1999 EC reviewd

The Political Arena
On October 8, 2006, an ACP-EU parliamentarian fact finding mission delivered its unequivocal opinion that strongly impressed upon the government to unconditionally accept the findings of the Independent Inquiry Commission, set up to investigate the post 2005 Elections violence in which nearly 200 citizens were killed. In a related development on October 22, P.M. Meles assured diplomats that the drawn out trial of over 100 detained Coalition for Unity and Democracy (CUD) leaders, members and others, would wind up before the year flickered out. It seems that Meles has kept his word…if only just barely within his self-imposed deadline.
It has become quite apparent as far as the nation is concerned and even in the private opinion of relieved EPDRF members, that release from nearly 2 years detention of all those accused of major crimes in connection with the consequences of the ill fated 2005 elections, though long over due, loosened much of the underlying political tension. Whether the new millennium will witness political courage by all sides concerned to bridge the divide is the fervent hope of not just Ethiopians but also of the region and the world at large.
For better or worse, Ethiopia is fast reclaiming its rightful place as the region’s pivotal nation and among the continent’s most important countries, with all due respect to other African nations. The extent of Ethiopia’s role in the region and beyond, indeed, whether it has a role to play at all and the potential consequences of unilateral action were a core issue which led to bitter acrimony in parliament’s initial November-December sessions. On November 23, the P.M had presented a request to the House of People’s Representatives (HPR), to be given a free hand to deal with “a clear and present danger” from Somalia and specially, the Islamic and virulently anti-Ethiopian UIC.
A fortnight later, Ethiopia’s powerful army and air force launched a lightning quick offensive, capturing one UIC stronghold after another until the rout become total, with the UIC crushed and Somalia’s capital Mogadishu becoming host to the legitimate authority, the Transitional Federal Government (TFG). Somalia is entering what will surely be a difficult yet historic opportunity for national reconciliation, achieved at no small sacrifices, by not least the lives of Ethiopian soldiers, loss of military assets and the inevitable aftershocks on Ethiopia’s economy.
November hosted various international gatherings including the fifth African Development Forum (ADV-V), held at the ECA-Africa hall which took as its theme “Youth and leadership in the 21st Century”.
In April the inexplicable death of a student on the grounds of the A.A.U. campus ignited a violent reaction from fellow students who clashed not only with security personnel but also amongst themselves.
Early in May, the Council of Ministers approved a bill requiring mandatory third party insurance. Ethiopia had been one of the few countries in the world not to have adopted such legislation.
China’s influence in Ethiopia has been growing consistently and this year was accelerated through various bilateral agreements and wider China-Africa levels of co-operation which are unprecedented. Sealing the relationship, the A.U. and China signed an agreement for the latter to fund a 150 mln USD A.U. headquarters in Addis Abeba.
Later in June, the Global Peace Index put Ethiopia second from bottom from among 121 countries in a World Peacefulness Report. Ethiopia ranks just above Bangladesh. P.M Meles breathed some life into gridlocked domestic politics when at a June press conference he highlighted his government’s readiness to create national consensus by talking with opposing groups, including the CUD and rebel forces.
The World Bank’s Ethiopia Office welcomes Kenichi Ohashi as its new country director for Ethiopia and Sudan, relieving Mr.Ishac Diwan.
In July, the cloud of political uncertainty lifted in part after a committee of elders succeeded in negotiating the release on July 20 of the detained leadership of the CUD, who eventually obtained a presidential pardon.
In the last week of July, Bernard Kouchener French Minister for Foreign and European Affairs arrived on a working visit to Ethiopia and the A.U. during which he proposed an Ethio-French Joint commission and also held talks with A.U. Chairperson Alpha O. Konare on French and European efforts in resolving the ongoing conflict in Darfur as well as humanitarian assistance to the region’s dismayed millions.

The Economy Matters
Almost exactly a year to the day, last September 2006, telecom monopoly ETC vowed to make available 1 mln mobile phone lines every year. It seems that they are delivering, albeit with teething problems, on the ambitious pledge. Other September headlines include the return on Sept 24 to Ethiopia of businessman Temesgen Mehari after he was cleared of corruption allegations, which involved CBE officials as well. The week’s news ended with a report which revealed certain construction companies have evaded paying indirect taxes, including VAT.
ETC was never out of the news this year, mostly in less than desirable coverage spanning mismanagement, mega-scale corruption and plain inefficiency. A potent example of the latter is ETC’s failure to furnish Indian tele-software company Usha Comm with proper data to finalize a new billing system, costing the corporation and Ethiopia millions of birr.
United Insurance S.C. had a rosy October when on the 29th it realized record breaking profits for a private insurer, amounting to 10 mln ETB after taxes.
1999 E.C. was a year in which Addis Ababa attracted a record number of high profile state visits and numerous delegations. Brigitte Geraldin, French Minister for Co-operation Development and Francophony arrived for a two day visit, conferring with P.M. Meles , F.M Seyoum Mesfin and A.U. Chair Professor Alpha O.Konare. The French Minister also co-signed with Sufian Ahmed, Ethiopia’s Minister of Finance and Economic Development, a five year partnership frame work agreement between France and Ethiopia. The same week delivered a sobering ranking of 130th for Ethiopia out of 163 nations surveyed on a Transparency International Corruption Perception Index. Scoring a lowly 2.4 in 2006, Ethiopia was 0.2 points sleazier than 2005.
The second week of November opened with bombshells beginning when Auditor General Lemma Argaw was relieved of his duties by Prime Ministerial letter. Meanwhile, Tefera Walewa flatly rejected an appeal by medical doctors for a substantial salary increment. A few months later it was reported as a bitterly amusing anecdote, that there are more Ethiopian doctors in Washington DC than in the whole of Ethiopia. The petitioning doctors were belatedly given raises on May 13, 2006.
November also saw a major development in pharmaceuticals when the Ethiopian Drug Administration and Control Authority (DACA), banned up to 10 local importers of medicines, alleging they imported sub-standard drugs from China and India, among other nations. Later in February, DACA blacklisted three dozen foreign manufactures and importers.
Branding was all the rage this ended 1999 E.C. and mostly it was to Ethiopia’s gain as giant Starbucks blinked first in a trade mark dispute which received massive international publicity and ultimately, big bucks from Starbucks and recognition of the brands Yirgacheffe and Sidamo. Starbucks chief drops by and shares a cup with Meles and relevant stakeholders.
Its been a busy year for EEPCO – the power utility which has been performing rather well among the state monopolies. In December, EEPCO set its sights on the fourth phase of the Gilgel Gibe hydropower station, planned for a capacity of 2400 MW. It is expected to be built by Salini Constructori, an Italian firm with extensive and reputable experience in Ethiopia for a quarter century.
By most indicators, the economy did rather well in 1999 E.C. Various sectors such as financial services, new airline routes and carriers and importantly, a spurt in the weak manufacturing sector were noted.
Mr. Pierre Castel, President of Group Castel, which has BGI- Ethiopia as among its global brewing interests, arrived January 31, 2006 to confer with PM Meles and Trade and Industry Minister Tadesse Haile on prospective plans to establish a world class winery in Ethiopia.
In what many had at the time taken as a move leading to the controversial issue of its privatization, the assets of ETC were examined and found to be worth over 300 mln USD as of 2001, although this conservative value pales compared to the 2 bln minimum that some authoritative experts have estimated.
Alarm bells rang in late February when fearing an acute and embarrassing shortage of accommodation for the expected but generally no-show diaspora, the A.A. City Care taker Administration eyed newly built and assigned condominiums as a possible solution.
It was a year also of detainee releases in the economic crimes category. Given her freedom after several years, business person Shadia Nadi, implicated with former Prime Minister Tamerat Layne et al, left for Djibouti hours after being released.
In March, the Privatization and Public Enterprises Supervising Agency was eagerly seeking to woo domestic and international partners for large scale coal phosphate fertilizer and rubber plantation and processing ventures. Meanwhile media dartboard ETC does a megadeal when it gave a 1.5 bln USD telephone network upgrading contract to another state company-China’s ZTE.
Later in March, a parliamentary report disclosed that based on the Development Bank of Ethiopia’s half year performance, export loan guarantee responsibilities have been transferred to the DBE from the National Bank of Ethiopia.
April Fools’ Day dawned with reports of not so funny malpractice by 1091 licensed importers and 292 private customs agents. The number of fraudsters seemed modest at first until the March National Tax Conference also revealed that they represented over 91% of all registered importers.
Foreign Direct Investment (FDI), grew by leaps and bounds in 1999 E.C. The 2007 Economic Report on Africa released in April and entitled, Accelerating Africa’s Development Through Diversification, showed that the percentage of FDI in GDP mushroomed from a barely appreciable 0.3% in 2004 to 7% in 2006 – an 800% boost.
The Commercial Bank of Ethiopia (CBE), also made the headlines that week, after it more than doubled its paid up capital with a 2.5 bln ETB infusion to its 1.5 bln ETB nestegg. Another star performer this year was the National Oil Company (NOC), a start up oil products supplier which disclosed an annual turnover of 2bln birr.
The Addis Ababa Water and Sewerage Authority (AAWSA), short listed seven companies for a project to rehabilitate 12 boreholes in increasingly water short Addis Ababa.
In a continued expansion in the financial service sector, new banks and insurance companies have been established as existing ones keep earning substantial returns.
In May, Buna and Gena banks announced their formation bringing to a full dozen the number of private banks.
Another burgeoning economic arena has been the domestic manufacture of medicines. In this regard early in June, Cedilla Pharmaceuticals Ltd, a global company present in over 43 countries launched production of various medicines in Ethiopia, in Akaki-Kality Sub-City, A.A., under an Ethio-Indian venture between Almeta Impex and Cedilla Pharmaceuticals of India.
Ethiopian manufacturing is set to take off judging by the record number of local foreign investment projects in progress, under process and/ or in negotiation. Many of these ventures are cement factories, news of which has been consistent in the press. Companies such as Midroc – Derbaa are expected to meet the high demand for cement. Prices of 100 kg of cement had reached a peak of up to 300 Birr in 1998 EC/2005-06 and have dropped to between Birr 180-210 during this concluding year. In June, the Ministry of Trade and Industry, in a bid to increase cement supply loosened a previous directive which had set a cement importation minimum of 25,000 tons bringing it down to just 3,000.
June ushered in more good news in the industrial enterprises category when RusAfro Trolley announced it is to manufacture electric buses, a first in Africa, at its facility to be established in Debre Markos, Amhara.
Meanwhile, controversy was brewing at United Insurance S.C, which locked horns with the NBE not to mention amongst its component interests. The saga began after the bank elected four board members in contravention of a new NBE directive relating to board member eligibility and tenure.
Corruption and particularly land speculation, was rampant and endemic. Headlining Capital’s front page on July 8, 2007 were the findings of a study conducted on the Addis Ababa City Administration by the Federal Ethics and Anti-Corruption Commission in which it was disclosed that VIPs, renowned artists, high profile investors and famous athletes had engaged in land speculation.
In June, ETC shed dead wood as it has done repeatedly in the last 12 months as it fired salvo after salvo of top officials and other employees over alleged corruption. The June dismissals followed an auditor’s’ report which revealed corrupt practices.
In mid – August banks complained of court injunctions on property registered as loan collateral, preventing the banks from disposing of the properties. Ethiopian Banks Association (EBA), after a study involving 223 case samples concluded that banks are facing challenges in exercising their right to sell the property of defaulters, granted by law in 1998.
Mirga Wood Industry announced in August news of a 50 mln ETB project to establish a bamboo processing factory in Addis Alem town, 40 kms west of Addis. Enterpreneur Ephrem Gugsa was motivated by Ethiopia’s abundant supply of bamboo on nearly 1mln hectars found on smallholder farms. In 1999 E.C, Ethiopia has been ‘discovered’ by proponents of alternative fuel in an exciting and on-going development to which Capital devoted its editorial of August 26, 2007, encouraging government and investor interest in large scale plantation of crops suited to bio-fuel production and extraction.

The Social Scene
Ethiopian arts and culture were as colorful this year as they usually are, although most activities have been more new Millennium related than regular events. Of course, there were the usual visiting artists and performers, dozens of photo and art exhibitions and a lively modern and traditional music scene. However it seems like most singers are keeping their new millennium projects under wraps, except for Teddy ‘Afro’ Kassahun who has just released another anticipated chartbuster. Singer Abenet Agonafer it can safely be said is the undisputed star of the year with his great album having been the mainstay in the hottest pubs and on airwaves. Mulatu Astatke, veteran musicologist, composer and ambassador of Ethio-jazz was awarded a prestigious Harvard Fellowship, in yet another distinction in the career of a great Ethiopian.
The sports arena was the under performer to say the least, as the year saw Ethiopian football more polarized than political parties had been. The Ethiopian Football Federation was more pre-occupied with sports than salvaging what little or any respect Ethiopian football is left with. The football story of the year was despite the EFF controversy, the 10th East and Central Africa Soccer championship held in Addis Ababa – which of course saw not just Ethiopia but also the entire region lose to guests Zambia.
It was Ethiopia’s athletes who collectively have made us proud on many an occasion this year. Notwithstanding the Mombasa debacle, Haile, Kenenisa, Tirunesh, Mesert and team Ethiopia in general deserve not only praise but complete admiration for maintaining our beloved flag atop the highest sports pedestals.