25 November 2014 Economics News Briefs (UPDATED)

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Power Development Plan to Receive 20bn Dollars Injection

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Powering Africa: Ethiopia meeting sees government announce intention to build 10 to 12 new power generating projects.

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The Ethiopian government plans to spend 20 billion dollars on its power development program in its second generation of the, Growth & Transformation Plan (GTP-II), from 2015 to 2020.

This figure is consistent to the country’s annual spending track record of two billion dollars annually for the past three years, according to Mekuria Lemma, head of Strategy & Investment Division at the Ethiopian Electric Power (EEP).

Mekuria disclosed this at the “Powering Africa: Ethiopia Meeting” organised by the UK-based company, Energy Net Ltd, held at the Radisson Blu Hotel last week. The two-day event aimed to connect governments with local and international power infrastructure developers. It brought together various stakeholders interested in investing in Ethiopia’s green energy, including leaders from the Energy & Environment power (EEP) and the Ethiopian Power Utility (EPU). Representatives of the two organizations have presented the country’s power demand and investment opportunities in the power-generating sector.

Besides government officials, foreign investors have also presented project proposals.

Ethiopia’s government planned budget will be spent on building an additional 10 to 12 new power generating projects, Mekuria disclosed. He hopes to see the government generate the finance from domestic sources, which is to be supplemented with loans.

The projects will utilise local resources as their main input for construction materials. Although Mekuria and the government hope to garner 60pc of the inputs locally, for the remaining 40pc of construction materials, foreign investors interested in investing power generating projects in Ethiopia will be sought according to Mekuria.

The government will offer tax cuts to foreign investors as an incentive, he disclosed. Except for power distribution, which is reserved for the state utility monopoly, investors are encouraged to build, own and operate power generating plants in the country.

Recent data on ongoing construction from the EEP shows that construction completion rates are 40pc for Ethiopia’s signature dam on Abay; the Grand Ethiopian Renaissance Dam (GERD), 87.6pc for Gilgel Gibe III Hydroelectric, 61pc for Genale Dawa Power Plant, 80pc for Adama II wind power generating farm, and less than 50pc for Reppi (Koshe) Waste to Energy Power Plant Project.

When all these projects in the pipeline come to completion, there is hope that the country will achieve a generation target of close to 10,000Mw. It will be five times larger than the 2,090.4Mw electric power generated from its 15 hydropower stations, and 51Mw from Adama I Wind Farm. Commencing operation in 2011, the Adama I Wind Farm was built with a total cost of 117 million dollars.

During the second generation of GTP, the government aims to increase the energy generation capacity to 15,000Mw. It also aims to expand its total electricity coverage of the country from its current 55pc to 99pc. If achieved, it will be a monumental success compared to the 41pc coverage four years ago.

The government will promote a mix of energy by developing renewable wind and geothermal sources to achieve the intended goals, Mekuria disclosed at the meeting.

Hosted in Ethiopia for the first time, the two-day meeting was attended by 66 international business delegates and government representatives. Powering Africa Summit will be held in Washington, D.C., in January 2015.

http://addisfortune.net/articles/power-development-plan-to-receive-20bn-dollars-injection/

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Oldest Hydro power plant reincarnated

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Aba Samuel Hydroelectric Power Plant is to commence operation within two years after sitting idle for four decades.

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Although its debatable, the power plant is considered to be the first hydro electric plant in the country and it is now being rehabilitated by the Chinese Hydrochina Haudong Engineering Corporation.

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For the rehabilitation, the Chinese government has provided a USD 15 million grant.

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According to Azeb Asnake, CEO of Ethiopian Electric Power (EEP), the project is expected to be finished within 24 months.

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The current rehabilitation includes dam maintenance, installation of four units of turbines and generators, a new penstock and civil engineering work.
After the rehabilitation the power plant is expected to generate 6.6mw of electric power. The Ethiopian government will add 10 million birr for a transmission line and maintenance of an access road.

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The former Ethiopian Electric Power Corporation (EEPCo) that recently split into two, has been trying to rehabilitate the plant for the last decade.
The Akaki River and the lake are now contaminated due to citizens’ utilization of the river system.  “Through this process of plant rehabilitation, the contractor is expected to mitigate the problem and enhance green and clean environment,” Azeb said.

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She said that the rehabilitation of the Aba Samuel plant will also help promote tourism around the lake.

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Aba Samuel Dam located on the Akaki River began first phase construction in 1936 with a capacity of 3.3mw and started production in 1941. In 1953 the power plant generated 3.3 mw with one turbine and then 6mw after they installed one additional unit.

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However, in 1974 the plant stopped generating power when the turbines failed.

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http://www.capitalethiopia.com/index.php?option=com_content&view=article&id=4743:oldest-hydro-power-plant-reincarnated-&catid=35:capital&Itemid=27

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Ethiopia Plans Debut Dollar-Bond Joining Ghana, Kenya.

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By Lyubov Pronina Nov 25, 2014

Ethiopia plans to sell its first dollar bond as Africa’s fastest-growing economy exploits record demand for the continent’s debt.

Ethiopia picked Deutsche Bank AG and JPMorgan Chase & Co. for fixed-income investor meetings in Europe and the U.S. beginning tomorrow, according to a person familiar with the matter, who asked not to be identified as the information is private. The proceeds of the sale will be used to fund electricity, railway and sugar-industry projects, Finance Minister Sufian Ahmed said Oct. 8.

The Horn of Africa nation is joining issuers, including Ghana, Kenya, Senegal and Ivory Coast, who sold what Standard Bank Group Ltd. says is a record $15 billion of Eurobonds this year. Government and corporate issuers are seeking to benefit from investor appetite for higher returns before the Federal Reserve raises interest rates as soon as next year.

“There is an incentive to issue before U.S. rates start to gradually edge up from next year,” Samir Gadio, head of African strategy at Standard Chartered Plc in London, said today by e-mail. “The market seems to expect that Ethiopia will price among the highest-yielding African sovereigns.”

African government and corporate Eurobonds sales this year beat 2013’s record $14 billion, Standard Bank said on Nov. 13. Sovereigns accounted for about 71 percent of issuance, according to the Johannesburg-based lender.

African Returns

The yield on Kenyan dollar bonds due June 2024 was at 5.91 percent today, down from 6.88 percent when it was sold in June. Zambian dollar bonds returned almost 17 percent this year, while Ghanaian debt earned 9.5 percent, according to the Bloomberg USD Emerging Market Sovereign Bond Index. (BEMS) Ivory Coast returned 1.3 percent as neighboring countries battled an outbreak of Ebola, while Gabon earned about 11 percent.

Emerging-market assets have benefited from record-low interest rates in developed nations that pushed investors to seek out higher returns elsewhere. The end of quantitative easing by the Fed and the prospect of its first interest-rate increase since 2006 is drawing some of that money back to the U.S.

Almost 30 years after pictures of Ethiopian children with distended stomachs were used to raise money by Bob Geldof and Live Aid, the country is growing faster than any other African economy, at an average of 10.9 percent over the past decade, International Monetary Fund data shows.

Credit Rating

Ethiopia was assigned its first credit ratings in May. Moody’s Investors Service rates it a non-investment grade B1 with a stable outlook, while Standard & Poor’s gave the East African country a B rating. The country is Africa’s biggest coffee producer and the continent’s second-most populous nation after Nigeria.

Ethiopia’s planned issue could be assisted by technical factors, such as scarcity, as the Eurobond will be the only tradable asset for international investors wanting access to the African nation, Standard Chartered’s Gadio said.

State Minister of Finance Abraham Tekeste and Haji Ibsa, a spokesman for the Finance Ministry, didn’t answer their mobile phones when Bloomberg called each of them seeking comment today.

Ethiopia is building the continent’s biggest hydropower plant on the Blue Nile River, known as the Grand Ethiopian Renaissance Dam, that will probably increase electricity supply five-fold by 2020. It may need to invest about $50 billion in infrastructure over the next five years, of which $10 billion to $15 billion may come from foreign investors, the finance minister said last month.

http://www.bloomberg.com/news/2014-11-25/ethiopia-plans-debut-foreign-currency-bond-joining-ghana-kenya.html

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Answer still no for privatizing banking, telecom, power

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Ethiopia will not open up its telecommunications, banking and power sectors any time soon, according to Dr. Debretsion Gebremichael, Deputy Prime Minister and Minister of Communication and Information Technology.

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In an exclusive interview with Capital, Debretsion said that Ethiopia is not yet ready to open those sectors partially or fully any time soon. “We have to develop all the areas in the country. The rural population should get access to electricity and telecommunications infrastructure. Before we accomplish this we will not open them up,” Debretsion told Capital.

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The country will open up those sectors to international competition when it is ready. “When our capacity increases, then we will open up, because then we can compete,” Debretsion added.

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Ethiopia is at the early stages of development, the deputy prime minister went on to explain, adding that strong control from the government should be applied to protect these services.

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However international organizations such as the World Bank disagree. “Ethiopia needs to open its financial sector in order to maintain the fast economic growth the country has registered for the last ten years. There are some necessary risks, and financial integration is a necessary risk. Ethiopia currently does not have a financial sector that has integrated with the rest of the world,” states the World Bank’s 2014 World Development Report.

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“Other countries that have been growing at the same rate as Ethiopia have been able to sustain the level of growth only by integration. The question is how you manage the integration and that is where some of the lessons from international experiences can be used,” the report further suggests.
Debretsion argues this saying that the country maintains its growth because it was not part of the world’s financial system. “If we were part of the international financial system we would have collapsed during the financial crisis,” he said.

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A French high official also agrees with Debretsion. “The country should first build its muscles on these sectors, then it can allow outside markets to these sectors. Otherwise they will be swallowed by the much stronger international companies,” the French official who commented on conditions of anonymity said.

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Debretsion also said that international companies always look for their benefits, “multinational companies want profits; they are not bothered about connectivity, they don’t care about developing the rural areas, but we care about developing the rural areas that’s why we don’t open them,” he added.

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http://www.capitalethiopia.com/index.php?option=com_content&view=article&id=4747:answer-still-no-for-privatizing-banking-telecom-power-&catid=35:capital&Itemid=27

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United Expenditure up in Bid to Lead Banking Sector Technological Development

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Such a drive is partly behind a significant increase in United’s expenditure last year, up by 148.6 million Br, from the previous year, reaching 680.5 million Br. It was a point on which shareholders who met inside the Addis Abeba Hilton on November 13, 2014, and demanded explanations.

Explanations came from the Bank’s President, Taye Dibekulu, who attributed the increases to the strategy designed to make the bank paperless.

“We want to be on the lead in the technological development of the banking sector,” Taye told shareholders.

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The Bank’s board of directors chairman Fasil Asnake (left) smiling and whispering to the Bank’s President Taye Dibekulu (right) after the gathering.

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United Bank S.C. has registered a net profit of 278.17 million Br in the fiscal year 2013/14, one per cent lower than last year’s. However, the significant drop was seen on Earnings Per Share (EPS), which has decreased by 28.45pc, to 34.13 Br.

“The reason behind the decrease in EPS is our decision to increase the Bank’s capital,” said Taye. “We had discussed that the decrease in the EPS was to come.”

Nonetheless, it remains to be an amount higher than what its peers in the industry offered to their shareholders during the same period. Nib International Bank has offered 28.5pc in EPS, followed by Wogagen Bank’s 26pc, and Zemen Bank’s 24pc.

The paid-up capital of the Bank has increased to 898.3 million Br, which is up by 298.3 million Br from the previous fiscal year.

The staff and administrative costs have also soared, from 151.47 million Br to 198.92 million Br. Although the Bank has managed to control its expenses on interests, its operating costs have expanded considerably. They went up to 400.75 million Br, from 284.6 million Br in the preceding year.

“This has to stop somewhere,” says Eshetu Woldekidan, a shareholder of the Bank with 3,823 shares. “With the interjection of the National Bank of Ethiopia (NBE) we cannot imagine where it is going.”

He calls on the regulatory hands of the central bank to do something similar in imposing limits to compensations paid to board of directors of banks. The NBE has limited the maximum annual remuneration of directors to be 50,000 Br.

Taye, however, defends his record in compensating his staff numbered 2,424, which he said cannot be stopped from increasing, as the staff needs benefits and salary increases every year, in accordance with the Bank’s development plans.

United Bank has made impressive advances in several key areas, including its total income, which has exceeded a record of one billion Birr, showing a growth of 15pc from last year. The income from interest loans, advances and investments in the NBE bonds increased to 716.23 million Br, showing a growth of 19pc from 2013/14.

The assets of the Bank have also increased by 19pc, reaching 11.8 billion Br and the loans and advances disbursed in the reporting year have reached 4.99 billion Br, an increase by eight per cent. The liquid assets of the Bank too increased significantly. The total cash and bank balances held by United Bank have increased by 64pc, to 3.38 billion Br, and the cash and bank balances to total assets ratio has increased from 25.57pc to 36pc.

This is not necessarily a development which should comfort those responsible for the management of the Bank, according to Abdulmena Mohammed Hamza, financial analyst and accounts manager at London-based Portobello Group Ltd.

“The building of liquidity has deprived its interest income, which could have been generated had these resources been used in revenue generating activities,” Abdulmena said.

Taye acknowledged the high concentration of liquidity during the reported year, but attributed it to economic slowdowns in the country over the summer.

“But this is not true with our Bank as we have disbursed loans to the traders, taking advantage of winter trading activities,” Taye told Fortune.

United Bank has increased its subscribed capital to 1.6 billion Br, showing an increase of 374.1 million Br on the previous year.

“We’ll work to increase the paid-up capital in order not to affect the EPS,” Taye told Fortune.

Although critical on United Bank’s mounting administrative expenditures, Eshetu, a shareholder, is pleased to see United perform better than its peers where he also has shares.

“I see a brighter future for United than the other banks I own shares in, in terms of EPS and other developments,” Eshetu told Fortune.

By contrast, the income from foreign exchange dealings failed to exceed 81.35 million Br, showing a drop of 13pc.

“Bank management needs to investigate why United’s industry position is being eroded, and develop a strategy to reverse this downward spiral,” comments Abdulmena.

The President disagreed.

“Income has shown an increase from the previous year, but it is not up to expectations,” he told Fortune. “This is because of the decline in the international market of coffee, as most of our customers are coffee exporters.”

http://addisfortune.net/articles/united-expenditure-up-in-bid-to-lead-banking-sector-technological-development/

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Misys updates core banking system for Ethiopian bank

misysawashbank

Misys has implemented a core banking system for Ethiopia’s second largest private bank, Awash International Bank, which has enabled it to reduce its IT costs while introducing new services.

Ethiopia is Sub-Saharan Africa’s fifth biggest economy and is expected to record GDP growth of approximately 10.6% this year according to CNBC Africa. Awash International Bank is keen to tap into growing demand for financial services as the country moves towards middle-income status over the next decade.

The new system uses Misys’s FusionBanking Essence product, which includes componentised solutions for retail and small business banking and was named a ‘leader’ in the 2014 Gartner Magic Quadrant for international retail core banking. It will enable Awash International Bank to offer new services to its customers in internet banking, mobile banking, agent banking, portal transaction and point of sale.

“Misys has been our strategic technology partner for almost two decades,” said Ato Tsehay Shiferaw, president of Awash International Bank. “Core banking replacement is a high risk activity, but Misys took full responsibility for risk around implementation, ensuring absolutely no disruption to our customer service – most vendors would not take such measures.”

Awash International Bank has also deployed FusionBanking Essence Teller, Misys’s browser-based teller application, across 97 branches in Ethiopia. “Awash International Bank has a strong history of pioneering new technologies to maintain its competitive edge and market leadership,” added Nadeem Syed, CEO Misys.

http://www.waltainfo.com/index.php/explore/16227-misys-updates-core-banking-system-for-ethiopian-bank

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Wegagen Bank profits 414mln birr

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Wegagen Bank amassed 414 million birr in pre-tax profits last year.
During the 21st general assembly held at the Addis Ababa Hilton Hotel, Wegagen Bank announced that it earned 318 million birr in net profits after tax during the 2013/14 fiscal year. Last year it registered 340 million birr net profits.

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In the 2012/13 fiscal year the bank’s paid up capital reached one billion birr, which is double the National Bank of Ethiopia’s (NBE) requirement, and it has expanded it to 1.3 billion birr in the past fiscal year.

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The total capital including the reserve has reached 2.1 billion birr, according to Araya Gebre Egziabher, president of Wegagen; its total assets reached 11.5 billion birr, which is a 1.1 billion birr growth compared with the 2012/13 fiscal year figures.

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According to the bank’s statement that was released to the general assembly the total deposit mobilization has grown compared with the previous year.
The annual report indicated that Wegagen’s total deposits reached 8 billion birr, from 7.5 billion birr in the 2012/13 fiscal year.

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According to the report, the 2013/14 fiscal year’s loan and advances disbursed to the bank’s customers was similar with the 2012/13 performance, which is 4.5 billion birr.

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Two years ago the bank disbursed 3.4 billion birr in loans and advances to interested borrowers.

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According to the bank statement the number of shareholders in the past fiscal year has reached 2,203; a figure that amounted to 2,157 a year ago.
Meanwhile, Wegagen Bank’s leaders are enthusiastic about the construction of a 23 floor headquarter building in the heart of the city around National Stadium.

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Bank officials announced that work of the 805 million birr project was progressing and they expect the building to be completed by April 2016.

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Currently, Wegagen has 98 branches throughout the country; along with  89 ATM and 136 PoS machines. The bank is currently using the Agar Visa Card and is in the process of introducing Master Card, one of the three largest credit card companies.

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Recently the bank launched a mobile and Internet banking system. “The new technological banking service particularly mobile banking is significant because it allows bank access for 24 hours,” the bank report stated. The new mobile service offers customers greater flexibility and convenience and the ability to receive SMS alerts every time there is activity in their bank accounts which provides enhanced security.

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In addition, the bank’s corporate Internet banking makes it possible for organizations to make bulk payments for expenditures like salaries, announced the bank, which is currently using 17 international money transfer companies.

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The bank, established in 1997 with 15 founding shareholders and 30 million birr in capital now has 2,203 shareholders.

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http://www.capitalethiopia.com/index.php?option=com_content&view=article&id=4744:wegagen-bank-profits-414mln-birr&catid=35:capital&Itemid=27

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Nyala Insurance to double its capital

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The general assembly of Nyala Insurance SC (NISCO) announced plans to more than double their paid up capital from the current 125 million birr.

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This past year has been good for one of the strongest insurance companies in Ethiopia as their growth remained strong.

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At the general assembly, held on Tuesday November 18, at the Sheraton Addis, NISCO’s shareholders agreed to expand the company’s paid up capital to 300 million birr, which will make it one of the leading insurers in terms of capital strength.

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A year ago the company decided to expand its capital to 125 million birr, from 35 million birr the preceding year. This decision came about as a result of actions the company took to increase the firm’s capability to bring in more money.

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NISCO has significantly increased its market share to 6.2 percent in the past fiscal year. The company earned 77.8 million birr in pre-tax profits during the 2013/14 fiscal year. Their net profits (after tax) stood at 66.1 million birr for the past fiscal year and the earning per share stood at 1,396 birr.

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Last fiscal year, the insurance firm provided 98.5 billion birr worth of life and general insurance. This means that their coverage for these two types of insurance grew by four billion birr or four percent when compared with 2012/13.

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The total amount of money NISCO earned from premiums was 307.3 million birr, which is a growth of 14 percent compared with the preceding year.
The gross written premiums in the general insurance sector stood at 266.3 million birr, which registered a growth of nine percent compared with the previous year.

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Auto insurance took the majority of that with a 42 percent share of the market. This was followed by engineering, marine and fire insurance at 13, 12 and 11 percent respectively.

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Meanwhile, incurred claim increased by 31.5 percent from 69.5 million birr to 91.4 million birr in the 2013/14 fiscal year.

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The company’s life insurance grew by 53 percent which is significant because that type of insurance has not been performing well recently, say pundits. “Based on our strategic plan for the current fiscal year life insurance is expected to grow significantly,”  Yared Mola, CEO of NISCO, said at press conference held after the general assembly.

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From the total 181 million birr in expenses, 62 percent of that went to pay claims. Car accidents and the price of spare parts have been on the upswing and that has affected insurance. Still for NISCO their loss ration for auto insurance did not exceed 54 percent. The industry average loss ratio for auto insurance is 65 percent.

Currently the insurance firm is offering micro insurance coverage for farmers in Oromia, Amhara, Tigray and SNNP regions.

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“During the current fiscal year we have a plan to expand micro insurance in one another region and expand the coverage into livestock,” Yared added.

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The total assets of the company reached 618 million birr which is a growth of 142 million birr or 30 percent.

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NISCO is adding and renovating service centers (branches). It has 16 in Addis and 9 in other regions. There are plans to open 15 new service centers based on its strategic plan that will end within 5 years.

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http://www.capitalethiopia.com/index.php?option=com_content&view=article&id=4746:nyala-insurance-to-double-its-capital&catid=35:capital&Itemid=27

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World’s power producers flock to Ethiopia

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The Power Africa meeting, a continental energy talk held for three consecutive years in Addis Ababa, has been attracting interest from energy industry representatives.

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Experts who attended the two day meeting at Radisson Blu from November 20 have attracted international financiers, contractors, investors and international organizations, eager to be part of the exciting developments in the energy sector.

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The number of private sector participants is increasing, indicating that companies want to be involved in developing the energy sector on the continent.

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“Around 70 private sector participants showed up and that is a dramatic increase from the 50 last year,” experts in the energy sector said.

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“I talked with every participant in my office before they came to the conference, which will provide insight in selecting the most appropriate and enthusiastic developers,” Mekuria Lemma, plan and program head of Ethiopian Electric Power (EEP), told Capital.

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“We have a huge interest in expanding the private sector’s involvement in power development and because of that this is a good opportunity for us to attract potential investors,” Mekuria who presented his enterprise’s strategy and future projects at the meeting, added.

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He said that several applications are coming from the private sector to be part of the renewable energy development in the country.

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Recently Ethiopia ratified a law mandating private sector development of  electric power from wind, solar, geothermal and hydro.

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EEP and Reykjavik Geothermal (RG) also signed an agreement allowing the company to sell electricity to EEP. Currently, RG is developing the Corbeti Geothermal project that will generate 1,000MW when completed.

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Ethiopia wants to use both the private and public sectors to expand power generation. According to the country’s law, power developers have to sell the energy to EEP, which has a state monopoly on power distribution.

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http://www.capitalethiopia.com/index.php?option=com_content&view=article&id=4735:worlds-power-producers-flock-to-ethiopia&catid=35:capital&Itemid=27

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Logistics Strategy Report Draft Expected this Week

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In-depth study of existing logistics and full logistics strategy in fourth phase, final draft of the report is expected to be submitted to the Committee on November 27, 2014.

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Nathan Associates Inc. (NAI), the American company hired by the Ethiopian government to conduct a detailed study of the country’s logistics system and develop a national logistics strategy, is expected to submit its fourth findings of the project to the Ethiopian Maritime Affairs Authority (EMAA), on Monday October 24, 2014.

Ethiopia ranks 141 in the world in the logistics sector, according to a 2013 Ethiopia Economic Update II report published by the World Bank. It is a drop from the 104th ranking the country had five years ago. Reports published by the organization indicate that poor logistics is severely hampering trade and foreign direct investment.

Importing a single 20ft container costs 2,400 dollars, whereas export costs 200 dollars more, the report states. In Tanzania, imports cost just 1,090 dollars, and exports in neighboring Kenya require 2,000 dollars. While in Ethiopia importing a container takes 41 days and exports 40 days, in Kenya exports only take 21 days.

This has forced the Ethiopian government to develop a more in-depth detailed strategy for the logistics sector.

Hired by the government to complete the strategy in March 2014, and follow-up on its implementation, the consultant submitted its third draft report in the one million dollar project, in mid October 2014. The new strategy being developed aims to slash the time it takes to import and export by half, according to a source involved in the project.

The latest report of the third stage of the study, dubbed ‘the blue print’, will be the country’s future logistics strategy. It was submitted to a committee formed by the Authority under the directorship of Mekonnen Abera, which is responsible for the follow up of the progress on the study.

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Mekonnen Abera, general director of Ethiopian Maritime Affairs Authority (EMAA)

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The Committee, after the submission, sent the draft for comment to various institutions that have a stake in the implementation of the strategy.

These institutions include the Technique Committee, composed of representatives of the Office of the Prime Minister, Ethiopian Shipping & Logistics Services Enterprise (ESLSE), Ethiopian Freight Forwarders & Shipping Agents Association (EFFSAA) and others, such as the Ethiopian Revenues & Customs Authority (ERCA), Federal Transport Authority (FTA), the Ministry of Transport (MoT) and financial institutions, such as the Commercial Bank of Ethiopia (CBE).

“There is a logistics transformation unit established at the Authority that will be the implementing entity of the strategy,” Liyuwork Amare, the national logistic strategy study follow up contact person at the Authority, told Fortune. “The unit will follow the logistics and strategy affairs and will compile the comments of these parties to send it to the consultant.”

This unit also had a video conference with the NAI for further refinement after the submission of the first draft report.

Comments from the industry mainly focused on the implementation of the strategy in accordance with the country’s context, such as the landlocked nature of the country, according to Liyuwork.

The first two reports of the NAI study, submitted consecutively to the committee, were the inception and the diagnostic reports. The former dealt with the conditions of the logistics sector and identified the areas where the sector could be improved. The latter assessed the institutions involved in the logistics sectors and identified the hindrances to the logistics service through the supply and value chain, taking some export and import items into consideration.

There was a great deal of dissatisfaction on the scope of the study Nathan carried out during its first presentation in Harmony Hotel back in September 2013, where many criticized its experts for focusing on Ethio-Djibouti corridor and not on the national logistics roadmap.

“The implementing bodies know what can be achieved and what cannot, as the nature of the strategies and the implementation depends on the context in the country,” Liyuwork says.

After the corrections, in light of comments made, the next step of the project is to draft the implementation methodology. This is called the intervention stage and will show how the strategy needs to be implemented. It is expected to be delivered to the committee at the Authority on Monday, November 24, 2014.

The final draft of the report is expected to be submitted to the Committee on Thursday, November 27, 2014, after the corrections are made.

After the submission of the final draft, a steering committee of the government, especially designed for the reviewing of the reports by NAI, headed by the Prime Minister, will see the report to check the implementation of recommendations, officials at the Authority disclosed to Fortune. The final step will be the implementation stage that is to be conducted under the supervision of NAI.

http://addisfortune.net/articles/logistics-strategy-report-draft-expected-this-week/

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Number of Turkish companies visiting Ethiopia increasing

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Number of Turkish companies visiting Ethiopia increasing

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Number of Turkish companies visiting Ethiopia because of their desire in investing in the country has been increasing, Ethiopian Ambassador to Turkey Ayalew Gobeze announced.

In an exclusive interview with ENA, the Ambassador said 120 Turkish companies visited Ethiopia last year. Of these investors some have already got licenses and others are planning their projects.

The number is expected to increase this year. Some 10 Turkish investors, who are interested to invest in Ethiopia, have visited the country in the month of September, he added.

These companies have shown interest to engage in textiles and leather industries and cotton cultivation, he said.

Noting the share of Turkish investment in Ethiopia is large, Ayalew said, number of companies that are desirous to invest in Ethiopia is also increasing.

A total of 350 projects owned by Turkish companies are licensed so far, of which 90 are already operational.

In addition to textiles, leather and agro processing, Turkish companies are also engaged in the construction sector.

The bilateral relations between Ethiopia and Turkey have been growing over the past years, according to Aykut Kubaroglu East African Affairs Deputy Director at Turkish Foreign Ministry.

Turkey has created strong investment tie with Ethiopia, which is one of the fast growing economies in the world, he added.

The favorable investment atmosphere, fast economic growth and peace and stability of the country are helping Ethiopia to attract more Turkish investment, the Director said.

http://213.55.98.22/enae/index.php?option=com_k2&view=item&id=2538:number-of-turkish-companies-visiting-ethiopia-increasing&Itemid=260

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Senior CPC leader vows stronger ties with Ethiopia

A senior leader of the Communist Party of China (CPC) said on Monday the CPC is willing to strengthen exchanges with the Ethiopian People’s Revolutionary Democratic Front (EPRDF).

Liu Yunshan, member of the Standing Committee of the Political Bureau of the CPC Central Committee, made the remarks while meeting with Demeke Mekonnen, EPRDF vice chairman and vice prime minister of Ethiopia.

Hailing the fruitful cooperation between both countries since they forged an all-round cooperative partnership in 2003, Liu said China hopes to work closely with Ethiopia to implement the consensus reached between both state leaders, respect each other and learn from one another, to promote bilateral ties.

This year marks the 20th anniversary of the official relationship between the CPC and the EPRDF. Liu said the CPC hopes to share experience with the EPRDF in governance, and make joint efforts to facilitate stronger China-Ethiopia and China-Africa ties.

Applauding the comprehensive substantial cooperation between Ethiopia and China, Demeke Mekonnen said the EPRDF is ready to cement cooperation with the CPC and learn from China’s experience, to push forward stronger bilateral ties.

http://www.waltainfo.com/index.php/explore/16228-senior-cpc-leader-vows-stronger-ties-with-ethiopia

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Ethiopia, Portugal to Boost Trade, Investment Ties

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Ethiopia, Portugal to Boost Trade, Investment Ties

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Ethiopia and Portugal should boost their trade and investment relations utilizing the long-standing diplomatic cooperation of the two countries, Portugal’s Ambassador to Ethiopia said.

In an exclusive interview with Ethiopian News Agency, Ambassador Antonio Luis Cotrim said the economic tie of the two countries is weak, even if the diplomatic relationship spanned for many years.

The ambassador, who noted that the annual trade exchange of the countries is not more than three million Euros, added that both parties have started activities to increase the amount.

Portugal imports coffee and leather products while it exports pharmaceutical products to Ethiopia.

Although many Portuguese investors have shown interest in investing in Ethiopia, it is only one company which is engaged in renewable energy generation in Tigray State, the ambassador stated.

According to Ambassador Cotrim, the countries have signed agreements that strengthen the bondages of the governments and the private sectors in different sectors. The signed agreements cover education, politics, youth and sport, culture and media, he indicated.

The countries are also working closely in international politics, economy and security issues in addition to bilateral cooperation.
Ambassador Cotrim admired Ethiopia’s efforts in bringing peace and stability to Africa and East Africa in particular.

The cultural and people-to-people relationship of Ethiopia and Portugal is around 500 years, according to the ambassador.

A concert will be held at the National Theatre next month to commemorate the occasion, he added. A painting exhibition will then be held in January.

http://213.55.98.22/enae/index.php?option=com_k2&view=item&id=2549:ethiopia-portugal-to-boost-trade-investment-ties&Itemid=219

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Yemen Keen to Strengthen Relations with Ethiopia: Speaker Yahya Ali Al-raa’e

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Yemen Keen to Strengthen Relations with Ethiopia: Speaker Yahya Ali Al-raa’e

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Speaker of Yemen’s Parliament, Yahya Ali Al-raa’e said his country is keen to strengthen its long-standing relations with Ethiopia.

The speaker delivered today a letter sent to President Mulatu Teshome from President Abd Rabbuh Mansur Hadi.

According to the speaker, Yemen wants to particularly strengthen relations in investment and trade.

The country especially wants to share Ethiopia’s experience in its inclusive development, he added.

President Mulatu said on his part Ethiopia is ready to support Yemen and to strengthen the long-standing sisterhood relationship of the two countries.

He stated that Yemen will be one of the beneficiaries of the Grand Ethiopian Renaissance Dam (GERD). This will open another chapter in boosting further the friendship of the countries.

Diplomatic relations between Ethiopia and Yemen started in 1935, it was learned.

http://213.55.98.22/enae/index.php?option=com_k2&view=item&id=2540:yemen-keen-to-strengthen-relations-with-ethiopia-speaker-yahya-ali-al-raa’e&Itemid=260

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Ethiopia succesfully holds out climate change crisis: Dr. Tewoldeberhane

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Ethiopia has successfully withstood  serious climate change impacts, which  is a severe threat for  human existence.

In his exclusive interview with WIC, Advisor in the Ministry of Environment and forest Dr. Tewoldeberhan  Gebreegzabher said that Ethiopia has been effectively implementing the robust policies designed to reduce the hazards of climate change crisis.

He said that Ethiopia has been achieving encouraging results  in its efforts against  the impacts of climate changes.

One of the  successes of the nation is its capability of  reducing carbon emissions, which is the main causes  of crisis of climate changes, he said, adding that this is  taken as  a model by other  countries.

According to Tewoldeberhan, Ethiopia  is  constructing  carbon emissions  free  Hydroelectric  Dams  and  Railway systems  that  this environment friendly development  has emanated  from the viable economic  policy  of country.

Efforts are exerted to plant billions of  seedlings  all over the country that  have rased the 3 per cent  forest  to 10 per cent  in the past ten years,   said  Dr Tewolde Berhan.

He alsao added that the development  of green  economy  is underway to  reduce  the carbon pollution in the country.

Millions of Ethiopians are participating in the rural soil and water conservation programs in all regions, said  Tewoldeberehan,  adding the activities not only contribute  to  protect   climate  change crisis but also raise  agricultural productivity.

Dr. Tewoldbrhan, a former Director General of Ethiopian Environment Protection Authority is among the few scientist of the world who is tirelessly working to protect the human being from the crisis of climate change.

http://www.waltainfo.com/index.php/editors-pick/16229-ethiopia-succesfully-holds-out-climate-change-crisis-dr-tewoldeberhane-

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Ethiopia harnesses sewage to cut climate emissions, pollution

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Sewage in Ethiopia’s capital could soon be turned into cylinders of compressed biogas as part of an effort to clean up the city, cut climate-changing emissions and find new sources of clean energy.

Currently the Addis Ababa Water and Sewage Authority (AAWSA) estimate that it collects and treats only 12 percent of the city’s liquid waste. But a new effort to trap sewage and use bio-digesters to turn it into biogas and fertilizer could help lower energy costs, reduce methane emissions from sludge and cut spills, its backers say.

The 18 million US dollars project is a joint effort of the city’s water and sewage authority, a non-governmental environmental monitoring firm and 4R Energy, an Ethiopian firm that focuses on recycling and reusing municipal waste for renewable energy.

Benjamin G. Sishuh, 4R Energy’s project manager, said he sees the effort as a way of scaling up small-scale biogas projects that have proliferated in Africa and elsewhere.

“I saw that biogas use in rural or urban area was very small, so I came up with a plan for biogas development that can be used by the majority of the population (and) which can be affordable” said Sishuh. He said his company wants to put the project into effect at two large waste dumps in the city.

The project could be operational as soon as early next year, he said. If successful, it could supply as much as 30 percent of Ethiopia’s compressed natural gas needs, AAWSA estimates.

Ethiopia currently meets its gas demands by importing liquefied petroleum gas (LPG) from countries including Yemen, Sudan and Libya, Shishuh said.

The project is a public-private partnership with environmental non-profit Lem Ethiopia carrying out environmental monitoring and impact assessment, he said.

Sishuh’s company hopes that gas produced by the project will be sold to households for cooking and heating, at prices lower than those families now pay for imported gas. Fertilizer produced from the waste also could be sold to farmers inexpensively, he said.

REDUCING CLIMATE CHANGE, POLLUTION

But city officials are most interested in the project’s ability to reduce methane emissions and local pollution, which is worsening as the capital grows.

Nuri Mohammed, a wastewater treatment manager at AAWSA, said lack of sewage treatment today leads to problems with the safety of drinking water, and could spell outbreaks of diseases such as cholera if not properly dealt with.

AAWSA, which is struggling to keep up with the city’s waste disposal needs, is currently expanding Kaliti wastewater treatment plant in order to increase its capacity by 90 percent, to around 1,000 cubic meters of waste per day by 2016, he said.

Nuri said that as the city tries to cope with a growing number of homes and businesses, the need for proper sewage disposal is paramount and his authority is working on expanding sewer systems to accommodate the flow.

Currently some of Addis Ababa’s sewage is deposited at several dump sites where it is converted into fertilizer for non-edible crops, such as flowers.
Moges Worku, the executive director of Lem Ethiopia, the organization that will carry out environmental monitoring of the project, said it will have “great impact in cutting greenhouse gases being evaporated from the landfill sludge to the atmosphere”.

Ethiopia aims to become a net zero carbon emitter by 2025 through the use of renewable energy, biofuel and reforestation programs.

Gebreegzabhir Gebremeksel 33, who owns a small restaurant that employs three staff, said cheap gas is a major attraction of the project. Today he spends on average 20 percent of his income on liquefied petroleum gas, he said.

Each month he spends on average 1,630 birr ($81) on gas cylinders to run his restaurant and his home, a cost on top of feeding his family, paying his workers and paying his rent, he said. Any reduction in the cost of energy would produce welcome savings, he said.

http://www.waltainfo.com/index.php/explore/16199-ethiopia-harnesses-sewage-to-cut-climate-emissions-pollution

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Government Considering to Pull ZTE Off ethio telecom Deal

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800 million dollars deal on the brink of collapse, Sony Ericsson ready to step in

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ZTE, the Chinese telecommunications equipment and network solutions provider, is on the brink of losing an 800 million dollars deal with ethio telecom, following its refusal to work on the swapping of the old networks. The deal termination will deliver ZTE into the hands of Sony Ericsson, now Sony Mobile Communications AB.
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ZTE is going to lose the project within a few weeks if it does not agree to swap the old network with the one to be newly installed, according to Debretsion Gebremichael (PhD), minister at the Communication & Information Technology, in the rank of Deputy Prime Minister.

The project was signed in August last year, when ZTE and its other Chinese competitor, Huawei Technologies, won these contracts. The contract was to provide fourth generation (4G) technology, a broadband technology allowing browsing speed of 100mb per second in Addis Abeba, and to enable third generation (3G) services across the country, with a total investment of 1.6 billion dollars, which was to be obtained from the Chinese government through these companies.

Huawei finds itself in good footing with the project, moving now into testing its 4G network in the capital, with individuals selected by ethio-telecom experiencing the service. Its fierce competitor faces a snag.

ethio-telecom, the Ethiopian state monopoly, divided the country into 12 infrastructural zones, allowing one sole vendor within each to undertake swift maintenance services. The ZTE contract was to set up a network in Addis Abeba, where there have been other networks set up by Nokia, Siemens and Ericsson.

“We requested a new commitment from ZTE to include the swapping of the old network, along with the optimisation they are working on according to the former agreement” said Debretsion. “But their response to our demand was negative, reasoning that it is an extra service requiring additional payment.”

ZTE’s officials in Addis Abeba deny the government’s decision to pull out from the deal although confirmed the existence of discussion over the dispute.

“We are still negotiating stage,” ZTE’s public relations officer by the name Pise, told Fortune.

She has declined, however, to speak further on the subject, claiming non-disclosure clause in the contract with the telecom monopoly.

Under this contract, the three-phase project was finalised three months ago. The first phase involved replacing the old Nokia network, set up in 75 areas including Bisrate Gabriel, Mekanisa, Ayer Tena, Alem Bank, and Alem Gena, with a new Huawei network. The second phase involved 239 further areas.

In the third phase, ethio-telecom built the capacity for providing the 4G service for 400,000 customers, by completing civil works, erecting antennas and installing service equipment in an additional 410 sites. In these sites, there will be 210 antennas supporting 4G. A total of 722 antennas were installed bringing the city’s service coverage reach to 100pc.

The expansion project, which is to be completed by the end of the Growth & Transformation Plan (GTP) period, in 2014/15, is supposed to increase the mobile service capacity from 23 million to 50 million, with 40 million subscribers.

Following the completion of these three phases, ethio-telecom was expected to offer 4G services in Addis Abeba and begin the countrywide optimisation by the beginning of this year, but this has yet to happened.

“As an alternative, and as a back-up, we have planned two deals that we are discussing with Sony Ericsson, which seems fruitful,” Debretsion disclosed to Fortune.

ZTE also fell into a tax row with the Ethiopian Revenues & Customs Authority (ERCA), as the Authority required 920 million Br in tax from the company, as well as interest and penalties, which was finalised by administrative measures reducing the tax by nearly half.

Ericsson agreed to come up with the financing, as ZTE has done before, and will also work on the full swapping, according to Debretsion.

The first overseas firm to install mobile networks in Addis Abeba for 19,000 subscribers while still Ericsson AB, Sony-Eric is a multinational mobile phone manufacturing company headquartered in Tokyo, Japan, and Lund, Sweden.

http://addisfortune.net/articles/govt-considering-to-pull-zte-off-ethio-telecom-deal/

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First Contract for Bombardier in Ethiopia

bombardier

Rail technology leader Bombardier Transportation has won a contract to deliver the main-line signalling solution for Ethiopia’s new 400km Awash-Weldia line.

The order has a value of approximately 36 million euros and was awarded by Turkish construction company Yapi Merkezi.

Part of an investment programme by Ethiopian Railways to extend the country’s rail network, the new link is to be equipped with the proven Bombardier Interflo 250 system; this is based on the European Rail Traffic Management System (ERTMS) — a globally standardised signalling system that will ensure the new railway’s high utilisation.

Erdem Arioglu, board member of Yapi Merkezi, said: “This is one of the longest lines tendered as a turn-key project in Sub-Saharan Africa. Yapi Merkezi went through a very detailed selection process to determine its suppliers and sub-contractors and Bombardier was selected due to its proven track record and successful long-term co-operation with us on similar projects world-wide.”

Bombardier’s advanced rail control solutions have already been selected across Africa, including the Gautrain Rapid Rail Link and Durban’s main rail corridors in South Africa, plus Zambia’s north–south connection between Livingstone and Chingola — plus the upgrade of Morocco’s Casablanca to Tangiers line. Bombardier is also providing Algeria.

http://www.waltainfo.com/index.php/explore/16216-first-contract-for-bombardier-in-ethiopia

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States, Investors Pledge 357 Million Birr for Dev’t of Zone

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States, Investors Pledge 357 Million Birr for Dev’t of Zone

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A pledge of 375 million birr was made to sustainably solve the problems and the development of Wag Himra Zone.

The money was raised by a fund raising campaign organized by Wag Himra Development Association, regional states, and local investors.

Speaking on the occasion, President Mulatu Teshome said the peoples of the country are working effectivey in speeding up the prosperity of the country by making use of the favorable national environment created to fight poverty and accelerate the renaissance of Ethiopia.

Yet there are still students in some parts of the country that attend classes under trees and people who do not have health services, he added.

The challenges these compatriots face is not to be taken lightly, the president stressed.

According to Mulatu, since developing any part of the country is beneficial to all Ethiopians, the government and all stakeholders should strive hard to develop Wag Himra Zone.

House of Federation Speaker Kassa Teklebirhan said on his part the fund raised demonstrates that the federal system we established is not only competitive but also where regional states support one another to solve their problems and develop the country together.

According to Kassa, there are some indications that Wag Himra Zone could possibly be a source of wealth for the country, even if the zone was devastated by famine and war.

Coffee and sesame exporter Belayneh Kindie stated that investors have national responsibility to support localities lagging behind in development along with the government as the country is on the road of development.

The investor pledged over 1 million birr and added that he would further consolidate his support.

Out of the total amount of money pledged for Wag Himra Zone, 30 million birr was by Amhara regional state, 20 million birr by Tigray, 10 million birr by Gambella, 5 million birr by Afar, 4 million birr by Oromia, and 3 million birr by Southern Nations, Nationalities and Peoples states.

http://213.55.98.22/enae/index.php?option=com_k2&view=item&id=2541:states-investors-pledge-357-million-birr-for-dev’t-of-zone&Itemid=260

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Government Strengthens Copyright Proclamation for Right-Holders

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Collective Management Society to be established to manage copyright payments.

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berhan

Brehanu Adelo, general manager of EIPPO

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Ethiopia’s Parliament has ratified the bill for the amendment of the existing Copyright & Neighboring Rights Protection Proclamation first issued in 2004, on November 18, 2014.

The original proclamation lacked some specific issues which are now included in the amendment, according to its authors. The first of these is royalty-fees payable to the owner of a work protected under the proclamation, which includes writings, audio recordings, pictures and photographs. It is to be collected by the Collective Management Society (CMS) from those who use the works for commercial purposes.

“The Society will be responsible for the collection of the royalties from the users of the works,” Brehanu Adelo, the general manager of the Ethiopian Intellectual Property Protection Office (EIPPO), told Fortune.

The Society, which will comprise different right-holders in the copyright arena, is to be established and recognised by Brehanu’s Office through an application letter.

The Society will be formed for non-profit purposes, according to the proclamation.

After the establishment, the mandates of the Society are to collect royalties from users and distribute them to the right-holders, preparing royalty schemes and submitting them to the Office for approval and implementation, preparing a working manual to submit to it and withhold income tax to pay it to the Ethiopian Revenues & Customs Authority (ERCA).

“The redistribution of the royalty is also the mandate of the society,” said Brehanu. “The Office is not going to intervene in this system; we only identify if the scheme is reasonable or not, in accordance with the paying capacity of the users.”

The establishment of an Intellectual Property Tribunal is also included in the new amendment. Tribunals are not new in the Ethiopian legal context. There are some, like the tax appeal commission which looks into cases related to tax valuation, and the Federal Trade Competition & Consumers’ Protection Appellate Tribunal.

“There is a tribunal now in the Office which has been operating on the cases of trademarks and we only need to reorganise the structure,” Brehanu said. “There are legal areas that require some expertise in the field and this is one of them.”

The establishment of the tribunal also helps solve the traffic at courts by taking some of the claimers, according to Brehanu.

The amendment encountered controversy during the process of the ratification, especially based on the Marrakesh Treaty, which favors those with disabilities, as they will need to use the works produced by others after changing it into another form. This means those who are seeing impaired have the right to access books and change it into an audio recording.

Even though Ethiopia signed the Marrakesh Treaty in June 2013, the Parliament has yet to ratify the treaty which could have become the law.

“We have asked some questions on the amendment during the public hearing, but now the amendment has been ratified,” Gebre Teshome, the public relations branches and membership affairs head at the Ethiopian National Association of the Blind (ENAB). “Now, after the ratification, I will not comment on the law.”

The Association expects the treaty to be ratified within two months as it is tabled by the Council of Ministers at present, according to Gebre.

But Brehanu argues the Marrakesh Treaty is not considered in the amendment, as the treaty is not the law of the country.

“But when it becomes the law, there might be a need for more amendments,” Brehanu explains.

The proclamation also discusses the issue of works without masters. The length of time a work is protected for a specific kind of work is for the lifetime of the right-holder and an additional 50 years after he or she dies. The 50-year period begins from the beginning of the following January after their death. Royalty collected from such works is to be collected by the Society and is to be reinvested in the protection of copyright and related works, the Proclamation declares.

Punishment on the transgression of the rights was five to 10 years of imprisonment if it is made intentionally; and if the transgression is made in negligence, the guilty party will be punished by one to five years of imprisonment. But considering the low deterrent effect it would have, the punishment was improved to have a 5,000 to 25,000 Br penalty for negligent transgressions. And for intentional transgressions, there is a 25,000 to 50,000 Br penalty.

http://addisfortune.net/articles/govt-strengthens-copyright-proclamation-for-right-holders/


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Cereal productivity in Tigray reaches 28 quintal per hectare

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Sustainable follow up and capacity building provisions has enhanced the productivity of cereal, which mounted to 28 quintal per hectare from 26.6 the same period last year, Tigray Region Agriculture and Development Office said.

Crop Development and Soil Fertility coordinator Solomon Hailu told WIC that the continues capacity building and development army building efforts exerted by the Regional State have enhanced productivity.

Following continues capacity building offered to farmers, 45 million quintal compost, 62 thousand quintal modern fertilizer and 178 thousand quintal selected seed have used.

According to the coordinator, 35.3 million quintals of cereal was harvested from 1.3 million hectares of land.

According to Solomon, during the assessment program 40.8 million quintals of crop is targeted to harvest but the assessment shows that 46 quintals of cereal from 1.3 million hectare of land will be harvest.

http://www.waltainfo.com/index.php/explore/16235-cereal-productivity-in-tigray-reaches-28-quintal-per-hectare-

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Netafim in Ethiopian talks to sell $200m irrigation systems

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Ethiopian farmers

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Irit Avissar and Ron Stein

A consortium of Israel financial institutions is providing financing for an Ethiopian government company.

Drip irrigation technology company Netafim Ltd. is in advanced negotiations for a $190-200 million deal to supply pumping and underground drip irrigation systems for sugar cane to an Ethiopian government company. A consortium of Israel financial institutions, headed by Bank Hapoalim (TASE: POLI), is providing financing for the Ethiopian company.
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The project is complex, and its terms, including the financing question, have not yet been finally closed. Netafim, managed by CEO Ran Meidan, is carrying out the work in Ethiopia in cooperation with Global Africa Industries, owned and managed by Itai Terner. In addition to the complex deal itself, one of the interesting things about it concerns the question of financing. The bank’s customer is Netafim, but the party receiving credit from the bank is an Ethiopian company controlled by the Ethiopian local government, with the money being paid to Netafim as payment for the project. The finance transaction is a complicated scheme called buyer credit, in which the bank is actually financing the company receiving services from its customer. Credit granted to an Ethiopian company, however, is considered high-risk credit, because it involves a company operating in a country defined as an emerging market, and which does not have large foreign currency reserves. This loan is therefore designed to be secured through a credit insurance company. The parties have apparently not yet settled the question of the insurance, and it has not yet been determined whether the party providing it will be the government credit insurance company or a foreign credit insurance company.

The advantage of the deal for Bank Hapoalim is that the risk is being transferred to the credit insurance company (these companies have high debt and financial strength ratings), which means that Bank Hapoalim’s risk is determined by the credit risk of the insurance company insuring the loan, which is low, rather than by the Ethiopian company’s risk.

Quite a big deal

The negotiations for putting together a financing package have reached an advanced stage, although they have not yet been finally approved. The deal is a rather large one, and the bank is therefore expected to recruit other financial institutions to take part in it, apparently mainly foreign institutions specializing in this type of transactions. Bank Hapoalim is also providing credit to Netafim directly through a consortium that includes Clal Insurance Enterprises Holdings Ltd. (TASE: CLIS), Harel Insurance Investments and Financial Services Ltd. (TASE: HARL), Amitim (the older pension funds for which an arrangement has been made), Mizrahi Tefahot Bank (TASE:MZTF), Israel Discount Bank (TASE: DSCT), Union Bank of Israel (TASE: UNON), and HSBC. Some of these institutions may also participate in financing this contract.

Netafim, controlled by the Permira private equity fund, uses drip irrigation that saves water and reduces erosion and soil exhaustion. Netafim exports $800 million annually. The company has 16 plants in 11 countries, and 13 of its plants are outside of Israel. The company has 4,000 employees.

http://www.globes.co.il/en/article-netafim-in-ethiopian-talks-to-sell-$200m-irrigation-systems-1000967346

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