Jigjiga Export Slaughter House Plc. (JESH), is establishing an industrial complex with an initial capital of USD 5 million, and is to commence operations in June, 2013.
More than 70 percent of the civil work has been finalized with the fencing of the perimeter and the completion of bore holes; and the equipment for the industry is to arrive in three weeks’ time. The structure of the factory is of steel and will be relatively easy to raise, it was stated.
The complex JESH is constructing will have an abattoir, a tannery and a leather factory to be built on the 280 hectares plot of land JESH has acquired in the Somali Regional state, Faafan area, situated 30 km west of Jigjiga or 70 km from Harar. . The regional government has played a big role in speeding up the process of completion of the industry by constructing a two-kilometer access road.
Mohamed Elmi (MD), Director of the Jigjiga Export Slaughter House Plc, has acknowledged and thanked the efforts exerted by the Ministry of Agriculture (MoA) for repeatedly visiting and extending advice and the Commercial Bank of Ethiopia (CBE) for availing the necessary hard currency. He said he hoped the industry would be at least one of the biggest in the leather sector in the country.
To begin with, the abattoir will have an eight-hour shift, with a projected capacity of slaughtering around 2000 sheep and goats per shift as well as 200 cattle. The number of shifts can be increased in the future when the need arises, Mohamed explained. The abattoir also has plans to slaughter camels.
After negotiations with several companies, JESH procured the equipment from a Chinese company, the Guangzhou Slaughterhouse equipment manufacturer, which they claim are up to the standard the Chinese export to Europe are required to ensure. ,. “We approached some companies from Europe and Asia. We finally opted for the Chinese company,” the Director said, “as the company has 22 years of experience in the field.”
One of the challenges in establishing abattoirs in the lowland areas of the country, which is the source of 90 percent of the country’s live-animal exports, is very limited transportation. “We are a little bit far from Bole International Airport,” Mohamed joked. There is in fact the Garad Wilwal Airport just outside Jigjiga, but it doesn’t have the ground facilities to accommodate exports just yet. Mohamed is hopeful that Ethiopian Airlines, who has promised that through its cargo section it will make the necessary ground facilities available as soon as there’s the demand for it, will do so in the near future.
Although about 90 percent of the country’s livestock are found in the lowlands where pastoralists reside, there is not a single abattoir, because there was very limited infrastructure development in these areas. JESH will be the first, upon the completion of construction and commencement of operation, according to the Director.
On another level, Mohamed says JESH is challenged by the lack of adequate financial facilities in the area. The majority of the pastoralist areas are occupied by Islam religion followers who do not use financial institutions with interest. “Unless we get access to finance, via interest-free banking facilities in those areas, one of goals of the country’s GTP would hardly be achieved or realized,” he stated.
It is to be remembered that the National Bank of Ethiopia (NBE) has issued a directive to banks to provide interest-free service as one of the multitude of services they provide, but specifically prohibits the formation of interest-free banks.
The company, as any private firm, has a national goal. “We believe this project would contribute to the GTP,” he said. “The income for three years after the completion of the construction and commencement of operation is expected to be 15 million USD.”
The feasibility study and design for the industry is said to have been accomplished in just a year’s time. The management has visited the facilities at Mekelle, Bahir Dar, and Modjo. JESH, a big and well-designed industry, has a storage capacity of around 400 tones. No other industry in the country has that capacity, Mohamed said.
To reach the international market, JESH is planning to buy cold or refrigerated trucks that would transport meat from the factory located 508 kilometers from Addis. The Director said they are also trying to arrange space at the Cargo Terminal of Ethiopian Airlines, situated at Bole International Airport, for future use and to utilise Ethiopian Cargo airplanes to transport their exports. The other available option the company has is to charter cargo flights, which is more expensive.
“The industry will have a very big impact on the country’s economy, especially on the lives of pastoralists living in the Somali Regional state and surrounding areas,” he said. Pastoralists used to travel to border areas seeking markets. The price they sell their sheep, goats, cattle and camels were decided by others which obviously were in favor of the latter. “The establishment of this industry would help these people to get access to the right markets where they will collect the appropriate price for their animals.”
The company has plans to replicate this venture in the near future around the Gode area.
Mohamed concluded that the necessary infrastructure like roads, electric power, telephone and other services have been put in place and the area is being developed, making it safe for investors to get involved in the industry, in these areas.
Owner and director of the industry, Mohamed has worked for 12 years for NGOs. He is involved in the construction and real estate sector now, he informed Capital.