The decision of Ministry of Trade and Industry (MoTI) to opening up the cement market to the previous scheme has slashed the price by half.
Experts in the sector said that the price of cement per quintal has sharply dropped this week following the government’s allowance of buyers to access the construction material directly from manufacturers.
Builders that Capital spoke to regarding the latest development on the industry said that the market has tremendously calmed down just few days after the decision of MoTI.
“Not only has the price shrunk but the product is now also easily available in the market, which helps us to accelerate our construction projects,” one of a real estate developer told Capital.
“In the past the price of a quintal of cement at the factory was less than 300 birr but actually we bought it from black market up to 800 birr,” he said.
He added that it has had an effect on their business since the transaction is undertaken in illegal ways at the black market with the receipt they issued by about 300 birr for sellers but actually paid 800 birr.
According to sources, currently the price of cement has dropped about to 400 birr per quintal at the factory rate.
“This time both builders and the government shall benefit since we get the product on the stated amount from legal market with the receipt of the stated amount of money due to that the government shall also get its appropriate revenue from the tax that was calculated on the stated amount, while the shadow traders are losing their place,” a builder commented.
Experts added that such market price will also encourage factories to produce the day and night since it is better profit for them, “this situation may also attract others to invest on the sector.”
Experts claimed that illegal chain was started from factories down to retailers that were revoked by the market itself.
On its statement last week, MoTI said that it has decided to make cement supply and distribution in accordance with the previous marketing guidelines.
“In order to address grievances in the cement market, the government’s efforts to improve the accessibility of cement products were carried out under the previous marketing system. As a result of an agreement to do so, and the capacity of factories to fill the supply gap, and the government’s decision to import cement as needed, the marketing directive was suspended indefinitely,” says Kassahun Mulat, Director of Commodity Pricing, Monitoring and Control, Cement. Kassahun has decided to conduct the transaction in accordance with the free market system as the previous directive and enforcement circuits have been repealed.
In the past the government had set a factory production price for the 12 listed cement factories ranging between 233 birr and 300 birr to control the illegal brokers. But in actual term the problem was not solved.
Some experts like Gemechu Waktola, Assistant Professor at Addis Ababa University and Founder and CEO at The i-Capital Africa Institute that organizes the East Africa Cement, Concrete and Energy Summit, explained that the government should leave the sector market for players rather than involve itself.
“When the government imposes conditions on market, the problem becomes larger rather than a solid solution. As the experience of other countries, the market of cement, which is the second consumable product after water, shall be managed by a strong association established by sector actors,” Gemechu commented.
Cement prices shrink by half as MOTI opens market
Tycoons back National Defense Forces
The manufacturing moguls back the National Defense Force with two hundred million birr in a single meeting, Capital learnt.
On the meeting chaired by Janitrar Abay, Deputy Mayor of Addis Ababa City Administration, held on Thursday July 22 at Sheraton Addis, well known Ethiopian investors were involved particularly on the manufacturing industry have vowed almost 200 million birr to support the law enforcement mission at the northern part of Ethiopia.
Sources who attended the meeting told Capital that the meeting was accompanied by full of allure opinion and sensational mood.
On the meeting investors promised that they will continue to support the government’s effort to cut the current challenge that the country faces in northern Ethiopia. The law enforcement measure was commenced when the outlawed and former central government political dominant TPLF ignited firing onto the northern command of Ethiopian National Defense Force (ENDF) late November 3.
One of the participants stated the meeting was very emotional.
Sources said that prominent business leaders including Sheik Mohammed Hussein Al-Amoudi, Sabir Argaw, Getu Gelete, Belayneh Kinde, Buzayehu Tadele and others have pledged millions of birr to support the mission.
“They pledged huge amounts of money happily,” one of the businessman who attended the meeting told Capital, “I, myself have contributed millions of birr. It is national issue.”
“We have contributed this sum because everything shall run smoothly if the country is peaceful. We will continue our contribution for our country,” another manufacturer told Capital.
Some of the investors have contributed 10 and more in millions of birr at the initial stage while on the day the contribution of Sheik Mohammed Hussein Al-Amoudi was very big as he contributed 100 million birr.
Sources said that the initiative will continue on other sectors and may have another round call to support the nation to prevail its peace.
It was recalled that recently Lieutenant General Bacha Debele, one of the top leaders of the mission, and Adanech Abiebie, Deputy Mayor of Addis Ababa City Administration, met with Ethiopian investors from different sector to brief them about the recent central government decision that took unilateral cease fire to open space for farmers in Tigray region to manage their harvest in this rainy season and to smooth humanitarian operation.
Children rights infringed as TPLF deploys minors
The Ethiopian Human Rights Commission (EHRC) is investigating the reports related with child soldiers which are being deployed by the TPLF group in the war front after receiving reports.
Beside its attack on civilians living in the neighboring region, the TPLF is deploying children to the battle front, as reports shows.;w Multiple pictures going viral among Ethiopians in social media indicates that the Tigray People’s Liberation Front is extensively using child soldiers in the battle against the Ethiopian Defense Force and Amhara region forces.
Earlier this week, the TPLF launched an extensive military campaign in the Afar region, although, the TPLF was unable to prevail in the Afar region and continue a military offensive. It has suffered a crushing defeat in Alele Sulula area of the Afar region. A force called May Day has been deployed according to government report deploying child soldiers in the front as well. However, the TPLF forces were defeated, and several child soldiers were captured.
“The TPLF is forcing children to get in the war by giving them about three days of trainings, and is also collecting bodies of the children killed in the fights to spread its propaganda,” says the national defense force.
Also the government expressed that the leaders of the TPLF group are ordering not to give aids for families that didn’t sent their children to the fight.
Expertise working on the human rights says that role of children taking direct part in war bears serious implications for their physical and emotional well-being. They are commonly subject to abuse and most of them witness death, killing, and sexual violence. Many are forced to commit violent acts and some suffer serious long-term psychological consequences. The reintegration of these children into civilian life is an essential part of the work to help child soldiers rebuild their lives and is often a long road to fully recovery
In Ethiopia the minimum age for military service is 18 and although such service was not compulsory, there had been “credible” reports that lots of teenagers had been forcibly recruited into the army, especially during preparations for the offensive. Also Recruiting and using children under the age of 15 as soldiers is prohibited under international humanitarian law, treaty and custom, and is defined as a war crime by the International Criminal Court.
Although the International Community has been calling for an end to the conflict and resorting to political dialogue to resolve the dispute between the Federal government and TPLF, they are however quiet about TPLF using child soldiers in battles, government blamed. Prime Minister Abiy Ahmed also accused the international community of the silence about the TPLF recruitment of child soldiers.
Aron Masho, public relation director at EHRC told capital that, the commission is investigating the situation based on reports the commission has received. “Since the commission follows up human rights violation, we are working to find out what the situation is,” said Aron, adding that so far there is no completed report.
New association to lead the CoE 2022
The newly formed Ethiopian Coffee Association that was established with the amalgamation of six different associations of the bean sector would have the leading role for the upcoming cup of excellence under public private partnership (PPP) modality with the government.
Adugna Debela, Director General of Ethiopian Coffee and Tea Authority, told Capital that the newly established association will lead the Cup of Excellence (CoE) 2022 that was supported and manage by Feed the Future Value Chain Activity for the past two years.
“We have strengthened the associations in the coffee industry to become a single sectoral body to lead the PPP and the authority would be the backstop to undertake the upcoming CoE,” he explained.
“We are already looking for funding organizations to start the next year’s competition. Local banks have also expressed their interest to support the initiative, while as inception we have some amount from the commission of CoE 2021,” Adugna added.
In the past there were six associations including producers, exporters, suppliers, rosters and women in coffee associations, “now we have formed one and strong Ethiopia Coffee Association that shall represented the private sector and work with the government for the benefit of the stakeholders and country.”
The authority head says that the evaluation for the CoE 2021 will be undertaking to identify the strength and weakness that will support to register better performance for the CoE 2022.
On the 2021 CoE, 1,848 competitor’s samples have been submitted and top 150 samples have passed for the second stage and 40 of them are in the final top round.
From the top 40 specialty coffees, the first 30’s have achieved 87 points and above to trade their bean on international online auction on allianceforcoffeeexcellence.org that was held on July 7.
To encourage the farmers and promote Ethiopian coffee the Ethiopian Commodity Exchange has also introduced micro lot trading platform’ to trade specialty coffee on once in a month time.
The 110 samples were eligible for micro lot trading from the 150 samples that passed for the second stage of competition under the CoE 2021 excluding the last 40 finalist.
On the international online auction that held two weeks ago Ethiopian coffee has registered another new world records.
The highly anticipated auction that gathered 188 buyers from 33 countries saw bids for over 4,000 times for more than nine hours to secure the sought-after winning coffees.
After the auction, Kidist Mulugeta, CoE Coordinator and Capacity Building Manager at Feed the Future Value Chain Activity, told Capital that the country’s quality coffee is now getting more attention from global buyers, “for instance we had only sent samples for 170 buyers but additional 18 buyers have been involved on the auction without testing the lots, which shows the buyers confidence on Ethiopian coffee, which is very high of course.”
One of the biggest achievement for this year auction is all 30 coffee have got over USD 15/pound. Last year there were some coffees that had got very high amount; the rest was low, while for this year all the coffees have amassed significant value.
The 2020 Ethiopia CoE, which is the first for Ethiopia, auction broke records, with total sales of USD 1.5 million topping the previous record of USD 830,245 from El Salvador in 2011. The El Salvador auction had 42 lots for sale, while the CoE Ethiopia auction included only 28.
For this year, the total proceeds value breaks another record for the second consecutive year and topped USD 1.8 million.
The winning lots that participated on the auction are the top 30 coffees that scored above an 87 percentage by the Cup of Excellence Global Coffee Centers. Coffee by Tamiru Tadesse of Sidama was the top scoring 90.6 percent.
In the 2020/21 Ethiopia earned a record USD 907 million from the export of 248,000 metric tons of coffee export. According to Adugna, in the current budget year that started on July 8, the authority has projected to export 280,000 metric tons of coffee that will generate a billion dollars.
He said that the performance in the first month of the budget year, which is July, has shown a promising performance.
