Capital

Presidential investment

By Groum Abate

Raw, semi-finished leather export tax triples

By Muluken Yewondwossen

City Bank to open office in Addis

By Tagu Zergaw

Bill Clinton to visit Ethiopia

The former president is set to return to Africa at the end of this month to inspect the progress of his wildly successful Global and HIV/AIDS Initiative programs, his office announced.

By Groum Abate

Ethiopian Insurance wins huge contract

By Kirubel Tadesse

Melaku to remain head at new Revenue Authority

By Tedla Yeneakal

TATA opens Addis office, engages in leather

By MulukenYewondwossen

40 arrested in latest police raid against pirates Officers attacked

By Abiy Demilew

Flower exporter under police investigation

By Tedla Yeneakal

Leather Institute internationally accredited

By MulukenYewondwossen

Police detain CBE branch manager, employees over embezzlement

By Tedla Yeneakal

Ethiopian breaks passenger record
Two Boeings 757s arrive to match traffic

By our staff reporter

US program to assist Ethiopia’s feeble tourism

By Kirubel Tadesse

Company to produce table grape

By MulukenYewondwossen

Businesses, FIRA row over revenue, expenditure reports

By Tedla Yeneakal

Company to export mosquito repellent ointment

By Addis Mulugeta

EEPCo stops power shedding

By Groum Abate

UNCTAD estimates 25 years to mark off Ethiopia, LDC list

By Kirubel Tadesse

Projects on pastoralist livelihood operational

By Addis Mulugeta

Court orders gold scandal suspects to trial

By Groum Abate

Technical meeting on family health integration and HIV/AIDS

By Addis Mulugeta

Presidential investment

By Groum Abate

President Ismael Omar Guelleh of Djibouti is set to invest in the agriculture sector after receiving a large tract of land estimated to be over 7,000 hectares in Bale, Oromia Regional State. The multi-million dollar investment would commence in the next few weeks. The plot is slated for a wheat farm.
The president has also received 20 hectares of land around Sebeta to invest in the booming flower sector, on lease basis.
The president also visited a site of 10,000 sq. meters at Babogaya Lake in Bishoftu (Debre Zeit) town, 45 kilometers South East of Addis Ababa and has received a free title deed for a plot to construct a home.
During the hand over ceremony of the title deed, President Guelleh stated that he expects Bishoftu to be his second home and thanked the town’s mayor for the plot.
Abadula Gemeda, President of the Oromia Regional State presented the title deed to the president on Friday July 18, 2008, at the Air Force Officers Lounge, as well as deeds to the flower and agricultural plots that are both located in the Oromia Regional State.
President Guelleh is here on vacation with his spouse.
The plot that was given for construction of a vacation home used to host a Catholic Mission that was set up 45 years ago.
According to information obtained from Bisoftu town officials, the mission has a plot of over 36 hectares in the town and after negotiations, the mission agreed to return over six hectares of land. The mission head has met and talked with President Guelleh.
The Oromia Regional State President presented as a gift traditional clothes of the Oromo people, to President Guelleh and his wife.
Gifts were also given to the high level delegation that accompanied him during the visit.
Ministers including the Foreign Affairs Minister of Djibouti and others and high level officials accompanied the president.
The president of the Republic of Djibouti also paid a visit at one of the mosques in the town for his Friday Prayers.
President Guelleh has built a 5-storey guest house that is worth 45 million birr in Dire Dawa city, with 60 standardized rooms, which is expected to be functional in the near future. The president was born in 1947 in Dire Dawa city.
President Ismael Omar Guelleh took office on May 8, 1999, after winning an April election that a panel of international observers judged as free and fair. He was overwhelmingly reelected in 2005 after an election that was marred by the opposition’s refusal to participate. Under his guidance, Djibouti is entering a new era, with hopeful signs for democratization and development. The President has committed himself to reaching out to all sectors of Djiboutian society, to transparency, and to modernizing the government to attain economic and social development goals. The 2006 regional and local elections, widely accepted as a positive, multi-party process, were a significant advance.
Warda A. Graham, owner of Wajag Gas and Alemayehu Ketema a well known businessman in the construction business facilitated the investment opportunity.

Raw, semi-finished leather export tax triples

By Muluken Yewondwossen

Export tax on raw, semi-processed and finished leather items is to be raised three fold in December 2008, sources disclosed to Capital. The existing tax rate on these products is 150%.
These sources believe that if the new regime is issued on the stated products it will create opportunities to improve the activities of the leather industry and to increase foreign exchange earnings from the sector.
Abdissa Adugna, secretary general of the Ethiopian Leather Industries Association (ELIA), told Capital that there are strong indications the tax will be raised but he was not sure by how much.
“At the existing time local tanneries are up-grading their capacity to start producing finished leather and foot wear. Countries like India have improved the leather sector’s capacity by increasing tax on leather products, raw leather and finished leather,” said Abdissa.
Experts say that the proclamation will help international leather factories to invest in the country on finished leather products, including companies that import raw and semi-processed hides and skins from Ethiopia.
The House of People’s Representatives approved the proclamation to toll export taxes to 150% on raw and semi-processed hides and skins, in February 2008 after extensive consultation on the issue with the respective authorities of the sector.
The proclamation’s rates and basis of computation state that raw hide and skins shall be levied 150% of value and wet-blue cow hide is levied 20%. Pickled sheep skins are levied 10%, with wet-blue sheep and wet-blue goat skins levied 5%.
Currently, 160 tanning, footwear and other leather goods producers have obtained licences from the Ethiopian Investment Agency.
In addition to these, 6 tanners, 7 footwear and 9 leather goods factories are under construction.
Ethiopia generated 90 million dollars from leather and leather products in the last fiscal year. This makes the sector the fourth highest source of export income following coffee, oil seeds and gold.
It is to be recalled that P.M Meles Zenawi, at the All African Leather Fair on January 24, 2008, stated that Ethiopia would become a center for world leather industries.
According to Girma Birru, Minister of Trade and Industry, the government envisions producing and exporting 60 to 70 thousand pairs of shoes per day or 24 million pairs per year by 2010.
“Capacity strengthening of the factories to enable them to process leather products to final stage with quality standards up to the international market is targeted by the government,” Girma added.
Ethiopian shoe factories produce 24,000 pairs daily. Ethiopia supplies 1.3 million raw hides and 16 million raw skins (goat and sheep) per annum. Ethiopia has the 10th largest population of livestock in the world, and one of the largest in Africa with some 78 million cattle, sheep and goats.

City Bank to open office in Addis

By Tagu Zergaw

The U.S. based City Bank plans to open a branch office here in Addis Ababa. The office will also be a base for East and Central Africa, sources disclosed to Capital.
City Bank will be the second foreign bank to open offices in the country. Early this year a bank from Germany, Commerzbank, opened a representative office.
However, both banks will not be involved in any operational banking activities, as Ethiopia’s investment law reserves engagement in the financial sector for local investors only.
According to officials from local banks this reservation is likely to change.
“Since Ethiopia is on the way to become a member of the World Trade Organization, the market should be open to foreign investors in every sector including in financial services.
“The National Bank of Ethiopia (NBE) is expected to be devising a regulation to accommodate the foreign banks. And when the market is fully liberalized foreign banks will continue to come to the country and compete with local banks,” said the officials.
A banker within a private commercial bank said that they can not close their doors and that due regulation is moving fast so local banks should embrace big international financial institutions.
“They are trying to open their respective offices. For example a German bank opened an office here not for business but to help the bankers. They are helping us. They have invited the Bankers Association Chairman to Germany for training. The foreign banks are indeed coming, but I don’t consider them as competition but rather as collaborators because we can obtain knowledge and technology since our service is as old as the banking history in Ethiopia,” said the banker.

Bill Clinton to visit Ethiopia

The former president is set to return to Africa at the end of this month to inspect the progress of his wildly successful Global and HIV/AIDS Initiative programs, his office announced.

By Groum Abate

The former president of the United States, Bill Clinton, is set to return to Africa at the end of this month to inspect the progress of his wildly successful Global and HIV/AIDS Initiative programs, his office announced.
Clinton, whose involvement with his foundation slowed but never ceased during his time as a surrogate for his wife, will be traveling with a horde of prominent leaders (including Iowa Gov. Tom Vilsack), staff and journalists in an attempt to draw increased attention to mother-to-child transmission of HIV/AIDS, malaria, and other issues. The trip, which he makes yearly, is set for June 28th through August 4th.
“Africa has always been a special place for me, full of hope and tremendous opportunity,” he said in a statement release. “Ever since I first traveled to Africa as President in 1998, I return as often as I can to meet the inspiring people who live there, hear their stories, and learn more about ways my Foundation can help them address the challenges they face.”
The countries he’s expected to visit include Ethiopia, Rwanda, Liberia and Senegal. He’s also traveling to Mexico, where he is set to deliver remarks at the International AIDS Conference.
This year’s trip will focus not on the progress the Foundation has already made, but will highlight new efforts, specifically: the Clinton HIV/AIDS Initiative’s new program to prevent the mother-to-child transmission of HIV/AIDS in Ethiopia, programs to increase access to malaria drugs and diagnostics in Liberia, and the Clinton Hunter Development Initiative’s projects to spur sustainable economic development in Rwanda.
President Bill Clinton also visited Ethiopia on July 2006, where he met with Prime Minister Meles Zenawi and launched a new health programme to help children suffering from AIDS.
Clinton had said during his last visit that his Foundation would further enhance its support to health development programmes in Ethiopia in the years ahead, while Meles assured Clinton that the government would do everything possible to help the Foundation realise its goals.
The two also visited ALERT (All African Leprosy and Rehabilitation Training Centre) Hospital, which provides healthcare services to children and AIDS orphans, and where Clinton laid a corner stone of the new Children Treatment Centre, which is being built with the assistance of the Foundation.
According to media in the United States, the news of Clinton’s trip comes at a fairly innocuous time in the election cycle. While both campaigns have waged an aggressive political war, the real drama (when Clinton’s help may be most needed) will come as November approaches.
The former president also announced that his foundation had signed pricing agreements with suppliers working on malaria-fighting drug in an effort to stabilize the cost of that medication. He also told reporters that he was ready to campaign for Barack Obama “whenever he asks.” Saying the two had a “good talk” after a contentious primary, the former president added:
“I told him that whenever he wanted me to do it, I was ready, and so it’s basically on their timetable,” Clinton said.

Ethiopian Insurance wins huge contract

By Kirubel Tadesse

The state owned Ethiopian Insurance Corporation (EIC) has won a tender issued by the Ministry of Finance and Economic Development (MoFED) to buy comprehensive insurance for government vehicles for a period of three years, Capital learnt.
EIC has won the bid MoFED floated for 7649 cars federal budgetary institutions detailed to a MoFED committee which was responsible to procure the service. EIC tabled a 11.5 million ETB offer when private companies proposed less attractive quotes which were as high as 48 million ETB . Accordingly, among other qualification criteria, the EIC by far topped its competitors when the bid documents were opened in the presence of competitors and legal representatives on June 10, 2008. However EIC and MoFED are yet to ink the contract.
Tesfaye Berhanu, head of MoFED Government Property Administration Department, told Capital this week that the contract is expected to be concluded between July 28, and August 2. Tesfaye added that due to minor delays the original plan to kick off the insurance period as of July 8, 2008 has been amended and the contract is expected to be signed shortly to be effective as of August 7, 2008.
Quoting the performance report of the Government Procurement Agency, Capital had reported that the procurement had faced a delay [originally planned to have a contract that starts by January 10, 2008 and expires by January 8, 2011] as the task was transferred to MoFED in a memo sent to Minister Sufian Ahmed of MoFED. The procurement agency was concerned that if it conducts the insurance procurement itself, it would be in breach of procurement procedures, and advised MoFED to take on the responsibility. Accordingly, MoFED’s Government Property Administration Department was put in charge and a committee was established which collected the number of cars to be insured from budgetary institutions and floated a closed tender for ten local insurance companies until June 10, 2008.
The EIC win was expected as its domination is felt in the insurance sector by weak private insurance competitors. EIC is currently a share holder in African Import and Export Bank, African Reinsurance Corporation, Motor Engineering Company of Ethiopia (MoENCO) and Universal Investors Share Company. It is also making its presence felt in the finance sector, taking on various projects in collaboration with banks.

Melaku to remain head at new Revenue Authority

By Tedla Yeneakal

Melaku Fanta, who has been serving at the Ministry of Revenue (MoR), before the Ministry was decided to be dissolved, has been appointed by Prime Minister Meles Zenawi this week, to be director general of the new Revenue and Customs authority.
One of the Federal government’s twenty ministries, the Ministry was transformed to an authority; this year after a Business Processes Reengineering (BPR) project had been in effect at the Ministry for the last two years.
Melaku is set to remain leading the revenue sector, whose mandate has been downsized along with three newly appointed deputy directors that would manage different sectors the new authority will lead, replacing the existing Ministry that co-ordinates three institutions, namely the Federal Inland Revenue Authority (FIRA), the Customs Authority and the National Lottery Administration.
About 600 employees of the Ministry have been taking a civil service training program before the Council of Ministers decided to transform the ministry into an authority.
The Ministry was upgraded from the previous Federal Government Revenue Board during a restructuring in the year 2001, a move the government considered as putting its house in order.
According to a recent report by the Ministry of Revenue to parliament, changing to an authority follows several proposed amendments such as allowing tax payers to transfer loss even if the ministry fails to okay reports in time [before the announcement of next year’s revenues] but also seeks to keep rights to reverse the transfers and prosecute the external auditor if fraud is found while inspecting the audit report that may come at any time. This is among proposed amendments in the tax laws [ Income, VAT, Excise and ToT] the ministry tabled to the House of Peoples’ Representatives last month, which accepted the proposal of its Budget and Finance Affairs Standing Committee and endorsed the decision of merging the Ministry of Revenues (MoR) and the Customs Authority as a single entity [Revenues and Customs Authority].
Another amendment that was tabled relates to avoiding challenges faced in enforcing the existing tax laws and prosecuting offenders by lifting the five day period taxpayers have to give receipts for services that are liable to VAT taxation. When prosecuted for not issuing receipts for taxable services, the ministry says, the defendants claim that they are still entitled to have five days in order to give receipts for their customers. If approved, the amendment puts a condition to issue receipts immediately after the service.

TATA opens Addis office, engages in leather

By MulukenYewondwossen

Indian car giant, TATA International Limited, has opened an office in Addis Ababa, on June 16, 2008. The TATA group that came for the opening of the office has met Prime Minister Meles Zenawi to discuss future investment possibilities in the country.
The three man delegation was led by TATA president, Ram Balasubramaniam, and met officials from the Textile and Leather Department, including State Minister of Trade and Industry, Tadesse Haile to discuss leather sector development. In addition the group also discussed manufacture of footwear and investment on a tea farm.
The delegation discussed with board members of Ethiopian Leather Industries Association (ELIA) on Tuesday, Abdissa Adugna, secretary general of ELIA told Capital.
“They want to buy crust and finished leather from the members of the Association for a leather garment factory which is located in Chennai, India, until they start full operations here,” he added.
Tata International is India’s leading leather and leather-products exporter and supply chain integrator. Its value chain encompasses global sourcing, excellent manufacturing in India and China, design studios in Europe, strategic alliances, marketing, and world-renowned brands as clients.
Tata has invested in 10 African countries with investments exceeding 100 million dollars. A subsidiary of Tata International a global company with a turnover of 1.6 billion dollars, it was established in Johannesburg, South Africa, in 1994.
Tata International was established in 1962 and evolved from an export house into an international business company with turnover of 850 million dollars in 2006-07. In international trading, it encompasses the entire value chain from sourcing products to delivery. The company has taken on various value-added roles and has stakes in a cross-section of businesses.
It’s business lines include leather, engineering and pharmaceutical products. Major markets are Europe, Africa, Asia and Oceania.
Tata International is a member of the Tata Group - India’s best known industrial group, with an estimated turnover of 28.8 billion dollars (equivalent to 3.2 % of India’s GDP). Besides its trading house profile the company has stakes in mines, a five star hotel, distributorships, trailer and railway wagon manufacturers and IT ventures; customer support facilities for Tata vehicles, design studios for leather, and warehouses dotted across the world.
According to information from the Indian Embassy, 351 Indian companies have invested 1.8 billion dollars in Ethiopia up to April 2008.

40 arrested in latest police raid against pirates Officers attacked

By Abiy Demilew

In the latest raid the Addis Ababa Police launched this week, against piracy overshadowing the art scene, at least 40 suspects were held until Thursday afternoon, Capital learnt.
Two police officers were reported to be attacked by suspects, in an operation launched close to St. Urael Church, Bole Sub City, to capture a key suspect which police consider as the main character copying, duplicating and distributing creative arts on CD. The suspect escaped after the attack on the two police officers, of which one is still hospitalized.
Police launched the operation last Monday, July 14, 2008, after receiving repeated claims and accusations of the ever worsening piracy of intellectual properties including music and film releases, sources in the police revealed Capital.
“Myself and three other producers released our films on DVD and VCD last Monday, but sadly enough, the illegal copies flooded the city days before the official release,” Theodros Teshome, producer - director of Fikir Siferd, told Capital.
Fikir Siferd, Sara, Fikir and Dance and 11th Hour are now the latest victims of piracy, being sold between 5 to 8 birr a copy.
“We have printed 3000 original copies and they are not sold yet as the market is already taken over by the illegal copies,” Theodros added. Overwhelmed by the incident, the four producers reported to the police and asked for interference.
“In a large city like Addis where we have more than 6000 registered venders, it has become difficult to sell just 3000 original products,” said Theodros in Capital’s exclusive.
Another producer and director also told Capital that piracy has taken control of the music and film markets in a nation where the rule of law applies. “Almost all existing laws in the country declare the copyrights of the owners and we have all the infrastructure to have them applied.”
Even though there have been different efforts exerted to control the situation, the problem exists to be very much complicated and deep rooted, according to various reports and facts on the ground.
“I don’t even know how this can be controlled as hundreds of people in each corner of the town, have based their lives on piracy,” a member of the police told Capital. “Anyone who has a computer can do it in various ways and manner.”
Five years ago, after the biggest demonstration, artists addressed the issue to the Prime Minister’s Office. It is to be recalled that, police launched a massive campaign on pirates, all over the nation, in which hundreds of suspects were captured and the illegal business calmed down for a while.
Besides the huge media campaign that followed, there have been some adjustments made by the artists, producers, record companies and distributers to control the illegal market by advocacy and selling original copies at affordable prices; 25br per copy.
Now the four movies are not only illegally copied and distributed, but the pirates had them before their official release, a lawyer told Capital. “This shows how much the pirates are adversely becoming stronger and more organized.”
“That is what we are seeing now, when pirates attack a police squad,” said a police officer on Thursday.
“I’m still shocked and frustrated to see what has happened,”said Theodros. “We are campaigning for the police to take more action.”
In the latest United Nation’s Creative Economy report, released on May 26, 2008 in Accra, Ghana, it was revealed that, Africa’s creative industries are faced by a big challenge of piracy, directly impacting on the continent’s share of the global creative economy, which now stands at only one percent.

Flower exporter under police investigation

By Tedla Yeneakal

Customs police have detained two employees of a private flower exporting firm, Joytech Plc, allegedly on suspicion of understating the quantity of stems that were being inspected for export, informed sources disclosed.
Two transitors working for Joytech were apprehended last week Friday, July 11, 2008, after they were accused of writing a quantity on the pack list that was actually lower than the real amount set for export.
According to sources from the Customs Authority, when samples from 3 million stems that were set for export by Joytech Plc were inspected, extra quantities above what was stated on the pack list were found. This shipment was immediately banned from export.
“The extra amounts are normally placed in the packs so that exporters reserve the foreign currency obtained from the added stems which they then install in foreign banks,” the source said.
A company official with Joytech, who requested anonymity, told Capital that the extra amounts were listed unintentionally, and are a result of mistakes that may have occurred during the process of packaging.
“The employees are now released on bail and I can assure you that our company did not have illegal intentions,” the official said.
Geberemedhin Gebereyohannes, Head of Public and International Section with the Customs Authority, on his part told Capital that he was not aware of the incident but said that the authority will be more alert based on the experience.
“It is a great loss to the country, if such evasion recurs as foreign currency earnings will be lost,” Geberemedhin said.
The general manager of Joytech was unavailable for comment.
After the Ethiopian government formulated a policy in 2003 to encourage investors focusing on export, flower farming has been among the priority sectors.
With 72 local and foreign investors in the sector, over 1,000hct of land had been cultivated by November 2007, of which 860hct is under greenhouses.
Of the 1.18 billion dollar total revenues Ethiopia generated last fiscal year from exports, 100 million dollars was obtained from floriculture. In the 2007/08 fiscal year, the country has envisaged to double revenues from the export of flowers.

Leather Institute internationally accredited

By MulukenYewondwossen

The Ethiopian Leather and Leather Products Training Institute is under process to be certified by the South African National Accreditation Service (SANAS), for finished leather products.
After LLPTI is accredited, the Institute is to certifies internationally finished leather products to enable them be competent on international markets.
A source within the Institute told Capital that there are five types of standard tests in three testing spots.
“Of the three standard tests the first phase is already being finalized and will commence in the near future. It meets the criteria the World Trade Organization (WTO) has outlined for the international standards products,” said the source.
According to a source from the Ministry of Trade and Industry’s (MoTI) Leather and Textile Department, the accreditation will create a conducive atmosphere for the local products to be more competitive on the international market and will support economic growth as well as boost manufacturers’ confidence.
Earlier to the accreditation the products the Ethiopian producers put on the international market were sold at a low price since their standard was neither certified nor accredited.
LLPTI was established in 1998 under the Ministry of Trade and Industry at a cost of 127 million birr to address the shortage of trained manpower in the sector and provide training opportunities and conduct research in the field.
About 86.5 million birr was earmarked for the purchase and installation of devices under an agreement between the Ethiopian and Italian governments. Machinery worth two million birr was donated by the United Nations Industrial Development Organization.
(UNIDO) as well as other items also purchased with another two million birr allocated by the government.
LLPTI certifies trainees at certificate and diploma level in the leather, footwear, leather and leather goods technologies. It plans to offer training at degree and post graduate level as of 2009.
It is called Prime Minister Meles Zenawi appointed Solomon Getu as the new director for the Ethiopian Leather and Leather Products Training Institute (LLPTI) Solomon assumed his post on June 30, 2008.
SANAS is recognized by the South African Government as the single national accreditation body that gives formal recognition to Laboratories, Certification and Inspection Bodies, Proficiency Testing Scheme Providers and Good Laboratory Practice (GLP) test facilities that are competent to carry out specific tasks.

Police detain CBE branch manager, employees over embezzlement

By Tedla Yeneakal

Police have put under custody three employees of the state owned Commercial Bank of Ethiopia (CBE), Africa-China Friendship branch, allegedly suspected of embezzling more than 400 thousand birr from the bank, on Monday, July 14, 2008.
Ayele Cherenet, Head of Public Relations with CBE, confirmed to Capital that including the branch manager, the Customs Services head and the cashier are behind bars, with police in the process of investigating the robbery.
“The Federal Ethics and Anti Corruption Commission is the government body that took the case for investigation, I can not further comment on the affair,” Ayele said.
According to sources from CBE, the investigation is in preliminary stages and employees of the particular branch are still under close follow up.
“We were forced to stay at the office as late as 10 PM in the evening this week, for further investigation,” an employee said.
The Addis Ababa Police Commission public relations office declined to comment, saying it would distract from the investigative process.
The case was reported amid the Bank’s report last week that it had registered in this Ethiopian fiscal year an all time high gross profit of 1.3 billion birr, exceeding last year’s profit by more than 28 percent. The management attributed the successful performance to an ongoing reform of the Business Reprocessing Re-engineering (BPR) project.
Established in 1942, with a capital of 65 million birr, CBE now has a capital 4.2 billion birr. Total assets are currently estimated to be over 49 billion birr.

Ethiopian breaks passenger record
Two Boeings 757s arrive to match traffic

By our staff reporter

Ethiopian Airlines has carried 2.5 million passengers until June 30th of this year, a record high, and 400, 000 more than the 2.1 million passengers it carried in last year’s same period, Capital learnt.
To cope with the ever growing number of passengers Ethiopian announced this week that it has leased two Boeing 757-200 aircraft. Leul T.Medhin, Acting Manager of Ethiopian Airlines Public Relations & Publications, told Capital that the aircraft have arrived and will remain with the airline for the next five years.
The two aircraft were leased from the Babcock & Brown Air Limited and each has a capacity of 171 passengers. They had previously been leased to ATA Airlines in the United States. The arrival of the aircraft is expected to ease the pressure due to the delay of the ordered ten Boeing 787 Dreamliners.
Over 1,000, 757s have been delivered since the aircraft first flew in 1982. The aircraft has exceptional performance, allowing it to operate from almost any airport in the world, including noise-restricted airports, short runways and airports in hot and high locations. It is quiet and fuel-efficient, is environmentally friendly and meets worldwide standards for engine emissions.

US program to assist Ethiopia’s feeble tourism

By Kirubel Tadesse

Aiming to boost Ethiopia’s earnings from its weak travel and tourism sector, the United States Agency for International Development (USAID) announced the launch of a five-year ecotourism development program.
USAID plans to spend 10 to 14 million USD on this five-year program, aiming to contribute to the development of Ethiopia’s unique and potentially very lucrative ecotourism sector.
The Program which is part of the USAID Global Sustainable Tourism Alliance, targets to stimulate economic growth to eradicate poverty by pushing Ethiopia to claim a share of the three trillion USD the world enjoys from the tourism and travel industry annually [expected to double by 2020].
“The time is now to prioritize Ethiopia’s travel and tourism industry, to improve tourism and ICT infrastructures, and to protect the nation’s natural resources,” US Ambassador Donald Yamamoto advised when he joined Ambassador Mohamed Dirir, Ethiopia’s Minister of Culture and Tourism at the USAID Ethiopia Tourism Competitiveness Workshop, held on July 16, 2008 at Sheraton Addis.
Ambassador Mohammed on his part said his government is exerting due attention to the sector and has designed an eco-tourism development program.
Nancy Estes, USAID Acting Mission Director, noted that Ethiopia is surrounded by stiff competition from neighbouring Kenya, Tanzania and Uganda, which, according to experts, have to be topped if the nation it to claim a fair share from the sector.
Back in November 2004, Ethiopia was announced to become one of the first countries to be targeted under a United Nations scheme to harness tourism potential in order to tackle entrenched poverty. It was reported that the World Tourism Organization (WTO) had announced Ethiopia would benefit from a WTO-led, development-friendly, tourism scheme. However, the program didn’t result in the changes anticipated.
Ethiopia, which may be called a true tourist’s paradise, is a land of contrasts and extremes, and remote and wild places. Starting from Semien Mountains, one of UNESCO’s World Heritage Sites, to the amazing Danakil Depression, the country offers fascinating cultural, historical and natural attractions. Despite this historical and natural advantage, Ethiopia hardly sees its tourist’s attractions transformed into income, compared to the 175 countries in a WTTC study.
According to the World Travel and Tourism Council report, Ethiopia’s travel and tourism industry ranks 110th in absolute size, 105 in relative contribution to national economies and 143rd in long-term (10-year) growth. Ethiopia’s Real GDP growth in travel & tourism is expected to be 4.2% in 2008 and to average 4.0% per annum over the next 10 years.

Company to produce table grape

By MulukenYewondwossen

A group of South African and Ethiopian investors are on course to start producing table grape in Mekele, the capital of Tigray regional state.
The first phase of production is planned to be on 200 hectares of land and is 100% targeted for export.
Ten Ethiopians already engaged in the horticulture sector established Ethio Grape S.C., investing 120 million birr while three South African investors have invested 250,000 dollars per hectare
Dire Highland Flower, Dugda Floriculture Development, Enyi Ethio Rose, Rose Ethiopia, Ethio Flora and Luna Fruit are some of the Ethiopian investors who have established Ethio Grape. Tesfalidet Hagos, owner of Luna, is board chairman of the new company.
Tesgaye Abebe, a shareholder in Ethio Grape and president of the Ethiopian Horticulture Producers Exporters Association (EHPEA), told Capital that cultivation will begin at the end of October 2008 and have plans to expand the project.
Moges Mesfin, head of the Tigray Regional State Investment Office, said his office has studied the suitability of the environment and the soil.
"The local investors were the ones who were first interested to invest in the region and they hired a South African consultant to study the land and the business. But later, South African investors became interested, finding the harvest season suitable for their requirements.
The office will give an additional 400 hectares at the end of December 2008 to Ethio Grape and a study is being conducted to provide another 1000 hectares," said Moges.
In the first phase of production on the 200 hectares, 2 million cubic meters of water is required yearly.
According to the investment head, currently, local and foreign investors have shown interest to engag in various sectors, including in horticulture.

Businesses, FIRA row over revenue, expenditure reports

By Tedla Yeneakal

Major businesses have complained about a Federal Inland and Revenue Authority (FIRA) order, which stipulates that companies must report detailed information about firms that have transacted with them throughout the year, claiming it impractical.
According to FIRA’s order issued six months ago, companies must hand in details such as Tax Identification Number (TIN), addresses and other information of firms they have provided a service to as well as of those they have made purchases from.
“It is really a daunting task to find details of the companies we have transacted with and the authority must consider revising this particular operation,” a private company general manager said. “We know that it is introduced with the objective of identifying that all businesses are engaged with legally operating firms, but it is difficult to practically implement it, considering the large number of companies that we have done business with throughout the year.”
Sources disclosed that several large firms have refused to give these details and they are preparing to file an official complaint to the relevant executives.
Abebe Kebede, Public Relations Head of FIRA, told Capital that if the companies refuse to submit the required information, they will be held legally responsible as per relevant articles.
“We have not yet been informed about the complaints,” Abebe said. “I can not comment further about the situation without officially hearing from the companies on this subject.”
According to articles related with tax evasion, any individual who evades the declaration or payment of tax or commits an offence; in addition to other penalties may be prosecuted and subjected to a term of imprisonment of not less than five (5) years.
If any amount of tax is not paid by the due date, the person liable is obliged to pay interest on such amount for the period from the due date to the date the tax is paid. The interest rate is set at 25% over and above the highest commercial banks loan interest rate that prevailed during the preceding
quarter.
A person who fails to file a timely return is liable to a penalty equal to 5% of the amount of tax underpayment for each month (or portion there of) during which the failure continues, up to 25% of such amount. The penalty is limited to 50, 000 Birr for the first month in which no return is filed.

Company to export mosquito repellent ointment

By Addis Mulugeta

A local company, Green Plc, that produces buzz-off mosquito repellent ointment has started exporting to the international market. Production begun eight months ago.
Gezaye Ambaye, managing director of Green plc, told Capital that the overall investment is 12 million birr, including for the factory’s on going expansion.
“The product is like a cosmetic that will be applied on exposed skin parts and buzzes off mosquitoes for eight consecutive hours,” added Gezaye.
Currently, the company exports the ointment to Sudan, Nigeria and Somalia. Locally, the Ethiopian Defense Force widely uses the repellent.
According to a study by the Addis Ababa University, Aklilu Lema Research Institute, and another study in the Amazon, the new product of malaria preventive control is active, has significant importance for tourists, and should be advocated by those traveling to areas known to be at malaria risk. Farmers, the military and ordinary people can use the product before and after they go to bed.
The cost of the product has considered the income of the people and is less than that produced in Germany and Britain. This is 8 birr for a single mosquito repellent whereas the imported product costs 170 birr. So far the product has been tested in the Amhara region, specifically in areas of Gojjam.
Gezaye applauded that Green plc is negotiating with Holland Company to produce scented oil here in Ethiopia. Currently Green imports the ingredients for making the oil from New York. When it starts producing the ingredient, Green plans to sell 10% on the local market while the remainder is to be exported.
“Green Plc is a member of the Coalition Against Malaria. The coalition includes the Ministry of Health, World Health Organization, UNICEF, the African Union, Regional Health Bureau, Carter Center and USAID. Green Plc promotes buzz-off mosquito repellent to members of the Coalition,” said Gezaye.
The company plans to produce 37 million units of repellent ointment, each year. Currently, it produces 6 million units.

EEPCo stops power shedding

By Groum Abate

After three months of darkness the Ethiopian Electric Power Corporation (EEPCo) is to stop the power shedding program as of tomorrow, Monday, July 21, 2008.
EEPCo has for the last three months shed power after its dams were depleted but after adequate rain water flow to the dams in recent weeks, it is to stop the power shedding that has worsened the economic condition of the country.
Power interruption has caused a considerable amount of damage to the economy that is estimated according to reports at over a billion birr.
The corporation faces a power shortage of over 40% in the capital city, Addis Ababa. Out of the total 200MW of electric power needed, the corporation was short 80MW.
According to officials of the corporation power demand grows 10% every year. The corporation’s data in 1999 Ethiopian fiscal year it distributed 2160GWH power and in the last nine months of the 2000 fiscal year the corporation distributed 2412GWH power.
The ever increasing number of new industries as well as the expansion of investment activities in various parts of the country, accompanied by low levels of rain during the main rainy season have aggravated the problem.
World Bank data shows that the DRC has a 40GW (gigawatts) hydro resource potential on the Congo River that is yet to be harnessed. Ethiopia is second with for a 35GW hydro power potential.
A feasibility study is being carried out to connect Kenya to Ethiopia, which has a production capacity of 1,875 megawatts. Other activities are also underway to connect Ethiopia with Sudan and Djibouti and this is expected to be finalized next year.
Earlier in the year, the Common Market for Eastern and Southern Africa (Comesa) announced a one trillion shilling plan to interlink its 19-member countries. Comesa said the programme would encourage member states to co-operate in joint development and utilisation of energy resources in order to have enough supplies at affordable prices.
Already as part of this plan, a high voltage line is being constructed to link Nairobi to Arusha after studies were completed last year. Kenya Power and Lighting Company (KPLC) confirmed earlier that the line will be able to take power to either side.
Kenya is also connected to Uganda.

.UNCTAD estimates 25 years to mark off Ethiopia, LDC list

By Kirubel Tadesse

If the recent annual growth Ethiopia registered persists, as maintained by the United Nations Conference on Trade and Development (UNCTAD) 2008 report, the country will be scrubbed off from the 50 countries the United Nations lists as Least Developed Countries (LDCs) in twenty five years.
Based on Development Committee recommendations forwarded every three years, Ethiopia is among the 25 countries that are expected to leave LDCs in the long term. In order to be in the mark off list countries should at least meet two of the criteria out of the three; low income, human assets and economic vulnerability.
Ethiopia’s time was estimated based on the low income threshold. Even if the thresholds are liable to reassessments, currently countries are expected to register 1, 040 USD per capita gross national income to qualify for the low income graduation. Ethiopia has only USD 157 gross national income per capita now. However, because of its successful Gross Domestic Product (GDP) growths [double digit performances for the last five years in a row] it is expected to move faster than nations like Yemen, Tanzania, and Chad which have relatively higher gross national income per capita [ 660, 337 and 417 respectively.]
It is assuming that Ethiopia and other LCD countries will continue to register the same GDP growth they have registered between the years 2004-2006 that the report details the number of years they will be in the position to graduate from the LCD.
The report is good news for neighboring countries like Sudan and Djibouti as it expects Djibouti to graduate from LCD in just one year. The nation already enjoys gross national income of 1, 013 USD. Sudan, with USD 660 gross national income and a booming economy, will leave LCD in just about six years.
On its report launching date UNCTAD released a statement from Geneva warning that the highest rate of economic progress in the LDCs in the last three decades has not been enough to prevent their total number of poor from growing. “Three fourths of those living in these nations continue to survive on less than 2 USD a day,” the statement explains, “the recent rising food costs are threatening undercut the modest progress achieved.”
Driven by their exports clamber [collective 80% between 2004 and 2006] LDCs economy is at better condition, about 7% growth rates in 2005-2006, but the report stresses the rapid population increases and other factors which explains that some 581 million people are still living in material deprivation out of a total 767 million in 2005.

Projects on pastoralist livelihood operational

By Addis Mulugeta

The Pastoralist Livelihood Initiatives project (PLI) has begun operation to support and enable pastoralists to improve household livelihood security and maintenance assets during drought cycles, in Oromia, Afar and Somali regional states. This was explained during the Pastoralist Lesson Bazaar held from July 15-16, 2008, at the Global Hotel organized by CARE-Ethiopia.
Participants include government departments, donor organizations, CARE Ethiopia partners, local community partners and Somali, Borena and Afar pastoral representatives.
According to Dr. Abera Deressa, Minister of Agriculture and Rural Development, to alleviate the challenges of pastoralists, various programs and projects have been implemented by the government and international agencies as well as non-governmental organizations with the objectives of reducing vulnerability and therefore enhancing the livelihood of pastoralist communities.
Dawn Wadlow, CARE Ethiopia Program Director, on her part said that over the last two and half years CARE Ethiopia and its partners had sat down as partners with regular and coordinating meetings, over the pastoralist programs. She said that the major objective of the Bazaar is to enable Pastoralist Livelihood Initiatives and allow partners to present key lessons and research, and share their experience to identify problems and opportunities to implementing project/ programs in pastoralist area as well as to influence policy.
The PLI project is designed and implemented in partnership with the government, NGO consortia, and the community working at field level. The activity is divided in to those related to early warning and emergency response and on continuing pastoralist livelihood support in the extensive pastoral lowlands of Somalia, Afar and Oromia regional states.
CARE Ethiopia and partners have been doing operational research in terms of regional management including bush clearing, harmonization and best practices in savings and credit, schemes and livelihood diversification strategies.
Wadlow noted that at the end of the conference, they some consensus was reached to develop the new program, conducting emergency dolls and promising practices and commitment to follow research and best practice rather than repeating the same mistakes in the pastoralist areas. The outcome of the event is to contribute to support ongoing efforts, strengthen good governance and policy implementation in pastoral areas as well as in facilitating learning among different consortium member organizations to bring the desired impact and commitment at all levels.
CARE has 20 years of experience in the pastoralist program in Ethiopia. It has been involved in Borena since in 1985 and in Afar since 1995. CARE has been working on contingency planning and supports government and the community.

Court orders gold scandal suspects to trial

By Groum Abate

The Federal High Court First Criminal Bench passed verdicts on suspects that were charged for involvement in the recent gold scandal that hit the National Bank of Ethiopia (NBE) to defend their cases.
The suspects appeared before court on Friday, July 18 to hear the verdict after the Federal Ethics and Anti-corruption Commission pressed at charges in January 2008.
Gold bricks NBE purchased were discovered in a random inspection to be only gold plated steel, prompting the arrest of employees of the central bank and the Ethiopian Geological Survey along with other businessmen, as alleged accomplices.
At a time when the Commission is investigating the scandal jointly with the Federal Police, another bar of gold that was sent to NBE from the exhibit vault of the police has reportedly been caught.
36kg of gold bars, deposited 5 years ago by the Ministry of Finance and Economic Development were also found out to be gold plated steel.
In connection with the National Bank of Ethiopia’s (NBE) phoney gold scandal, the Federal Police have arrested many business people and government employees so far.
Four brothers were arrested at the end of January, for allegedly acting as accomplices to one of the suspects accused of swindling hundreds of millions of birr by supplying fake gold to the Bank.
Apprehended on January 16, 2008, the businessmen now under custody are Kaf Mohammed, owner of Sofam Fashion; Sultan Mohammed; Fuad Mohammed, owner of WOW Fashion; and Nuredin Mohammed, owner of Nur Building.
The police charged the suspects at the First Instance Court of the Arada Criminal Bench, accusing them of covering up for Mukemil Sheriff, who is a fugitive also indicted of cheating 65 million birr out of the Bank by supplying 13 bars of gold-plated steel to NBE.
The Federal Ethics and Anti-corruption Commission took over the case from the Federal Police on January stating that the case involves corruption. Subsequently, the file was closed at the First Instance Court.
The case of NBE suspects Mohammed Said, Alemayehu Kassahun, Chimdessa Hirpa and Fekadu Lulu has also been closed and transferred to the Federal High Court. The cases of the experts from the Geological Survey, Sisay Engida, Belachew Berissa and Yasin Yimam have also been moved to the jurisdiction of the High Court.
The scandal was revealed about eight months ago when NBE discovered that some of the gold bullion in its reserve vaults was steel gilded with gold. The first scandal was followed by another which involves fake gold bars for which the bank had paid over 300 million birr.

Technical meeting on family health integration and HIV/AIDS

By Addis Mulugeta

To prevent unintended pregnancies and to help women and couples adequately space their births, Family Health International (FHI) organized a technical meeting on family planning, reproductive health and an integrated HIV/AIDS program, from July 14-17, at the ECA Conference Hall.
Participants came together from different countries of Africa, and outside the continent, to discuses the practical implementation of programming and reorganizing service and management systems to make sure that integrated approaches are possible.
Francesca Stuer, FHI Country Director, said that the major objective of the meeting was to share programmatic, research experience, lessons learned and document best practices and tools on how to best integrate family planning and HIV programming in to family plan services or family planning into HIV. The conference also indicated the management of programs.
For FHI, expanding access to quality family planning programs and conducting research to expand global knowledge of contraception and delivery of quality family planning services have long been institutional priorities.
According to Dr. Negist Tesfaye, Head of the Family Health Department of the Ministry of Health, integration of family planning, and reproductive health services has been an important agenda. Being able to address various reproductive needs of a population in a comprehensive manner has its advantages. Ethiopia has given priority to reproductive health and family planning and HIV/AIDS. Family planning plays a significant role to fight maternal mortality.
At the end of the conference was reached a consensus on how to implement integrated family planning, HIVAIDS services, how to be more effective in family planning programming, knowledge about family planning and HIV integration.
FHI built its experience from 1971, and does research focused on family planning, HIV/AIDS. It is well placed to share information to people living with HIV and provides access to counseling, support and service provision of family planning.

Presidential investment

Raw, semi-finished leather export tax triples

City Bank to open office in Addis

Bill Clinton to visit Ethiopia

Ethiopian Insurance wins huge contract

Melaku to remain head at new Revenue Authority

TATA opens Addis office, engages in leather

40 arrested in latest police raid against pirates Officers attacked

Flower exporter under police investigation

Leather Institute internationally accredited

Police detain CBE branch manager, employees over embezzlement

Ethiopian breaks passenger record Two Boeings 757s arrive to match traffic

US program to assist Ethiopia’s feeble tourism

Company to produce table grape

Businesses, FIRA row over revenue, expenditure reports

Company to export mosquito repellent ointment

EEPCo stops power shedding

UNCTAD estimates 25 years to mark off Ethiopia, LDC list

Projects on pastoralist livelihood operational

Court orders gold scandal suspects to trial

Technical meeting on family health integration and HIV/AIDS

Presidential investment

Raw, semi-finished leather export tax triples

City Bank to open office in Addis

Bill Clinton to visit Ethiopia

Ethiopian Insurance wins huge contract

Melaku to remain head at new Revenue Authority

TATA opens Addis office, engages in leather

40 arrested in latest police raid against pirates Officers attacked

Flower exporter under police investigation

Leather Institute internationally accredited

Police detain CBE branch manager, employees over embezzlement

Ethiopian breaks passenger record Two Boeings 757s arrive to match traffic

US program to assist Ethiopia’s feeble tourism

Company to produce table grape

Businesses, FIRA row over revenue, expenditure reports

Company to export mosquito repellent ointment

EEPCo stops power shedding

.UNCTAD estimates 25 years to mark off Ethiopia, LDC list

Projects on pastoralist livelihood operational

Court orders gold scandal suspects to trial

Technical meeting on family health integration and HIV/AIDS

Ethiopian breaks passenger record
Two Boeings 757s arrive to match traffic

Ethiopian breaks passenger record
Two Boeings 757s arrive to match traffic