ICL Announces Potash Program for Ethiopia
ICL, a global manufacturer of products based on minerals in the agriculture, processed food and engineered materials markets, announced that it launched a Potash for Growth program in Ethiopia. The program is designed to unlock the potential of agriculture in Ethiopia by promoting balanced fertilization among its small and private farmers in order to increase their agricultural productivity and economic benefits from farming.
The Potash for Growth program launched by ICL, in collaboration with its Ethiopian partners, includes a range of activities to increase awareness by Ethiopian farmers of the benefits of potassium fertilizers.
The program’s activities include:
Potash demonstration plots and outreach to farmers:
During 2014, over 600 potash demonstration plots were developed on farms in the states of Tigray, Amhara, Oromiya and Southern regions to demonstrate that potassium fertilizers increase yields of major Ethiopian crops, such as teff, wheat, barley and sorghum. Several hundred additional plots will be established on farmers’ fields and farmer training centers during 2015. Field days for farmers will also be organized at these demonstration plots.
Soil fertility mapping:
Potash for Growth also supports a nation-wide soil fertility mapping program that is being conducted by the Ethiopian Agriculture Transformation Agency in collaboration with the country’s Ministry of Agriculture and its regional partners. The mapping will enable Potash for Growth to recommend the most appropriate fertilizer applications at the district and PA (Peasant Association or Kebele) levels.
Research and validation:
In collaboration with Ethiopia’s national universities, ICL’s Potash for Growth program supports research by graduate students in the areas of potassium in soil and plants in Ethiopia in order to increase knowledge of balanced fertilization on various crops and to assist in developing specialists in plant nutrition.
Commenting on the Potash for Growth program, Stefan Borgas, President & CEO of ICL, said, “We are honored to play a role in Ethiopia’s rapidly growing agricultural sector by contributing our broad expertise in helping farmers to optimize their agricultural output, as well as our financial support, to enable Ethiopian government agencies to boost the country’s agricultural productivity. We believe that the Potash for Growth program will yield substantial benefits for the Ethiopian farming community, and, in the long-run, for food security in Ethiopia. By partnering with Ethiopia’s Ministry of Agriculture, Regional Bureaus of Agriculture and the ATA, we hope to demonstrate the vital role of balanced fertilization in creating sustainable food production in Ethiopia.”
Ethiopia’s Fertilizer to Arrive in Batches Every Month
And, in what should be no longer be a surprise to anyone, Yara is the big winner again.
The government is expecting to receive three consignments of fertilizers, each carrying 50,000 quintal this January, which is part of the 900,000ql the government purchased with 431.9 million dollars from five companies.
The five supplier companies are Yara Switzerland Ltd, Agri Commodities Group, Witraco, Helm AG and India Agro. The fertilizer started entering the country by the beginning of November 2014 and seven consignments close to 350,000 quintal have reached the port of Djibouti and have started entering the country, according to Shiberu Demisse, director of agricultural input marketing at the Agricultural Input Supply Enterprise (AISE).
The Enterprise announced a tender in August 2014 for the purchase of 521,000tn of NPS and 373,000tn of Urea. For the tender, a total of 11 companies have responded but only one of them, Yara, made an offer for each of the two kinds of fertilizers, while the remaining made an offer only for one type of fertilizer. This is the second year in a row that the Enterprise has bought NPS, a replacement for DAP, which it dropped two years ago. NPS has become favored over DAP because it has everything DAP has and Sulfur, according to Amarech Bekele, director of communication at the Enterprise.
Yara will supply 571,000ql of fertilizers, of which 371,500ql is NPS with a total cost of 286.4 million dollars, Agri Commodities won for the supply of 100,000ql of Urea with 30 million dollars, Witraco will supply 150,000ql of NPS with 78.5 million dollars, Helm Ag is to supply 50,000ql Urea with 19.1 million dollars and India Agro will deliver 22,539ql of Urea with 9.8 million dollars.
Yara, a Swiss based international grain and fertilizer trader with a history of financial awards to Ethiopian officials through Yara International, has been prominent in Ethiopia’s fertilizer market for many years and is now going to supply over half of the current round of government fertilizer purchase.
The tender was floated in 19 lots, eight for Urea and the remaining 11 lots for NPS. Yara won 11 lots while the remaining eight went to the other four companies. The expected delivery time for all the fertilizers is May 2015. The auction was divided into 19 different lots to avoid overlaps in the delivery to the Enterprises and at the Djibouti port, said Shiberu.
Many products are imported through the port of Djibouti, so to avoid the overlap we scheduled to transport only three consignments every month, he added.
While the price of fertilizers per ton was 321 dollars in October 2014, the time when the government purchased the fertilizers, by the next month, it had declined to 311 dollars per ton. But it increased to 312 in December 2014, according to YCharts, a provider of financial information based in Chicago and New York (US).
The Agricultural Inputs Supply Enterprise (AISE) is a public enterprise established in 1985 and accountable to the Ministry of Agriculture (MoA). The Enterprise has 31 million Br in assets, including 22 warehouses, seven distribution and sales outlets and 36 vehicles. It managed to achieve a net profit of 35.4 million Br during the 2011/12 fiscal year and 35.6 million Br during the following year.
The AISE buys and distributes agricultural inputs, including fertilizers, farming chemicals, different kinds of seeds, plants and animal medicines and vaccines, and laboratory equipment. The Enterprise imported 552,000tns of fertilizer in 2010/11 and 560,000tn the following year. Its imports in 2012/13 were down to 477,000tns.
The government is constructing four fertilizer factories in the Tigray, Amhara, Oromia and Southern regional states, with annual capacities of 25,000tns of fertilizer.
Currently, the Country cultivated 14.1 million hectares of land with cereal and pulses and the use of fertilizer per hectare reached 63Kg, according to a data from the MoA.
The government is constructing four fertilizer factories with annual capacities of 25,000tns
Export said essential to develop foreign currency, create jobs
The Commercial Bank of Ethiopia (CBE) honored exporters and money transfer agents who promoted the bank’s portfolio in terms of earning huge foreign exchange here Thursday at Sheraton Addis.
The award is aimed at recognizing them and strengthening the export sector. The Bank has been giving its services for the last 70 years uninterruptedly regardless of changes of government.
The exporters are those engaged in money transfer, coffee, leather, textile and mineral sectors. MIDROC Ethiopia, Western Union and Dehabshiil Money Transfer agents earned over 150 million USD while Belayneh Kindie, an exporter earned around 140 million USD receiving the highest awards and Certificates of Appreciation.
CBE President Bekalu Zeleke said that the Bank was successful in expanding export trade, introducing local products for foreign market, making local products get recognition, and in building its capacity to be competitive in the international markets thanks to its investors’ continuous hard work.
Bekalu also said that as export trade is essential to develop foreign currency and to create employment, CBE has been working on how to support and encourage customers to work on export trade.
“We believe that our Bank has a problem on the export trade sector, even if our government has taken measures to boost export trade and recognize our investors efforts in their role to improve the growth of the national economy,” Bekalu said. “But it is undeniable that CBE is showing faster growth in the last few years. It has 9.4 million customers in its 909 branches in the country. The Bank’s total asset has reached over 250 billion Birr.”
Bereket Simon, Adviser to the Prime Minister with the Rank of Minister and Chairman of the Board of Governors of the CBE, said that the government and its people have long been working hard to eradicate poverty and to make the country join the level of middle income countries through the implementation of various strategies.
The Minister said: “The country’s continuous registration of fast economic growth has been going on for the last seven years. To increase the pace of such growth to even higher levels the government’s role in leading the people is significant.”
According to Bereket, due to the fall in the price of coffee in the global market in 2012/13 the country’s income was forced to decline. However, despite this the export trade of the 2013/14 year has shown a marked improvement. Compared with the previous year, coffee has shown an increase of 41.5 per cent, oil seeds 17.1 per cent, meat and meat products 12.6 per cent while fruits and vegetables have shown an increment of 8.7 per cent.
Bereket said that government creates conducive environment for the export of manufactured products for local investors. Development partners and exporters should focus on working jointly by sustaining export trade to help the country sell its products and get more benefits from the sector.
Country Representative to Dahabshiil Money Transfer Limited, AL. Jama Guush said on his part that Dahabshiil is the only African company working in Ethiopia, employing 5,000 people across 126 countries. It works with 17 banks in Ethiopia. Dahabshiil has more than 40 years experience in the provision of valuable lifeline in the Horn of Africa and it remains committed to its original values of trust, reliability, integrity and customer-focus.
Dahabshiil plans to strengthen its position in the market and to further expand its network of agents throughout the world by building strong partnerships and adding new products and services to meet the growing expectations of its valued customers worldwide.
Belayneh Kindie Importer – Exporter, the leading exporters of oilseeds and other cereals to different countries in the world especially to China started six years ago and has brought 60 million USD through CBE and 15 million USD through other banks. This success is a result of the hard and continuous efforts of its employees and managers in addition to the policy and strategy that are undertaken by the government.
FOREX Africa: Is 2015 Ethiopian Birr’s Time To Shine?
By Jeffrey Cavanaugh
As a frontier market, the countries of Africa represent both tremendous opportunities and tremendous risks. On the risk side of the ledger are all the usual complications of international trade and investment compounded by the problems inherent in a developing, emergent continental market consisting of 54 countries and 1.1 billion people – it’s a lot to keep track of.
Luckily, the ups and downs of the African currency markets aren’t one of them if you know where to look. To help with that, AFK Insider has compiled all the news you need to know now in order to slim down your currency risk in the week ahead. Let’s see what’s happening out there.
From Band Aid to Investor Darling
Early last month Ethiopia marked a remarkable milestone in its history. Thirty years ago the country was in the grip of a deadly, mostly man-made famine caused by civil war and government mismanagement.
As the Marxist regime fought for control of the countryside in a war that it was ultimately going to lose, media reports from the stricken country showed hordes of refuges and children with stricken bellies scratching out a bare existence in overwhelmed aid camps. Such was the country’s plight that it became the subject of the original Band Aid song Do They Know It’s Christmas?
How things have changed. On December 4th Ethiopia’s inaugural Eurobond issue raised $1.0 billion from investors, paying in the process the relatively low yield of 6.625.
By way of comparison, Ethiopia is paying what copper-rich Zambia is paying for its notes and less than a full percentage point higher than what neighboring Kenya, which has a much larger economy, is paying for the $2.0 billion in debt it issued earlier in 2014.
Indeed, as the venerable Financial Times pointed out at the time of the sale, the remarkably low rate was similar to what developed countries were paying as recently as 2000.
This success for Ethiopia is sourced from two places. First, Ethiopia has been the fastest growing economy in Africa for the past ten years, averaging according to the IMF’s numbers an average rate of growth of 10.9 percent over the past decade.
This is quite a record and means Ethiopia has now been growing faster than China, which last saw growth in excess of 10 percent way back in 2010, for several years now.
Of course, much of this is due to Ethiopia starting from such a low starting point – it is one of the poorest countries in Africa and poorer countries tend to grow very quickly when growth begins – but it is also due to conditions generally getting better within Ethiopia itself.
Still, Ethiopia’s success isn’t entirely self-made.
As with Africa’s other commodity producers, it has benefited greatly from demand growth elsewhere—especially the Middle East and China, which have increasingly snapped up Ethiopian coffee, vegetables, cattle and sheep as they have grown richer.
Luckily, this increase in demand for Ethiopia’s products has coincided with better, more stable government so its economy, compared to the war torn days of the 1980s, is better able to react to the market and take advantage therein.
What’s even more fortunate, this growth in trade hasn’t been based on oil, either, but on agriculture, which employs a lot more people, spreads wealth around more evenly, and, most important, has a fairly steady demand and price given the growing number of mouths to feed worldwide.
An oil windfall in reverse
This lack of oil in the Ethiopian growth equation is especially important now that the price of that commodity has collapsed. That’s because it will immediately help Ethiopia’s economic growth rather directly.
According to the latest data available, Ethiopia spends about $2.2 billion importing refined petroleum for its fuel needs, or about 19.25 percent of its total import bill. With oil about 40 percent less costly and assuming it imports the same amount as it has in previous years, that number should shrink to about $1.32 billion if prices stay this low going forward: a hefty savings considering the country just borrowed $122 million more than that on the bond market.
When looking at the Ethiopian economy as a whole, then, oil’s price collapse effectively just paid for nearly all of what the country borrowed—and that windfall will be spent on investment and additional consumption in the coming year, boosting growth further.
What’s more, what applies to Ethiopia applies to most of its trading partners, too, meaning they will also have all that additional spending power to buy what Ethiopia is selling. That means more cut flowers going to Europe, more coffee to China, and so on.
It’ll even be cheaper to ship since the cost of transportation will, again, decrease because of the massive decline in oil.
So, looking ahead to 2015, barring any disasters—and Ethiopia was quick to remind investors that it was still subject to terrible things happening to it—the coming year should be a good one.
Not only will it have $1.0 billion in additional capital to spend on roads, bridges and all the other vitally important infrastructure it needs, but will also have nearly that much again in additional consumption power to spend on whatever else it needs, too. That’s a huge gain, meaning that if these predictions are borne out the birr could do well indeed.
Jeffrey Cavanaugh holds a Ph.D. in political science with a specialization in international relations from the University of Illinois at Urbana-Champaign. Formerly an assistant professor of political science and public administration at Mississippi State University, he writes on global affairs and international economics for AFK Insider and Mint Press News.
Most developing countries will benefit from oil price slump, says World Bank Group
The decline in oil prices reflects a confluence of factors, including several years of upward surprises in oil supply and downward surprises in demand, receding geopolitical risks in some areas of the world, a significant change in policy objectives of the Organisation of the Petroleum Exporting Countries (OPEC), and appreciation of the US dollar. Although the relative strength of the forces driving the recent plunge in prices remains uncertain, supply-related factors appear to have played a dominant role.
Soft oil prices are expected to persist in 2015 and will be accompanied by significant real income shifts from oil-exporting to oil-importing countries. For many oil-importing countries, lower prices contribute to growth and reduce inflationary, external, and fiscal pressures.
However, weak oil prices present significant challenges for major oil-exporting countries, which will be adversely impacted by weakening growth prospects, and fiscal and external positions. If lower oil prices persist, they could also undermine investment in new exploration or development. This would especially put at risk investment in some low-income countries, or in unconventional sources such as shale oil, tar sands, and deep sea oil fields.
“For policymakers in oil-importing developing countries, the fall in oil prices provides a window of opportunity to undertake fiscal policy and structural reforms as well as fund social programmes. In oil-exporting countries, the sharp decline in oil prices is a reminder of significant vulnerabilities inherent in highly concentrated economic activity and the necessity to reinvigorate efforts to diversify over the medium and long term,” said Ayhan Kose, director of development prospects at the World Bank.
The analysis on oil prices in Global Economic Prospects is complemented by two special features on how trends in global trade and remittance flows are impacting developing countries.
Global trade weak on cyclical and long-term factors
Global trade expanded by less than 3.5% in 2012 and 2013, well below the pre-crisis average annual rate of 7%, holding back developing country growth in recent years.
Weak demand, mainly in investment but also in consumer demand, is one of the main causes of the deceleration in trade growth. With high-income countries accounting for some 65% of global imports, the lingering weakness of their economies five years after the crisis suggests that weak demand continues to adversely impact the recovery in global trade. However, long-term trends have also slowed trade growth, including the changing relationship between trade and income. Specifically, world trade has become less responsive to changes in global income because of slower expansions of global supply chains and a shift in demand from trade-intensive investment to less trade-intensive private and public consumption.
The analysis finds that these long-term factors affecting trade will also shape the behaviour of trade flows in the years ahead — in particular, that the expected recovery in global growth is not likely to be accompanied by the rapid growth in trade flows observed in the pre-crisis years.
Remittances have potential to smooth consumption
A second special feature reports that remittance flows to many low- and middle-income countries are not only significant relative to GDP but also comparable in value to foreign direct investment (FDI) and foreign aid. Since 2000, remittances to developing countries have averaged about 60% of the volume of total foreign direct investment flows. For many developing countries, remittances are the single largest source of foreign exchange.
The study finds that, in addition to their considerable volume, remittances are more stable than other types of capital flows, even during episodes of financial stress. For example, during past sudden stops, when capital flows fell on average by 14.8%, remittances increased by 6.6%. The stable nature of remittance flows, the analysis concludes, means that they can help smooth consumption in developing countries, which often experience macroeconomic volatility.
GE to build wind farm
A consortium that includes General Electric, a US based company, is going to undertake the wind farm project at Aysha, Somali regional state.
The consortium that delivered its study for the development of 310mw of electric power from wind is expected to bring a detailed proposal.
According to sources, Ethiopian Electric Power (EEP) has approved the consortium’s feasibility study to generate electricity in the area.
“EEP is now waiting for the technical and financial proposal of the consortium for final negotiation,” sources said.
Lafto Turbine Technologies plc, a German based company, plans to develop 120mw of electric power from wind on a similar location at Aysah.
The new design undertaken by GE shows that the area has the potential of generating 310mw of electric power at the location expected to be developed by Lafto, according to experts.
According to studies, Aysah is a major wind power source in the country, although it has yet to be developed.
The area has a potential of generating 10,000mw electric power from wind. The country also has a capacity to generate over one million megawatts of electricity from wind power.
GE is currently working with EEP on capacity building trainings for local staff, according to sources.
The private sector interest is now growing to get involved in the power sector. This will expand the opportunity to select the perfect and genuine private sector company.
The interest of the government has also grown to include the private sector as they seek to export power regionally.
In the coming quarter of a century the power sector (generation, substation and transmission) investment demands USD 177 billion or USD four billion every year. The distribution investment is not included in this figure.
The private sector is expected to foot the bill for most of these endeavors.
In the next 25 years, 27,000mw power generators, 19,000km transmission lines, and more than 300 new substations are slated for construction.
In the coming five year plan (GTP II) the power sector target would be 15,000mw and the investment demand will be USD four billion per year.
In the GTP II several investments will be expected. Experts said the EEP has targeted to shrink the hard currency demand from the current amount. “In the coming GTP the local currency investment would be at least 40 percent of the total investment in the power sector,” Mekuria Lemma, head of Strategy and Investment Division at the Ethiopian Electric Power (EEP) explained during his presentation on the Powering Africa event held in November last year.
Sudan, Ethiopia agree to remove obstacles facing trade exchange
Chairman of the Sudanese Exporters Chamber Wagdy Mirghani said a meeting was held with an Ethiopian high-level economic delegation to discuss all problems hindering trade exchange.
The two parts agreed to do their best to enable the flow of goods between Sudan and Ethiopia, he added.
Ethiopian goods face no problems in entering Sudan, while Sudanese goods face several problems to enter Ethiopia, causing an imbalance in the balance of trade, he added.
Japan to support Ethiopia’s industry through Kaizen
Phase three Kaizen project is expected to be launched with the support of Japan International Cooperation Agency (JICA) by the beginning of 2015.
The project expected be last until 2020, will contribute to strengthening industrial competitiveness to the country, according to Jim Kimiaki, chief representative of JICA Ethiopia Office during a press conference held on January 8, 2015 at its office off of Ethio-China Avenue.
JICA provides bilateral aid in the form of Technical Cooperation, according to the chief representative.
It has been providing monetary and technical support to Ethiopia since the Hailesilasie regime. Currently, JICA is engaged in agricultural and rural, private sector & industrial and infrastructure development.
JICA has been providing technical assistance on Kaizen promotion in Ethiopia since October 2009. Ministry of Industry was the counterpart in Phase one and Ethiopian Kaizen Institute (EKI) was established for Phase two.
During the last fiscal year, the agency trained 20,957 trainees rising from 11,996 are trainees in 2012/13 fiscal year.
Etur Textile to start export to Europe, US
The Turkish textile manufacturer, Etur Textile has announced on Monday that it would start exporting its products to markets in Europe and America having conducted successful trial exports to Algeria and Morocco.
According to Adil Basoglu, board member and executive director of Etur, the factory has fully embarked on production and it will soon start export into the larger overseas markets.
Etur Textile, one of the largest textile factories operating in Ethiopia, is located in Wonji road, six km. from Adama town in the south east of the capital Addis Ababa.
According to the executive director, the textile factory aims at becoming the biggest exporter in the country.
“We have moved here to become more productive and help out the countries vision in the sector,” Basoglu said.
Hiring more than 800 employees, the factory has stepped up its production to start export in full capacity. However, employees complain of meager wages, a portion of which is deducted for the recruiting agency but the company denies.
“We have no clear response for that since we know we are paying them relatively higher salary,” Basoglu said.
Basoglu said high turnover of employees is forcing the company to bring in untrained labor which is only aggravating work-related accidents inside the main production units. “We have no clear response for that since we know we are paying them relatively higher salary,” Basoglu says. In addition to this Basoglu also told journalists visiting the company that dust blowing up from the gravel road by adjacent to the factory is set up has also been affecting business in the production unit. “We have told the city administration so many times but no quick response yet,” Basoglu said.
Currently there are 110 textile companies in Ethiopia of which Turkish, Chinese and Indians are major contributors for the textile and garment export which has reportedly grown by 28 percent year on year during the previous fiscal year (2012-2013). Under the five years Growth and Transformation Plan, currently on its final year, Ethiopia aims to earn USD one billion from the textile industry But the country is still far from achieving the target mainly plagued by shortage of raw material such as cotton.
In the last five months of 2014, Ethiopia imported more than 3,000 tons of cotton to meet the demand of domestic textile industry as a short-term measure, Textiles Industry Development Institute (TIDI) said this week.
Maaza partners with Petram to open Ethiopian bottling plant
Maaza International, the UAE company behind a popular mango beverage brand, has partnered with Petram, one of Ethiopia’s largest and most successful companies, to open a bottling plant with an installed capacity of 3.5 million cases a year.
“It’s a bottling and distribution arrangement we have with Petram and similar to arrangements we have for Saudi Arabia or Kuwait,” said commercial director Samer Salah, noting that it was Maaza first bottling partnership in Africa since a previous arrangement in Sudan 11 years ago.
“They had been importing our products earlier and there was merit in upgrading the relationship to a franchise. Apart from within Ethiopia itself, the bottler can distribute to some outside territories as well.
“This is the second Maaza bottling arrangement we have in Africa after we introduced it in Sudan 11 years ago. Ideally, we would like to go further into Africa, markets like Tanzania or Kenya. These are markets ripe for higher growth rates.”
The deal shortly follows UAE pharmaceutical giant Julphar’s plans to build a $49.5m insulin factory in Ethiopia through its local subsidiary Julphar Ethiopia Pharmaceutical Industry.
In another recent Gulf-Ethiopia deal, Bahrain’s Ibdar Bank concluding a $100m deal with Ethiopian Airlines for the bank’s acquisition of four aircraft back for lease back to the airline.
Ethiopia also inaugurated its long-anticipated embassy in the Al Bateen area of Abu Dhabi, in a diplomatic reflection of the ever growing economic connection between the two countries.
China to further increase presence in manufacturing, infrastructure
Ethiopia is asking for China’s support in three areas of the second Growth and Transformation Plan (GTP II), Capital learnt.
China who is a major partner of Ethiopia has also played a vital role in helping the government to realize its development strategies in the first GTP which was endorsed in 2010.
Most of the mega infrastructure projects are eitherbeing financed or constructed by China and companies from the second largest economy in the world.
Diplomatic sources at the Chinese Embassy in Ethiopia recently told Capital that in the coming GTP II the Ethiopian government requested the support of China on establishing and enhancing the transportation sector in regional states.
China has been one of the major allies in the construction of road infrastructure in the country and they have provided money and human resources in large numbers.
According to diplomatic sources, the Ethiopian government officially expressed its desire to work with China in manufacturing during the GTP II, which will be endorsed this July.
In the current GTP that will end this budget year China’s investment in manufacturing dramatically increased.
For instance the major footwear manufacturer Huajian, one of the top three shoe companies in the world, established its factory during the current GTP.
Even though in the beginning of the GTP the government disclosed that manufacturing would be the leading economic sector by the end of the five year plan, the number of local and foreign investments and developments in the sector are below expectations.
Poverty reduction, which has been a priority for the Ethiopian government and the ruling party since it became the leader of the country about two decades ago, is the third major area that China has been asked to assist in.
On several dimensions the government has been attempting to eradicate poverty from the country. According to the information from Ministry of Finance and Economic Development, the country has registered significant achievement on poverty eradication in the past year.
The per capita GDP (USD nominal) has increased to USD 632 in the 2013/14 fiscal year, which was USD 558 a year ago. By the end of the GTP the government planned to raise the per capita income to USD 700.
Wonji-Shoa Sugar Factory boosts production to ease shortage
The factory has been undertaking an expansion with an outlay of three billion birr since 2011 in Wonji area; 110 km south east of the capital, in the Oromia Regional State. The expansion work was carried out by Uttam Group of India after the Indian government extended a USD 640 million loan for three sugar factory projects including two expansion projects at Fincha and Wonji and a new factory in Tendaho, in the Afar Regional State.
The Wonji/Shoa crushes 6250 tons of sugarcane per day to produce the much needed sugar which was in a critical supply a few months back. The Ethiopian Sugar Corporation (ESC) attributed the shortage to suspension of sugar production during the rainy season in the three existing sugar factories – Wonji/Shoa, Metehara and Fincha – as well as delay in Tendaho Sugar project which was expected to enter production in May last year.
While briefing journalists who were on a field visit to the project site, Wonji Shoa Factory officials said part of the problem in sugar supply lies with the distribution channel in place. They blamed the state owned Merchandize Wholesale and Import Trade Enterprise (MEWIT), which is responsible for the distribution of sugar to institutions and regional states outside Addis Ababa.
“We have plenty amount of sugar in store but the transportation is below the production level,” Dadi Bekele, property unit head of the factory, told The Reporter.
According to him 85,574 quintals of sugar is already stored in the warehouse waiting to be picked up for distribution.
A similar scenario was witnessed at Metehara Sugar Factory. Zenebe Yimam, general manager of the factory, said there is a stockpile of 72,000 quintals of sugar waiting for distribution.
However, MEWIT insists it has been distributing sugar according to the time table it has set out.
“Out of the 395,000 quintals we are expected to distribute in four months we have distributed more than 70 percent so far. We still have a month to go at which time we will transport the rest,” Gemeda Alemi, general manager of MEWIT, told The Reporter.
Despite the government ambition to realize competitive sugar industry, sugar is still one of the commodities that majority of the people hardly find in the market. According to factory managers, the three fully functional sugar factories found in Wonji, Metahara and Finhca are inadequate to meet the domestic demand. But the domestic market can expect a boost when Tendaho, whose construction has been completed, enters production.
Established in 1951 in the reign of Emperor Haileselassie after a lease agreement was signed with H.V.A, Dutch company, Wonji had been the only sugar factory that supplied sugar for the entire nation until Metahara Sugar was founded a decade later in the central Rift Valley South-East Shoa.
Julphar plans $49.5m insulin factory in Ethiopia
Ras Al Khaimah-based Julphar Gulf Pharmaceutical Industries has plans to establish a $49.5m insulin factory in Ethiopia through local subsidiary Julphar Ethiopia Pharmaceutical Industry.
“We are hoping that the land for construction will be handed over to us in the next two weeks,” said Mukemil Abdella, Julphar’s country director for Ethiopia, adding that the company intends to make Ethiopia the insulin hub of Africa.
Julphar first entered the Ethiopian market in February 2013, when it inaugurated its existing $9.6m factory under Julphar Ethiopia Pharmaceutical Industry — an Ethiopian arm that is 55% owned by Julphar and 45% owned by local firm Med-tech Ethiopia.
The existing Julphar Ethiopia factory has an annual production capacity for 25 million bottles of suspensions and syrups, 500 million tablets and 170 million capsules.
According to reports, the new insulin factory is going to be constructed on an 11,051m2 plot of land and is expected to begin production within two years.
The deal comes at a time of a soaring trade between the Ethiopia and the UAE — growing from $123m in 2002 to $934.5m in 2011, while in Dubai alone, the emirate’s chamber of commerce has registering 318 Ethiopian companies.
The investment is in all types of project, but particularly in manufacturing (38%), real estate (27%) and agriculture (23%), with 12% split across fields such as education and construction.
In 2013, the Abu Dhabi Fund for Development (ADFD) also signed a $10m loan for a road-building project in Ethiopia, where huge projects are also currently underway to expand the countries 70,000km road network, including 400km of road plans for the Benishangul region.
Ministry suspends issuing exploration licenses in mineral rich areas
The Ministry of Mines announced that it has stopped issuing mineral exploration licenses in the South Western part of the country, a region known for different mineral deposits.
In a public notice issued last week, the Ministry of Mines, Mineral Licensing and Administration Directorate, announced that it has suspended issuing mineral exploration licenses in South West part of the country as this area is reserved for a joint geological study being undertaken by the Ethiopian and Chinese geological survey institutes. The directorate revealed that it will not accept applications from companies requesting exploration areas in this part of the country for unspecific period of time.
Local and foreign mining companies expressed their discontent over the large concession held by the Chinese and Ethiopian geological survey institutes for the joint geological study.
Based on a bilateral agreement signed by the governments of China and Ethiopia the Ethiopian and China geological survey institutes are undertaking a joint geological study in the South Western part of Ethiopia since 2012. The South Western part of Ethiopia is known for different mineral resources including gold. The concession includes tens of thousands of sq. km. of land in South Western parts of Ethiopia. The geological surveys are trying to identify the mineral resources of the concession area. Chinese and Ethiopian geologists are jointly working to learn about the types of the existing minerals. The cost of the exploration project is covered by the Chinese government. However, Ethiopian and foreign mining companies are not happy about this project. They are wary of the Chinese move saying that this gives comparative advantage for Chinese mining firms.
The Ministry of Mines, Public Relations and Communication Directorate director, Bacha Fuji, told The Reporter that the Ethiopian and Chinese geological survey institutes are assessing the mineral potential of the area for the past two years. “They are collecting useful geological data. They are adding value to the concession. Hence, the Mineral Licensing and Administration Directorate will not process exploration license applications until the joint study is finalized,” Bacha said. However, he said the Ministry will avail the crucial geological data for all local and foreign mining firms once the joint study is finalized.
“Apart from the concession area held by the joint study other concessions are open for interested local and foreign investors,” Bacha said.
The Ministry of Mines recently introduced a stringent mineral exploration licensing procedures. It has also evaluated the performance of companies engaged in mineral exploration activities and revoked 56 companies licenses who failed to execute exploration work according to their commitments.
The Reporter Newspaper – NEWS IN BRIEF
Vitol Bahrain to supply diesel, benzene to Ethiopia
Vitol Bahrain, part of the Vitol Group a multinational energy trading company, will supply 30 percent of Ethiopia’s import of diesel and benzene starting from this month, the Ethiopian Petroleum Supply Enterprise (EPSE) announced.
The contract has given to the company that won the bid for the importation of the products for the coming year, Demelash Alemu, Adviser to the CEO of the Enterprise, said.
The fall in the price of oil globally benefited Ethiopia. The nation has managed to save more than 103 USD because of the price decline over the past six months, Demelash said.
The nation saved this amount of money in spite of the increase in the consumption of oil nationally by 8 percent compared to the previous year, the adviser added.
Ethiopia could still stand to gain from the continued tumble in the price of oil with the nation expecting to save another USD 600 million.
Ethiopia imports 70 percent of diesel, kerosene for airplanes and benzene from Kuwait, while light and heavy diesel oil for industries are imported from Saudi Arabia.
Ethiopia marks 365 days without reported cases of Polio
Since 5 January 2014 no new cases of wild polio virus have been reported from the Somali region of Ethiopia, where the last case of polio in the country was reported, according to the World Health Organization (WHO).
Pierre M’Pele-Kilebou (PhD), WHO Representative to Ethiopia, and Dr Omar Mohammed Farah, head of Somali Regional State Health Bureau, visited Wardher town in Doollo Zone, Somali region, on 5 January 2015 to congratulate the Zonal Administration and WHO/UNICEF Operations Base staff for their persistent efforts to ensure that every last child gets vaccinated against this paralyzing disease.
The high level delegation acknowledged the excellent collaboration with the Polio Partners Group in Ethiopia to kick polio out of the country and the Horn of Africa. Until August 2013, when the first case of wild polio virus was confirmed from the Somali region, Ethiopia had been polio-free since 2008. Ethiopia’s fast and aggressive response together with immunization partners helped to halt the spread of the disease, but intensified efforts must continue as the virus continues to circulate in neighboring Somalia.
Al-Shabaab lost 80% of the areas under their control – AU
The Al-Qaeda linked terrorist group Al-Shabaab has lost ground in 80 percent of the areas it used to control in Somalia, African Union (AU) envoy said.
AU Special Representative to Somalia and head of AMISOM, Ambassador Maman Sidikou said this at a press conference held in Addis Ababa, Ethiopia.
Shedding light on the security situation of Somalia and the achievements of African Union peacekeeping troops, the ambassador said Al-Shabaab lost control of over 80 percent of the areas under their control through joint military operations by AU troops and government forces.
The ambassador stated that Al-Shabaab shifted their strength and capability to the rich agricultural areas of Lower Juba region controlled by the Interim Juba Administration.
Sidikou has not specified the exact date when the military operations against Al-Shabaab will be launched, but said there are ongoing negotiations and consultations on the issue.
The ambassador has been in Addis Ababa the last few days to discuss issues with the regional leaders related to the operations against Al-Shabaab that are expected to begin in few weeks time.
Turkish president to visit Ethiopia in Africa tour this month
Turkish President Reep Tayyip Erdogan will go on his first overseas trip of 2015 to the African continent. World Bulletin reported citing information from the Presidency sources that Erdogans’ first round trip, which will be in January, will include Ethiopia, Tanzania and Somalia.
Turkish investors with over 3 billion USD capital are engaged in various sectors in Ethiopia, the country’s Ambassador to Ethiopia, Osman R. Yavuzalp, disclosed.
This makes Turkish business persons the leading foreign investor in Ethiopia in terms of capital volume. According to the ambassador, the trade exchange between the two countries had jumped over 400 million USD.
Ethiopia imports machinery, metals, plastic products, drugs and factory products while exporting oilseeds, fruits and vegetables, cereals and textile.
The two countries would work together in climate change, fighting terrorism and other international issues, Ambassador Yavuzalp said.
Erdogan will go to four separate tours and will visit a total of 12 countries in Africa. As the prime minister, Erdogan visited Somalia in 2011 and he will go there as the president this time.