The National Bank of Ethiopia (NBE) amends ‘transparency in foreign currency allocation and foreign exchange management directives’ to increase the foreign currency allocation for first priority import items that adds some more import commodities.
The foreign exchange bureau has been included on those items that shall serve on demand.
The ‘transparency in foreign currency allocation and foreign exchange management directives No. FXD/77/2021 that replaced directives No. FXD/67/2020, which was emplaced a year ago, has included input for manufacturing industry of edible oil and liquefied petroleum gas (LPG) as part of the first priority for the allocation of foreign currency at banks.
In the past, the transparency in foreign currency allocation and foreign exchange management directive had been amended several times since the first one was issued in 2016 which placed medicine, input for manufacturing of pharmaceuticals and laboratory reagents in first list.
The newly amended directive included the import of edible oil input to be included under the number two classification of the first priority import items.
Currently, huge edible oil pressers have been setup in different part of the country which will halt the import of refined oil. For a huge capacity to be established here, industrialists argued they were unable to manage the operation as per their capacity due to lack of hard currency. To provide a solution for this, NBE stepped to facilitate hard currency for oil industries in the past months, and to this end he new directive shall help industries to get hard currency regularly to import mainly crude oil.
Ethiopia allocates over half billion dollars for the import of cooking oil per annum, while the government is tirelessly working to replace by local production.
Similarly LPG has got special attention to be part of the first priority commodity to get hard currency from banks under the third classification following edible oil. In the previous directive, LPG with motor oil and lubricants was at the top on third priority items to get foreign currency.
Now it has shifted to first priority. Experts in the industry told Capital that LPG shortage in the market has pushed the government to include it in the product of first priority. It is recalled that the government is importing petroleum, while LPG was drawn by the private sector.
The current and former directives about foreign currency allocation stated that the foreign currency allocation for imports of items listed on the first, second and third priorities shall have at least 50 percent of the total foreign currency allocation of all import of goods and services in any time.
However; according to the new directive of NBE, the share of first priority import item portion from the 50 percent has increased to 15 percent from the previous 10 percent. It said that the 50 percent allocated for essential goods mentioned under three priority steps shall be distributed 15 percent for first priority, 45 percent for second priority, which is included input for agriculture and manufacturing sectors, and 40 percent for third priority.
The third priority that includes several essential items and services hard currency share has reduced from 45 percent to 40 percent on the new directive.
Under the article, the items listed are exempted from registration procedure of essential items and shall be served on demand forex request for all transaction included.
The directive became effective as of December 1, 2021. Before this, FXD/67/2020 was in effect for almost 14 months.
NBE amends forex allocation priorities
Ethio telecom to activate 5G trials
Ethio telecom has finished its preparation to pilot the 5th generation (5G) network for the first time in the country with the launch expected next week, Capital has learnt.
The company is implementing the project using technology from the Chinese technology company Huawei. As sources said, Ethio telecom has been working on the preparation for the last two months.
5G is set to be introduced to deal with the high volume of data transmission in dense urban networks in the country and will be upgraded to the existing 4G infrastructure which will help in user demand whilst solving data traffic.
Few months ago while speaking about the performance of the firm, Frehiwot Tamiru, CEO of Ethio telecom explained that the telecommunication company was taking the necessary preparation to start deploying 5G networks in the country within a short period of time, before 2022, as per its plans. “Ethio telecom is undergoing network infrastructure and system enhancements to pilot 5G networks soon and we’ve made some of our networks ready for 5G,” mentioned the CEO in here recent previous speeches while addressing the performance and future plans of the company.
The network is said to be applied on hotspot areas in Addis Ababa, including the areas around the head office of Ethio telecom and premises of Bole international Airport.
As previously highlighted by the CEO, Ethio telecom has upgraded its business management system to Huawei-powered “New Generation Business Support System (NGBSS)” which is designed to allow Ethio telecom to bill 5G network services to fit with its plan with view to modernize services and enhance customer’s experience.
The new development will make Ethiopia early adopters of 5G in Africa, yet the question remain over investor and market readiness for mass use of the technology across the continent.
Globally, 5G network services for commercial use were first deployed in 2018 by Verizon. In Africa, 5G networks are available in Kenya and South Africa.
The Global Partnership for Ethiopia Consortium (GPEC), led by Kenya’s Safaricom, which was officially granted the first private telecommunication operator’s few months ago, also plans to begin operation with 4G network services and quickly introduce 5G. Having acquired a 15-year telecom operation license for 850 million dollars, the operator is scheduled to start in early 2022.
CRONY CAPITALISM & ELECTIONEERING
Whether we like it or not, it is crony capitalism that has won the day in our modern world system. If truth be told, there is no place on earth where crony capitalism is not the main operating mode of accumulation. Rhetoric aside, the institutions of economic governance directly and indirectly encourage the entrenchment of crony capitalism across the board. From Ethiopia to Estonia from USA to Uganda, crony capitalism is now the actual face of the dominant global system. But there are plenty of problems associated with crony capitalism. The main problem being; unlike old-fashioned capitalism, crony capitalism alienates more than it empowers. As a result, it instigates insurrections, both creeping and abrupt, all over our planet!
In many countries oligarchs cannot exist without their supporting politicos. This also applies to our continent. The propaganda of the global ruling elites, which insinuates the possibility of creating genuine wealth outside of generalized corruption, is, by and large, a farce. Here is how the game is played. The crooked politicos need faux front companies to steal the country’s resources. Some of these stolen resources are recycled to facilitate elections, including vote riggings. Every time there is an election in an African country, the banks invariably become overstretched, as these institutions will be instructed to extend plenty of credit to the connected oligarchs. The money is then used to buying votes. A couple of millions of birr to a strong candidate can be quite convincing to force withdrawal. Frankly speaking, a billion birr can do electoral miracles! Vote rigging has become common and elections have been rendered mere rituals necessary to usurp power. Like anywhere else, the project of winning election, by hook or a crook, is the driving force of Africa’s psychopathic politicos.
Once the incumbents are reelected, plenty of money will again be directed to the old cronies, via tenders, government procurement, tailor made projects, etc., etc.! Rinse and repeat!
Elections are influenced by the preponderance of the ‘deep state’ in the core countries and the ‘Mafiosi State’ in the peripheries. Winning election outside the desires of the deep state/Mafiosi state is not easy. Nonetheless, upsets can and will happen when things become absurdly offensive. When such a point is reached, the sheeple will cast its massive ‘protest vote’. In the process outsiders can usurp power. Recall that we have defined the deep state as the military-intelligence-industrial-banking-media-complex. Invariably, the deep states of the powerful states would like to see submissive governments in the weak states of the nation-states system. To this end, everything will be done, including election rigging. Showing signs of stubborn independence, on the part of the weak, might well bring havoc to their existence. In the long run, these countries almost always face internal difficulties that can easily unwind coherence and expose them to fragility.
Crony capitalism creates money out of thin air. In crony capitalism the old fairytale of ‘from rags to riches’ through hard work is conclusively proven to be just that; fairytale. Most of the money in global circulation is created by commercial banks. This phony/unearned money is systemically channeled to those loyal to the system, i.e., aspiring oligarchs and their political handlers behind the veil of capitalism. The creation of phony money always creates inflation and inflation disproportionately affects the working poor. The convertibility of countries’ currencies into gold, via the US dollar was abandoned in 1971. Since then countries print their own money as if there is no tomorrow, until they can’t! The case of many, before it demonstrate this brutal reality of printing money with abundance. Those that depend on constant supply of bank money are not affected by inflation. It is only those who are forced to earn their keeps by selling their labor, mental or physical, that suffer the consequences of inflation. This is the main reason why crony capitalism supports vacuous electioneering!
Resistance to crony capitalism, by extension electioneering, is growing by the day. The main stream media, as part and parcel of the deep state, doesn’t want to cover the weekly protests in their country. On the other hand, the Hong Kong demonstrations are always on the news. Any perceptive reader can easily pinpoint which protests are favored by the deep state and which are not.
In places like ours opposition to crony capitalism can take a very undesirable turn! Crony capitalism and useless elections go hand in hand, one cannot exist without the other. The two are always in a symbiotic relation. This relation is one of the main defining characteristics of late modernity.
Ethiopia makes history in airfreight logistics
Ethiopia has become the first African nation to chair the global airfreight institute that promotes international air cargo.
The annual congress of the International Federation of Freight Forwarders Associations (FIATA), the global logistics association, has also approved the chairmanship of Ethiopia for its regional wing.
On the congress of FIATA held two weeks ago, Ethiopia was elected to chair one of the four FIATA’s regional wing, Region Africa and Middle East (RAME), and the Airfreight Institute (AFI).
According to Ethiopian Freight forwarders and Shipping Agents Association (EFFSAA), who is member of FIATA, two Ethiopians have been nominated by the association to chair the international associations.
It was stated that the competition to get the position for AFI was very tough since the interest from western countries was very high, while Ethiopia successfully secured the post with higher vote.
As a result, the former president of EFFSAA, Salahadin Khalifa, and the current vice president of EFFSAA, Dawit Wubshet have been nominated by the association for RAME and AFI respectively.
The local association that was formed in 1998 indicated that Salahadin, who is well know by his active involvement on the logistics issues and leader of one of the biggest logistics company in Ethiopia has been elected to chair RAME for two years. Before he came to the top seat, Salahadin served RAME as vice chairman.
Similarly Dawit, who has ample experience on the sector, has been elected to lead AFI for the coming two years.
The assignment of Dawit at AFI was also stated as historical since he is the first chair from the African continent to lead the over five decades institute which has actively pursued its mandate to define, craft and promote the role of the forwarder in international air cargo.
AFI is inclusive of a wide spectrum ranging from non-governmental organizations, special interest groups, government bodies, regulators, carriers, shippers, consignors, customs groups, legal specialists, cargo risk underwriters and technology providers.
AFI’s has a proactive posture on issues which may impact the international forwarding community and has reputation within the global transport industry as the go-to group for consultation and action on air cargo issues.
The EFFSAA said that the latest development is indicated that the capacity of the two individuals, “it a big recognition for the association, who is representing the country to have a big role in the international arena.”
It is stated that the opportunity to lead the two logistics associations shall benefit Ethiopia to pursue the experience of others in the sector development, while it has also an input for the country to make it a hub for logistic services.
“The representation of Ethiopia on these higher bodies shall also facilitate the opportunity for the local association to promote and attract foreign direct investment, job creation and technology transfer,” EFFSAA said on the press release sent to Capital.
