Steel together

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Photo: Anteneh Aklilu

Habesha Steel Mills PLC, a company established in 2007, manufactures different sizes of ribbed bars.
Habesha has elevated the strength and mechanical property standards of the Ethiopian ribbed bars by being the first and only manufacturer to use German patented technology to produce high quality reinforcement bars. It produce full range of reinforcement bars meeting international standards which are used in mega projects such as hydro-power dams, large infrastructure projects, airports, railway, road works, bridges, high-rise buildings, heavy industries, universities and many more.
The company believes in supporting the country’s development through creating a large number of employment opportunities, substituting rebar imported into the country, saving millions of dollars in foreign currency, increasing rebar supply of the country by providing the best quality with competitive price.
Kishen Raval Managing Director of Habesha Steel says that his company takes constant pursuit to make life better for the community where they live and work with various initiatives in health, safety and education. Excerpts;

Capital: Can you tell us about your company in brief?
Kishen Raval: Our factory is located in Oromia region Dukem town. Habesha Steel has more than 1,500 employees and we have built the modern customer oriented company and have shown a steady growth due to its focus on quality and modern system of production, this is because of our strong, committed and loyal employees from the community.
We started production in 2010 and over the years we have been doing various expansions and growing up our capacity right now we are one of the largest steel producers in Ethiopia.
Our main market segment is directly for the contractors of big projects. We focus on them because of our quality. We produce good quality of steel, which is the main marketing strategy.
That’s why we don’t have any advertisements or anything because the quality speaks for itself and once we got our customers that customer will be working with us for long time because they are happy by our service.
One of the largest steel factories in Ethiopia Habesha Steel produce full range of reinforcement bars for construction of residential and commercial structures, flyovers, bridges, and power plants.

Capital: You have been in Ethiopia for more than ten years how do you see investing in Ethiopia, what are the challenges and opportunities?
Kishen Raval: Ethiopia has a very good opportunity at the same time there are lots of hard and difficult things that you will encounter. As a growing economy most countries face the same challenge, such as low infrastructure, power and telecom services, this are some of the major problems we are facing on operating a modern business. Over the time we have built our business to be patient to understand how things work in the country, now we are confident that we know on what to invest and how to invest in Ethiopia.

Capital: Do you have other plans or new investments?
Kishen Raval: In fact we have many projects in the pipeline for more investments in to Ethiopia. We have different projects related with expansion of the steel industry hence we have to develop our capacity with the demand of our quality products. We are looking at the health care industry and fewer other projects. We have finished our project study and it is on an implementation stage. We are diverting to other business which can sourced locally with raw materials, large employees to create large opportunities to the local community. We are aggressively looking for opportunities to invest in Ethiopia. We know what should be done and we believe in Ethiopia’s potential.
You have to set clear strategy accordingly and identify opportunities. It is very difficult to run an import dependent business. In Ethiopia raw materials and resources are largely found and there is a huge human resource. We are focusing on local raw materials and import substitutions.
One of the problems in Ethiopia is related with power, however the thing is that Ethiopia doesn’t have a power shortage but the main bottle neck is distribution, the government is heavily investing to resolve the power problem.
As a big investment we are leaning to invest on substitution to resolve the problem of power to our industry. Of course it increase the total investment cost but, and the other main challenge is related with cash flow. As an investor we face all the problems that are happening in Ethiopia as all other investments.

Capital: You are familiar with Kenya and India, how do you compare investment in Ethiopia and these two countries?
Kishen Raval: Kenya and Ethiopia are very different because both countries have different economic structure, culture and different strategy.
I think Kenya is much integrated with the global economy and has better linkage but Ethiopia has better resources and man power. Ethiopia has sized better GDP than Kenya however the per capita income of the country is low because the population is almost double.
And India and Ethiopia has many similarities to the culture of the people, the political structure of the countries, however Ethiopia has much to learn from India on economic policy & reforms and how to manage differences. What is important in Ethiopia is everybody should stand as they all are Ethiopian and work for mutual benefit to bright the future.

Capital: How was your operation in the past years as the region was rocked with violence?
Kishen Raval: There is one saying “time always changes, in good times think about the bad days and in bad days expect the good,” we have been participating in different social issues and the community knows what we are doing so the community by itself protected us. Because we are good for them and we work for mutual benefit I believe this is the lesson every industries should learn. As we are participating and supporting on certain community works they will also protect us in bad days.

Capital: How do you see the problem that comes with covid 19, how are you facing it? Although many industries are laying off their employees what are you going to do?
Kishen Raval: As a country over the past year Ethiopia has passed through tough times, there is a big reform going on. However covid 19 is becoming another challenge. The westerns have all the advantage they still have saving and the government can also give them necessities.
But for African countries and specifically for Ethiopia it is very difficult.
We have not taken any measures on our employees and we will not lay off any single workers. We believe that this is a very serious issue and it is an obligation to companies to protect their workers. We are trying to reduce our production to protect our employees.
We want to be a role model for other industries, our collective and concerted efforts to help one another in times of great need will be the only way that we overcome these difficult times.
We have donated 15 million birr worth of medical supplies including oxygen to health facilities to help the fight against the pandemic. We will produce the products in our own factory. Besides giving the medical supplies; the factory is planning to support around 500 people that are living around its factory at a time of a lock down. We are planning to give them fully prepared hot meal because if we give them the materials there will be a lot of people who don’t have the other ingredients to prepare the food.