Ethiopian, Lufthansa to strike partnership deal By Groum Abate Ethiopian Airlines is going to sign a partnership agreement with Lufthansa next week.
The long awaited partnership on code sharing procedures has been negotiated by the two parties for a long time.
If the negotiations bear fruit, the two airlines would co-operate in many areas of the airline business, which they expect will make them more competitive.
As part of a bilateral cooperation, Lufthansa and Ethiopian Airlines will operate code share flights on several routes and also recognize the respective partner's frequent flyer programme.
According to their agreement the two airlines would exchange passengers on off routes.
Ethiopian Airlines Enterprise Chief Executive Officer Girma Wake, recently said that the airline would be privatized at some point and this partnership according to observers is a step forward.
Emirates and Gulf Air are becoming rivals for Ethiopian Airlines, sharing its West African business more, a route that used to be an Ethiopian Airlines monopoly.
Emirates and Gulf Air have an advantage over Ethiopian with their easy access to cheap fuel. Ethiopian however, buys fuel with hard earned foreign currency and could not compete with the two airlines.
Emirates and Gulf Air are also hiring Ethiopian Airlines staff for much better salaries.
Lufthansa had a gross revenue of 18 billion Euros in the year 2005, and transported 51.3 million passengers. It earned an operating profit of 577 million euros in the year 2005.
Lufthansa is bilaterally co-operating with a range of quality airlines. According to the official website of Lufthansa, the cooperation enables the airline to offer their customers a maximum number and range of flights within the Lufthansa airline system.
Ethiopian Airlines has also appointed in May 2006, AVIAREPS to represent it in Mexico, Brazil, Argentina, Columbia, Venezuela, Chile and Peru. The enterprise already relies on the airline representation specialist to serve the Belgian and Austrian market.
According to the financial report of Ethiopian Airlines, the airline secured net profit of 277 million birr in the year 2003, from a net profit of 79 million birr in the year 2002. For the period June to December 2005, Ethiopian recorded a 208 million birr profit before tax, registering a 19.9% increase in revenue at a time when many airlines around the world were filing for bankruptcy. The operating cost of the airline for the same period has shown an increase of 21.9% or 2.4 billion birr.
Ethiopian Airlines has become Africa’s biggest airline 60 years after its foundation and it is still expanding. With the construction of a new
Cargo Terminal and the sales contract for ten Boeing 787 Dreamliner jets, which will be delivered from 2008 on, the carrier is getting prepared for a splendid future in air transport services both for passengers and for cargo. The African airline is the national flag carrier of Ethiopia and offers flights to Europe, America, Middle East and Asia.
Ethiopian Airlines operates a modern fleet of six Boeing 767-300 for long-haul flights, nine Boeing 737’s for medium-range flights and several Fokkers for the domestic routes. With the order for the ultramodern Boeing 787 jetliner the airline will become first operator in Africa of the new jet. Al-amoudi haggles to buy CMC houses By Tedla Yeneakal The Ethio-Saudi business tycoon Sheik Mohammed Al-amoudi is under negotiations with the Rental Houses Agency to buy houses in the CMC area in a new round of talks with officials of the agency. Both sides failed to reach an agreement on the terms of the purchase a two years ago.
Sources disclosed to Capital that Al-amoudi intends to buy the residential houses known as CMC to be used by the many foreign construction professionals that are making their way to the country, for the piazza tower project as well as to accommodate other workers that will be involved in the ongoing ventures of the Ethio-Saudi business tycoon.
In mid- September last year the agency increased rental fees for houses in CMC by almost 100%. Disagreeing with the terms of increase many tenants have left their homes.
A two bedroom apartment in the area was previously being rented for 2,300 birr and has now been increased to 4,600 birr.
An official of the Rental Agency confirmed to Capital that he was aware of the negotiations that were underway but refrained from unveiling details.
CMC was built during the Derg regime for diplomatic homes. The present government gave the property to Rental Houses Agency to administer.
The agency has been renting the apartments for the last decade, mostly to diplomats for high rental fees.
In 2004, a Singapore based company involved in real estate development submitted a proposal to the office of the Prime Minister for the acquisition of the properties. The company submitted its proposal through the Ethiopian consulate in Singapore.
The company has also sent its consultants for a pre-feasibility study to evaluate the agency’s property but negotiations for the sale have not been finalized.
The Agency for Administrating Rented Houses merged with the Government Housing Agency to form the Rental Houses Agency six months ago.
The Administration for Rented Houses presently administers more than 3,000 houses including apartments and spacious villas that host embassies, governmental institutions, residential units and offices. Fraudsters bilk 700,000 birr from NOC By Tedla Yeneakal The National Oil Company (NOC) has been the victim of fraud at two of its stations two weeks ago, jointly amounting to about 700,000 birr. Employees of the company had been jailed accused of the alleged theft.
Sources disclosed to Capital that the stations are located in Kaliti and Bole sub cities. The former is the first station for NOC, chosen as a spot for the inauguration of its operations some two years back and allegedly lost 500, 000 birr due to the theft, whereas the latter station was bilked out of 200,000 birr.
Police arrested suspects of the fraud, of whom most are employees of NOC working as gas fillers but have recently been bailed out. The theft is still under investigation.
NOC has built 50 service stations across the country providing multiple services such as restaurants, supermarkets, Internet cafés, and carwashes in addition to standard services.
NOC is one of the two indigenous oil companies in the country along with Yetebaberut. NOC is jointly owned by Ethio-Saudi business tycoon Sheik Mohammed Alamoudi, Abenet G. Meskel and Taddese Tilahun, who also manages NOC.
NOC was established in April 2004 as the first local oil company, and started its operations with the inauguration of 11 service stations in Addis Ababa.
Officials of the company refused to give any comments on the theft.
Accor to launch construction this week By Tedla Yeneakal Accor, the much awaited international hotel chains group, which leased land near Meskel square from the Addis Ababa City Administration two years ago is set to officially launch construction this week on Wednesday, January 24, at a ceremony in the presence of top management, government officials, diplomats and invited guests. Guest of honor is to be Minister of Culture and Tourism H.E Ato Mahamud Dirir.
Accor is the world's largest hotel and tourism group with more than 4000 hotels and resorts in 90 countries and with the most comprehensive choice of hotel styles and locations. Accor's hotel brands include the luxury Sofitel, business class Novotel, the flexibility of Mercure, value of Ibis and the convenience of Formula 1 among others.
The group signed an agreement with the city two years ago that allows them to build two international class hotels in Addis Ababa at a cost of around 25 million USD near the vacant plot next to the Sunshine Construction Company headquarters adjacent to the Addis Ababa Exhibition Center. The brands to be built are, Novotel and Ibis.
Sunshine is also building another hotel near Accor’s spot.
Accor had finalized the terms with the city administration seven months ago to launch the project. The group initially planned to finalize the construction of the tow hotels this year, targeting two years back to complete construction in 24 months, while furnishing and other finishing touches should take another six months. The project, according to informed sources has been delayed over land right issues which required a revision of the original project design.
Ibis will be 12 stories and incorporate 154 rooms, international standard bars and restaurants with ample parking. Ibis is present in 36 countries with 750 hotels.
Novotel will be a six-storey building and will have 119 rooms, and shall be fitted with international standard bars, restaurants, swimming pools and parking areas. Novotel has 409 hotels in 56 countries.
The two hotels will be constructed by Kuwait’s Al Kharafi and Sons Construction at a total cost of 22 million dollars with 60% of the financing from Al Kharafi and Sons and 40% covered by Accor Group itself. Al Kharafi and Sons Construction have experience in the construction sector in Ethiopia, as they undertook the expansion works of the new terminal of Bole International Airport inaugurated in 2002.
According to information from Accor, each day, more than 21 million people in 35 countries use a range of services created and managed by Accor. In the Asia Pacific region, Accor is the largest and fastest growing hotel group of some 4000 hotels with more than 475,000 rooms in 90 countries including Australia, New Zealand, New Caledonia, Cambodia, China, India, Indonesia, Japan, and Korea. East African Breweries’ Meta acquisition aborted By Tedla Yeneakal East African Breweries Ltd (EABL) and Meta Abo Brewery, who were in the final stages of direct negotiations since March 2006, have recently failed to conclude a deal for the former to procure major shares in the state owned brewery.
Sources disclosed to Capital that the terms of agreement for the majority take over from East Africa Breweries was not welcome and more than a year of negotiations with officials from the Ethiopian Privatization Agency and after company officials from EABL paid several visits to the Meta Abo plant, the deal fell through.
East African Breweries Ltd (EABL) is East Africa's leading branded alcohol beverage business and has an outstanding collection of beer and spirits brands. It currently runs breweries, distilleries, support industries and a distribution network across the region.
EABL has an annual turnover of 3.6 billion birr and has the largest share of the beer industry in the region. The group employs more than 1000 people across East Africa, according to information from the company.
The group includes breweries such as Uganda Breweries, International Distillers Uganda, Kenya Maltings, Central Glass Industries and UDV Kenya.
The government owned Meta Abo, one of the five beer companies in Ethiopia generated a revenue of over 115 million birr in the budget year 2004/2005.
Meta Abo S.C. has suspended a 90 million birr tender floated September 2006 for the brewery's planned expansion project for the supply and installation of various brewery machinery and other accessories with up to 14 participants, including major European and African brewery companies.
Sources disclosed that although the management of Meta decided to expand the brewery to meet its growing demand, increasing its capacity by 40% from its current 420,000 hectoliters annually, it was not welcomed by the Privatization and Public Enterprises Supervisory Authority.
The latter did not approve of the proposal by reason of the ongoing negotiations with East African Brewery to privatize Meta Abo. Officials of Meta Abo said they suspended the expansion tender until further notice from the authority.
The local businessmen who had also bid to buy shares in Meta Abo are the owners of Star Business Group, who offered over half a billion birr to acquire major shares in the brewery. Star Business Group is owned by Minwuyelet Atnafu, Abebaw Gelaye, and Abebaw Desta, who had all spent four years behind bars on suspicion of corruption. Star Business Group’s activities include transport services, retail, and also hold large shares in Abyssinia Bank and Nile Insurance.
Three of the country’s biggest breweries - Meta Abo, Harrar Brewery and Bedele Brewery have been tabled for sale for a while now. The repeated attempts to sell the breweries by the then Ethiopian Privatization Agency was not a success. In the last three years alone, Privatization and Public Enterprises Supervising Authority had launched tenders more than five times but did not fetch the expected result.
In June 2003, the last bid was floated attracting two contenders - South African Breweries (SAB) and Brasserie Internationale, owner of BGI Ethiopia. An offer of 65 million USD from SAB and 55 million USD from Brasseries Internationale was offered, for the acquisition of the three government owned breweries, namely Meta, Bedele and Harrar.
The Privatization Agency only managed to sell one local brewery, Saint George’s acquired by BGI in October 1998.
BGI Ethiopia’s brands include Bati, Saint George and the export standard Castel. BGI was already present in Ethiopia, having set up a new plant in Kombolcha-Wolo, 378 Km north of Addis Ababa.
Since its acquisition, BGI has refurbished the old Saint George plant in Addis Ababa, and is now undertaking a huge expansion project, investing USD 25 million to turn the existing draft beer plant into a bottled beer plant as well. This is said to boost BGI’s beer production to 750,000 hectoliters from 650,000, making BGI the leading beer producer in the country, according to company sources.
The failure to attract suitable buyers for the three breweries prompted the government to expand Harar Brewery, producers of Harar Beer, Hakim Stout and Harar Sofi, with a 50 million birr investment that will allow it to augment its production capacity to about 300,000 hectoliters of bottled beer and 75,000 hectoliters of draft.
Bedele Brewery, which is located 483kms out of Addis Ababa in the South West of the country was built in 1993 with the technical assistance of the government of the former Czechoslovakia and has a capacity of 250,000 hectoliters annually.
With regard to the termination of the acquisition of Meta Abo, Solomon Kebede the general manager refused to comment on the specific reasons leading to the failure of the negotiations. Ongoing problems in Ethiopian livestock export By Andualem Sisay In the past few years, Ethiopian meat and livestock export has been one of the major foreign currency generating items of the country. But following the Saudi and Egyptian ban due to Rift Valley Fever and Foot and Mouth Disease (FMD), the market has begun to decline. Last August a delegation of the Ethiopian government went to Saudi to solve the problem and came up with a solution of quarantine space provided by Djibouti to a Saudi national who imports most Ethiopian livestock to Saudi Arabia. Instead of solving the existing market problem, this solution ended up causing its own problem that led livestock exporters to stop exporting for some time.
The market has become adverse as the previous 8 USD per livestock transit payment increased to 28 USD for the quarantine service in Djibouti. “The 20 USD additional payments per cattle discouraged the exporters and most stopped exporting. This resulted in a surplus of the product in local markets,” says Kalid Ahmed, Manager of Kalid Ahmed Importer and Exporter. “This means we are losing from 100 to 200 birr per head of livestock. Still there is no clear solution for the problem although we hear that at one time the payment was stopped and at another time it has declined to 10 USD.”
According to Kalid, the government of Ethiopia has to build its own well protected and internationally accepted quarantine center in order to preserve the sector from turbulence and secure the most foreign currency out of it.
Before the opening of the Djibouti quarantine service which gives certification after 21 days, exporters were paying eight USD per cattle for transit to Djibouti. The quarantine service used to be provided by local Quarantine Inspection and Veterinary Public Health Team under Animal Health Department in the Ministry of Agriculture and Rural Development.
The shift to the Djibouti quarantine came about as the local quarantine centers were not completely able to protect those in quarantine from the local livestock who might be suffering from certain kinds of diseases.
As Aminat Nuru, Manager of Aminat Nuru Import Export points her finger at the former Yemeni importers who have now become exporters with a tourist visa. “Most of our former Yemeni importers are using brokers who along with their physical presence, buy livestock in the Adama livestock market.
They come flush with foreign currency and compete with us in the market using their brokers. In a situation where they become the exporters as well as the importers, who is going to buy from us?” Aminat wonders.
These former importers who are now both exporters and importers are using Ethiopian women for their business according to Aminat. “The women or brokers will only have the license in their name and get their commission,” she says.
Dr. Tefera Hailu, General Manager of Tefera Hailu Exporter also agrees with her. “According to the 1963 law, a foreign investor who wants to be engaged in livestock export should also be engaged in fattening activity and must have its own fattening place. But these people are taking us out of the game by violating this rule,” he says. Export of livestock with a rented ‘beret’ (barn) should be left to Ethiopians only. The foreign investors have to be engaged in the areas where we fail or are not capable of covering.”
It is recalled that in the report of UN OCHA Pastoralist Communication Initiative released last September, Saudi Arabia’s ban on live imports due to Rift Valley Fever from the horn is criticized.
Capital’s attempts to obtain clarifications from the delegation’s head to Saudi Arabia were not successful. Al Amoudi involved in 200 bln birr resort in Dubai By Groum Abate Sheikh Mohammed Hussein Al Amoudi, announced that he will develop Ottoman Palace Hotel and Resort at Bawadi, the 200 billion birr hospitality and tourism boulevard near Dubai land.
Al-amoudi on Wednesday January 17, signed an agreement with Bawadi to create the resort that will replicate the 16th and 17th centuries.
The agreement confirming the partnership was signed between Saeed Al Muntafiq, chief executive of Tatweer, Bawadi's parent entity and Shaikh Mohammad Al Amoudi, chairman of Golden Leaves Hotels and Resorts Ltd at the Bawadi offices in Dubai.
Al Muntafiq said: "Sheikh Mohammad Al Amoudi represents the best of private sector entrepreneurship and is proof of much of what is happening in African development.
"With the alliance of industry leaders in the hospitality sector, Bawadi will considerably enhance Dubai's global positioning as the world's leading tourism destination."
Al Amoudi owns a wide ranging business portfolio, notable amongst which are oil refineries in Sweden and Morocco, gold mines and agricultural projects, in addition to industrial projects. He is also the founder and chairman of MIDROC Ethiopia Group, which owns major diversified business sectors in Ethiopia. His hotels portfolio includes properties in Ethiopia, Uganda, Djibouti, Morocco, Saudi Arabia, Europe and Yemen where two new hotels are under construction.
Al Amoudi said: "Dubai has firmly established itself in the world economic community. The high-profile projects that Tatweer represents convinced us of Bawadi's extraordinary vision for the region. We look forward to developing the Ottoman Palace Hotel and Resort as a must-visit resort within Dubai."
A five-star hotel, Ottoman Palace Hotel and Resort will be a model of the life and times of the 16th and 17th centuries. Replicating the Ottoman era, the resort will include offerings like the traditional Turkish baths. Enhancing the experience of the 600-room resort will be cultural performances.
Bawadi will represent the largest concentration of leading hotels on the globe on a 10km boulevard, including the largest hotel in the world, Asia Asia.
Sheik Mohammed Hussein Al-amoudi has been ranked 77th out of 739 billionaires in the world, progressing 166 steps higher from previous year position. EU in step with WB to approve 150 mln Euros for PBS By Eskinder Michael The European Union has followed in the footsteps of the World Bank by deciding to join the provision of funds for the Protection of Basic Services (PBS), as the union is expected to approve a 150 million Euros PBS deal for Ethiopia.
H.E Tim Clarke, Head of the European Commission Delegation to Ethiopia, told Capital that he would be heading to headquarters to assist in the finalizing of the deal.
“We also have a big project for which I am going to Brussels next week, as I am looking to get a 150 million Euro program approved for the Protection of Basic Services (PBS) which is going through out internal committees next week,” he said.
According to Clarke, a committee that consists of the entire EU member states will approve the proposal and once that is done and the deals are signed between the EU and Ethiopia, it should go operational by March of 2007.
The much vaunted PBS system went operational when the World Bank Group and UK approved for an interim country assistance strategy, pumping 215 million USD and 94 million pounds sterling respectively into basic services. The assistance is expected to increase by 10% every year.
The decision came about five months after deciding to stop Direct Budgetary Support (DBS) to Ethiopia after donors, including the WB, disapproved of the way Ethiopia handled its political crisis following the May 15, 2007 general elections.
The PBS project is supposed to ensure that CSOs and other local organizations such as faith based organizations disburse money to education, water and health sectors. On May 25, 2006, the WB group approved 215 million USD for the PBS project which will be part of an interim strategy providing 491 million USD for programs in Ethiopia in the fiscal year - which started a month later - and between 400-550 million USD in the next fiscal year.
Just as was the case with the WB and Britain, the money for PBS is expected to increase enrollment in primary schools, decrease child mortality, make bed nets available to children living in areas vulnerable to malaria and last but not least, child vaccination could also be part of the deal. ‘...we will still be a major supporter
of food security issues and
road strategy but also support good
governance…’
Capital - What would the six months of German EU presidency hold for Ethiopia in terms of aid and development?
Tim Clarke – I can say that it is a very challenging time for Ethiopia, the region and Africa as a whole. I believe that the German presidency will be a real consolidation to the work that has been done so far. I think that the aid flows will continue and perhaps there will be more work done on how to keep the aid coming in and help the donor community find its roots.
I think there is a real drive to support Ethiopia and the regional integration process, not only politically, but also economically. I also believe that what happened in Somalia is a wake up call for the international community. The destabilizing effects of certain political forces can be very damaging for the region and so it is very important to ensure that the region can develop a program which will bring peace and stability to the horn and I think that the Ethiopian intervention will have support and every effort will be made to use that window of opportunity in Somalia to bring some peace and stability to the lives of Somali people and the region as a whole. So I believe that it is going to be a high profile six months for the European Union.
I also think that it will be a very creative period because in Ethiopian terms, the millennium is coming up and a lot of people are trying to see how they can support the festivities and bring about change, so I think that there is a real sense of the partnership deepening between the EU and the people of Ethiopia.
How does the EU view the intervention of Ethiopia in Somalia? Is it an action that is supported by the EU?
Though there have been statements by some individual members, I don’t think that there has been any sort of official statement by the EU, but my sense is that as a result of the Ethiopian intervention, there are some strong hopes that there can be a peaceful and secure solution. The political dialogue has to deepen and the support to establish security for peacekeeping missions to go in is top on the agenda so that the immediate security of the area can be assured.
The negotiation process can go several notches up if security is stabilized and in the long term, real development can come to Somalia so that this problem that we had in the past 15 to 20 years won’t appear again. I mean it when I say that there is a real window of opportunity to help Somalia and the EU will do everything it can to support the peacekeeping efforts to bring security to the people and move to the next stage. That is consolidation of the democratization process and bringing aid to rebuild and reconstruct the Somali economy.
You earlier mentioned that Ethiopia and the EU are to sign a cooperation agreement. Can you furnish us with some details?
What is going to happen is that during the course of this year, we will be finalizing with the Ethiopian government a European Commission strategy that will be supported by many bilateral member states of the union, and thereby develop a real, coordinated and coherent EU strategy for Ethiopia. In this process, substantial resources will be mobilized starting from January of 2008, so it is a transition year between our previous programs, the so called ninth European Development Program, where we virtually completed all of our commitments. We also have a big project for which I am going to Brussels next week, as I am looking to get a 150 million Euro program approved for the Protection of Basic Services (PBS), which is going through out internal committees next week. But once that is through the system, I am hoping that it should be approved next week, then we will have virtually completed all our commitments in good time, and we can then turn our attention to developing the strategy for the future, and start allocation of resources as of January 2008.
This new strategy to kick off in January of 2008, what areas would it be supporting?
To some extent, it is a continuation of the past work. We will still be a major supporter of food security issues and road strategy but also support good governance. In that context, we will be trying to develop new instruments to support the justice sector, some of the democratic institutions such as parliament and so on. We also believe that regional integration within Ethiopia and ensuring that the different elements of the economic development can be brought together and then the linkage between economic development in Ethiopia and the region as a whole through economic partnership agreements, so the regional integration within Ethiopia is a key. Governance issues, support to democratic institutions and some more traditional sectors, food security and transport infrastructure will also be covered in the strategy.
When can we expect the EU to approve the 150 million Euros for the Protection of Basic Services?
What we are hoping is that our next week committee that consists of the entire EU member states will approve the proposal, and I have no reason at the moment to think anything different, and if it is approved, then it has to go through the internal process for the final touches, the financing agreement that is the legally binding instrument between ourselves and the Ethiopian government could be expected to be finished by March of 2007.
Talking of migration, the EU under German rule seems to have a whole new agenda about Africans migrating to Europe. What exactly would the EU be looking at? Is there anything particular in the case of Ethiopia?
We are responding to the world as we see it. Last year, there were significant fluxes of movements of people from Africa to Europe and that got high on the political agenda. There was a ministerial meeting that took place in the matter in Tripoli, Libya in November of last year, where we set out the ground lines on how we should go about that issue, which is all about really providing incentives to people to stay where they are. Migration is the product of poverty and what we think we should do is try to address that at the grass root level and what the German presidency would like to do is to find out what are the issues about migration here in Ethiopia, if there is a problem and if there is, there is a process to provide for this called Article 13 ‘The dialogue treaty’, which is binding Ethiopia and EU. So what we want to do is put these issues on the table and look for constructive ways of solving the problems.
I don’t think anyone has a clear idea on whether there is a problem or not vis a vis Ethiopians going to Europe and vice versa, and so I believe that the German presidency wishes to look at that issue on a wider context and see if there are solutions.
We have heard that the EU is keen to join the Engineering Capacity Building Program (ECBP). Is the plan going according to schedule?
I don’t want to talk about that particular issue, but one of the new concepts that we are trying to introduce is what we call the ‘Paris Concept’ where the different aid flows are put together and harmonized so they become more effective. So when we are developing our strategy for Ethiopia, we want to make sure that the German, French, UK or other interventions are in a context that will reduce some of the transaction costs for each donor and will have a real value added. For example, the German bilateral relationship is focused on vocational training, it will see if there is anything that the other member states can do to assist that process financially or other wise. So we, in other words, are trying to see if we can make the summation of the interventions and bilateral relations be more effective on top of making the EU program work here.
Yamamoto takes Ethiopia to heart By Eskinder Michael His credentials might make him seem like a giant out of Washington, but this soft spoken expert on the horn of Africa is quite the contrary. H.E Donald Yamamoto, Ambassador of the USA to Ethiopia, projects a warm feeling of friendship to whoever meets him.
In his first ever meeting with the press, Yamamoto made an effort to convoy the message that Ethiopia was close to the heart of the US in terms of friendship and support for development.
“There are four major countries in Africa for the US, and Ethiopia is a cornerstone country for the US, not only politically but also economically,” he said.
Though he kept the issue of Somalia on the sidelines, the Ambassador was keen on talking about what he would like to see done during his three years here.
The former Deputy Assistant Secretary in Washington has 11 years of experience in the horn of Africa and his arrival here in Ethiopia shows the need for a knowledgeable person for the region. “I was assigned here because we wanted to show that Ethiopia means a lot and that we won’t just assign a junior here to Ethiopia,” he said.
Yamamoto, hailing out of New York says he watched as the second plane went into the World Trade Center (WTC) on 9/11 and he said that many of his high school friends had died there. “When the WTC collapsed, many of my high school friends who were cops and firemen went in and died. My college buddies were in the tower as they worked there and they died. Ethiopia was the first country to send its condolences and that means a lot. Ethiopia was there for us during 9/11, so now we want to be there for
Ethiopia,” he said.
The ambassador also said that his country also assists Ethiopia in training peacekeeping forces as Ethiopia is the 2nd largest country in Africa to provide peacekeeping forces and the 6th in the world.
Yamamoto believes that the US hasn’t done enough to help Ethiopia. “We fear that we haven’t listened enough to what people want and in some cases that has got us in trouble, but now we want to listen to what the people want,” he said. He made it clear that he wants to focus on poverty reduction, modernizing and developing Ethiopia not to mention the education sector. He believes that as Ethiopia, is the top investment location for the US, export sectors such as flowers and livestock should be expanded further.
Donald Yamamoto was sworn in as US Ambassador to Ethiopia on November 9, 2006, and prior to his appointment, served as Deputy Assistant Secretary of State in the Bureau of African Affairs from 2003 to 2006. He also served as US Ambassador to Djibouti and Deputy Director for East African Affairs from 1998 to 2000. Lamy promises assistance to Ethiopia
US to strengthen trade ties with Ethiopia By Eskinder Michael
World Trade Organization (WTO) Director Pascal Lamy has reportedly promised to help Ethiopia in a speedy accession to the WTO as Ethiopia has taken the first step of signing and sending the necessary documents to the WTO last month.
Pascal Lamy, who was on a low profile visit to Ethiopia, reportedly promised PM Meles Zenawi during a meeting that Ethiopia would soon be eligible for help from the WTO and thus will receive assistance in its plans to join the trade organization.
Support however, will not just come from the WTO as the US has also reiterated its plans to assist Ethiopia to join the WTO. Ambassador Peter F. Allgiere Deputy U.S Trade Representative and U.S Representative to the WTO, who was here on a visit, believes that if Ethiopia was to be favored with improved access to the WTO, it would be able to have a voice in the international market and also be able to fight dumping.
He mentioned however, issues of liberalizing some sectors if Ethiopia was to join the WTO. “Liberalizing the service, financial and telecommunication sectors could be a necessity to joining. In order for Ethiopia to join the WTO, these sectors need to be competitive and inviting others to enter the service or liberalize the sectors slowly will make them competitive,” he said.
“Liberalizing some of the sectors could have a profound effect on the competitiveness of the Ethiopian economy,” he added.
The DUSTR however believes that the process of liberalization is not done overnight, but ‘has to happen overtime’. “Liberalization breaks down vested interests, meaning that monopoly reigns. Making sectors competitive helps in having better cell phone and, internet services and even reduced electricity tariffs,” he said.
Asked if his talks with Prime Minister Meles Zenawi revealed any signs of the PM’s willingness to liberalize a few sectors any time soon, the trade representative told Capital, “I believe that the sectors are generally going to open up, but I believe he is more worried about finding the right pace for doing that, but the idea is there,” he said. The trade representative believes that liberalization is a must if Ethiopia is to join the WTO. Chasing after imported equipment for technology transfer By Andualem Sisay
His eyes are always wide open for imported equipment which Ethiopia doesn’t manufacture. He searches for ways on how he can produce them for the least cost but of equal quality and he succeeds. Gebeyehu Sukesa, today known for his manufacture of casting molds that replace imported molds, trained and worked for some time as a health extension worker. That is where he observed the shortage of laboratory equipment in rural health centers and the idea of locally producing these was born. After a long and challenging effort, he was able to manufacture a casting mold for six types of laboratory equipment seven years ago.
Then he began producing these six molds from imported stainless steel and aluminum. Currently, Gebeyehu is replacing the 4,000 up to 7,000 birr imported centrifuge used for sedimentation at a cost of only 800 birr but while maintaining the same quality as imports.
“My strategy is import substitution and technology transfer. My eyes are open to expensive imported materials and I figure out quickly how I can produce them locally,” says Gebeyehu.
Acquiring and absorbing foreign technologies, and further developing them, are costly, time-consuming and complex processes that demand significant efforts because acquired technologies often need adapting to local conditions.
Technology transfers can occur through various forms. Informal transfer of technology is one of them. It includes 'reverse engineering', where learning how to design a product is achieved by taking an existing product to pieces and analyzing its parts, moving skilled personnel from one country or organization to another, consulting trade journals and technical papers in international journals and participating in seminars, conferences and trade fairs.
The main drivers in these types of technology transfer tend to be acquirers that take an active role in searching, identifying and obtaining available knowledge, without relying on assistance from the sources of that knowledge.
As he comes from a family of farmers in western Ethiopia’s Welega-Iraguliso, he gives more emphasis to solving their problems and providing affordable modern equipment to the farmers that make up 75 % of the total population of the country. “I observed that the prices of imported agricultural tools, especially honey extracting equipment are not affordable by most of our farmers,” says Gebeyehu. “After that, I began replacing the imported casting mold for wax extraction that used to cost some 8,000 birr with 1,800 birr after certification. I also replaced the imported milk churner that cost 25,000 birr with a 5,000 birr product.”
In relation to bee products, he makes 19 types of equipment such as us bee brush, honey tractor, honey presser, bee smoker, bee glove and the like. Currently, there are some 70 farmers in his birth area who are equipped with Gebeyehu’s free modern honey and wax producing equipments.
“Now every beekeepers union and individuals prefer to buy our product and importing it is almost becoming history. As I am receiving orders for these products from neighboring countries such as Kenya, We are aiming at export,” he says. “For more than seven years people have been using this equipment and are getting service equal to that of imports.”
Although he has succeeded in transferring technology and saving to help foreign currency, Gebeyehu has a shortage of land on which to expand production capacity and become an exporter. “Government has to support entrepreneurs and provide us land at least cost or free for sometime to build our capacity,” he says. Commission allots 200 hectares to
floriculture amid pollution concerns By Tedla Yeneakal
The Oromia State Investment Commission has allotted investors a total of 200 hectares this Ethiopian year, for the purpose of developing flori business amid growing concerns from residents and farmers of the region about from flower farms.
Alemu Sime, Commissioner of the state investment office told Capital that the commission has not in anyway prevented investors who wish to engage in the floriculture business.
“It is simply a rumor that we have discontinued giving plots for private businessmen,” he said. “In fact, requests from investors in the flower business has grown and that is why we have made more plots of land available.”
The Commission has been devising a new working mechanism for the last two years. Under the new system, developers who are offered plots will be required to commit 10% of the lease amount upon signing contracts. Previously, the commission did not ask for any commitment charges.
Oromia Regional State is the largest region in Ethiopia, covering 363,000 square meters and divided into 14 zones and 197 districts. The 10% of the lease amount that is required to be committed upon signing contracts is relatively lower than that demanded by the Addis Ababa City government, which requires 20%. Oromia is the second largest investment destination next to the capital. The new directive is a result of frustration felt by authorities over the hundreds of developers who have taken plots at no initial cost but failed to start their projects. Officials at the Commission hope that the advance payment of 10pc of the lease amount will deter developers from rushing into projects they may not be seriously committed to. Last year, the regional government repossessed plots awarded to 116 companies in the floriculture, manufacturing and agricultural sectors, claiming that they failed to start projects after having agreed to do so within the six-month period as stipulated.
Germany promises Somalia By Eskinder Michael
The European Presidency was passed on from Finland to Germany at the beginning of the new European year and as part of its six month strategy, Germany has promised to focus on the situation in Somali and the horn as a whole.
“Concerning Africa the German EU-Presidency will base its work on the EU Africa Strategy adopted on December 15, 2006. One focus will be on Somalia and the Horn of Africa. The EU will give its utmost support to a peaceful solution based on an inclusive and substantive negotiation process within Somalia and a broad agreement among its neighbors,” H.E Dr Class Dieter Knoop, Ambassador of Germany to Ethiopia said.
“Another major issue will be the preparation of the Lisbon summit between the EU and AU and of a joint EU-AU-Strategy, building on the principles of ownership and mutual accountability, to be worked out with the involvement of civil society and other stakeholders,” the ambassador stated.
At a press conference held at the Goethe Institute here in Addis Ababa to mark Germany’s assuming of the EU presidency, Ambassador Knoop said that ‘Germany had a full agenda for the six months not only for Berlin and Brussels, but also to be implemented in Addis Ababa, the capital of Africa’.
Germany during its presidency will also look at the ‘burning issue of immigration’ with a full agenda. “Migration is a burning issue with the European Union. Every time, we hear of people trying to get to European countries via dangerous methods and end up dead trying to do so. We need to discuss this with our African partners,” he said.
The ambassador reiterated the seriousness of the matter by saying that last year, it cost the German tax payers 1.8 billion Euros to support immigrants and that this amount was a burden for Germany and for other countries as well.
He also added that the EU would address the issues of good governance and poverty reduction in countries that have the highest rate of migration because ‘if people weren’t poor, if they had security and weren’t under poor governance, they wouldn’t migrate’.
“One of the major endeavors will be the work on a roadmap showing how a constitutional treaty can become a reality across Europe. The challenges that must be addressed today are economic, social and ecological modernization in the age of globalization, the safeguarding of resources, the fight against terrorism and international organized crime, and commitment to a peaceful and democratic future. Germany would like to intensify the cooperation in these fields with neighboring countries and regions,” the ambassador added.
The EU presidency will be taken over by Portugal in June. Slovenia will succeed Portugal six months later. Caffeine-free, non-decaf coffee may soon be on menus By Groum Abate
Coffee drinkers may soon be able to drink a cup that does not have caffeine and yet is not decaf.
One of Australia's pioneer coffee growers is looking to import a plant that naturally grows without caffeine. The first plant was discovered in Ethiopia several months ago.
The coffee is expected to be healthier and taste the same.
But the plant's success depends on the Brazilian researchers who uncovered it in remote parts of Ethiopia.
"Some Brazilian scientists were researching in Ethiopia and they found 6,000 coffee plants in an area and they found out that of those, there were four that were naturally caffeine free," she said.
"They have now taken these back to Brazil and they are researching and trying to propagate them."
It is not known how and under what auspices the Brazilian researchers obtained the specimens from Ethiopia.
Beles power project construction By Groum Abate
The Ethiopian Electric Power Corporation (EEPCo) officially launched the Beles hydroelectric project on Saturday January 20, in the presence of President Girma Wolde Giorgis.
The hydroelectric project that is slated to produce 435 mega watts of power is expected to be completed by 2009.
The government has awarded Salini Costruttori the turnkey contract for the Beles project on the River Beles close to Lake Tana. In turn, the Italian firm has handed the 89.5 million dollar turbine supply contract to Austrian company VA Tech Hydro. Apart from designing, supplying and installing the four turbines at the underground site, VA Tech Hydro will supply all other electro-mechanical infrastructure required by the project.
Many government officials and EEPCo general manager Mihiret Debebe with his seven deputies were present at the official launching of the project that is going to cost the government 800 million dollars.
As well as providing 435MW of new generating capacity, in common with Tekeze it is designed to supply water for both residential and agricultural use in the Amhara region.
The development of the Gilgel Gibe II, III, possibly IV, and Tekeze dam certainly mark a step in the right direction with the country planning to be an electric giant in the region. Now that work is underway on the Beles hydro scheme, the Ethiopian government is seriously talking about turning the country into a major exporter of electricity.
The Ethiopian power sector is dominated by state owned Ethiopian Electric Power Corporation (EEPCo), which controls generation, transmission and distribution in the country. The company has 1110MW of generating capacity, of which over 95% is accounted for by hydro schemes. However, many power plants in the country are operating at less than their nameplate capacity because of a lack of maintenance work in previous years.
EEPCo plans to export electricity to foreign markets by the year 2010 at which time the construction of the Tekeze hydropower dam with a capacity of 300MW, Gilgel Gibe II with a capacity of 420MW and Beles hydropower dam with a capacity of 435MW will be completed. Neighboring Djibouti, Kenya and Sudan are the most likely markets and the company estimates that it could earn tens of millions of dollars a year from exports.
The three schemes are being developed at a total cost of 1.4 billion dollars. The biggest ever construction is the Gilgel Gibe III which cost the corporation 1.75 billion dollars.
The addition of 1,870 MW of new capacity from Gilgel Gibe III and 1150MW from the Tekeze, Beles and Gilgel Gibe II will certainly revolutionize the country’s power sector.
Part of the funding for the schemes is being provided by the Ethiopian government itself but the European Investment Bank (EIB) and the Italian government have also contributed financing. The Italian government has given Ethiopia a 277 million dollar loan on soft terms to help finance the second phase of the Gilgel Gibe project. The first 184MW unit of the plant, which is located on the River Omo in the south, came into operation at the end of 2004.
The Tekeze hydropower project on the Tekeze river in the north of the country will be the highest dam in Ethiopia at around 185m. It is being developed by China National Water Resources and Hydropower Engineering Corporation (CWHEC), at a cost of 350 million dollars. Construction work began in August 2002 and is expected to be completed by the end of 2007. When the contract was drawn up, it was the biggest Chinese investment in Africa since the construction of the Tanzania Zambia Railway (Tazara) in the 1970s. Apart from generating power, the project is designed to supply water to large areas of agricultural land, in one of the country’s main areas of coffee cultivation.
First cable and wire plant for the country By Tsion Aklilu
Sheba Steel Miller (SSM) is to establish a cable and wire factory. This is to be the first of its kind in the country.
The country has been importing cable and wire from abroad for various electrical and telephonic purposes.
The company under its expansion plan is already in the process of starting work on the factory. Netsanet Tesfaye public relations head with SSM told Capital that the company has started importing the necessary machinery for the plant that is located in Kaliti/Akaki sub-city if the Caretaker Administration of Addis Ababa approves their proposal.
The Ethiopian Telecommunications Corporation has been complaining about theft of cables. The new plant is expected to save foreign currency.
In a related development, Sheba Steel Miller (SSM) has transformed a house in to a free dispensary service. Oromia Investment Commission Commissioner, Alemu Sime inaugurated the Clinic officially on January 16.
In his speech, Alemu said, “I am grateful for the support of Sheba Steel Miller and of its social responsibility. I want to invite other companies to follow in the footsteps of SSM and I am also looking forward that the city mayor will reduce their rental burden by providing them with land.” The clinic started giving service as of January 9, 2007 with three nurses, one doctor, one laboratory technician and other service staff. On the morning of the official opening day, there were about 37 patients in the waiting area. According to the only doctor, the flow has been increasing day after day. Stinging adulteration of bee products By Andualem Sisay The House of People’s Representatives needs to quickly endorse the draft law which was submitted six months ago to control the adulteration observed in bee products, suppliers said to participants of the Agro industry fair opened Monday in Addis.
“Quality, specification and certification are not mandatory in our country. This is a big headache to the processors, because they are collecting product that is adulterated. So this is an area on which the government has to act quickly in endorsing the draft law that has already been submitted,” said a participant from Ethiopian Beekeepers Association.
The new Bee Resource Development and Protection Draft Law is aimed to protect and control the industry and punish unethical exporters who lessen the quality of Ethiopian bee products. It will also enable the responsible government office to check how and where honey producers process their products.
The proposed law also includes controlling mechanisms for bio-diversity, usage, and quality of imported tools and equipment, border-crossing bees, creating opportunities for the public to benefit from the sector and handling of bee products.
State Minister of Trade and Industry Taddesse Haile, visiting the fair also advised the Ethiopian Honey and Wax Producers and Exporters Association to work aggressively towards getting rid of such indecent business malpractice.
Export of honey and other bee products has been weak in Ethiopia due to problems that require proper coordination and collaboration. Among other things adulteration is the major obstacle which denied the country access to the EU market after one wax exporter shipped adulterated wax to the EU.
Ethiopia was once among the top five wax suppliers in the world, but the practice of mixing honey with other substances has damaged the reputation of Ethiopian bee products on the global market.
About 75% of honey and wax is produced in traditional ways, thereby affecting the quality of the products. Out of 10 million bee colonies that are believed to exist in the country, only 30,000 to 40,000 are using modern honey extracting methods.
Even though Ethiopia has the most bees in Africa, the country is only the sixth largest honey exporter, following Tanzania, Zambia, Egypt, Côte d’Ivoire, and Libya. Ethiopia exports three tons of honey per year, while Tanzania exports around 160 tons.
Ethiopia produces about 32,000 tons of bee products every year, of which 3,200 tons is wax and the rest (90%) is honey which is marketed. About 85% of the honey is used for the locally produced alcoholic drink tej. So far, Ethiopia is able to export about 1% of its yearly honey production and 12% of wax.
In a related development, at the workshop conducted following the opening of the fair on Tuesday, personalities with international experience in honey invited to the workshop advised the emerging bee product processors and exporters of Ethiopia to focus on local markets before jumping into the international market which has many requirements.
According to them, labeling specifications extend even up to fixing the font size an exporter uses to label honey jars. Such labeling and packaging activities compose up to 90% of the international honey market. “For the international market, what you put on the jar is more important than what you put inside it,” said one expert. Lawyers awarded for pro-bono By Andualem Sisay In the presence of High Court officials including Federal High Court vice President Adil Ahmed, Action Professionals Association for the People (APAP) awarded six lawyers at Ghion Hotel on Thursday for giving free consultancy and legal services to the community.
Fantu Getiye won in the counselling category for helping 736 women, while Maria Munir and Tidenekiyalesh Tesfa came second and third for counselling 569 and 458 women respectively.
In the category of lawyers who gave free services, Abeba Mengistu has been selected as most active for giving free legal service to 83 women and children, followed by Mesfine Addise and Ameha Mekonen who assisted 79 and 76 children respectively.
A research paper on the need for free legal services was presented. APAP is a local, non partisan and non governmental organization established in 2001 with the main objective of providing legal and professional services to the poor, women and children.
The new strategic plan of the organization which is currently being implemented focuses on economic, social and cultural rights with particular emphasis on the rights to housing, health, education and food. Sheikh Ahmed Sharif arrested By our staff report Reports have confirmed that Sheikh Ahmed Sharif Sheik, a top official of the Union of Islamic Courts (UIC) was arrested in Garissa, a border town in Somalia as the remnants of the UIC soldiers try to escape to neighboring countries.
Sheikh Ahmed Sharif Sheikh, according to reports, is second in command to Hassan Dahir Aweys and was captured near Dadaab Refugee Camp as he was trying to flee. The refuge camp is reportedly administered by the United Nations High Commissioner for refugees.
Though some reports say that Somali troops nabbed the notorious UIC leader, other unconfirmed reports say that he was caught by Kenyan police as he was trying to slip through the Kenyan borders.
Kenya has been arresting people it believes are connected with terrorism and the UIC. It is believed that Sharif had resigned from his post before capture, but that couldn’t save him from being caught as he is believed to be one of the masterminds behind the UIC leadership.
The sheikh is believed to have been the head of the eight-man decision making committee at the helm of the religious uprising that dislodged the interim Somalia Transitional Federal Government from southern and central parts of the country.
After stepping down, Sharif’s place was taken over by Aweys, at which point the latter used his position to repeatedly declare jihad on Ethiopia. UIC troops were however annihilated by Ethiopian and TFG troops in a matter of days. |
