17 March 2014 News Briefs


Ethiopia to host Africa Investment Forum


Juliet Onyango  March 17, 2014

Photo by African Union: A high level panel during the last Grow Africa Investment Forum in South Africa.


The capital of Ethiopia, Addis Ababa, is set to host a significant continental investment forum early next month.Reports indicate that already about 150 international and 140 local companies have confirmed their participation.

Addisu Tekle, the head of the communications department at Addis Ababa Chamber of Commerce and Sectoral Associations (AACCSA), informed the media that the companies are in the fields of infrastructure and finance.

The African Investment Forum is scheduled to take place from April 8th-10th.

Reports indicate that the organizers include Trade and Fairs East Africa (TFEA), the German company, Planetfair GmbH plus, Co., as well as the Ethiopian government, the African Union, and the Pan African Chamber of Commerce and Industry (PACCI).

The forum is aimed at promoting sustainable growth on the African continent. Reports indicate that investors from 27 nations are expected to participate in this event.

Ethiopia hosted a similar summit in 2012, dubbed ‘Africa Sustainable Investment and Development Summit’ between October 17th-19th at the Hilton Hotel.

According to reports, several global investment bankers and venture capital investors met with entrepreneurs and companies from Africa.

The aim of the event was reportedly to generate business partnerships between fund managers, foreign investors, and companies based in Africa.

Additionally, the forum was a platform for investors to gain a better understanding of existing opportunities.

Sources indicate that the summit also highlighted how international investors could gain from assigning investment mandates in Africa and develop partnerships with the suitable investment managers.

Observers say there is a general lack of information on the opportunities, challenges, and potential investment risk in Africa. Therefore, analysts stress the importance of investors heading to the continent to get a better understanding of the potential.

Analysts say Sub-Saharan Africa has benefited immensely from open market policies, such as the privatization of government-run industries.

Africa is increasingly becoming an attractive hub for international investors in light of different economic and political reforms that are taking place in the continent, analysts say. This has reportedly resulted in an improved business setting conducive for direct foreign investment.

Currently, Africa is reported to be experiencing widespread development of crucial physical and social infrastructure, besides a growing pool of enterprising workers across the African continent.

Sources have revealed that international experts and other notable personalities will address many significant business topics related to Africa during the upcoming forum, dubbed “Grow,” which is expected to also comprise an exhibition.



New Agreement Sews Thread Between Smallholder Farmers, Textile Industry


The deal, which is likely to be repeated elsewhere, seeks to shorten the supply chain by removing middlemen


From left to right, Asefa Aga, general manager of ECPGEA, Amare Teklemariam, CEO of Ayka Addis, Yusuf Aydinzy, owner & president of Ayka Textile, Bawdi Ayele, Board chairperson of the Metema Union and Birhane G. Yohaness, chairperson of the ECPGEA.


The Metema Cotton Producers’ Union and member associations are guaranteed to be able to sell a kilogram of cotton at a minimum price of 24 Br if they produce 50,000qtls of cotton in the 2014/15 harvest season.

This is according to an agreement they signed with the Ayka Addis Textile & Investment Group – one of the biggest textile producing companies in East Africa, with an accumulated capital of 2.5 billion Br – on Friday, March 7, 2014, at the Elilly Hotel, located on Guinea Conakry Street around the Kasanchis area of Kirkos District.

Ayka Addis, whose plant is located in Alemgena town in the Southwest Shewa Zone of the Oromia Region (26km from Addis Abeba), has the capacity to spin 40 tonnes of cotton, knit 38 tonnes of thread, dye 50 tonnes of cloth and produce 80,000 pieces of garment in a day. With 7,500 permanent and 100 temporary workers, the Company exports its products mainly to Germany.

Ayka Addis, located in Alemgena town in the Southwest Shewa Zone of the Oromia Region


The Company consumes around 15,000 tonnes of cotton for its annual production and is expecting to satisfy 30pc of this demand from the Metema Union through the agreement.

Cotton farmers in Metema woreda, located 900km from Addis Abeba in the North Gondar Zone of the Amhara Region, will be relieved of the issue of getting buyers on time, according to the agreement signed by Yusuf Aydinzy, owner and president of the Ayka Textile, and Bawdi Ayele, the Board chairperson of the Union.

The two parties have agreed to set the price at the time of harvest based on domestic and international prices of the product, establishing 24 Br as the floor price.

The amount of cotton stated in the agreement is estimated to be worth between 150 million Br and 180 million Br at current prices, according to the statement distributed at the time of the signing ceremony. A metric tonne of cotton is currently being sold at 1,435 dollars in the international market.

“The price offered by Ayka Addis is not far from the actual price of this harvest season, which was around 30Br,” Assefa Aga, general manager of the Ethiopian Cotton Producers, Ginners & Exporters Association (ECPGEA), told Fortune.

The deal is designed to create a solid linkage between Ayka Addis and local smallholder farmers, and give them the chance to eliminate middle men, and supply to Metema Union, says Amare Teklemariam, CEO of Ayka Addis. It will also give the farmer’s market a price guarantee, enabling them to focus solely on production”.

The farmers in the Union, numbering 6,000, will start supplying cotton to Ayka Addis from October 2014, according to the one year contract – part of a program by the Cotton Made in Africa initiative (CmiA). The CmiA is an initiative of the Aid for Trade Foundation (AfTF), which is based in Hamburg, Germany, and is aimed at enabling people to help themselves through trade, by improving the social, economical and ecological living conditions of smallholder cotton farmers and their families in Sub-Saharan Africa. Through training programs, the CmiA teaches the cotton farmers about modern, efficient and environmentally friendly cultivation methods that help them to improve the quality of their cotton, yield higher crops and thus earn a better income. The local implementing partner for CmiA is the ECPGEA.

“We will train the farmers and hire up to 18 personnel to help the framers produce the required output,” says Assefa.

The project has also given a guarantee of one million Birr to Abay Bank S.C for the Union to access loans for the purchase of different inputs for the harvesting season, Fortune learnt.

“Aika Addis is also open to engage with other unions in similar modalities,” Amare told Fortune.

For Yared Mesfin, Cotton & Textile Marketing director at the Textile Industry Development Institute (TIDI), the deal is expected to set the trend for future engagement in the industry. The Institute has plans to implement similar projects in the future.

“For now, however, none have yet matured,” Mesfin said.

Problems of low productivity, shortage of inputs, land related bottlenecks and concentration of ginners around Addis Abeba are some of the obstacles that the cotton industry continues to face, the marketing director at the TIDI told Fortune.

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



CNR signs tramcar contracts with Ethiopia


BEIJING, March 17 (Xinhua) — Chinese train manufacturer CNR Corporation (CNR) has signed contracts with Ethiopia to provide 41 modern tramcars, marking the entry of Chinese tramcars into Africa, CNR said Monday.

The tramcars will be customized for use in Ethiopia’s capital of Addis Ababa, where the altitude is 2,400 meters and ultraviolet light is strong, according to CNR’s statement.

According to CNR, the tramcars are the world’s most sunlight-resistant and will use special components in the glass, rubber, paint and cable. They can travel at a maximum of 70 kilometers per hour.

CNR will deliver its first batch of tramcars to Ethiopia at the end of 2014.

CNR, one of the largest train makers in China, manufactures a range of products, from locomotives to high-speed trains, which have been widely used for the country’s railway services.

The company’s net profits totaled 2.39 billion yuan (391 million U.S. dollars) in the first three quarters of 2013, up 1.81 percent year on year.



Shares start for huge, new expo center


Addis-Africa International Convention and Exhibition Center S.C. (AAICEC) officially launched selling shares for the construction of the first phase of its center in CMC that will incorporate a conference hall, 2 exhibition centers, an amphitheater and facilities for restaurants and business centers.

Though the company formally announced that the shares are available on Friday, March 14, it has been promoting and selling shares since December, 2013. In fact, more than 30,000 shares have been bought by 54 companies and individuals, according to Ayalew Zegeye board chairman of AAICEC. AAICEC has 300,000 shares each worth 1,000 birr.

This formal launch is intended to attract big companies with more spending capacity and to show it is a private-public partnership project. Formed in November, 2012 by 20 shareholders with a capital of 10.85 million birr, the center will be built on a 110,000 sqm plot of land. The total cost is estimated at 2 billion birr, Ayalew said. The first phase construction requires half a billion birr to complete. After the company raises the 300 million birr, it will get the remaining amount from a bank as a loan. “We need to make sure that the banks trust us first,” says Ayalew. “So the 200 million birr bank financing is conditional on the share of sales.”

One of the 20 companies that founded the Center is the Addis Ababa City Administration and it will contribute 33 million birr for the construction in partial payments. Due to the absence of a secondary share market, the company decided the price of shares by itself, according to Ayalew.

When the entire center is completed in the next five years it will boast several conference halls, exhibition pavilions, market centers, entertainment centers and a 4-star hotel. Construction will begin in the next budget year, according to Ayalew.

During the second phase the remaining four pavilions and the finishing work for the first phase will be done. In the last phase a 4-star hotel and a mall containing shops and gymnasiums will be built. The sale of shares will start formally at the Sheraton hotel on Tuesday, March 18 in the presence of Deriba Kuma, mayor of Addis Ababa.

Construction of the whole project is expected to be completed within five to six years.



Asseco Poland signs a contract to implement a billing system in Ethiopia. The largest Polish IT implementation in Africa.


On 13 March 2014, in Addis Ababa, Ethiopia, Asseco Poland and an Ethiopian government agency, namely the Information Network Security Agency (INSA), signed an agreement to jointly execute a project aiming to lay foundations for a modern energy market in Ethiopia. The contract value amounts to nearly USD 10 million and the project shall be completed by end of 2015.

Construction of a modern energy market is of strategic importance to the Ethiopian economy. It will be created based on Asseco’s proprietary AUMS software as well as extensive know-how in IT solutions for the energy sector. Thus Asseco Poland has a chance to play a significant role in the development of information technology in Ethiopia and across Africa, and furthermore demonstrate to this continent that Poland is a country of innovative technologies which can be successfully implemented in the rapidly developing African economies.

“Asseco’s cooperation with the Ethiopian government is strongly supported by the Polish Ministry of Foreign Affairs. This is a perfect example of how our diplomatic services get involved in promoting the Polish economy on global markets. I would especially like to thank Jacek Jankowski, Polish Ambassador to Ethiopia and the Embassy staff. Without their commitment, we would not be able to conduct so many fruitful meetings with ministers and representatives of the Ethiopian Government as well as representatives of the African Union. The Ambassador’s presence not only raised the rank of these meetings, but also aroused greater interest among our partners,” emphasizes Adam Góral, President and CEO of Asseco Poland.

The concluded “INSA 2.0 Energy Enterprise Management System Development and Implementation Agreement” and “ERP Solution Advisory Services Agreement” both provide for the cooperation of Asseco and INSA in the area of implementing a software solution that is required to set up a modern energy market in Ethiopia. For this purpose, Asseco will deliver and launch a comprehensive IT system able to manage the power consumption readings, based on its proprietary Asseco Utility Management Solutions (AUMS). In addition, Asseco will provide advisory services associated with the development of ERP software, and it will also share the necessary knowledge and IT technologies in order to enable INSA build a modern energy market.

“Cooperation with Ethiopia is strategically important for the expansion of our product family of Asseco Utility Management Solutions into foreign markets. We achieved a remarkable success which is the first measurable effect of our sales efforts in the African market. This project is also a great opportunity for further expansion of Asseco in Africa, not only in the power industry,” says Paweł Piwowar, Vice President of Asseco Poland.

AUMS Billing is Asseco’s flagship product for the power industry, which has been tested at the IBM software laboratory in Singapore, and successfully implemented for Tauron Group, PGNiG Group, and Polkomtel, just to mention a few. Asseco Poland has implemented numerous projects for the energy industry for over a dozen years. The company’s engineers designed and implemented state-of-the-art IT systems for most of the energy companies in Poland. We always work with our clients on a partnership basis. We provide assistance in creating new solutions, right from the inception of a new idea up to its realization. Asseco is a reliable partner not only in designing IT solutions, but also offers know-how and experience in planning organizational changes, as well as development of new processes and operating methods for our clients. Asseco Poland leverages on the internationally recognized models to improve efficiency of enterprises. These models have been adapted to the specific IT market needs and modified based on our experience gained during the implementation of complex projects for corporate clients.



New Bill to Fuel Effectiveness of Prior Proclamations


The bill is deemed necessary in order to ensure that the country’s petroleum sector satisfies international standards


Owners and custodians of more than 500lt of petroleum or petroleum products, will be required to report the incident to government authorities in case of leakage and clean up the spill.


The Parliament is considering a petroleum bill intended to enable the Ministry of Water, Irrigation & Energy (MoWIE) protect the public and the environment.

Earlier proclamations have included one issued in 2010/11 requiring the Ministry to determine the standards of petroleum institutions and to monitor their performance, and another issued in 2009/10 requiring it to certify the competence of those that work in the sector.

The new bill, referred to the Natural Resource & Environmental Protection Affairs Standing Committee on Tuesday, March 11, 2014, is needed to carry out the duties the Ministry has from the earlier proclamation, the bill says in its preamble.

Among the requirements in the bill is that where there is a leak of more than 500lt of petroleum or petroleum products, owners or custodians of the product must report the incident to the MoWIE and clean up the spill. Where they fail to do the cleanup and the Ministry does it, they will be expected to reimburse the cost.

Previously, custodians or owners were not required to report incidents involving the spilling of petroleum products to any government regulatory agency or the Ministry, although reporting was encouraged.

The rationale behind the drafting of the bill, according to Getachew Bedane, deputy Government Whip in Parliament, is to ensure that the operation of petroleum products in Ethiopia complies with accepted international standards.

The draft bill maintains the requirement by the Ministry that any distributor must “keep reserve stock of no less than 500 cubic metres, so as to have a reliable supply of petroleum products in the country”.

Any person who wants to engage in petroleum supply operations must apply for a certificate of competence at the Ministry, the bill says. Applicants must comply with the national energy plan and strategies. The impact of the contribution by the applicant, in terms of social and environmental protection, is another requirement. Legal, technical and financial capacity and competence are also considered when issuing a certificate of competence.

The certificate of competence will be revoked or suspended when the holder violates the provisions of the bill or other laws concerning environmental protection, community safety and the capacity to store the minimum volume of petroleum products as a distributor, among others.

Nevertheless, some other issues should have been included in the bill, according to Serkalem Gebresilassie, CEO of Dalol Oil SC -the second publicly-owned oil retail company in the country. One of these is the location of big depots.

“As fuel is very combustible and sensitive in nature, the depots of all oil companies should be located far beyond the city limits, in order to mitigate accidents,” he argues.

That is happening without a law, he says, but “its inclusion would have given it weight.”

The depot of Dalol, which entered the Ethiopian petroleum business two years ago with a 40 million Br paid up capital and seven filling stations in the country, is located at Wolenchiti town, in the East Shewa Zone of the Oromia Region – 122km from Addis Abeba.

Serkalem complained that his Company should have been invited for consultation before drafting of the bill, as it had a stake and a lot to contribute.



Obama’s Power Africa initiative focuses on geothermal power in Ethiopia


Obama’s Power Africa initiative focuses on geothermal power in Ethiopia

Earl Gast, the United States Agency for International Development (USAID) assistant administrator for Africa, on Thursday, told journalists across Africa via a telephone press conference that Power Africa is gaining ground in terms of financial availabilities for the initiative. The Power Africa Initiative, along with Trade Africa was launched last year by President Barack Obama following his visit to Africa.

Gast said that currently, Power Africa has secured close to 20 percent of the USD seven billion which is to be available for 20 million Africans in the continent.  Ethiopia, Kenya, Tanzania, Ghana, Liberia and Nigeria are the six benefiting countries of Power Africa Initiative. The initiative will help to generate some 10,000 MW of electric power. However, the US is more inclined to assist Ethiopia on geothermal energy sources as opposed to the hydropower for obvious reasons- the fragile situation of Egypt and Ethiopia lies on the grand dam project Ethiopia is constructing over the river Nile.

Asked by The Reporter whether the initiative has got anything to do with the Grand Ethiopian Renaissance Dam (GERD), Gast was more inclined to discuss the potentials Ethiopia has in geothermal sources.. He clarified that Power Africa is all about green power; mainly focusing on geothermal, solar, wind sources and biomass and to the extent gas are the alternatives planned projects to be executed in those six countries.

According to Gast, some 600 million people in Africa are in need of electrical power supply. Illegal mining makes it more difficult for many in Africa to tap into potentials to the benefit of the mass. Both on and off the grid located communities are considered by the initiative, he said. The very intent of Power Africa is to embrace the private sector both in Africa and the States.

Gast was positive about the power export deals Ethiopia has with neighboring countries. USAID will assist production agreements the countries had for commercial benefits he said.  The initiative will make possible power related finances, legal, engineering and other assistances in transactions by overcoming hurdles in Africa. Yet, the initiative remains very immature even after a year.  It is still in progress for practical outcomes in Ethiopia if not in the remaining countries.

Recently, the curiosity towards developing geothermal energy seems central for countries like Japan, Poland and boldly the US. An Icelandic company has been in the headlines for its keen interests to invest some USD four billion for 1000 MW of energy from geothermal sources. Japan alone is working on a project to find out if the rift valley of Ethiopia has the potential to generate some 70 MW.



InvestorIntel: Allana Potash One Step Closer to Production with ICL Strategic Partnership


Toronto, Ontario–(Newsfile Corp. – March 17, 2014) – Farhad Abasov, President and CEO of Allana Potash Corp (TSX: AAA) (OTCQX: ALLRF) (‘Allana’) in an interview with Tracy Weslosky, Editor-in-Chief and Publisher of InvestorIntel about the USD$84 million milestone deal between Allana and Israel Chemicals (ICL, TASE: ICL), one of the largest mineral fertilizer companies in the world. Allana is at an advanced stage in the Danakil Potash Project in Ethiopia; it has completed the definitive feasibility study (FS) and secured the necessary mining license needed to start construction of the mine itself.

Commenting on the ICL deal, Farhad said “this is the first time in many years in the sector where a real potash producer has become a strategic partner with the junior potash developer like Allana and it is a very important deal for Allana because it is comprehensive and includes three major components: cash investment, equity investment, a solid off-take agreement for 80% of our production and a full technical assistance from organization like ICL.” It should be noted that ICL is the world’s sixth largest potash producer; it sold about five million tons of potash in 2013 and has mines in Spain and Great Britain as well. In addition, Allana and Ethiopia are strategically located to serve the rapidly growing African demand for potash, where typically potash consumption has been low. Ethiopia, one of the world’s fastest growing economies, will guarantee significant sales for Allana. The country has ambitious plans and agriculture is its highest priority: “so we are really fortunate to be in a country that is not only grown fast economically but is that its government is fully supportive on this project and they’re also fully supportive of this new strategic partnership with ICL.”

Allana has met all its benchmarks and commitments to shareholders and while 2013 was an eventful year, 2014 could be even more interesting. In fact, Allana is at an advanced stage in the project, having already completed the definitive feasibility study (FS) in 2013, securing the necessary mining license needed to start construction of the mine itself. In 2014, apart from the ICL partnership, Farhad expects Allana will be “working on further financing most the debt financing on this project; it will do further optimization works on the project again technically, and mostly on the aquifer testing and some more solution mining work. Ultimately the goal for this year is to actually finalize full funding for the project so that we can start construction.”

One of Allana’s main advantages compared to other mining juniors – and not just in the potash sector – is that it is several steps ahead of the game in a market where most all are talking – usually complaining – about money. Allana has already secured two internationally well-known strategic partners such as the International Finance Corporation (IFC) and Liberty Metals and Mining. Farhad adds “and now we have another large industry player such as ICL”. In addition, Farhad says that “it is very important to emphasize here that besides the fact that they’re putting a lot of capital into the company and that they’re giving us a very strong and solid off-take, the technical assistance has to be stressed. ICL’s production profile in the Dead Sea in Israel is very similar to what we envision for our project in Ethiopia in terms of solar evaporation, processing and even transportation modes such as trucking. There aren’t too many companies that are similar in their production plans to what where planning to accomplish in Ethiopia so it’s a big coup for us to have such a partner as ICL”.

Farhad then speaks about the potash price and market in general, suggesting that the market situation will be tight for the next few years but that Allana welcomes this as a chance to restore some discipline in the sector as many new potash projects do not make much economic sense. As less supply than expected comes on line, prices should start to increase.


Video here:  http://www.youtube.com/watch?feature=player_embedded&v=zMpWw6bdiFI


Al Mansouri Heads Commercial Delegation to Ethiopia


Al Mansouri: “Visit aims to strengthen mutual cooperation across diverse sectors”

Dubai-UAE: 17 March, 2014 – His Excellency Sultan Al Mansouri, UAE Minister of Economy, is leading a high-level delegation to Ethiopia aiming to build on the partnership agreement signed between the two countries towards strengthening bilateral cooperation in trade and investment.

The agreement inked in 2013 led to the formation of a joint committee for cooperation in economic, political and social sectors and the opening of a representative office for the Dubai Chamber of Commerce and Industry in Ethiopia.

The UAE delegation includes His Excellency Abdullah Bin Ahmad Al Saleh, Undersecretary of the Ministry, Foreign Trade Sector, His Excellency Omair Al Dhaheri, member of the Abu Dhabi Chamber of Commerce and Industry , as well as representatives from the Department of Economic Development in Abu Dhabi, Abu Dhabi Chamber of Commerce and Industry , Dubai Chamber of Commerce and Industry , and private sector companies such as Mubadala, Gulfar, Al Jaber Aluminum and Agthia Group.

The two-day visit from 19 – 20 March will include a number of official meetings with representatives from the government of Ethiopia and events including the Emirati – Ethiopian Business Forum. Held in cooperation with the UAE Embassy in Addis Ababa and the Department of Economic Development in Abu Dhabi, the business forum will gather senior government officials and entrepreneurs from the two countries. Heads of Emirati companies will also meet with their Ethiopian counterparts on the sidelines of the event to discuss collaboration opportunities.

Speaking on the eve of the UAE delegation’s departure to Ethiopia, His Excellency Sultan Al Mansouri said: “Ethiopia enjoys rich natural resources and offers promising opportunities for investment in a number of sectors such as infrastructure, oil, gas, tourism, and the hospitality and food industry. We are looking to make headway on a number of investment projects that serve the interest of both the countries.

“We also aim to leverage the trip to highlight the enabling regulatory environment that the UAE provides for trade and investment as part of its priority to diversify the national economy. We will also share the obvious advantages of investing in the UAE that enjoys a strategic location as a regional gateway and offers advanced infrastructure and other assets that position us as an international trading hub.”

The Minister added: “Our visit to Ethiopia will help the UAE further its ambition of gaining a stronger trading partner in the African continent. Ethiopia holds special significance for us given the synergy we continue to enjoy with the country.”

Al Mansouri articulated the commitment of the Ministry of Economy in driving UAE exports through leveraging the partnerships it shares with many countries. The Ministry of Economy seeks to reinforce the competitiveness of the country’s products and services, and further advance the burgeoning exports sector.

The UAE’s investments in Ethiopia are estimated at US$3 billion, concentrated mainly in tourism and hospitality sectors. The trade volume between the two countries has reached one billion US dollars in 2012.



Ethiopia draws in Chinese water management expertise


ADDIS ABABA – Ethiopia and China have signed a memorandum of understanding, under which Chinese company Hydrochina would provide technical support and consultation to projects supervised by Ethiopia’s Water Works Design and Supervision Enterprise (WWDSE).

Ethiopia and China have signed a memorandum of understanding, under which Chinese company Hydrochina would provide technical support and consultation to projects supervised by Ethiopia's Water Works Design and Supervision Enterprise (WWDSE).

“Hydrochina will transfer scientific and technical software, knowhow and management systems,” WWDSE business development and planning sub-process manager Berhan Demisse told Anadolu Agency on Sunday.

“The agreement will last for one year beginning March 12,” Demisse added.

Under the deal, Hydrochina will provide training for the scientific and technical personnel of the Ethiopian enterprise, he said.

The memo of understanding also provides for the two sides to exchange scientific and technical skills and experience and to share information on the basis of mutually agreed commercial terms, added Demisse.

Founded in Shanghai, China, in 1954, Hydrochina is engaged in providing engineering consultancies, analytics and research services to water projects across China and worldwide.

Ethiopia has 12 river basins, estimated to generate an annual runoff of more than 122 billion cubic meters.

However, observers believe that the economic utilization of the resource lags behind demand.

Copyright © 2014 Anadolu Agency



Belgium Becomes Latest Buyer into Burgeoning Brewing Sector


Unibra have been active in the African beer market since they were established in 1960


Unibra, a Belgium-based company, has agreed, on March 4, 2014, to take 60pc ownership of the Zebidar Brewery – one of the latest entrants into Ethiopia’s beer industry – after eight months of negotiations with Zebidar-Hulegeb Industry SC.

The Belgium-based company, which has operated in the African beverage market since its establishment in 1960, through the merger of four breweries in what is now the Democratic Republic of Congo (DRC), currently produces 100,000hl of beer.

Zebidar Hulegeb has changed its name to Jemar Hulegeb, according to part of the agreement signed at the headquarters of the Ethiopian Investment Agency (EIA), located opposite the Dembel City Centre, in the Olympia area of Africa Avenue, and owns 40pc of the jointly owned Zebidar Brewery SC.

Another part of the agreement concerns the shareholding between Unibra and Jemar Hulegeb. The latter planned to sell 50pc of its shares in Zebidar. However, Unibra came up with a minimum requirement of 51pc.

“It took eight months to reconcile the differences and reach 60pc,” says Taddesse Abzaw, general manager of Jemar Hulegeb.

Zebidar, which plans to start producing 300,000hl of beer after September 2015, will have five board members, two from Jemar and three from Unibra.

Unibra will also provide a project manager, business coordinator and marketing coordinator for the Brewery.

Zebidar  is currently conducting a topography survey, water drilling, site clearing and civil work design to erect the brewery on the 150,000sqm plot it has taken from the Southern Region, in Gurba – 12km from Wokqite town, Guraghe Zone (158km from Addis Abeba). The location was selected because of its immediate market centre of Welqite town and proximity to other dominant centres like Addis Abeba, Jimma (346km from Addis Abeba), Hosanna (185km from Addis Abeba), Woliso (114.8km from Addis Abeba, Butajira (130km from Addis Abeba) and Zeway (163km from Addis Abeba).

The Brewery will have a capital of 800 million Br, out of which 350 million Br is contributed by both Unibra and Jemar and 210 million Br is contributed by Unibra. Jemar contributes 140 million Br, whereas the remaining 450 million Br will be obtained through bank loans.

“We expect to receive technical and marketing assistance through partnering with Unibra,” Gebru Habtewold, chairperson of Jemar, told Fortune.

Unibra is one of the founders of the Skol Beer brand, established in 1964.  It operates in six countries. Skol is the third largest beer brand in terms of volume. Unibra owns Skol in Africa. The company also entered the Rwanda market in 2010.

Zebidar is set to enter a beer market that is still relatively undeveloped. Ethiopia’s average annual beer consumption stands at five litres per person, while Kenya’s is 12 litres.

BGI Ethiopia ranks first in the Ethiopian beer market with a 48.25pc market share. The Heineken and Dashen Breweries trail behind in second and third, with an 18.75pc and 18pc, respectively. Diageo Plc comes last with 15pc.



New Council Promises to Transform the Lagging Tourism


Despite having more UNESCO sites than any other African country, Ethiopia still sits 17th in the continent of countries most visited


                 Ethiopian officials, Prime Minister Hailemarim Desalegn, middle, Amin Abdulkadir, minister of Culture & Tourism and Tadelech Dallecho, looked content with the establishment of the two entities, on Friday, March 14, 2014, at the AU’s headquarters.


Ethiopia has launched two new entities – the Tourism Transformation Council and the Ethiopian Tourism Organisation – both designed to transform its tourism industry.

The establishment of the two organs has been necessitated by the need to coordinate the activities of the various stakeholders in the industry, said Mulgeta Seid, State minister for Culture & Tourism.

At the founding assembly meeting of Ethiopia’s Tourism Transformation Council and the first meeting of the Council’s members, held at the African Union’s (AU) conference hall, on Roosevelt Stteet, on March 14, 2014, Prime Minister Hailemariam Desalegn, who chairs the Council, expressed his hope that the establishment of the Council will help make the country one of the top tourist destinations in Africa, as outlined in the government’s Growth & Transformation Plan (GTP).

“For a long time, Ethiopia has been negatively portrayed internationally,” Hailemariam said. “This is quickly changing and we need to sustain our efforts to positively portray the image of the country.”

Established under the Council of Ministers (CoM) Regulation entitled “Tourism Transformation Council & Ethiopian Tourism Organisation Establishment”, issued on August 27, 2013, the Council comprises of members from  different relevant ministries, mayors of the Addis Abeba and Dire Dawa city administrations, CEO of Ethiopian Airlines (ET), presidents of the Ethiopian Tour Operators Association and the Ethiopian Hotel & Restaurant Owners Association,  president of the Ethiopian Chamber of Commerce & Sectoral Associations (ECCSA) and representatives of religious institutions and  renowned personalities, among others.

The Council is meant to provide leadership and set directions for the country’s tourist destinations development and tourism marketing initiatives. It is also authorised to give necessary instructions to the concerned bodies to remove major impediments and challenges to development in the tourism industry and ensure their implementation.

Providing the necessary directions to ascertain collaboration and synergy among various institutions for the successful implementation of tourism development and marketing initiatives has also been defined as one of its duties. The Council, which will meet once every six months, is also tasked with setting directions on strategic matters that the Ethiopian Tourism Organisation, the other entity launched on Friday, will pursue.

Despite being endowed with the advantage of rich natural, historical and cultural resources and having nine UNESCO registered World Heritage sites – the highest number in Africa – Ethiopia’s tourism industry still remains undeveloped, as data from the Ministry of Culture & Tourism (MoCT) indicates.

In 2012, 52.3 million tourists visited Africa, out of which only 596,341 reached Ethiopia. That same year, the continent earned 34 billion dollars from the industry, out of which 1.19 billion dollars flowed in Ethiopia’s directions.  Ethiopia’s tourism industry is earning less than other competing nations by raking 121st in the world and 17th in Africa.

“It is not too late for Ethiopia,” argues Mulgeta. “Ethiopia still has time to catch up with those countries earning more revenues, provided that it works hard.”

The Council was established with the view to raise the standard of the industry to a higher level, the State minister indicated.

For Woldegebriel Berhe, tourism promotion expert at the newly established Ethiopian Tourism Organisation, who was at the meeting, the Council will help to elevate the tourism industry, as it has the advantage of being made up of members drawn from various institutions, as well as influential individuals.

“Another is the decision making advantage,” says Woldegebriel. “The Council’s decision has the voice of heads of various member institutions, making it easier to be applicable.”

The ceremony also saw the establishment of an autonomous federal government organ – the Ethiopian Tourism Organisation. This will function as the secretariat of the Council and is structured to have a Tourism Board and a director general.

“The establishment of these entities will lay a strong foundation and help us in our efforts to develop the tourism industry,” Amin Abdulkadir, minister of Culture & Tourism said during the inaugural ceremony. “The Ministry is encouraged by recent growth of the sector and is keen to scale up its efforts to utilise the industry’s full potential.”

The Ministry recently announced that over 1.38 billion Br revenue was obtained from tourism in the first half of this Ethiopian budget year. The revenue was earned from 370,754 foreign tourists who visited the country. The number of tourists increased by 36pc compared to that of same period the previous year.

The Ethiopian government expects to earn three billion dollars from tourism by the end of the GTP in 2015, and aims to turn Ethiopia into one of the top five tourist destinations in Africa by the end of 2020.



Kenyan government reduces fertiliser prices


Fertiliser Kenya IFDC Photography

The Kenyan goverment has provided support to Kenyan farmers by reducing fertiliser prices. (Image source: IFDC)


The Kenyan government has reduced the prices of fertiliser by 25 per cent to increase usage as the planting season approaches

The national fertiliser usage is currently 530,000 mt against the recommended one million metric tonnes, the Kenyan government said.

According to government officials in Kenya, optimum fertiliser usage will boost food production by 30 per cent.

“The only way to spur food production is to reduce the prices of farm inputs such as fertilisers. My government is committed to making sure that farmers have access to affordable fertilisers”, said President Uhuru Kenyatta as he flagged off lorries ferrying subsidized fertilizer to various parts of the country.

In the current financial year, the government has purchased 143,000 tonnes of subsidized at a cost of US$85mn through the National Accelerated Agricultural Inputs Access Programme (NAAIAP).

The government approved the formation of the Fertilizer and Seed Fund in August 2013 with an initial capital of US$35.2mn building up to US$176mn in five years.

To improve fertilizer utilization, the government has recieved financial assistance from the European Union who analysed soils in 164 sub-counties to ascertain their mineral contents among other attributes.



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