Ethiopian Coffee and Tea Authority (ECTA) says it is working with the Ministry of Revenue (MoR) to introduce a scheme for assimilating coffee trading.
The authority that is registering tangible changes on the coffee market and export earnings since vertical integration’s commencement as an alternative for Ethiopian Commodity Exchange (ECX) platform, said that it is working with the revenue authority to harmonize the new trading scheme.
Adugna Debela (PhD), Director General of ECTA, said that under the new scheme which commenced about a year and half ago empowered farmers, suppliers and exporters to trade the bean directly which also benefited other stakeholders. Moreover it has boosted the volume and the value of the coffee export.
Despite visible success there are also claims that the trading price under the vertical integration is higher than the range that is given by the regulatory body and trading floor at ECX.
However, ECTA argues that the contract between the buyers and sellers is approved by the authority prior to export.
Experts said that the authority only evaluated the contract of the two parties, suppliers and exporters, and not the receipt of the trading, “the good thing is that suppliers issue the receipt for exporters. If ECTA wants to know the case it has to ask for the transaction receipt in addition to the contract agreement,” experts remarked.
Adugna told Capital that there might be different under table negotiations. He said that the way out as mentioned by experts is an alternative to solve the possible challenge.
“We are currently working with MoR to regulate the transaction,” the authority stated indicating that it is working with MoR to assimilate activities with the revenue authority.
“We have crosschecked transaction samples randomly and the result will be seen,” the Director General said, adding that it helps to maximize revenue collection.
In the current budget year, ECTA has targeted to trade 280,000 metric tons of coffee that is the biggest volume ever in the sector trade for the country.
The vertical integration scheme is expected to take the major share of the export.
In the first three months of the 2021/22 budget year the country has earned additional USD 120 million or over half of the target from the coffee export against the amount that ECTA set to attain.
In the stated period a total of USD 330 million was secured from coffee, which is the major hard currency source for the country.
The global coffee price is surging in the past few months because the biggest producer and exporter of the bean, Brazil is being affected this season.
Due to that the performance of Ethiopia registered marvelous achievement in the past budget year from coffee export which has continued to maintain newer records this year.
For instance in the first month of the budget year that started July 8, the authority had projected to export 21,340 tons of coffee but actually it attained to ship 31,146 tons and earn USD 115.5 million that surpass the target by 146 percent and 161 percent in volume and value respectively.
Similarly, the July performance has shown increment of 64 percent and 81 percent in volume and earning respectively compared with the same period of last year.
The authority is aggressively working to expand the high quality coffee, which is the major hard currency source of the country and well known by its quality and flavor, output ranging up to grade 3 than commercial coffee. In this regard in the 2019/20 budget year, high amount of quality coffee was exported than commercial coffee, which took the lion’s share in the past experience.
ECTA liaises with revenue authority to progress coffee trade
Zuqualla Horti cuts through European markets
The state of the art horticulture facility, Zuqualla Horti PLC successfully exports the first batch of its cuttings flower to the European market this week.
Recently, the high tech farm which converted to cuttings partly from the former strawberry production stated that its plan was to start exports by November this year; however it has achieved it before the projected timeline.
The cuttings business that is rare but economically lucrative for the country has now seen additional player besides the five players who are engaged currently.
According to a statement from the Ethiopian Horticulture Producers Exporter Association (EHPEA), Zuqualla Horti, formerly Ilan Tot Strawberry Farm in Qoqa, 91km south east of Addis Ababa, last Wednesday 27th October successfully exported its first cuttings to the European market. This comes at a time where the farm has been growing as a result of the 10 month investment phase which is still ongoing.
“After starting construction last January and planting the first batch in July, this is a huge milestone for the company and the country’s horticultural sector. Being the 6th ornamental cutting producer- and exporter in the country, it can give extra strength and boost to attract other cutting producers in the future,” the statement added.
Zuqualla Horti PLC’s ultramodern greenhouse facility at Qoqa, built on 5.5 hectare of land, holds a complete automized climate system, fully equipped with moveable screens and LED grow lights, as well as a gutter recycling system for all drain water.
“Depending on the quality and feedback from our customers and how successful we can get through our first export season, plans are there to expand the greenhouse facility with another 2.2 hectares,” Wout van Koppen, the company’s General Manager, said.
Zuqualla Horti PLC, founded in 2005 originally being a pioneer in growing and exporting strawberry’s, welcomed its new investor EMS Flower, European largest ornamental producers company by the end of 2020. The new company has promised that the fresh hands will continue on the same facility with better business.
The company stated that the strawberry export will also continue, while it will be transferred in hydrophonics growing system in tunnel greenhouses farming to increase yields and export value from the current open field.
In the past half year, the company was engaged on the development of five greenhouses that lies on 1.1 hectares each and prepared them for cuttings production and some of them are already at the nursery stage.
In August, Bennie Uoipers, owner of EMS Flower, told Capital that the new business so far consumes 7 million euro, while most of the finance is covered by itself and financial sources in Dutch.
Zuqualla initially targeted the exports to come about in November but has since surpassed its projection by exporting the cuttings much earlier than anticipated, explained the farm manager.
Mekonnen Solomon, Horticulture Export Director at Ministry of Agriculture, told Capital the latest news from Zuqualla is not only horticulture activity or export earnings but it has massive meanings for the country’s economy at large.
The cuttings business is different compared with other floriculture activities, “the job creation per hectare is over 38, which is very high compared with other rose and cut flower production and even manufacturing industry. It is also different in earnings and high tech that has a contribution for the sector.”
Recently, Wout van Koppen, General Manager of Zuqualla Horti, told Capital that the cutting business is very labour intensive and requires high tech, “thus if you compare the cutting business let’s say to rose farms and other cut flowers, that is a very different story.”
In the first year the company targets to export 25 million cuttings. Under the plan, the company has targeted to expand the greenhouses routinely at its compound.
The company currently has a workforce of 550.
Affordable public Wi-Fi comes to fruition
Ethio telecom is working to launch public Wi-Fi for the first time in the country at four national flagship sites.
Recently inaugurated places which are appealing abundant visitors in the city; Unity Park, Meskel Square, Entoto park, and Friendship square are said to be beneficiaries. As sources from Ethio telecom informed Capital, Ethio telecom has started its trial test to make the service fully operational within few weeks’ time.
According to the telecom service provider, customers will get the service with low and affordable price.
Customers are expected to pay 5 birr for 1 hour, 8 birr for 2 hours and 12 birr for 3 hours of high-speed internet connection to which the fee will be deducted from their air time. The Wi-Fi password will automatically be sent via SMS upon the transaction. In order to enjoy the service, customers will have to access the company’s website and enter their phone number. The connection speeds to be enjoyed are stated as 4Mbps.
The newly inaugurated Addis Ababa mega projects are said to change the livelihoods and immensely contribute in the reviving tourism industry by hosting various cultural, arts, fashion, political, economic and other international as well as continental conferences and events which made the service provider to start this new service.
The service was said to be operational starting from September 1, 2021 but it is still under the testing stage and will soon be availed to the public.
Few months ago, Ethio telecom’s CEO Frehiwot Tamru said that new technologies and additional features will be implemented to enhance customer experience, quality and accessibility of services to achieve the set strategic plan.
By expanding its local and international telecom service packages, Ethio telecom will work to intensively meet its plan and the public Wi-Fi initiative will see to enact the same.
In the latest update at the end of the fiscal year the number of customers for Ethio telecom has reached 56.2 million customers. Mobile voice subscribers has reached 54.3 million increasing by 22 percent from last year, while data and internet users has reached 25 million showing 5 percent increase.
Ethio-Telecom has been working hard to become a competent and preferred telecom service provider in the fast and dynamic telecom market to meet the growing demand for telecom services. In its plans, the telecommunication giant targets to grow its subscriber count to 64 million this fiscal year and its data and internet users by 16.2 percent to 28.5 million.
EthSwitch to upscale digital payment scheme
EthSwitch, advances a step further on the digital payment scheme through Person to Person (P2P) account transfer that would ease transfer and pay between financial firms without extra delay and process.
The scheme that EthSwitch tested successfully through piloting has now been commercialized since the regulatory body gave a green light.
In a statement, Ethiopia’s National Switch announced the commencement of interoperability of digital wallet, mobile and internet banking systems run by banks, microfinance institutions (MFIs) and E-money issuers, following the authorization from the National Bank of Ethiopia (NBE) after a successful testing.
“The interoperability enables customers of banks, MFIs and E-money issuers with digital wallet, mobile and internet banking and accounts to send funds from one institution to another. The interoperability includes transfers from bank account to bank account, wallet to wallet, wallet to bank account and from bank accounts to wallet using internet based and USSD channels as well as smart phone applications,” the statement of the digital company explained.
Nine banks and one MFI have participated during the pilot period executing over 125,000 transactions worth 1.1 billion birr. More financial firms are on their way to complete their technical integrations and testing.
The national switch, which is one of the two national switches in the continent, said that as an evolutionary progress from previously attained ATM and POS interoperability, digital wallet, mobile and internet banking interoperability, technically termed as interbank P2P account transfer, is a significant step in achieving Ethswitch’s primary goals of ‘Attaining Complete Channel Interoperability’.
Interbank P2P account interoperability is a mechanism that enables customers of banks, microfinance and digital wallet providers to transfer funds to others or between their own accounts from their mobile devices from anywhere at any time between different financial institutions.
Yilebes Addis, Ethswitch CEO, stated, “Digital Banking Interoperability is a significant step in the modernization and integration of payment systems in Ethiopia, which will help financial institutions leverage existing technology with Ethswitch to provide efficient services, increased reach and smooth customer experience.”
He explained that it ultimately enhances the digital banking uptake by customers and increases the financial institutions’ resource mobilization and customer service monetization capability. “It is also worth noting that in addition to currently operating financial institutions and digital wallet operators, emerging payment system operators will also find this development hugely beneficial as it makes integration with current system so much easier,” the CEO elaborated.
“The most important beneficiaries are the customers, as Interbank P2P Account Interoperability will bring them unprecedented flexibilities in conducting transfer and payments,” the CEO explained.
As a result of Interbank P2P account interoperability, the market share of electronic transactions both for transfer and payments will increase leading to the rise of the amount of money flowing through the formal sector benefiting the financial industry’s effort in resource mobilization.
