13 March 2015 News Briefs


Intra COMESA trade expanding, State Minister


comesaAddis Ababa, 13 March 2015

Intra Common Market for Eastern and Southern Africa (COMESA) trade has been fundamentally growing.
Still a long way to go and we need to do more but since we started to culminate in COMESA regional integration agenda, there have been very important developments in even trading with each other across the member countries, said yesterday State Minister of Finance and Economic Development Ahmed Shide while briefing journalists on current affairs.

According to him, Ethiopia is now exporting leather products to a lot of COMESA member countries. Member states are also exporting to each other.
The East Africa power system improvement, the road link between member countries and the ongoing railway investment within member countries are really boosting our capability to generate more wealth and to trade within each other, he added.

The Minister also announced that nation will host the 34th COMESA policy organ meetings that will culminate by 18th COMESA Summit of heads of state and government to be held from March 20-31, 2015.
Ethiopia has been selected at the 17th COMESA Summit that was held last year in Kinshasa, the Democratic Republic of Congo, DRC, to host the 18th COMESA summit.

Related article  Ethiopia to Host COMESA Summit of Heads of State, Government

Ethiopia took this opportunity as a platform to reiterate its support to the objective of the organization as well as an opportunity to share its best practices from the country’s national transformational agenda, Ahmed said.
The COMESA chairmanship will be handed over from President Joseph Kabila of DRC to Prime Minister Hailemariam until the next summit.

The theme of the summit is inclusive and sustainable industrialization which aims not only to bring forth the issue of constraints on goods to be traded on the regional and international markets but more importantly to ensure job opportunities for the region’s population.

It was learnt that the summit will comprise nine sessions, among which are meetings of the Administrative and Budgetary Committee, the Intergovernmental Committee, the Council of Ministers, the Ministers of Foreign affairs, the First Ladies Roudtable, and the Summit of Heads of State and Government.



Emerging Markets investors need Ethiopia on their shortlist 

By Anders Heede of BDO

Many emerging markets, especially in sub-Saharan Africa, have seen solid GDP growth in the past decade driven mainly by natural resources. But with falling commodity prices and Chinese demand dwindling, those with overly resource-dependent economies are being caught.

Companies seeking to invest in emerging markets should be on the lookout for those countries that have invested in diversifying their economies. That will often mean having Ethiopia on their shortlist.

In 2012, Ethiopia was the 12th-fastest growing economy in the world, according to the World Bank. Hefty state-led investment has kept the economy of Africa’s second most populous nation growing at more than 8 per cent a year for over a decade. More than that, it has become Africa’s fastest-growing non-oil economy. The government’s focus on value-added activities has bolstered its transformation towards a diversified economy and, as a result, it is attracting the attention of ambitious businesses and investors alike. How has it solidified its position and what are the opportunities for businesses?

Most importantly, the country has invested in infrastructure. The government has delivered on its five year Growth and Transformation Plan, which has seen it making large investments (around 15 per cent of GDP) in infrastructure projects. At the heart of the programme are railway, road and dam projects to give the landlocked nation cheap power and reliable transport. The programme’s poster child is the controversial Grand Renaissance Dam on the Blue Nile, which will become Africa’s biggest hydro-power plant and turn Ethiopia into a regional power hub.

At the same time, reforms to business registration and changes to regulatory institutions have simplified rules, improved the quality of business support and considerably reduced the cost of doing business. The time required to clear customs for export and to secure a business licence, for example, has been cut to 15 days, from 44 in 2004.

With China slowly running out of inexpensive labour, manufacturers are looking at low-income countries like Ethiopia. Textile manufacturers have already been attracted by the rich local supply of leather and cotton. Multinational retail clothing companies H&M and Primark both source significant amounts of material from Ethiopia. The government has developed specific industrial zones that will see the companies within them benefit from a tax ‘holiday’ of up to 17 years. Chinese shoe maker Hujian Group has already invested heavily in the Chinese-built Eastern Industrial Zone and last year announced plans to invest a further $2.2bn in an industrial zone of its own, located in the Lebu area on the south-western outskirts of Addis Ababa. Turkey is currently the leading country investing in Ethiopia – Turkish companies have invested $1.2bn in the last decade. Other big names that have recently announced investment plans include Unilever, GE and GSK.

With a growing population of 94m, urbanisation and rising income levels, Ethiopia is also surfacing as an attractive consumer market. By 2020, Coca-Cola hopes to sell 100m unit cases in Ethiopia, putting it on par with Egypt and South Africa. Meanwhile, Heineken has just inaugurated what it claims is Ethiopia’s biggest brewery to capitalise on figures showing the Ethiopian beer market has doubled over the last five years, with per capita consumption still relatively low compared to other east African countries.

However, the country is not without its challenges and there is some uncertainty ahead. Ethiopians will go to the polls on May 24. The elections will likely see another win for the ruling EPRDF party that has claimed victory in every election since the fall of the Derg regime in 1991. It will be the first election to be held under the current prime minister, Hailemariam Desalegnn, after the death in 2012 of Meles Zenawi, who ruled the country for 21 years. Complaints from many human rights activists about growing inequality and demands for freedom of press and political participation are likely to challenge the ruling party.

Investors will be keen to find out whether the government plans to loosen its grip on the economy – for example, many sectors remain closed off to foreign investors and even to domestic companies at times. Access to finance for the private sector remains difficult, even more so because of the government’s large infrastructure plans. For its boom to continue, Ethiopia needs a stronger banking sector. The World Bank’s survey on investing across sectors shows that Ethiopia has above-average restrictions on foreign equity ownership in many sectors, including telecommunications, financial services, media, the retail trade and transport.

Nevertheless, we see Ethiopia as a major future market for our clients.

Anders Heede is chief executive for Europe, the Middle East and Africa at audit and advisory firm BDO. Million Kibret, chief executive of BDO Ethiopia, co-authored this post.



Ethiopia among Africa’s Big Five, likely to lead the continent in the next 25 years


Ethiopia among Africa’s Big Five, likely to lead the continent in the next 25 yearsAddis Ababa: March 13, 2015  –

As Africa aspires to take responsibility for its development, peace and security, the question of regional leadership is key.

The Institute for Security Studies (ISS) has organized a seminar which will discuss the historical distribution of power in Africa and how it is likely to change over the next 25 years.

Related March 25, 2015 seminar link here:  Which country will lead Africa in the next 25 years?

In an increasingly multipolar world, parts of Africa will become more prosperous. But will that change Africa’s relative influence globally? And which countries have the greatest ‘power potential’?

A new research by the ISS explores Africa in the global power context and the future capabilities of the continent’s Big Five: Algeria, Egypt, Ethiopia, Nigeria and South Africa.



President Urges IFC to Focus on Value Added Products


President Urges IFC to Focus on Value Added ProductsAddis Ababa March 12, 2015 –

President Mulatu Teshome urged the International Finance Corporation (IFC) to strengthen its support to value added products  such as textile, food processing and leather.

The president held talks today with the Vice President of IFC on issues of financial and technical supports to the private sector.

IFC has reportedly been engaged in allocating support to mining, hotel, tourism and agriculture sectors.

President Mulatu called on the corporation to focus on extending support to the country’s priority areas such as textile, food processing and leather industry.

International Finance Corporation Vice President Jin Youg Cai said on his part IFC will continue its support during the second phase of the Growth and Transformation Plan.

The International Finance Corporation (IFC) is an international financial institution that offers investment advisory, and asset management services to encourage private sector development in developing countries.



U.S business giant Dow eyeing Ethiopian market

Addis Ababa, 13 March 2015 

The Dow Water and Process Solution said it is opening an office in Addis Ababa to showcase its world famous water treatment innovations.

Representatives of the company told reporters on Wednesday at the Radisson Blu Hotel that they have held a successful Exclusive Customer Seminar whereby they met potential customers to their Ultrafiltration (UF) and Reverse Osmosis (RO) technologies.

“Ethiopia is a highly strategic market and this seminar is a milestone in extending the Dow Water and Process Solution’s footprint across East Africa,” commented Zakia Bahjour, Regional Commercial Manager for the company.

Though Dow Executives declined to tell Dire Tube as to how much money they put into the project, they said their technology products can be used in business ranging from mining to food and beverages.
More than 50 people from the manufacturing, leather, textile, flower and representatives from the Ministry of Water, residential and commercial developers have attended the Dow meeting.

Sand filters are currently the most conventional water treatment technology in use in Eastern Africa. During the press conference, Dow team have highlighted the main benefits of Ultrafiltration and Reverse Osmosis technologies. They said Dow’s technologies include more consistent filtration quality, lower footprint and easier maintenance and expandability.



Institute Consolidating Preservation of Near Extinction Biodiversity


Institute Consolidating Preservation of Near Extinction BiodiversityAddis Ababa March 13, 2015 –

Ethiopian Biodiversity Institute disclosed that it has preserved over 74,000 biodiversity at the National Genetic Bank in order to conserve plant species that are near extinction.

The Institute is also building the second genetic bank of the country with over 24 million birr around Fiche town of Oromia Regional State.

Speaking at a consultative workshop held in Gonder town with stakeholders, Institute Communications and Public Relations Director, Dereje Taye said the second biodiversity genetic bank will go operational next Ethiopian year.

The establishment of an additional genetic bank will contribute to not only strengthening the conservation of biodiversity but also plays a big role in increasing accessibility, according to Dereje.

The institute has plans to establish biodiversity genetic banks in all regional states, it was indicated.

Ethiopia is among the 12 countries in the world and the first in Africa with abundant biodiversity resources, the director stated.

In order to preserve plant species that could be exposed to damage as a result of the building of the Grand Ethiopian Renaissance Dam, more than 137 plant species are conserved in the national genetic bank, he further pointed out.

The consultative forum is expected to discuss the roles of biodiversity and community knowledge in preserving plant species and the participation of stakeholders in sustaining the crucial age-old knowledge of the community, among others.

The two-day forum was attended by agricultural research institutions, institutions of higher learning, and officials of environmental conservation office, governmental and non-governmental organizations.



Kesem project sees completion

Addis Ababa, 13 March 2015

The Kesem Dam Irrigation Project which is 99 per cent complete is expected to become fully operational soon.

The project site is located in Afar State, about 800 meters above sea level and 237 km away to the north east of Addis Ababa.

The dam, which is the first of its kind in the country, is 1,096 meters long and 7,18l wide with a capacity of half billion cubic meter of water and capable of irrigating more than 20,000 hectares of land.

Water Works Design and Supervision Enterprise Kesem Project Representative Engineer Getu Mola said that now that the construction of Kesem Dam is almost through, what is left is the finalization work of building structures for irrigation.

The project life span is estimated to be 50 to 60 years. Till it got fully operational it will consume a total production cost of 2.6 billion birr, he added.

The dam project is expected to benefit local residents through creating job opportunities. Apart from creating job opportunities, the dam reservoir affords drinking water to residents of the locality. Fishery could also be practiced on the dam, Getu added.

Water Woks Construction Enterprise Project Process Owner, Jigsa Deyesa, on his part said that the dam is not meant only for sugarcane development, it will cater for the drinking water need of the local people. “The topography was very challenging. It was tasking us to conduct more than two million cubic metres of soil filling activities,” he added.

He also said that even if the project has been a protracted one, the final outcome was very much rewarding.

The project, which began in 1997 E.C, has created job opportunities for about 2,500 to 3,000 Ethiopians posted at different parts of the project, depending on the season.

It was learnt that the target set in the GTP for the irrigation development is increasing from 2.4 per cent in 2002 E.C to 15.4 per cent by the end of the 2007 E.C, the end of the GTP period. It is to be learnt that the irrigation coverage of the country was 127,242.6 hectares of land when the GTP started. In the course of the GTP period, the coverage is expected to grow up to 785,582.6 hectares of land.



EDB provides 3.2 bln birr loan for agriculture, manufacturing

Addis Ababa, 13 March 2015 

The Ethiopian Development Bank (EDB) disclosed that it has given 3.2 billion birr loan to investors engaged in agriculture and manufacturing during the past six months.

The bank focuses on providing loans for exporting modern agricultural development, agro-processing and manufacturing industries, it was pointed out.

EDB President, Isayas Bahre, told ENA that out of the extended loan 63 percent was allotted to manufacturing, 27 percent to agriculture and the remaining 10 percent to agro-processing sector.
Some 70 percent of the loan was given to local investors and the remaining to foreign ones, it was learned.

The capacity of annual loan the bank could provide has jumped from 1 billion birr to the present 8 billion, he added.
Although EDB had plans to extend 4.5 billion birr loan during the past six months, it extended 72 percent of the amount as applicants failed to meet the requirements of the bank.

Some 1.6 billion Birr loan has been reimbursed during the stated period, according to the president.
Ethiopian Development Bank provides 90 percent of loans for the private sector and the remaining 10 percent to public enterprises.



Ethiopia reduces the amount of food aid it imports by 50%


Ethiopia reduces the amount of food aid it imports by 50%Addis Ababa: March 13, 2015 –

In the past three years, Ethiopia has managed to reduce the amount of food aid it imports by 50%.

The Ministry of Agriculture disclosed that the number of people in need of food assistance has reduced leading to the downfall in imports of food aid. Mitiku Kassa, State Minister for the Ministry noted that the nation will cease requesting for food aid on a permanent basis all together soon.

Ethiopia has instituted an effective early warning and preparedness mechanism to deal with such emergencies. The State Minister added that progress made in agricultural productivity and a dependable food reserve in the country contributed to the fall in food aid imports.

Misrak Mamo, Head of the Strategic Food Reserve Agency stated her Agency is working to stock up 1.5-2 million metric tons of food reserves in the pre-second GTP period. She added there is an efficient means of delivering aid in case a natural or manmade disaster strikes. Misrak underscored the Government’s commitment to buy food staffs from the local market.



Ministry set to boost cereals, oil seeds, spices export trade

Addis Ababa, 13 March 2015

The Ministry of Trade yesterday discussed performances of the export trade on the cereals, oil seeds and spices over the past eight months with stakeholders on its premises.

The Minister of Trade Kebede Chane requested the stakeholders and the exporters in order to increase production and productivity so that the sector could achieve the intended goal though the situation of prices at the international market is not encouraging.

Presenting the report, Crop Marketing Directorate Director Samuel Gizaw said that unlike that of the previous year, the accomplishment of the export trade on cereals, oil seeds and spices over the past eight months is slightly below the intended plan due to certain constraints like the falling of prices of the commodities at the international market.

Ministry of Trade State Minister Yaecob Yala said that though the sector has been struggling with several constraints in the eight months, the government and the stakeholders shall show high commitment in the coming four months in order to meet the intended plan for this year.

In the panel discussion, it was indicated that the export trade is demonstrating low performance. According to the office representatives of the states and exporters, the sector has been struggling with problems for the products lack proper quality standard and their prices are highly falling.

It was also noted that the reason for low quality could be attributed to the ineffective and inefficient way of cultivating the cereals and lack of proper provision of the new seed for the farmers.



Nation to Fit Cars with Speed limiters


Nation to Fit Cars with Speed limitersAddis Ababa March 13, 2015 –

Ethiopian Transport Authority said speed limiters would be fitted on vehicles to reduce traffic accidents that have been creating social and economic crisis in the country.

Speaking at a consultative meeting focusing on the level of traffic accidents in African countries held here yesterday, Authority Director-General, Kasahun Hailemariam said Ethiopia losses about half a billion birr and 3,000 of its citizens every year due to traffic accidents. This is unacceptable in the light of the only 600,000 vehicles in the country, he added.

Fitting vehicles with speed limiters is therefore the only alternative because the increase in the number of accidents is related to high speed of vehicles, Kassahun stated. “The country is therefore ready to implement the technology needed to reduce the crisis”, he stressed.

A limited number of vehicles would this Ethiopian year be fitted with speed limiters, according to the director-general.

Vehicles that cause frequent accidents would first be identified and a trial will be carried out by fitting speed limiters on limited number of cars, he elaborated. All cars could then be fitted with the device that stops them from going over the limited speed, it was learned.



Traffic accidents socio-economic concern for Ethiopia: Minister

Addis Ababa, 12 March 2015 

Traffic accidents and fatalities on the continent are a worrying phenomenon. It is even a socio-economic concern to Ethiopia.

It was so stated yesterday by Minister of Transport Workneh Gebeyehu, in his inaugural address to the conference discussing the challenges of accomplishing targets of Road Safety in Africa in accordance with Decade of Action Plan organized by the Ministry and International Road Federation, IRF.

According to Workneh, road safety is a serious problem all over the world. However, he said, the severity of the problem is more pronounced in developing countries. Africa is the region with the highest death rate from road crashes; and this is particularly worrying the continent. The Minister said, a high number of vulnerable road users, poor vehicle condition, under-developed infrastructure, insufficient risk awareness, and ineffective enforcement jeopardized by weak institutional arrangements are among the major causes for accidents.

“Road accident is in a state of rise and recognized as a major socio-economic concern facing Ethiopia as the country is known as having one of the highest accident records in Africa—about 64 deaths per 10,000 vehicles,” the Minister stressed. Ethiopia is estimated to own about six hundred thousand vehicles.

Concerted efforts should be exerted hence to stop this phenomenon. In this regard, Chairman of International Road Federation (IRF). K. K. Kapila, said that challenges such as vehicles that are not in good shape, the road systems that need improvement, difficulties in addressing the trauma victims, among others, are areas to bring road safety into focus. The road system and the poor conditions of the vehicles are the two most pressing challenges in Africa, Kapila said. By 2020, we are planning to cut the road accident fatalities to half, he said.

“Road traffic accident is a very important challenge in Africa that needs to be dealt with,” said Stephen Karingi, Director, Regional Integration and Trade Division, ECA. The loss of lives, injuries and property damages are estimated to be 1-2 of the total GDP. So the continent should work on road safety. However, he said for a continent that contributes 65 per cent of the global road crashes, the road infrastructure is underway with a little portion of the budget.

The conference also heard road safety experiences of some of the countries from the continent.



Farmers’ Cooperative, Private Companies Building 153 Million Birr Wheat Processing Factories


Farmers’ Cooperative, Private Companies Building 153 Million Birr Wheat Processing FactoriesAddis Ababa March 12, 2015 – 

Wheat processing factories that have been built with an outlay of 153 million birr in East Gojam Zone of the Amhara State are expected to go operational within two months. 

The three factories are being built by a farmers’ cooperative and two private companies, it was learned.

Upon going fully operational, the factories would have the capacity to process over 1,000 quintals of wheat in a day.

Since East Gojam Zone is endowed with abundant wheat, farmers would be able to supply enough input to the factories, according to Zonal Cooperatives Manager Mesel Worku.

More than 5 million quintals of wheat are brought to market every year in East Gojam, it was indicated.

Preparations have also been underway to utilize the waste products of the factory owned by the cooperative for livestock feeding, the manager said.

Selam Flour Factory General Manager, Haimanot Belte, said on his part, in addition to the factory which has been processing 420 quintals of wheat in a day, his company is building a pasta and macaroni factory.



Italy becomes part of Ethiopia’s development story, says Minister

Addis Ababa, 12 March 2015 

The Ministry of Foreign Affairs said that Ethiopia has been on the investment radar of many countries due to the development of the country, especially in infrastructure, agriculture, mining, manufacturing, energy, and tourism, among others.

Italian business persons were engaged in about 200 investment projects in Ethiopia between 1994 and 2014, with possible capital involvement of 6.2 billion Birr, it added.

Opening an Ethio-Italy and Greece Trilateral Investment and Business Networking Forum at the Intercontinental Hotel yesterday, State Minister Dewano Kedir said: “We are indeed very happy to organize and host this special occasion of Ethio–Italy and Greece Business Forum, which I believe will contribute to our economic cooperation and I would like to take this opportunity to express my heartfelt gratitude to both Italian and Greek business delegations for being here to attend and to explore investment and business opportunities.”

Dewano further said that Ethiopia and Italy have signed a bilateral investment protection agreement in 1966. On the investment front, Italy has already become part of Ethiopia’s development story. A growing numbers of investors from Italy are already engaging in various sectors such as industry, agriculture and construction, he said.

Given the investment and market opportunity in Ethiopia, it is our hope that this relationship could further be expanded. Ethiopia is committed to work hard to encourage your greater involvement in investment. “We would like to see more Italian investment so that there will be an Italian Industrial Zone similar to the ones that the Chinese and the Turks have established.” The bilateral trade with Italy is growing significantly. The overall trade volume grew over five-fold between 1997 and 2009 from just over one billion Birr to 7.3 billion Birr in 2013, Dewano added.

The Greek Community in Addis Ababa and other parts of the country have substantially contributed to improve our relationship. Particularly, Foreign Direct Investment from Greece has also reached close to 300 million Birr. “But we still have to work hard, despite our very positive relationship,” he said.

The Ethiopian Chamber of Commerce and Sectoral Association President Gebre-Hiwot Gebregziabher on his part said: “The government’s policy is to encourage industrialization, with the major manufacturing opportunities offering attractive potential benefits to prospective investors in for example the textile and garment sector, in the food and beverage, the leather and electronic, as well as in the building material and non-metallic mineral and metallic industrial sub sectors.”


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