15 May 2014 News Round-Up

Israel Chemicals profit plunges


Israel Chemicals


Potash sales reached a record in the first quarter but were sold for lower prices.

Israel Chemicals Ltd. (TASE: ICL) reported a sharp fall in profits in the first quarter of 2014. Revenue was $1.61 billion in the first quarter, down slightly from $1.61 billion in the corresponding quarter of 2013. The fall from the corresponding quarter was mainly due to a drop in global prices, which was offset by a rise in sales volume.

Gross profit for the first quarter of 2014 totaled $563 million, compared with $659 million in the first quarter of 2013. Operating profit for the first quarter of 2014 totaled $243 million, 33% down from $363 million for the first quarter of 2013.

The bottom line was that net profit to shareholders for the first quarter of 2014 totaled $131 million, down 57% from $305 million for the corresponding quarter.

Adjusted net profit was $189 million in the first quarter of 2013, after eliminatiing $58 million for non recurring tax expenses following assessment discussions in European subsidiaries and increased costs due to a strike at Rotem Amfert.

In the first quarter of 2014, Israel Chemicals unit ICL Fertilizers sold a record 1.46 million tons of potash, up 12% from 1.3 million tons in the corresponding quarter. The rise was mainly due to increased sales in China, Brazil and Europe.

The company’s board of directors will distribute $91.5 million in dividends on June 25.

Published by Globes [online], Israel business news – www.globes-online.com – on May 15, 2014

© Copyright of Globes Publisher Itonut (1983) Ltd. 2014


Mining the green gold of Ethiopia’s Danakil


By Elissa Jobson in Addis Ababa
The Danakil Depression holds the world’s largest potash deposit – production should start by 2015. Stocktrek Images/Richard Roscoe/Getty

The Danakil Depression holds the world’s largest potash deposit – production should start by 2015. Stocktrek Images/Richard Roscoe/Getty

As companies rush to secure their claim on Ethiopia’s mineral riches, the government is keen to show it supports international transparency measures.

Ethiopia is in the midst of a gold, oil, mineral and gemstone rush. More than 250 companies are currently scouring the territory hoping to strike it rich.

We started our exploration in mining at a good time because we are not learning the hard way. We have seen what happened in different underdeveloped countries

“Ethiopia is a very large country. There is a diversity of geology,” says Tolesa Shagi, the minister of mines. “There is huge potential for different minerals – that is what we understood after we invited foreign mining companies.”

Just over half of the country has been surveyed so far and it already appears that there are significant reserves of gold, oil and potash as well as valuable deposits of coal, tantalum, cop- per, platinum, opals, rubies and other gemstones.

The mining sector currently accounts for around 1% of the Ethiopian economy, but the government expects that in 10 years’ time it will represent 10% of GDP. Potash is likely to be one of the first commodities to contribute to this growth.

In the remote and arid Danakil Depression, in northeast Ethiopia, lies the world’s largest potash deposit. Three companies – Allana Potash Corporation, Yara International and Ethiopian Potash Corporation – are exploring the reserves.

Allana expects to start production by the end of 2015 and Yara by the end of 2017, pending the results of its feasibility study.

Sanjay Rathore, executive director of Yara’s Ethiopian subsidiary Yara Dallo, says the company expects to extract 600,000tn of high-grade sulphate of potash every year.

“This means our project will produce about 10% of the current world market at start-up,” he says, adding that the Danakil deposit is special because all the required chemical components are naturally present in the salt mixture.

Tax incentives

Commercial mining operations like those planned by Yara are the exception in Ethiopia, where 90% of all mining activity is artisanal and small-scale.

There are only two large-scale mines: a state-owned tantalum mine in Kenticha, Oromia (production there has stopped while the government searches for an investment partner) and Lega Dembi gold mine in Adola operated by Midroc, a company owned by Ethio-Saudi billionaire Mohammed Al Amoudi.

The government is offering a variety of incentives to attract investors, including tax holidays, import-duty exemptions, lower royalty levels and guarantees on selling rights. But it is wary of the dangers associated with the exploitation of mineral wealth.

“We started our exploration in mining at a good time because we are not learning the hard way. We have seen what happened in different underdeveloped countries,” he says. “That is why we are trying our best to become a member of EITI [Extractive Industries Transparency Initiative]. We have to make a transparent system.”

In March, three years after its first application, Ethiopia was accepted as an EITI candidate despite the reservations of some board members and vociferous opposition from international organisations like Human Rights Watch.

There are concerns that the legal and political climate for civil society organisations will prevent them from being fully involved in industry oversight – a key requirement of the EITI process.

But Ethiopia has been working to build the capacity of local organisations, says Kirsten Hund, senior mining specialist at the World Bank, which has been assisting Ethiopia with the preparation of its EITI application.

She says membership is important for the sustainability of the sector: “EITI is not going to solve all the problems in the extractives industry but I think it is a very good way forward, especially because the Ethiopians are starting the process at the very beginning of the take-off of their minerals industry. They are working on a legal mechanism to enforce EITI implementation.”



Gao Hucheng: Deepen China-Ethiopia Economic and Trade Cooperation and Bolster Common Prosperous Development


On May 5, Minister of Commerce Gao Hucheng talked about China-Ethiopia economic and trade cooperation during an interview. The main contents are as follows:

In 2013, President Xi Jinping put forward the cooperative concept of “Sincere, Honest, Close and Earnest” during his visit in Africa, injecting new contents of the times to the China-Africa new strategic partnership. This year, Premier Li Keqiang took Ethiopia as the first leg of his visit to Africa, which is coincidently the same arrangement as that during late Premier Zhou Enlai’s visit to Africa 50 years ago. It fully shows that China pays high attention to developing comprehensive partnership with Ethiopia.

I’m probably the only ministerial official in the State Council who has lived, studied and worked in Africa for many years. The unique experience gives me great affections toward Africa in my later career. Although the two countries with ancient civilizations are far away, their friendship is long standing due to similar historical experiences and the tradition of safeguarding national independence, and the friendliness between the two peoples has been natural. Over the 44 years since the establishment of diplomatic relations, China and Ethiopia have adhered to equality, sincerity and friendship, holding hands together in revitalizing their economy and realizing common prosperity and development.

In recent years, China-Ethiopia relationship has been growing rapidly, with bilateral economic and trade cooperation enjoying a strong momentum and achieving remarkable results. Ethiopia has become the bellwether of China-Africa economic and trade cooperation. Over the past decade, bilateral trade witnessed an average annual growth of nearly 20% to reach US$ 2.19 billion in 2013. By the end of 2013, China’s direct investment in Ethiopia amounted to US$ 720 million, contract projects signed by Chinese enterprises were valued at US$ 22.4 billion, and the projects under construction had a combined worth of over US$ 15 billion. China has been the largest trade partner, main source of investment and projects contractor of Ethiopia for many consecutive years.

At present, a large number of Chinese enterprises including private enterprises have invested in manufacturing in Ethiopia, with the accumulated amount exceeding US$ 600 million, which takes up 80% of investment in Ethiopia and covers building materials, leather, pharmacy, automobile assembling and food processing. Not only advanced and practical manufacturing technologies have been transferred to Ethiopia to bolster the expansion of “made in Ethiopia”, but also created more than 5,000 jobs, with 80% of employees being local residents. Besides, Chinese enterprises have taken an active part in fulfilling their social responsibilities, digging wells and paving roads for local communities, sponsoring medical treatment and public health as well as culture and sports, and enjoying a harmonious coexistence with local people.

In terms of construction, Chinese enterprises have undertaken a batch of large-scale and influential infrastructure projects. The first wind power plant and first expressway in Ethiopia have been completed, and the first light rail and a transnational railway are under construction. All of the achievements show the painstaking efforts of Chinese and Ethiopian engineering personnel, and demonstrate the two countries’ friendship and cooperation. The African Union Conference Center is not only a landmark of Ethiopia’s capital Addis Ababa, but also a new monument of China-Africa friendship. The success of these projects makes “constructed by China” famous, and enables China’s electricity and transportation equipment and technological standards to become renowned in Ethiopia.

Now bilateral relationship has entered the best period of development. China is comprehensively deepening reform and opening up, striving to achieve the two centennial goals. Ethiopia is carrying out plans of economic growth and transformation, making efforts to realize national revitalization. Further strengthening bilateral economic and trade cooperation accords with the fundamental and long-term interests of the two countries and their people. Under this background, Premier Li Keqiang’s visit to Ethiopia will be conducive to improving cooperation, promoting solidarity and seeking common development. During the visit, several documents of economic and trade cooperation are expected to be signed, covering the fields of industrial parks construction, energy and mineral resources exploitation, intensive processing of agricultural products, infrastructure construction and loans for small and medium-sized enterprises.

Though different in development phases, China and Ethiopia have common ideas and strong wishes for cooperation. Following the cooperative concept of “Sincere, Honest, Close and Earnest”, China is willing to make concerted efforts with Ethiopia to display their complementary advantages and deepen bilateral economic and trade cooperation.

In manufacturing investment, China and Ethiopia are highly matching in industrial transfer and reception, and have wide cooperation space. Ethiopia has favorable conditions to develop labor intensive industries, including superior investment environment, high facilitation for business operation, abundant labor resources, and substantial market potential. The two countries can take the existing achievements like the Eastern Industry Zone as the foundation, continue to create a favorable policy environment for Chinese enterprises to invest in Ethiopia or transfer technology, cultivate more laborers with proficient work skills as well as professionals in operating management. In this sense, Ethiopia can be turned into the main destination in Africa to undertake the transfer of Chinese manufacturing.

In infrastructure construction, Ethiopia will start a series of large projects in electricity, transportation and telecommunications fields to support its industrialization. On the basis of former achievements, the two countries will do their best to implement the key projects including Addis Ababa light rail, Addis Ababa-Djibouti railway and Adama wind power phase II. Meanwhile, the two countries will encourage financial institutions, on the basis of mutual benefit and win-win as well as risk control, to study innovative financing modes to resolve the shortage of funds for construction of Ethiopia. Besides, China pays high attention to the cooperation on regional connectivity in Africa, and is willing to provide supports to project planning and feasibility studies concerning Ethiopia, and positively participate in the construction, financing and operation of the projects.

Looking forward to the future, we have the reasons to believe that China and Ethiopia will take this visit as an opportunity to make more progress hand in hand, and drive China-Ethiopia economic and trade cooperation to a higher level and a wider domain.



Building Resilience Tops Agenda at Global Conference in Ethiopia


Addis Ababa, Ethiopia, May 13, 2014—Poor countries and vulnerable people are facing a barrage of shocks: economic shocks such as volatile food prices and financial crises; environmental shocks and natural disasters such as droughts, floods, and earthquakes; food safety, diseases, and health shocks; and social and political shocks such as conflicts and violence that disrupt the food supply and threaten food and nutrition security.

On May 15, more than 800 experts and practitioners from food, nutrition, health, agriculture, humanitarian, and related development sectors will meet in Addis Ababa, Ethiopia for a three-day conference, “Building Resilience for Food and Nutrition Security,” to discuss how to incorporate resilience into the post-2015 agenda and improve policies, investments, and institutions to strengthen resilience so that food and nutrition security can be achieved for all.

The conference is the centerpiece of a consultative process led by the International Food Policy Research Institute (IFPRI) and its 2020 Vision Initiative and their partners.

Partners for the conference are the CGIAR Research Program on Agriculture for Nutrition and Health; the CGIAR Research Program on Policies, Institutions, and Markets; The Technical Centre for Agricultural and Rural Cooperation; Royal DSM; DuPont Pioneer; Farming First; the German Federal Ministry for Economic Cooperation and Development; Deutsche Gesellschaft für Internationale Zusammenarbeit; the International Fund for Agricultural Development; the International Livestock Research Institute; Irish Aid; The Rockefeller Foundation; the Resilience Learning Consortium; UPL Limited; and the United States Agency for International Development.

Building resilience means helping individuals, households, communities, and countries anticipate, prepare for, cope with, and recover from shocks and not only bounce back to where they were before the shocks occurred, but become even better off.

The concept of resilience is currently the subject of wide attention in the development community, but resilience in the context of food and nutrition security is less widely discussed.

“The post-2015 agenda must take resilience seriously to ensure an end to hunger and under-nutrition sustainably and forever,” says IFPRI director general Shenggen Fan. “A resilience approach has the potential to improve livelihoods and support economic growth and transformation while mitigating future shocks. In fact, it can help us tackle issues that run across the entire agriculture, food, nutrition, and environmental system.”

The conference will be opened by H.E. Hailemariam Dessalegn, Prime Minister of Ethiopia, and Nkosazana Dlamini Zuma, Chairperson of the African Union Commission. Also, heads of various international agencies (United Nations World Food Programme, International Fund for Agricultural Development, and The Global Environment Facility), government ministers, and key leaders from nongovernmental organizations, private sector, and research institutes will participate.

For more information, including the program and conference papers, please visit the conference website: http://www.2020resilience.ifpri.info/.

The International Food Policy Research Institute (IFPRI) seeks sustainable solutions for ending hunger and poverty. IFPRI was established in 1975 to identify and analyze alternative national and international strategies and policies for meeting the food needs of the developing world, with particular emphasis on low-income countries and on the poorer groups in those countries. www.ifpri.org.

Contact Information: 

Sarah Immenschuh Brawner,


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World Bank to help create new jobs and improve competitiveness through development of industrial zones and strengthening linkages with local economy


WASHINGTON, May 13, 2014—The World Bank’s Board of Executive Directors today approved a US$250 million credit in support of the Government of Ethiopia’s effort to create new jobs and increase competitiveness in the light manufacturing sector through the development of industrial zones and enhancing linkages with the local economy.

“Growth of the manufacturing sector creates employment opportunities for the poor, as light manufacturing primarily uses unskilled and semi-skilled labor,” said Guang Zhe Chen, the World Bank Country Director for Ethiopia. “Job creation through industrialization will help contribute to the reduction of extreme poverty and promotion of shared prosperity which are key goals of the World Bank Group.”

Representing a transformational engagement in Ethiopia, today’s credit from the International Development Association (IDA*) supports the Competitiveness and Job Creation Project. The project is designed to establish industrial zones as a platform for catalyzing investment and job creation, with a focus on export-led manufacturing, and tackling cross-cutting constraints for private sector development.

The project will provide large and medium-sized firms with new, serviced industrial land and buildings (including water, electricity, and transport connections), and with a One-Stop Shop to reduce the transaction costs of doing business.  The project will also target small to medium-sized enterprises that will act as local suppliers for the light manufacturing sector, as well as sector institutes that will be involved in project implementation and in developing skills and training of workers with requisite skills.

Drawing on the lessons learnt from global practices, the positive impacts of the project will not be confined to the industrial zones being developed under the project but are expected to contribute to the strengthening of the government’s larger industrial zones program and jobs agenda as well as attract new investors to Ethiopia.

“The project will benefit people who will be employed as a direct consequence of creation of new jobs in the targeted zones, said Asya Akhlaque, the World Bank Task Team Leader for the project. “The majority of the beneficiaries are expected to be women employed in the garment and shoe industries that initially set up business in the project area.”

The project is well-anchored within Ethiopia’s Country Partnership Strategy (FY13-16) and is expected to support its first pillar, ‘fostering competitiveness and employment’, that outlines increased competitiveness and productivity, and improved delivery of infrastructure as its strategic objectives. The project is also well aligned with the World Bank Strategy for Africa that focuses on competitiveness and employment.



Nation Earns Over 1.5 bln USD from Tourism


More than 1.5 billion USD has been earned from tourists during the past nine months, according to the Ministry of Culture and Tourism.

The stated amount was obtained from 509, 000 tourists who visited Ethiopian destinations in the reported period.

Nation Earns Over 1.5 bln USD from Tourism

Speaking at a work performance evaluation forum, Culture and Tourism Minister Amin Abdulkader noted that the government has given due attention to the development of tourism sector. This has resulted in a continuous growth of number of tourists visiting the country.

Culture and Tourism State Minister Tadelech Dalecho said on her part Ethiopia has become one of the top ten countries visited in the world due to the peace and stability prevalent in the country.

The income earned from the sector has also been growing by 12 percent annually, following the construction of airports in various regions, she added.

The performance during the report period has exceeded that of same period last year and efforts are being exerted to earn more during the remaining months of the fiscal year, the State Minister concluded.


Turkey’s Anadolu News Agency officially opens an office in Ethiopia


Turkey’s Anadolu Agency (AA) officially inaugurated its new regional bureau in Addis Ababa on Monday (May 12) as part of the agency’s plans to bolster its Africa coverage. Formally launching the bureau along with Ethiopian State Minister in Charge of the Government Communication Affairs Office, Mr. Ewnetu Bilata, the Anadolu Agency Director-General and Board Chairman, Mr. Kemal Ozturk, said the new Addis Ababa office would produce Africa news in English, Arabic, Turkish and French languages.

He pointed out that the new Ethiopian bureau would be the agency’s biggest in Africa after Cairo and Tunis, and noted that AA had some 1500 subscribers around the world. He indicated that the agency would also soon open offices in both Senegal and South Africa.

The Turkish Ambassador to Ethiopia, Mr. Osman Riza Yavuzalp, said that the opening of the office would help to further bolster the existing excellent relations between Ethiopia and Turkey. He said the the new Addis Ababa bureau would cover not only Ethiopia and the African Union, but also other African countries. He underlined that the Anadolu Agency was “one of the most respected news agencies in the world”, adding “I only have one wish: that this office will produce good news for people to see the beauty and stability of Africa.”

State Minister Ewnetu said he hoped the new bureau and Ethiopia’s official news agency would work together as “real partners,” suggesting that they could share experience, technology and expertise. He said the government would provide the necessary support to make agency’s work successful.



Private Sector Investments Create Sustainable Markets for Ethiopia’s Food-Insecure Households


Private-sector investments can create more sustainable markets for farmers as well as build food security for households, reports SNV, a Dutch development organisation.

At the international “Multi-Stakeholder Conference on Agriculture Investments, Gender, and Land in Africa” held in South Africa, Nicholas Nyathi of SNV Ethiopia said private sector investments in training, quality inputs, and leadership development are helping farmers grow better quality produce and expand their markets. Combined with technology, farmers are better able to understand and access markets.

“Initiatives by SNV and its collaborators have increased farmer access to technology so they better understand and can access reliable markets, thus creating greater demand for their produce,” Nyathi said.

According to a press release Agricultural Communication Coordinator of  SNV sent to WIC,  an estimated 8 million Ethiopians live in chronic food insecurity with most of them located in rural areas and dependent on rain-fed agriculture. Production is hampered by lack of access to technology and inputs, financial services, market information, and sustainable markets. Gender inequities and limited opportunities to generate income from other businesses are also barriers to food security.

These households are heavily reliant on subsistence farming where yields are too low to facilitate their graduation to food security.

In response, the U.S. Agency for International Development (USAID) created “Graduation with Resilience to Achieve Sustainable Development” (GRAD).

In addition to SNV, the GRAD collaboration includes CARE, Agri Service Ethiopia, Catholic Relief Service in Oromia, Organization for Rehabilitation and Development in Amhara, and the Relief Society of Tigray. GRAD has also worked closely with Ethiopia’s Household Asset Building Program, agricultural extension offices, and national and woreda cooperative agencies.

Through the years, some prejudices have formed towards woredas (or districts) which are third-level administrative divisions of Ethiopia. They are composed of a number of wards or neighbourhood associations, which are the smallest unit of local government. There are about 670 rural and about 100 urban woredas.

In an effort to change the attitude towards these woredas and attract the private sector into these areas, SNV Ethiopia brought together private sector actors; uncovered the market potentials of GRAD woredas; and devised contextual, market-based solutions. The effort resulted in improvements in honey, livestock, malt barely, potato, legume, and red pepper production and marketing.

GRAD helps farmers learn more about on-farm quality, negotiations, market dynamics, and general business skills to meet market demands. GRAD engages the private sector to provide agro-services such as seeds and fertilizers; link farmers to markets and other value chain actors such as food processors; and innovate or develop appropriate business models up and down the food chain.



EPRDF says preparations for upcoming production season going well


Executive Committee of the Ethiopian People’s Revolutionary Democratic Front (EPRDF) said that preparations for the 2006/7 Meher (production) season are going as per plan.

The Executive Committee, in its regular session yesterday, evaluated the preparations for the upcoming Meher season as well as deliberated on various agendas and put directions.

The Committee, while closing its regular session, said that the direction put to increase crops that would be used for food, export and for industrial inputs is well underway.

The Executive Committee also confirmed the availability of sufficient select seed and fertilizer that enable to attain the target set to register a 20 per cent increase in major crops.

The Executives Committee also deliberated on the disturbances recently occurred in some universities of Oromia regional state.

It said the situation was masterminded by few anti–peace forces that have been waiting for to seize the opportunity to create violence through spreading distorted campaign.

The Committee also expressed its deep sorrow over the losses of life and property in connection with the disturbance.

The residents are leading a normal life as the problems that were occurred in some areas of the regional state are being solved through discussion, the Executive Committee said.

The Executive Committee finally said that the government would continue to ensure safety of its citizen as well as it vowed to bring to justice those who are responsible for the problem.



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