development Cooperation Lilianne Ploumen at the signing of the Memorandum of Understanding last year. She emphasised the importance of close collaboration between public and private institutions for this type of project.

Commitment to Africa and local sourcing HEINEKEN has a long history in Africa – the origins of our first brewery in the Democratic Republic of Congo go back to 1923. In Ethiopia, we currently own two breweries in Bedele and Hara and are building a third close to Addis Ababa.

We are fully committed to sustainable agriculture and local sourcing and have made it one of our key focus areas within our “Brewing a Better Future” sustainability strategy.

Along with barley in Ethiopia, we also have local sourcing projects in 8 other African countries, such as programmes for the agricultural development of maize in Rwanda and sorghum in Sierra Leone. Together these projects help us towards our ambition to source 60% of our raw materials in Africa locally by 2020. This is a pledge we reiterated at the 2013 Clinton Global Initiative event in New York.

Beating targets We are encouraged by steps already taken towards our local sourcing commitment. Siep Hiemstra HEINEKEN President Africa & Middle East, recently announced: “I am very pleased that we are well on track towards our 60% ambition.” We estimate that our local sourcing projects across Africa have already improved the livelihood of 100,000 farmer families.



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