Djibouti Port tarif increases
Managers in Addis ; Aden A. Doualeh appointed Head of DPFZA
By Groum Abate
The Port of Djibouti will apply the newly revised port tariff as of tomorrow Monday, December 1, 2008. The new tariff that applies to all services at the Port of Djibouti, have been a point of discussion for both the Ethiopian and Djiboutian governments since its announcement in July this year.
Jérome Martins Oliveira CEO of the Port of Djibouti, Djama Ibrahim Darar the Commercial Director, and Gherard Bhota the Director of the Container Terminal, arrived today for a three-day visit in Addis Ababa.
During their visit the group is expected to meet with exporters, transporters, transitors, forwarders and representatives from the Ethiopian Shipping Lines, and Maritime and Transit Services, and confer on the new port tariff among other issues.
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DBE gets new chief
By Groum Abate
Essayas Bahre, Vice President of Human Resource of the Commercial Bank of Ethiopia (CBE) has been appointed as President of the Development Bank of Ethiopia (DBE) this week, replacing Wondwosen Teshome.
Essayas Bahre who served CBE for the last 15 years in a managerial post, has also served the Bank as Operations and Branch Vice President.
Essayas obtained his first degree from the Addis Ababa University and went to England for his further studies where he received his masters in Banking and Finance.
The appointment made by the order of the Prime Minister’s Office, replaced the current president as of Monday December 1, 2008.
Wondwossen Teshome had taken over from Moges Chemere three years ago.
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Foreigner caught in telecom scam
By Groum Abate
The Federal Ethics and Anti-Corruption Commission (FEACC) arrested eight individuals for alleged involvement in a telecom scam.
FEACC apprehended eight individuals, including a foreigner, for allegedly providing telecom services using devices that were banned from entering the country.
The suspects, who were put under custody on November 21, 2008, allegedly were making international calls without the recognition and permission of the Ethiopian Telecommunication Corporation (ETC). In doing so, the suspects amassed considerable sum in foreign and local currencies that could have otherwise been collected by ETC.
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ECX launches coffee trading
By Muluken Yewondwossen
The Ethiopian Commodity Exchange (ECX) has launched a coffee trading exchange as of Thursday November 27, rendering redundant the 37 year-old state owned Coffee and Tea Authority’s auction center that closed one week before. Trading is done on the basis of standardized contracts, according to coffee origin, type and grade.
Other auction centers are to be opened in Jima, Bonga, Gimbi, Bedele, Awasa, Dilla, Harar, Dire Dawa, Nekemte and Sodo.
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Women entrepreneurs selected for export opportunities
By Addis Mulugeta
An organization based in Dublin, Ireland - Connect Ethiopia, selected nine companies for exporting their products to Ireland and neighboring countries from among 33 companies who submitted their corporate profiles.
This was told during a second consultative forum held under the theme ‘women entrepreneurs in Ethiopia - Opportunity and Challenges’ organized by CAWEE – Centre for African Women Economic Empowerment- at the Hilton Hotel on November 27.
Philip O’Dwyer, Director of Connect Ethiopia, told Capital that some of the areas in which entrepreneurs had been identified by Connect Ethiopia include: handloom, handicrafts and jewelry, textile industry, and promoting Ethiopian tourism abroad.
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Nib Bank nets record high profit, 113 mln birr
By Tagu Zergaew
Nib International Bank S.C. (NIB) netted a record high profit of over 113 million birr during the 2007/08 financial year, a 49% increase from the previous year’s profit the Bank registered. NIB’s total assets, deposits, loans and advances also surged by 40.0%, 31.6% and 16.1% respectively to reach 3.65 billion, 2.41 billion and 2.11 billion birr.
In 2006/07 NIB had registered a net profit of 75.6 million birr.
Dembel Balcha (Dr.), the temporarily delegated Chairman of the Board of Directors, while deliberating the Bank’s report on NIB’s 9th Ordinary and 10th Extraordinary General Meetings of Shareholders held yesterday November 29 said, though there were formidable global and domestic challenges for businesses and investments during the financial period, the Bank managed to register gratifying achievements in every area of its activities. “The Bank has successfully completed the first phase of the ongoing computerization program and further networked four more branches during the financial year. Further, the necessary arrangements have been finalized to network the remaining branches in the near future,” said the Chairman.
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New Addis Ababa city map launched
By Addis Mulugeta
To understand the rapidly growing and expanding city of Addis Ababa, the Ethiopian Mapping Agency produced a new comprehensive Addis Ababa city map with the support of the Ethio-German Urban Governance and Decentralization program. The new map was launched at the German House on November 24.
The development of new roads, high-rise buildings, churches, mosques, condominiums, hotels and recreation centers that are newly built and with many more buildings still under construction; the city is becoming the center of different international businesses, investments and a big summit. Such fast growth of the city has prompted the production of such a city map, which is very vital for citizens and visitors.
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'Development in the age of globalization'
By Addis Mulugeta
In order to find solutions to balance the negative effects of globalization on developing countries, both Ethiopia and India are trying to identify new areas of corporation in terms of bilateral and multilateral relations. While they have similarities, in terms of demography, both have more of a young population under the age of 25. Other similarities of the two nations are their multiculturalism and a poverty stricken society, just to name a few.
To commemorate the 60th anniversary of the establishment of relations between India and Ethiopia, various activities have been undertaken by the Embassy of India throughout this year including in the area of human resource development, capacity building, education, economic and business relations and parliamentary interaction.
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AYKA Addis Textile launches export
Chairman Aydeniz arrives to confer with Girma Biru
By Kirubel Tadesse
Corlu, Turkey
Inaugurated October this year, AYKA Addis Textile, an investment of the Turkish giant AYKA Textile Industry and Trade Incorporated, has shipped its first two containers of yarns to Turkey.
The exported two containers of yarn are expected to arrive in Corlu, Turkey, in two weeks time where it will be processed before its final products make it to European markets like Germany where the company holds a strong customer base after decades of operation, first launched in 1988.
Completing the first phase with 50 million dollars in Alemgena, Oromia region, in two years time, AYKA Addis went operational with its current 800 employees that work 24 hours in three shifts after it was inaugurated by Girma Biru, Minister of Trade and Industry and Oromia State Chief Abadula Gemeda on October 25, 2008.
At its completion, AYKA sets a target of exporting 100 million dollars worth of export to Europe. The parent company already holds a similar market share from its base in Turkey, which is also supported by 30 million dollars worth of revenue collected from local demand.
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2,000 CBE employees’ fate unknown
By Groum Abate
The Business Process Reengineering (BPR) that is expected to be fully implemented in the country's largest bank, the Commercial Bank of Ethiopia (CBE) is expected to affect over 2000 employees of the bank.
Sources told Capital that the BPR implementation in the bank that started a couple of weeks back is presently focused on the top management. According to our sources, the recently reshuffled management is discussing the massive reshuffling the bank is going to face.
These sources also added that the fate of the 2,000 employees that were not part of the BPR, has not been decided yet.
The implementation of the BPR that is expected to increase the bank's efficiency is also expected to lay-off many staff members.
"Upbeat" with its pilot Business Processing Re-engineering (BPR) project tested in a couple of its branches, CBE will in the coming weeks fully implement the BPR that also hit the management itself.
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Ethiopia denounces HRW’s report
By Groum Abate
The Ministry of Foreign Affairs (MoFA) on Wednesday November 27, disclosed the findings of an investigation into the allegations made by Human Rights Watch (HRW) in a report published in June 2008 entitled “Collective Punishment: War Crimes and Crimes against Humanity in the Ogaden areas of Ethiopia’s Somali Region” that accused Ethiopia of wrongdoing.
The disclaimer report entitled “Human Rights Watch: Flawed Methodology,
Unsubstantiated Allegations,” was issued during a press briefing by Minilik Alemu A/Director General of International Law and Consular Affairs with MoFA, undertaken by an independent Democracy and Governance Consultant.
Minilik said during the press briefing, despite the government’s conviction that the allegations were unfounded and that Human Rights Watch’s (HRW) methodology was seriously faulty, the government decided to undertake a detailed investigation of its claims on the ground.
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Norwegian Minister strengthens diplomatic ties
By Addis Mulugeta
After a period of diplomatic tensions between Ethiopia and Norway that led to the latter’s diplomats’ expulsion from the country, Norway’s Minister of Environment and International Development, Erik Solheim, paid a day-long visit to Ethiopia. He discussed various issues including politics, environment and investment opportunities with various government officials including Prime Minister Meles Zenawi on his official visit on November 17.
In an exclusive interview with Capital Mr. Solheim said, “The visit was very successful and we reached a common understanding on regional conflict resolution including how Ethiopia could play a stabilizing role in the entire region.”
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Mugher Cement seeks partner in roof, brick factory
By Muluken Yewondwossen
One year after first expressing interest, Mugher Cement Enterprise has again invited investors to join them in the Alemgena Clay Roof Tiles and Bricks Factory. The Factory will be the first to produce such materials with a capacity of 90,000 roof tiles and 100,000 bricks per day.
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Private sectors complain on corporate governance
By Addis Mulugeta
The legal provision of corporate governance in Ethiopia has not been equally treated by the private business sectors with that of public sectors while they have been contributing to the economic growth and development of the country. This was announced during a members' discussion organized by the Addis Ababa Chamber of Commerce and Sectoral Association (AACCSA) during a business luncheon organized under the theme "Governance issues in the Ethiopian corporate bodies" and held at the Hilton Hotel on November 27. "We need to ensure equal benefits and services between public sectors without further bureaucracy, and we need the deserved respect in every government office," said members of AACCSA.
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IFC opens branch in Addis
By MulukenYewondwossen
Access Capital and Ethio Cement are on the pipeline to get a loan from International Finance Corporation (IFC), which is part of the World Bank group, to improve their businesses. Derba MIDROC Cement Factory was the first local company that received a loan from IFC.
On November 25, 2008 IFC Executive Vice President and CEO, Lars Thunell and Sufian Ahmed, Minister of Finance and Economic Development signed an establishment agreement with IFC to work officially in the country.
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MAM honored with Crown Award
By Groum Abate
MAM Trading PLC has won an award in recognition of its commitment to quality and innovation from the International Quality Crown Award.
The annual International Quality Crown Convention that took place on November 24, 2008, in the Guoman Tower Convention Hall of London, United Kingdom, honored MAM trading with the award in the Gold Category.
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E-Life gets life
By Muluken Yewondwossen
Specialized Ethio-Life Insurance Company S.C., (E-Life), has joined the insurance industry and commenced operations at full scale since October 2008. The company which was founded by 117 shareholders in accordance with the laws of the land aims to introduce and promote long-term insurance to its customer.
E-Life is the first of its kind and the only insurance company specializing in the long-term insurance business in the Ethiopian market, offering wide range of life insurance services both to individuals and corporate clients. It is a specialized long-term insurance provider in the country and is striving to offer focused and second-to-none customer services, according to the management of the company.
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Life long education to the rural poor
By Addis Mulugeta
India based Barefoot College was established 38 years ago by a group of people with the support of the government of India. The College was meant only for the poor, to be built by the poor, and managed by the poor. Also, only the poor were invited to come to the College who continued to accept Ethiopian rural poor - who had no chance to access certifications in order to become solar engineers.
The term ‘poor’ is understood as women and children living on less than one Dollar per day. In ancient time, however, when there were no doctors, engineers, and teachers etc, what did the people do to develop their own community?
They simply used their traditional skills for the development of their own community. By using this philosophy, the Barefoot College promotes, mobilizes, and applies those traditional knowledge and skills for the development of remote illiterate areas in India, and the rest of the world including Africa. Most importantly, it encouraged women, mothers and grandmothers to come to India for training for about six months at Barefoot College as solar engineers and professionals in collecting rainwater, harvesting, and artisans.
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German construction companies seek local joint ventures
By MulukenYewondwossen
The German Contractors Association “Baugewerbliche Verbaende” (BGV) visited Ethiopia on November 17, 2008, with the aim to build a partnership with the Construction Contractors Association of Ethiopia (CCAE). Those involved, hope the “twinning” arrangement will transfer German experience, standards and knowledge to the Ethiopian construction sector through facilitating joint ventures.
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AU summit focuses on infrastructure
By Groum Abate
Infrastructure will be the theme of the new African Union (AU) summit scheduled to be held in Addis Ababa on January 2008, the Commission announced on Thursday, November 27.
AU chairperson Jean Ping told journalists that the summit will be held in Addis Ababa from 26 January to 3 February 2008.
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October registers
4.20% deflation
By Groum Abate
Ethiopia’s annual inflation rate declined to 55.4% in October from the 59.6% recorded in September, the Central Statistical Agency announced. The inflation rate was 61.7% in August.
Food prices inflation increased by 72.3%, slower than the annualized rate of 80.9% in September.
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Djibouti Port tarif increases
Managers in Addis ; Aden A. Doualeh appointed Head of DPFZA
By Groum Abate
The Port of Djibouti will apply the newly revised port tariff as of tomorrow Monday, December 1, 2008. The new tariff that applies to all services at the Port of Djibouti, have been a point of discussion for both the Ethiopian and Djiboutian governments since its announcement in July this year.
Jérome Martins Oliveira CEO of the Port of Djibouti, Djama Ibrahim Darar the Commercial Director, and Gherard Bhota the Director of the Container Terminal, arrived today for a three-day visit in Addis Ababa.
During their visit the group is expected to meet with exporters, transporters, transitors, forwarders and representatives from the Ethiopian Shipping Lines, and Maritime and Transit Services, and confer on the new port tariff among other issues.
The officials, who arrived today Sunday November 30, will stay until Wednesday December 3.
The tariff increment was first scheduled to be effective as of August 15, 2008, but later postponed for an indefinite period of time, following the recommendations made by the committee set up by the Ethiopian government to study the tariff revision proposed by the Port of Djibouti.
The committee set up to assess the port revision includes members from the Ministry of Trade and Industry (MoTI), Ministry of Transport and Communications (MoTC), the Customs Authority, Maritime Transit Enterprise (MTS) and the Ethiopian Shipping Lines (ESL).
According to their assessment the said tariff revision would be applied on three main services, namely an increase of 25 percent in marine charges and a 15 percent spike on both container stevedoring and cargo port dues, as well as a reduction of the period of free storage for cargo from the previous 15 days to 8 days on transit cargo from Ethiopia. Their conclusion was that the new price adjustment would incur over 22 million dollars additional cost per annum on Ethiopia calculated on current import export trade.
Ethiopian foreign trade is the mainstay of the Port and according to Djiboutian port authorities comprises up to 85% of all activity.
President Ismael Omar Guelleh of Djibouti during his official visit to Ethiopia in mid July had met with Prime Minister Meles Zenawi and said to have discussed the port tariff issue among others.
Concerned about the new tariff raise, Minister of Trade and Industry Girma Birru had also traveled to Djibouti on July 9, 2008, and held discussions with President Guelleh, as part of high officials' diplomatic negotiations.
In an exclusive interview with Capital in October, 2008 Jerome Oliveira CEO of Port of Djibouti had said that he expects the new tariff to be implemented by November explaining that the port has been facing huge costs not only in terms of operating costs but also in terms of the new facilities and equipment at Doraleh Container Terminal as well as Djibouti Port.
He further said that the two government officials have been discussing and the Ethiopian side had requested some time before the implementation of the new tariff. He also stressed that the port has not made any increment in some services for over 15 years, noting that the revised tariff when compared to other port facilities around the world is among the lowest.
It is noted that this will be the first comprehensive adjustment of tariff on port operations since Ethiopia and Djibouti signed a port utilization agreement in May 2004.
Abdourahman Elmi Ismael, Resident Representative of the Port of Djibouti in Ethiopia, confirmed that the newly revised tariff will be applied as of tomorrow, December 1. Whether this will affect goods that are already at the Port or not is not clear.
In related news, the first freighter ship is expected to dock at the new Doraleh Port, on December 10. Doraleh container terminal will be officially inaugurated on December 18, at the end of the PAPC - Pan African Ports Cooperation - conference scheduled from December 15 to 18, and hosted by the Port of Djibouti.
In related developments, Mr. Aden Ahmed Doualeh, former General Manager of the Port of Djibouti, before its management was contracted to Dubai Ports, has been appointed as Head of the Djibouti Ports and Free Zones Authority (DPFZA) replacing Abdourahman Boreh. Mr. Doualeh was serving as the representative of the government of Djibouti at the Port.
The Port of Djibouti's expansion works and increased vibrancy also reflect the surging volume of Ethiopian foreign trade. Total traffic for 2007 grew by 41% over 2006 figures (2006 - 3,743,332 MT, 2007 - 5,291,131 MT), and vessel numbers are up 35% to 1411 the port recalls. Inbound traffic, the bulk of which is destined to Ethiopia, stood at 6,271,466 tons in 2007, sharply up by 35% over 2006. This has been attributed to the nearly 400% spike in cement importation and also to the 46% higher volume of iron, both items imported by Ethiopia's booming construction sector.
Meanwhile, outbound traffic in 2007 touched 1,169,000 tons with container traffic rising by 31% to stand at 294,902 TEU.
In regard to infrastructure and capacity enhancement, the most significant undertaking has been the construction of the Doraleh Oil Terminal and its complementary jet and fuel storage facilities. The container terminal at the main port has also benefitted from the installation of modern lifting machinery and powerful gantries, which have sped up loading and the off-loading of cargo. Doraleh Oil Terminal boasts several berths are capable of accommodating multiple, deep-draught oil tankers at the same time.
The Port of Djibouti has been under DP World management concession since May 2000.
DBE gets new chief
By Groum Abate
Essayas Bahre, Vice President of Human Resource of the Commercial Bank of Ethiopia (CBE) has been appointed as President of the Development Bank of Ethiopia (DBE) this week, replacing Wondwosen Teshome.
Essayas Bahre who served CBE for the last 15 years in a managerial post, has also served the Bank as Operations and Branch Vice President.
Essayas obtained his first degree from the Addis Ababa University and went to England for his further studies where he received his masters in Banking and Finance.
The appointment made by the order of the Prime Minister’s Office, replaced the current president as of Monday December 1, 2008.
Wondwossen Teshome had taken over from Moges Chemere three years ago.
Wondwossen was Finance Head of the Rural Credit Division within the Bank. He has served DBE for the past 24 years, since graduating from Addis Ababa University in Accounting.
Moges was fired after 12 years of management, perhaps earning the title of the longest serving manager working for the state. Once head of the Legal Services of DBE, he was the second to assume such a position following the change of government in 1991. He took over in 1994 from Gebremariam Woldu, who served as a transitional head for two and a half years.
Formed in 1945 as an Agricultural and Industrial Development Bank with loan obtained from the United States, DBE has the role of providing long and medium term loans, strongly focusing on investments in the agricultural sector.
DBE, with its highly criticized implementations of loan requests, approved 740.8 million birr worth of loans for the 2005/2006 budget year, but only released 134.3 million birr to applicants.
DBE currently operates in Oromia, Amhara, and Southern Nations and Nationalities Peoples Regional State.
The Bank usually provides loans for financing the establishment and expansion of agricultural, agro-industrial, transport, and communication, mining and energy, education, health, hotel, tourism, and other sectors of the economy.
The government ordered recently the Public Financial Enterprises Supervisory Agency (PFEA) headed by Eyob Tesfaye (PhD), to replace Abe Sano the President of the Commercial Bank of Ethiopia (CBE) with his Vice President, Bekalu Zeleke, who had been working under Abe for the last two and a half years.
Foreigner caught in telecom scam
By Groum Abate
The Federal Ethics and Anti-Corruption Commission (FEACC) arrested eight individuals for alleged involvement in a telecom scam.
FEACC apprehended eight individuals, including a foreigner, for allegedly providing telecom services using devices that were banned from entering the country.
The suspects, who were put under custody on November 21, 2008, allegedly were making international calls without the recognition and permission of the Ethiopian Telecommunication Corporation (ETC). In doing so, the suspects amassed considerable sum in foreign and local currencies that could have otherwise been collected by ETC.
According to the information obtained from the FEACC, four of the suspects were considered as the major actors while the remaining four were in one way or another linked with the crime.
One of the major suspects was a foreigner.
The suspects, who appeared before court on November 25, 2008, allegedly provided the services in nine areas in Addis Ababa using internet and computer training centers, as well as various offices as a cover-up.
Earlier in October, FEACC filed charges against a South Korean citizen who was in custody for their alleged involvement in a telecom scam.
The charge filed by the FEACC states that the South Korean who entered Ethiopia using a tourist visa, was rendering an international telephone call service using illegally imported telecom gadgets.
The charge also counted four former employees of the Ethiopian Telecommunication Corporation (ETC) who sold 21 blocked and unused SIM cards to the South Korean, and assisted him to secure a license for the provision of Broadband Internet Service, which was not allowed for foreign citizens.
Moreover, five individuals who have been illicitly providing international telephone call services using the ID and password they obtained from the South Korean have also been charged.
The telecom fraud committed by the South Korean and his accomplices from October 2007 to August 2008 cost the state owned ETC over 4.5 million birr, according to the charge.
ECX launches coffee trading
By Muluken Yewondwossen
The Ethiopian Commodity Exchange (ECX) has launched a coffee trading exchange as of Thursday November 27, rendering redundant the 37 year-old state owned Coffee and Tea Authority’s auction center that closed one week before. Trading is done on the basis of standardized contracts, according to coffee origin, type and grade.
Other auction centers are to be opened in Jima, Bonga, Gimbi, Bedele, Awasa, Dilla, Harar, Dire Dawa, Nekemte and Sodo.
According to a statement from ECX, the principle behind the design of the contracts was to preserve the integrity of the origins and unique attributes of the coffees while maximizing the number of buyers and sellers that participate in the price bidding, thus ensuring competitive and transparent price bidding.
Eleni Zawde Gebremedhin (PHD), Chief Executive officer of ECX, indicated that the exchange reference of the new trading will be conducted in reference to the New York market.
“We do the exchange at the same time with New York daily and will display on our screens within seconds the price in US and international markets. ECX’s trading system will preserve and enhance Ethiopia’s specialty branded coffees, renown throughout the world, and our shares will increase on the world market, the brand and the quality of the type that we are producing,’’ said Dr Eleni Zawde.
“ECX adds value to the Ethiopian coffee sector by protecting the interests of both sellers and buyers, by guaranteeing the quality and weight of the deposited coffees, by ensuring a rapid and reliable clearing and payment system, and by providing real-time price transmission to all actors. This trading system is backed by global standard automated bank office operations that will reduce the risks and costs of trading,” Dr Eleni Zawde elaborated.
For this exchange market, ECX has selected 496 members - 346 are suppliers and 150 sellers. ECX started to stock coffee in Addis Ababa’s warehouse since Monday November 24, 2008, and the exchange was launched on Thursday November 27, 2008. The quality grade of the product is increasing from 5 to 10 on the new exchange system. ECX is trading 20 spots of coffee contracts (for immediate delivery), each up to 10 grades. Contracts for washed coffees are: Sidama A, Sidama B, Sidama C, Yirgachefe A, Yirgachefe B, Limmu A, Limmu B, Tepi, Bebeka, and Lekempti. Contracts for unwashed coffees are: Sidama A, Sidama B, Sidama C, Jimma A, Jimma B, Harar A, Harar B, Lekempti, and Forest. ECX is trading local consumption coffee.
“This new system is helping the coffee farmers to increase their income from the product,” added Dr. Eleni.
According to experts on the sector, the exchange center that will open on different coffee production areas of the country should minimize the illegal trade that is held on the borders.
Currently ECX has agreed with Ethiopian ICT Agency to work together to use V Sat technology for the price displaying screen in the place of broadband technology where it does not reach. ECX has a plan to increase the current 14 screens up to 130 within a year.
ECX was established in March 2008 and started its trading on barley, wheat, maize, and Soya beans.
Trading of coffee on ECX is to be on the basis of warehouse receipts that certify coffee origin, grade, and quantity. Trading relies on the “open outcry” method of price bidding, where both exporter and domestic coffee buyers and coffee suppliers, transact in the ECX trading floor, located in the ECX headquarters at Mexico Square. On this system for the first time, sellers will be able to make price offers on the coffee they bring to the market.
Women entrepreneurs selected for export opportunities
By Addis Mulugeta
An organization based in Dublin, Ireland - Connect Ethiopia, selected nine companies for exporting their products to Ireland and neighboring countries from among 33 companies who submitted their corporate profiles.
This was told during a second consultative forum held under the theme ‘women entrepreneurs in Ethiopia - Opportunity and Challenges’ organized by CAWEE – Centre for African Women Economic Empowerment- at the Hilton Hotel on November 27.
Philip O’Dwyer, Director of Connect Ethiopia, told Capital that some of the areas in which entrepreneurs had been identified by Connect Ethiopia include: handloom, handicrafts and jewelry, textile industry, and promoting Ethiopian tourism abroad.
Connect Ethiopia is the Irish business aid organization working on changing the way poverty is tackled in the developing world. Focusing the efforts of the Irish business community, institutions and sectoral associations, the organization gives assistance in the creation of a multitude of linkages, between Ireland and Ethiopia aimed at assisting the country’s economic development.
Established in 2005 by co-founders Brody Sweeney and Philip Lee, the aim of Connect Ethiopia is to concentrate its efforts on one specific country and to facilitate a multitude of linkages between Irish and Ethiopian business and civil society, in an effort to stimulate economic activity.
Nigest Haile, Executive Director of Center for African Women Economic Empowerment (CAWEE), said that it is a very good opportunity for CAWEE’s partners to create future contacts, communication and promotion with respected companies abroad. She further added that CAWEE is only working on promoting women entrepreneurs with a special focus on women exporters, but also is highly involved in facilitating business contacts and is working with Connect Ethiopia in this regard.
The efforts of CAWEE in promoting Ethiopian businesswomen were also complimented by different initiatives. One of the major initiatives is by the Embassy of United States of America in Ethiopia, that focus on providing a guarantee fund specifically designed for Ethiopian women entrepreneurs. The program implemented through USAID’s Development Credit Authority has set aside 4.28 million dollars in loans - specifically to women-owned enterprises through Abyssinia Bank.
A parallel program for Ethiopian diaspora was also set to be implemented with a fund of 6.4 million dollars through Dashen Bank with a single loan limit of 1 million dollars per business.
In addition, the Ethiopian government also showed commitment to promote and encourage women to benefit from export opportunities.
A research paper was also presented giving an in-depth SWOT analysis of local women entrepreneurs associations. Based on the research and efforts of CAWEE on the promotion of women in business, participants raised opinions, recommendations and policy ideas for further action and interventions.
This particular project of CAWEE, supported and financed by the Spanish –NEPAD fund, was designed to address some of the critical issues and areas of debate through conducting action-oriented research and organizing consecutive forums.
Policy makers, implementers, donors, representatives of the United Nations and other international organizations, business associations, Chamber of Commerce’s, NGOs, academic institutions, researchers, women entrepreneurs and other stakeholders participated in the forum.
Nib Bank nets record high profit, 113 mln birr
By Tagu Zergaew
Nib International Bank S.C. (NIB) netted a record high profit of over 113 million birr during the 2007/08 financial year, a 49% increase from the previous year’s profit the Bank registered. NIB’s total assets, deposits, loans and advances also surged by 40.0%, 31.6% and 16.1% respectively to reach 3.65 billion, 2.41 billion and 2.11 billion birr.
In 2006/07 NIB had registered a net profit of 75.6 million birr.
Dembel Balcha (Dr.), the temporarily delegated Chairman of the Board of Directors, while deliberating the Bank’s report on NIB’s 9th Ordinary and 10th Extraordinary General Meetings of Shareholders held yesterday November 29 said, though there were formidable global and domestic challenges for businesses and investments during the financial period, the Bank managed to register gratifying achievements in every area of its activities. “The Bank has successfully completed the first phase of the ongoing computerization program and further networked four more branches during the financial year. Further, the necessary arrangements have been finalized to network the remaining branches in the near future,” said the Chairman.
NIB’s initial plan was to implement ATMs, internet, foreign banking and computerize and network all their branches within 2008. The Bank has hired foreign experts to handle the networking and installation of computerized banking, which is anticipated to be in full swing in the nearfuture.
According to a press statement from NIB, the Bank has opened more branches than it did during the previous year -12 branches were opened to make the total service stations to 41 branches and 2 Foreign Exchange Bureaus.
NIB was the sixth private bank to join the country’s financial sector in 1999.
A founder and shareholder of the Bank told Capital that NIB was well organized from the very start. The organizing committee members were careful in their selection from various sectors: by their social status, work experience, and expertise – were all acceptable.
“Then the crucial thing was that the environment was very conducive when NIB came in, it was the time when the National Bank of Ethiopia was contemplating the rise of the minimum capital requirement to start a bank. So as soon as we finalized our formation formalities, the capital requirement changed from 10 million to 75 million. This move, in fact slowed down the entrance of new banks, which gave NIB the opportunity to establish itself firmly and progress rapidly. Only two banks were established after NIB in 2004 and 2007,” said the Founder.
A member of the specific committee the Bank organized to monitor its strategic plan’s implementation disclosed to Capital that in every aspect NIB is on the right track with regards to its planned targets up to 2012.
In recognition of the Bank’s outstanding performance of the budget year, the renowned New York based Global Finance and UK based - The Banker, have awarded NIB “The Best Bank - In Ethiopia for the Year 2007/08”.
New Addis Ababa city map launched
By Addis Mulugeta
To understand the rapidly growing and expanding city of Addis Ababa, the Ethiopian Mapping Agency produced a new comprehensive Addis Ababa city map with the support of the Ethio-German Urban Governance and Decentralization program. The new map was launched at the German House on November 24.
The development of new roads, high-rise buildings, churches, mosques, condominiums, hotels and recreation centers that are newly built and with many more buildings still under construction; the city is becoming the center of different international businesses, investments and a big summit. Such fast growth of the city has prompted the production of such a city map, which is very vital for citizens and visitors.
The new map provides a detailed overview of the whole city with indicated official street names, major landmarks and selected heritage sites. A unique feature of the new map is the first Addis Ababa minibus route map that immensely helps tourists, and most importantly city dwellers to navigate easily around the city by using minibuses.
German Ambassador to Ethiopia, Dr. Claas Knoop noted that the map is a useful tool for everybody who is searching for a direction in this fast developing and fascinating city. The significance of the new comprehensive city map not only is for visitors, but also for the citizens of Addis Ababa. As many city dwellers do not know much of Addis Ababa beyond their own neighborhood.
On the GTZ side, Country director Ulrich Mohr clarified that GTZ had already supported the production of an Addis Ababa city map some ten years ago in cooperation with Prof. Meissner from the University of Applied Science, Berlin and the Ethiopian Mapping Agency. Mohr further added that the Ethio-German Urban Governance and Decentralization Program promotes and addresses systems for Addis Ababa for good service delivery.
The city map is very important not only for citizens and visitors but also for city officials in their development planning and the promotion of good governance in the city. The map will be sold at the Ethiopian Mapping Agency bookshop on Menelik II Avenue and it is also available in Mega Bookstores and Book World stores. The price will be 50 birr plus VAT.
The Ethio-German Progam of Urban Governance and Decentralization aims at improving urban services and infrastructure for citizens, and to apply principles of good governance. The program works on various reforms of urban planning, urban finance, urban participation, municipal infrastructure and integrated housing and development program. The program is jointly implemented by GTZ and the Ethiopian Ministry of Work and Urban Development, by four regional states, thus a total of 18 secondary cities and Addis Ababa.
'Development in the age of globalization'
By Addis Mulugeta
In order to find solutions to balance the negative effects of globalization on developing countries, both Ethiopia and India are trying to identify new areas of corporation in terms of bilateral and multilateral relations. While they have similarities, in terms of demography, both have more of a young population under the age of 25. Other similarities of the two nations are their multiculturalism and a poverty stricken society, just to name a few.
To commemorate the 60th anniversary of the establishment of relations between India and Ethiopia, various activities have been undertaken by the Embassy of India throughout this year including in the area of human resource development, capacity building, education, economic and business relations and parliamentary interaction.
A dedicated symposium on 'Development in the Age of Globalization' was organized and held at the Hilton Hotel on November 27, where different timely issues were discussed by panelists in the areas of energy source, cultural diplomacy, bridging the digital divide, climate change, the challenge and opportunities of youth and women, and engagement with the Diaspora on which India and Ethiopia will work together.
Every crisis has a cause and impact and/or losses and gains. In the last two decades, the world has seen a significant increase of inequality, contradicting predictions that globalization would foster more equal opportunities for growth and development. The scarcity of energy resources, the deterioration of the environment and natural disasters, the spread of pandemics like AIDS, the growing interdependence of economics and financial markets and the migratory movements provoked by insecurity, and poverty or political instability are all products of globalization. Some people see these as additional opportunities' and contributions to higher living standards across the world. Others see it as a malign force that increases inequality exacerbated for poverty.
While it has positive impacts, globalization has a negative impact on both Ethiopia and India. Sufian Ahmed, Minister of Finance and Economic Development (MoFD), said during the occasion that, "It is not globalization that creates this feeling of anxiety; it is the absence of the means to tackle it appropriately. In other words, it is the absence of governance at the global level that is problematic", and added that with the absence of this sense, millions of people throughout the developing world will remain in mired poverty. In addition, it will reinforce the once strong and weaken those that are already weak.
Ambassador of India to Ethiopia, Gurjit Singh, complimented the idea that one of the solutions is to balance the effect of globalization on developing countries through a green economy, and a wider aspect of the solution would be the creation and utilization of the domestic demand to create markets for goods and services, so that developing countries will not be dependent on export to those markets which are in recession.
"We need to work together closely to enhance the employment generation, capacities, domestic demand as well as support the expansion of an entrepreneurship and rural consumption," Ambassador Gurjit added.
Ermias Amelga, Managing Director of Access Capital, and Zemedeneh Negatu, Managing Partner in Ernst and Young Ethiopia were among the panelists who were dealing on the financial crisis and bridging the digital divide respectively.
Ermias, on his part discussed how the financial crisis does impact on the real economy, foreign direct investment, development partners' assistance, remittance, and financial sector. The financial crisis has positive and negative impacts on Ethiopia, he said. For instance, in the financial sector there is no impact on interest rates, nor their availability. But, some impact on the movement of the currency will be affected. On Ethiopia's real economy, Ethiopia imports much more than export. For instance, the price of oil, fertilizers, and petrochemicals has folds that declined the huge savings of the country. In terms of the financial sector, it has not been impacted. In development assistance, as a very good strategic country, Ethiopia may not be affected. On the remittance side, there has been almost a 20 percent decline from the total percentage. Finally, on foreign direct investment, by Africa in general and Ethiopia in particular, markets in Asia and Europe are less attractive. Ethiopia and Africa's economy is still expected to grow and benefit from increased profit opportunities.
Zemedeneh on his part discussed on bridging the digital devide to take advantages of technological advancement and to adapt it from advanced countries, such as India. Using ICT is the best way for economic growth and promoting investors to come to the country.
The relation between Ethiopia and India covers a whole range of areas including activities in both bilateral and multilateral relations. In terms of private sector development, civil society sector, youth, women, energy sector, and climate change etc.; India has a lot of experience that Ethiopia wants to learn from. People to people and company to levels, are other areas both countries will be continuing to work closely on.
Globalization has many important damnations in the areas of economic growth, social development, political and environmental, cultural and religious, development cooperation, and investment flows.
AYKA Addis Textile launches export
Chairman Aydeniz arrives to confer with Girma Biru
By Kirubel Tadesse
Corlu, Turkey
Inaugurated October this year, AYKA Addis Textile, an investment of the Turkish giant AYKA Textile Industry and Trade Incorporated, has shipped its first two containers of yarns to Turkey.
The exported two containers of yarn are expected to arrive in Corlu, Turkey, in two weeks time where it will be processed before its final products make it to European markets like Germany where the company holds a strong customer base after decades of operation, first launched in 1988.
Completing the first phase with 50 million dollars in Alemgena, Oromia region, in two years time, AYKA Addis went operational with its current 800 employees that work 24 hours in three shifts after it was inaugurated by Girma Biru, Minister of Trade and Industry and Oromia State Chief Abadula Gemeda on October 25, 2008.
At its completion, AYKA sets a target of exporting 100 million dollars worth of export to Europe. The parent company already holds a similar market share from its base in Turkey, which is also supported by 30 million dollars worth of revenue collected from local demand.
Like its parent company, AYKA Addis too enjoys a construction wing which built the first phase, and expects to complete the company's expansion projects in two years time with a budget that takes the overall investment close to 140 million dollars. The company's operation, mostly in the garment section, will employ 10, 000 people.
Dr. Mulatu Teshome, Ethiopian Ambassador to Turkey, said that the investment of AYKA is the first one to be followed by many other Turkish giants in the textile industry. The Turkish textile sector takes the lion share for Turkish exports revenue, as it contributes 40 billion of the 150 billion dollars of income.
"The current trade volume between Turkey and Ethiopia is 180 to 40 million dollars in the Turkish favor, but I am not only optimist but also confident that in five years this gap will be narrowed and the overall trade will mount to half a billion dollars," explained Ambassador Dr. Mulatu who was in Istanbul for a meeting after which he took time to brief members of the Ethiopian press.
According to the Ambassador the trade volume between the two countries is currently close to 250 million dollars from the 100 million dollars registered in 2005. The 2005 record was fivefold from the 20 million seen in 2000. The strengthening of political ties, highlighted by the Ethiopian Embassy opening in Ankara (Turkish Capital) in 2005, is accounted to result in a trade mount.
According to Yusuf Aydeniz, Chairman of AYKA, his company's (he owns 50% of shares) investment in Ethiopia is much more than a good investment choice. "We did not choose to invest in countries like Egypt where there was 60%-80% of support for the textile mainly because here we have a chance to profit more money with a strong leadership support we are enjoying from Prime Minister Meles Zenawi and Minister of Trade and Industry, Girma Biru, "Aydeniz commented to Capital early this week at AYKA's company in the Turkish industrial city Corlu.
Capital learned that Aydeniz is currently in Addis Ababa, to confer with Minister Girma Biru on some of the challenges the company sees standing opposite to its ambition of exporting textile worth 100 million dollars annually.
"Here in Turkey, from our factories to the final European markets, it takes a little less than five days. But in Ethiopia, because of some of the inefficiencies that exist in custom clearings and alike, and also regulations such as Cash Against Document (CAD) where we are expected to operate with 200, 000 dollars that force us to sit down for six weeks due to the shipment time, it will be very hard if not impossible to attain the hundred million dollars export target, "Aydeniz had told Capital before leaving to Addis from Istanbul early this week.
2,000 CBE employees’ fate unknown
By Groum Abate
The Business Process Reengineering (BPR) that is expected to be fully implemented in the country's largest bank, the Commercial Bank of Ethiopia (CBE) is expected to affect over 2000 employees of the bank.
Sources told Capital that the BPR implementation in the bank that started a couple of weeks back is presently focused on the top management. According to our sources, the recently reshuffled management is discussing the massive reshuffling the bank is going to face.
These sources also added that the fate of the 2,000 employees that were not part of the BPR, has not been decided yet.
The implementation of the BPR that is expected to increase the bank's efficiency is also expected to lay-off many staff members.
"Upbeat" with its pilot Business Processing Re-engineering (BPR) project tested in a couple of its branches, CBE will in the coming weeks fully implement the BPR that also hit the management itself.
BPR is a management approach aiming at improvements by means of elevating efficiency and effectiveness of the processes that exist within and across organizations. The key to BPR is for organizations to look at their business processes from a "clean slate" perspective and determine how they can best construct these processes to improve how they conduct business.
These sources said that the BPR may also affect the organizational structure of the bank as well as officials and employees of the bank by large.
The Bank implemented a trial BPR on selected branches as of March 24, 2008 and successfully completed it.
According to the trial, CBE started to give service on one stop, affecting customer satisfaction which was a major blow for the Bank.
In related development CBE employees signed a petition expressing their disappointment over the termination of bonus payments and annual salary increments. Last July, the Labor Union of CBE asked the management for a three-month bonus payment and two salary-scale increment. After a series of negotiations with the management, the parties agreed on a two-month salary bonus payment and two salary-scale increment. Following the agreement reached between the Labor Union and the management, the latter presented the proposal to the Board of Directors for endorsement. But the Board reportedly declined to approve the proposal. The Labor Union said the bank amassed a record high profit of 1.87 billion birr adding that the employees were expecting the payment to be effected on the eve of the New Ethiopian Year celebrations.
The Prime Minister's office reportedly suspended the requests made by CBE, the Development Bank of Ethiopia, the Construction and Business Bank and the Ethiopian Insurance Corporation for bonus payments. CBE, the largest bank in the country, with 205 branches throughout Ethiopia, in the 2007/08 financial year ended July 7, 2008, CBE generated three billion birr revenue, surpassing that of last year by 31.4 percent.
The bank registered a net profit of 1.87 billion birr, surpassing the profit of last year by 59.6 percent. The bank dispersed 13.6 billion birr loan and collected 7.1 billion in the budget year. CBE has always been criticized for accumulated Non Performing Loan (NPL). However, this year, the bank reduced the NPLs by 493 million birr to 924.8, an all-time low.
Ethiopia denounces HRW’s report
By Groum Abate
The Ministry of Foreign Affairs (MoFA) on Wednesday November 27, disclosed the findings of an investigation into the allegations made by Human Rights Watch (HRW) in a report published in June 2008 entitled “Collective Punishment: War Crimes and Crimes against Humanity in the Ogaden areas of Ethiopia’s Somali Region” that accused Ethiopia of wrongdoing.
The disclaimer report entitled “Human Rights Watch: Flawed Methodology,
Unsubstantiated Allegations,” was issued during a press briefing by Minilik Alemu A/Director General of International Law and Consular Affairs with MoFA, undertaken by an independent Democracy and Governance Consultant.
Minilik said during the press briefing, despite the government’s conviction that the allegations were unfounded and that Human Rights Watch’s (HRW) methodology was seriously faulty, the government decided to undertake a detailed investigation of its claims on the ground.
The investigation was carried out by an independent team which visited the Somali Regional State in August and September 2008.
According to the team leader of the investigation Lisan Yohannes, they carried out dozens of interviews in towns and villages throughout the region, visiting virtually all of the areas and places mentioned by HRW. They also interviewed residents and clan elders, local officials, NGO personnel, members of the security forces, the Ethiopian National Defense Forces, prison inmates, and former members of the Ogaden National Liberation Front (ONLF), the team leader added.
Members of the investigation team found villages which HRW alleged were burnt by the Ethiopian National Defense Forces untouched. Other villages, according to former residents, were burnt by the ONLF whose terrorist activities HRW hardly had noticed. Former ONLF members confirmed that this was ONLF policy. HRW, however, has opted to accuse the Ethiopian government instead. Supposedly relocated populations were found in their original homes. People, alleged seen tortured and killed, were found alive and well. Further, no evidence of mass detention could be seen in any prison throughout the region. There was no sign of any “economic war”.
However, the government had successfully limited the flow of illegal weaponry and contraband last year by designing specific border crossing points to control smuggling.
In fact, the statement went on saying, the on-the-ground investigation found no trace of serious human rights violation let alone war crimes or crimes against humanity during the security measures taken against the ONLF following the slaughter of over seventy workers in April last year. It did, however, find a mass of evidence of further systematic abuses committed by the ONLF.
The U.S. based group, HRW, had accused the government of limiting access to the region and had hit-out at Western donors for failing to condemn war crimes on the mainly ethnically Somali people in the region.
The investigation demonstrated clearly that HRW, perhaps unwittingly, had allowed itself to be used as a propaganda tool by the ONLF, a terrorist organization which it has clearly romanticized. It was found that HRW’s report was crammed with fabrication and misrepresentation, exaggeration and misinterpretation.
The officials further noted that all this could have been avoided if HRW had made any serious effort to understand the realities of the situation in the region, and if it had been prepared to work in good faith with the government to ascertain the facts for itself, rather than relying on claims by ONLF supporters outside the region. “HRW completely failed to use first-hand, on-the-ground evidence. Its conduct in the production and dissemination of this report amounts to a virtual betrayal of its own mandate and vision,” said Minilik.
The two-month probe found that populations said to have been forcibly relocated were found in their original homes, while people who were allegedly tortured and killed were found alive and well. Villagers and elders also denied allegations of extra-judicial killings and rape or torture by the security forces, the report said.
Norwegian Minister strengthens diplomatic ties
By Addis Mulugeta
After a period of diplomatic tensions between Ethiopia and Norway that led to the latter’s diplomats’ expulsion from the country, Norway’s Minister of Environment and International Development, Erik Solheim, paid a day-long visit to Ethiopia. He discussed various issues including politics, environment and investment opportunities with various government officials including Prime Minister Meles Zenawi on his official visit on November 17.
In an exclusive interview with Capital Mr. Solheim said, “The visit was very successful and we reached a common understanding on regional conflict resolution including how Ethiopia could play a stabilizing role in the entire region.”
The government of Norway, appreciating Ethiopia’s efforts, announced that it is ready to share financial and material costs in peace building efforts within the region. Mr. Solheim also adds that peace is a precondition to fully realize the potential for economic and social development.
Mr. Solheim further noted that Norway values Ethiopia’s efforts and PM Meles’ commitment to discuss the environment and climate change by representing Africa in the international debate.
In addition, he said government organizations, politicians, NGOs and the people have become increasingly aware of the important implications of environmental issues of development efforts. The minister also stressed the importance of environmental impact assessments.
Both parties agreed and emphasized the possibility to increase cooperation in terms of trade and investment in Ethiopia. Norway is one of the countries that imports Ethiopian flowers, coffee and honey. A group of potential investors will arrive shortly in Ethiopia to identify areas of investment opportunity.
The Minister also discussed with the Ministers of Trade and Industry and Water Resources to look into Norwegian support for hydropower development in the country. The Minister further met with various women representatives and held discussions on the issues of Female Genital Mutilation (FGM), among others.
Ethio-Norwegian relations developed in the 1940s. However, during the Italian occupation of Ethiopia, which occurred at the time of German occupation of Norway, Emperor Haile Sellasie and the Norwegian King Haakon befriended each other while both were in exile in Great Britain.
Norway has contributed much to Ethiopia in hydroelectric power development, natural resource management, capacity building as well as women’s rights in various regions of the country.
Mugher Cement seeks partner in roof, brick factory
By Muluken Yewondwossen
One year after first expressing interest, Mugher Cement Enterprise has again invited investors to join them in the Alemgena Clay Roof Tiles and Bricks Factory. The Factory will be the first to produce such materials with a capacity of 90,000 roof tiles and 100,000 bricks per day.
To be located in Alem Gena, 23km southwest of Addis Ababa in the Oromia Regional State, the project needs more than 10 million US dollars, according to a feasibility study conducted a year ago.
Currently the country imports roofing material predominately from Europe and South Africa. Promoters of the project emphasize the positive foreign currency savings from local production in a sector growing on the back of a construction boom.
Sources told Capital that roof tiles currently produced in the country are not good quality and made from a mixture of cement with other materials.
“The Cement Enterprise has the capacity to realize the factory on its own but government wants it to be a joint venture with private companies,” the source said. “In the future it is intended to be fully private.”
Private sectors complain on corporate governance
By Addis Mulugeta
The legal provision of corporate governance in Ethiopia has not been equally treated by the private business sectors with that of public sectors while they have been contributing to the economic growth and development of the country. This was announced during a members' discussion organized by the Addis Ababa Chamber of Commerce and Sectoral Association (AACCSA) during a business luncheon organized under the theme "Governance issues in the Ethiopian corporate bodies" and held at the Hilton Hotel on November 27. "We need to ensure equal benefits and services between public sectors without further bureaucracy, and we need the deserved respect in every government office," said members of AACCSA.
On his brief orientation and awareness on the elements and importance of corporate governance, in the contexts of global issues, Emeritus Professor Johannes Kinfu said that in general, the principle corporate governance includes accountability, transparency, ethical behavior, anti-corruption and participation.
But it is a new concept not only conceptually, but also in the process of involvement. In the case of Ethiopia, in many places guidelines and laws with vague exemptions do not exist, as well as the absence of accountable agencies, supervising leadership, and sometimes monitoring authorities.
The frameworks of implementing corporate governance should be balancing economic and social goals, individual and commercial goals, and encouraging and enhancing efficient use of resources. In addition, adapting international governance standards and building the corporate standards in terms of transparency, public confidence and trust, are also part of the framework. Professor Johannes noted that this is very difficult to implement not only in developing countries including Ethiopia, but also in the developed world. Especially, in areas such as building and implementing effective corporate governance at different levels: Board, management, internal control, and risk and financial disciples. AACCSA provide multifarious services and products to its esteemed members and organizes various events such as Chamber Forums, business luncheons, meetings and seminars with a view to creating venues where members if the business community come together to discuss related issues.
In related news, to strengthen and establish a vibrant network among all African Chambers of Commerce and also with their counterpart Chambers globally, the Ethiopian Chamber of Commerce and Sectoral Association (ECCSA) organized a two-day conference for the African Chamber of Commerce (ACC) to promote the active participation and contribution of ACC.
IFC opens branch in Addis
By MulukenYewondwossen
Access Capital and Ethio Cement are on the pipeline to get a loan from International Finance Corporation (IFC), which is part of the World Bank group, to improve their businesses. Derba MIDROC Cement Factory was the first local company that received a loan from IFC.
On November 25, 2008 IFC Executive Vice President and CEO, Lars Thunell and Sufian Ahmed, Minister of Finance and Economic Development signed an establishment agreement with IFC to work officially in the country.
On the signing ceremony, Thunell said that IFC will give loan for food processing industries, agro businesses and for banks on the import export trade. "We give a loan after we ask the acceptance and economic value for the country from the government," Thunell added.
"We are evaluating the two companies to give a loan but we will continue our support for other local companies while we are in discussion with local banks in regards to how we will support them," Aliou Maiga, IFC's Country Representative told Capital.
Thunell indicated that enhancing access to finances, developing infrastructures, improving business environments, and investing in key economic sectors such as agri-business and manufacturing, are all high priorities for IFC.
Thunell was in Ethiopia on a two-day visit to officially open IFC's Addis Ababa office.
He met with key government officials and representatives of the private sector including Prime Minister Meles Zenawi, Minister Sufian Ahmed, and Tekelewold Atenafu the Governor of the National Bank of Ethiopia.
"IFC's new office in Ethiopia demonstrates our commitment to working with the government and the private sector to support Ethiopia's continued economic growth," Thunell said. "IFC has the innovation, global expertise and now on-the-ground presence to better serve the needs of the private sector in Ethiopia."
IFC in 2008 gave a 55 million dollar loan to Derba Midroc Cement, IFC's largest investment to date in Ethiopia and its first since 1989. The 55 million dollar loan, part of a 200 million dollar debt financing package from international financial institutions and a local bank, will help the company build a new plant that will address Ethiopia's cement shortage. The new plant will have an integrated capacity of up to 2.5 million tons per year and be located near Derba about 70 km from Addis Ababa. IFC worked in 2007 to build the first cement plant in Eastern Yemen.
IFC's involvement in Ethiopia's leasing sector dates back almost a decade when it first began working with Ethiopia's government to help draft a new legal framework for leasing in the country.
IFC is also considering developing the leasing the sector through an investment and advisory services that will help establish Ethiopia's first leasing company.
On the occasion it was emphasized that IFC's strategy in Ethiopia focuses on proactively developing new investment projects, public-private partnerships that promote economic growth, and mobilizing direct investments to key sectors of the economy including agri-businesses, financial services, health and education, infrastructure, manufacturing, and tourism. IFC's advisory service provides support to improve the investment climate and encourage entrepreneurs.
MAM honored with Crown Award
By Groum Abate
MAM Trading PLC has won an award in recognition of its commitment to quality and innovation from the International Quality Crown Award.
The annual International Quality Crown Convention that took place on November 24, 2008, in the Guoman Tower Convention Hall of London, United Kingdom, honored MAM trading with the award in the Gold Category.
Companies from 74 countries gathered to receive the award, which was based on the criteria of the QC100 quality model implemented in over 100 countries.
Eng. Mussema Aman, Managing Director and owner of MAM Trading told Capital that his company is the second company to be awarded this prestigious award after Midroc Ethiopia in the country.
Established in 2002 with a capital of 1.15 million birr, MAM Trading presently has a capital of 15 million birr.
It is engaged in exporting oil seeds and pulses including sesame seeds, Niger seeds, and cumin seeds as well as lentils, chick peas and pea beans.
It also processes the locally bought oil seeds in its state-of-the-art factory located in the suburbs of Addis Ababa.
The company exported 4,000mts of oilseeds and pulses in the year 2003, 6,000mts in 2004, 7,000mts in 2005, 9,000mts in 2006, and 16,000mts in 2007, and estimated to process and export 21,000mts in the year 2008. The total revenue of the Company was 12.8 million dollars in the year 2007 and it plans to earn 16 million dollars in 2008.
The government awarded MAM Trading Plc with a trophy in 2004 for its outstanding performance in the export of oil seeds and for wining a second prize title in the country. It has also been awarded with a trophy for winning a second prize title nationwide in the export of oil seeds in 2005. In addition, it was awarded with a trophy for its outstanding performance of exporting oil seed during the successive budget years of 2006 and 2007 by the government of Ethiopia. Referring from its business success it would surely secure an even better position of evaluation in 2008.
The company is also engaged in the horticulture sector, which is presently in a trial period.
E-Life gets life
By Muluken Yewondwossen
Specialized Ethio-Life Insurance Company S.C., (E-Life), has joined the insurance industry and commenced operations at full scale since October 2008. The company which was founded by 117 shareholders in accordance with the laws of the land aims to introduce and promote long-term insurance to its customer.
E-Life is the first of its kind and the only insurance company specializing in the long-term insurance business in the Ethiopian market, offering wide range of life insurance services both to individuals and corporate clients. It is a specialized long-term insurance provider in the country and is striving to offer focused and second-to-none customer services, according to the management of the company.
“E-Life strongly believes that a life insurance product gives the highest level of security to citizens who have the least number of assets to fallback onto for the critical days,” said Shimeles Gebre Giorgis, General Manager of E-Life at the press conference held on November 27, 2008 at Imperial Hotel.
Currently there are 9 insurance companies in the country and out of these only seven of them offer partly life insurance services.
Globally 65% of insurance companies offer life insurance while in Africa they do not exceed 35%. In Ethiopia the life insurance share represents 6% only, according to different studies made on the sector.
The Company, drawing on its sound financial strength and backed by one of the world-class and reputable re-insurers - Munich Re (German), has started to provide various types of life insurance covers, which are geared towards protecting and insuring the public against fortuitous pre-mature death, old age and illness, disability risks, and other kinds.
As a matter of fact and in E-Life’s view, an individual who goes for life insurance, though may do so unknowingly, would definitely invest in his/her financial resources given that it is in the right place.
According to the Company’s Operation Manager, Hirut Tequame, such long-term investment can also avail loan facility to the individual, which could enable clients to take care of basic needs.
E-Life at present is offering a variety of life insurance products: whole life, endowments, group term, educational, annuity insurance, medical, mortgage protection, and will add other new insurance systems in the country like funerals. Currently the company opened its branch around Megenagna in the same building of its head office, “We will add one branch in the coming six months,” Shimeles added.
Life long education to the rural poor
By Addis Mulugeta
India based Barefoot College was established 38 years ago by a group of people with the support of the government of India. The College was meant only for the poor, to be built by the poor, and managed by the poor. Also, only the poor were invited to come to the College who continued to accept Ethiopian rural poor - who had no chance to access certifications in order to become solar engineers.
The term ‘poor’ is understood as women and children living on less than one Dollar per day. In ancient time, however, when there were no doctors, engineers, and teachers etc, what did the people do to develop their own community?
They simply used their traditional skills for the development of their own community. By using this philosophy, the Barefoot College promotes, mobilizes, and applies those traditional knowledge and skills for the development of remote illiterate areas in India, and the rest of the world including Africa. Most importantly, it encouraged women, mothers and grandmothers to come to India for training for about six months at Barefoot College as solar engineers and professionals in collecting rainwater, harvesting, and artisans.
This is a medium to achieve the Millennium Development Goals (MDGs) for poverty eradication throughout the world in general, and in Africa in particular.
According to the Founder and Director of Barefoot College, Bunker Roy, “the College is to promote poor people throughout the world to use their potential traditional skills for the development of their community and themselves.” He added, “I am traveling throughout Africa to promote the College and initiate those people who have no chance of accessing certification to become a solar engineer within a six month period.” In Ethiopia alone, 19 villages benefited from the College in areas including Tigray, Gambella, Afar, and Somali. He said that 36 women were now in India from five different African countries, and three of them were Ethiopians. Because of language barriers with each other, the teaching and learning methods of rural illiterate people from all over the world in the College is simply through using body gestures and signs.
The College is the only solution to rural problems that lie within the community. It addresses the rural community problem of drinking water, girls’ education, heath and sanitation, rural unemployment, income generation, electricity and power, as well as social awareness and the conservation of ecological systems in the rural community. It benefits the poorest of the poor who have no alternatives. It encourages practical knowledge and skills, rather than just a paper qualification through conventional education. The College’s facilities were built entirely by Barefoot Architects.
The College does not aim to simply give a certificate after a trainee has completed their training, but rather the community gives the certificate by evaluating their skills in solar engineering. The project is completely funded by the government of India, both financially and materially.
In India alone, over 100,000 people have access to solar lights in 575 villages and 5,401 schools in 16 Indian states, generating more than 530 kilowatts of solar energy through 7,300 individual solar units and thus benefiting 11,000 families. More than 400 artisans including 300 women use traditional skills to produce handcrafted items, generating annual sales of 250,000 dollars. The Barefoot College has trained over 340 semi-literate men and women from 16 states in India and 9 other countries in Asia (Afghanistan), Africa (Gambia, Sierra Leone, Mali, Mauritania, Ethiopia, Cameroon), and Bolivia in South America.
German construction companies seek local joint ventures
By MulukenYewondwossen
The German Contractors Association “Baugewerbliche Verbaende” (BGV) visited Ethiopia on November 17, 2008, with the aim to build a partnership with the Construction Contractors Association of Ethiopia (CCAE). Those involved, hope the “twinning” arrangement will transfer German experience, standards and knowledge to the Ethiopian construction sector through facilitating joint ventures.
Melaku Tadesse, General Manager of CCAE and Gift Real Estate, told Capital that the discussion with the delegation focused on ways to partner to improve management and technical capacity building.
One member of BGV also promised the management of CCAE support of up to two million euros for projects based on the proposal delivered by the Ethiopian group.
Worldwide, the German Contractors Association BGV encompasses 5,000 companies and more than 70,000 members in employees, technical as well as trade and marketing associations, among others. Now laying their focus on Ethiopia, they are ready to help the construction sector improve its performances through joint ventures.
GTZ (German Technical Cooperation) consultants from the University Capacity Building Program (UCBP) are supporting this process.
The Civil Engineers Association, Electrical Engineers Association, Architects Association and Electrical Contractors Association took part on the meeting.
AU summit focuses on infrastructure
By Groum Abate
Infrastructure will be the theme of the new African Union (AU) summit scheduled to be held in Addis Ababa on January 2008, the Commission announced on Thursday, November 27.
AU chairperson Jean Ping told journalists that the summit will be held in Addis Ababa from 26 January to 3 February 2008.
Ping indicated that though the theme of the summit will be on infrastructure, other regional issues will also be discussed both at the ministerial and heads of state, and government level.
He said expert and ministerial level pre-summit meetings will also be held before the heads of state and government summit on 2 and 3 February 2008.
The summit is expected to discuss various issues related to infrastructure in Africa, which is key for development.
The multi-billion AU-EU partnership on infrastructure and energy will also be discussed during the summit.
However, the situation in Somalia, Democratic Republic of Congo (DRC), Mauritania, Guinea Bissau, Darfur as well as the current global financial crisis and its impact on Africa and climate change will also be discussed during the summit, according to Ping.The last summit was held in July in the Egyptian resort of Sharm el Sheikh on water and sanitation.
October registers
4.20% deflation
By Groum Abate
Ethiopia’s annual inflation rate declined to 55.4% in October from the 59.6% recorded in September, the Central Statistical Agency announced. The inflation rate was 61.7% in August.
Food prices inflation increased by 72.3%, slower than the annualized rate of 80.9% in September.
October was the third consecutive month of lowered inflation, led by a slowing in the price of food.
Part of the decline is also due to the distribution of subsidized grain in urban areas by the Ethiopian government, the statement posted on the agency’s website indicated.
According to the Statistical Agency’s report, this rising inflation rate on food price was due to the increase in the price of food components such as cereals, pulses, meats, oils and fats (prices of the latter having been relatively stable during the past few months), milk and eggs, vegetable and fruits, spices (specially whole pepper chilies), potatoes and other tubers and stems, and other food items and food taken away from home.
Ethiopia’s annual inflation rate stood at 18.8% in October 2007, according to the statistics agency. In September 2007, the annual inflation rate was 22.6 percent.
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