Floriculture actors asks the government for expedite measure to keep the sector from damage due to the outbreak of coronavirus epidemic. Government officials and exporters discussed the latest situation and the way-out.
Mid this week in the meeting co-chaired by Girma Birru, Advisor at the Prime Minister Office, and Omer Hussein, Minister of Agriculture, exporters including the coffee, leather, textile, livestock and meat, and sesame expressed their concern and challenges that might occur and already happening in their business.
According to those who attended the meeting that include few individuals due to the fear of the pandemic, the private sector expressed its fears related with the virus, while most of the export challenge related with corona is mainly affecting the horticulture sector than other major export businesses.
Tewodros Zewdie, Executive Director at Ethiopian Horticulture Producer Exporters Association (EHPEA), who attended the meeting, told Capital that the concerns have grabbed the attention of government officials. “We are looking swift measure by today or Saturday,” he told Capital on Friday via telephone conversation.
“The concern of others looks like they keep working in the export, while we are now almost inactive on the business,” he explained.
According to the information from EHPEA the export of flower has dropped by 80 percent from the normal time. Most of the product is transported to the Netherlands market.
Friday afternoon Prime Minister Abiy Ahmed announced some macro-economic measures besides several other mitigation strategies.
He announced that the government decided National Bank of Ethiopia to avail Birr 15 billion liquidity for private banks to enable them to provide debt relief and additional loans to their customers in need.
Abiy’s measure also included the removal of the minimum price set by the National Bank of Ethiopia on the horticulture sector for flower exports, and the Ministry of Revenue to expedite VAT returns to support companies with cash flows.
The association asked the government to reschedule ongoing loans and provide working capital for the farms to keep running the operation, which have over 150,000 employees.
The VAT refund is also the other area that the government is expected to extradite to support the growers cash flow. Besides the VAT refund suspension the association wants a protection from labor laws in case of downsizing the labor force.
Ease the hard currency repatriation threshold, which is USD 3.86 per kilogram of flower, is also the other area the association needs from government to be considered.
Making sure that airfreight cargo services are accessible even with less frequencies and with reduced rates is also the other area that the growers needs to be soft.
After the PM disclosed some measures the association appreciated the government decision.
Gov’t outlines new coronavirus support measures for businesses
Economic policies to combat COVID-19 in Africa
The COVID-19 pandemic is likely to impose heavy human, financial, economic, and social costs on Africa. But the crisis also creates an opportunity to re-examine the continent’s fiscal and economic-policy priorities, build stronger health and social sectors, and establish a global fund to support productive investment.
By Célestin Monga
The coronavirus pandemic could not have come at a worse time for Africa. Despite improved macroeconomic management over the last decade, the continent still lacks the resources to tackle high levels of poverty and inequality, create formal-sector jobs, and foster the structural transformations needed to absorb 12 million young people into the labor market every year. And now COVID-19 threatens to break Africa’s back economically.
Africa’s low average annual growth of 3.3% in 2014-19 was mainly the result of erroneous development strategies that focused on unviable capital-intensive industries (often in commodity sectors), instead of promoting competitive labor-intensive sectors. Insufficient growth has in turn constrained public finances, leading to underfunded health systems, weak governance, rapid increases in public debt, and large infrastructure deficits.
Given Africa’s precarious health institutions, and its shortage of doctors, health workers, medicine, and medical supplies, COVID-19 infections are likely to soar, sparking a humanitarian crisis that most likely will go unreported. The virus could spread widely in poorer areas with no water or sewage hook-ups, and in communities where low education levels, prevailing social habits, and skepticism toward government complicate containment efforts. If a cure for COVID-19 is not made widely available soon, the pandemic could devastate Africa.
Moreover, the prolonged halt to economic activity in the G20 countries (some of which are facing deep recessions) will cause global growth to decelerate sharply. That will hit African exports, the main engine of the continent’s growth, and worsen countries’ trade and current-account balances. Worker remittances and foreign direct investment will decline, too, as the pandemic throttles advanced economies.
In addition, lower prices for oil, natural gas, metals, and minerals will significantly undermine the fiscal position of many large African economies, especially Nigeria, South Africa, Algeria, Cameroon, Angola, the Democratic Republic of the Congo, Equatorial Guinea, Chad, the Congo, and Tanzania. That will force governments to make painful macroeconomic adjustments at the most challenging time.
Worse, Africa’s ability to use monetary and fiscal policies to mitigate the pandemic’s economic impact is limited. Whereas governments and central banks around the world have adopted robust and often unprecedented short-run stimulus measures, most African countries lack the policy space and capacity to do so, or are constrained by monetary arrangements that prevent them from implementing national strategies.
True, a few countries such as Morocco, Ghana, Mauritius, and Kenya have initiated national stimulus programs while also launching structural reforms to improve their medium-term fiscal outlook. But such policies would be more effective if they were designed and implemented at the continental level.
In the short term, Africa needs greater fiscal space to boost health expenditures, contain the spread of COVID-19, help the hardest-hit sectors, and stimulate domestic consumption, while the continent’s central banks should cut interest rates and channel liquidity to firms and households. But all spending measures should be implemented transparently, monitored by independent fiscal councils, and complemented by credible reform agendas that strengthen medium-term expenditure frameworks. To achieve these goals, African Union heads of state and government should hold an emergency virtual meeting to mobilize about 10% of the continent’s gross domestic product ($250 billion), including from central banks and development banks, and coordinate spending across borders.
Continent-wide measures should also be adopted to improve coordination of national tax policies, increase collection, and boost economic growth so that all countries can strengthen their national health systems. In particular, speeding up implementation of the African Continental Free Trade Area would provide additional fiscal space. A recent study has shown that a few easily implementable trade-policy actions – such as eliminating current bilateral tariffs and all non-tariff barriers on goods and services within the continent, and reducing the time it takes to cross borders – would generate $134 billion per year, or 4.5% of Africa’s GDP.
Second, Africa needs a special international financing facility aimed at enhancing its future productivity growth. Such an initiative would support emergency spending on health systems in budget-constrained countries while also boosting domestic demand. In addition, it would help to finance the construction of profitable infrastructure in competitive sectors, thus laying the foundations for future industrialization and growth.
This facility could initially be funded with an endowment of $1 trillion from institutional investors, regional development banks, the private sector, and G20 governments. It would allocate global savings to high-return projects that have a significant impact on economic development and employment. Such a facility would eventually generate self-sustaining public financing for Africa’s health and social sectors, reduce the widening gap between rich and poor, and make the continent an important contributor to global demand.
Third, existing monetary arrangements and financial-sector regulations that hamper external competitiveness – especially that of the 14 CFA franc zone countries whose currency is pegged to a strong euro – should be reformed to enable exchange-rate flexibility. Likewise, initiatives such as the US African Growth and Opportunity Act and the European Union’s Everything but Arms, under which imports from Africa are duty- and quota-free, should be open to all African countries without political conditionality.
Finally, a comprehensive new debt-relief scheme should be considered for African countries with good governance. The continent currently has a total external and domestic debt stock of $500 billion, and the median debt-to-GDP ratio has risen from 38% in 2008 to 54% in 2018. By causing a collapse in exports and terms of trade, the COVID-19 pandemic is pushing African countries into negative per capita growth. Given the continent’s financing needs and demographic growth, debt levels will quickly become unsustainable without debt forgiveness and policies to make Africa’s debt more transparent and better managed.
The COVID-19 pandemic is likely to impose heavy human, financial, economic, and social costs on Africa. But the crisis also creates an opportunity to re-examine the continent’s fiscal and economic-policy priorities, build stronger health and social sectors, and establish a global fund to support productive investment.
Célestin Monga, former Vice President and Chief Economist of the African Development Bank Group and former Managing Director at the United Nations Industrial Development Organization, is Senior Economic Adviser at the World Bank.
More than 200,000 Ethiopians crosses the countr’s border in search of better opportunities annually
Bodies of 64 men were found dead in shipping container on the back of truck at checking point in Tete, Mozambique on March 24, 2020.
Head of the Tete Provincial branch of the National Migration Service of Mozambique (SENAMI) told to the International Organization for Migration (IOM) that the men who were carrying no documents, have told SENAMI they are Ethiopians traveling to South Africa.
The survivors are deeply traumatized and the driver of the vehicle is in custody according to the official of SENAI.
IOM is coordinating with SENAMI to provide immediate assistance to the survivors, who are being treated for severe dehydration and exhaustion, including food and clothing.
The bodies has been buried there at Mozambique where the dead body found in Tete which is roughly 4,000 kms south of the Addis Ababa and 1,400 kms north of Pretoria, in South Africa. Mozambique is located along a migration corridor, the so-called Southern Route, frequently used by migrants from East and the Horn of Africa to travel to South Africa in search of protection, economic and education opportunities. IOM Mozambique has helped more than 400 Ethiopians voluntarily return home since 2018.
Tens of thousands of Africans seek passage every year to the Middle East, crossing hundreds of desert miles towards the continent’s eastern coastline on trails as old as mankind itself more migrants travel by bus as compared to any other mode of transportation.
According to the International Organization of Migration every year more than 200,000 young Ethiopians crosses the country’s border in search of better opportunities and exposed to wide range of risks. The government is making significant steps to enhance the protection of vulnerary migrants including by enhancing essential proclamations and revising old proclamations.
Although the exact number of Ethiopians who have migrated overseas is not known due to the absence of a centralized registration system, there is evidence that large numbers migrate to the gulf cooperation council states, Europe and South Africa seeking employment through irregular migration channels.
On March 18, 2020 the IMO has released a flow monitoring survey report on movement of Ethiopian migrants for the first time. As the report stated the intended final destinations of migrants are further investigated for 3 specific reasons, namely travelling for job opportunities, ease of access to asylum procedures and ease of access to humanitarian assistance.
Key findings show that most of the migrants surveyed, who was 69 percent male and 21 percent female, were unemployed. The primary country of departure amongst respondents was Ethiopia, followed by Sudan and Djibouti and the primary intended final destinations included the Kingdom of Saudi Arabia, Sudan and Ethiopia.
According to the United Nations Department of Economic and Social Affairs (UNDESA), in 2019 South Africa was home to about 4.2 million migrants, and 290,000 asylum seekers and refugees. Zimbabwe, Somalia, Malawi, the Democratic Republic of the Congo and Ethiopia were the main source countries.
Ethiopia announced that it found traditional medicine for covid 19
Ethiopia announced that it found traditional medicine for covid 19
Ministry of Innovation and Technology, Ministry of Health and traditional medicinal practitioners announced that they have approved a traditional medicine that was tested on humans and animals since the covid 19 outbreak was in December 2019.
Abraham Belay, Minister of Innovation and Technology, told Capital via text message that the country traditional medicine experts developed the medication for the virus that has not yet have official medication all over the world.