Ethiopia ready to join COMESA free market area

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The government of Ethiopia has finalized preparations to join the Eastern and Southern African Common Market (COMESA) free market area, the Ministry of Trade said.

Trade Relations and Negotiation Director-General at the Ministry Geremew Ayalew told ENA that the country has been searching for markets for the increasing market demand of its industries.

The competence of Ethiopian industries has been growing and the industries are in their stage of producing items meeting international standards, he said.

The rapid and consecutive development of the country and involvement of foreign-based companies which led to technology and knowledge transfer enabled industries build their capability.

The country has been engaged in various dialogues with various countries and entities to meet this increasing demand for market, he added.

The government has been making arrangements using bilateral agreements, sub-regional free markets like COMESA, and international markets through negotiations with WTO.

The nation has so far signed bilateral trade agreements with 16 African, Asian, European and North American countries. These agreements are aimed at expanding markets, he said.

He mentioned the agreement signed with Sudan to create free market area between the two countries as an example.

Promoting expansion of trade and economic development, fostering advancement of economic activity, increasing productivity and financial stability; and providing fair conditions of competition for trade between the two countries are the main objectives of agreement.

The nation has also searching markets using sub-regional free markets like COMESA. And the country has finalized preparations to join the free market, including the ratification of the free market area arrangement by the parliament, he said.

Under this arrangement, the countries agree to eliminate tariffs, quotas and preferences on most (if not all) goods that they trade among themselves.

The consultations to accede to the WTO are also another thing the country is engaged in. Consultations have been undertaking since 2003.

http://213.55.98.22/enae/index.php?option=com_k2&view=item&id=2182:ethiopia-ready-to-join-comesa-free-market-area&Itemid=260

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Premier Calls For Extension of African Growth and Opportunity Act

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Prime Minister Hailemariam on Thursday, August 28, 2014 called on American Senators he met here in Addis Ababa to support the extension of African Growth and Opportunity Act (AGOA).

The PM held talks on agricultural development in Ethiopia, food processing, empowerment of women and health with US Agriculture Deputy Minister Krysta Harden and other five female senators. The parties also discussed tourism, aviation, roles and benefits of women.
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During the discussion the premier asked the support of the senators in extending AGOA, which hugely contributes to the agriculture and foreign trade of Africa.
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The delegation leader, Senator Debbie Stabenow, appreciated the agricultural extension model introduced in the country and the effort being exerted to familiarize new technology.

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The senator said she had visited successful female agricultural experts prior to meeting the premier.

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She further said the delegation was pleased with the visit they made, adding that boosting the contribution of women to growth and peace through creating female leaders is essential.

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The senator indicated that they are willing to assist the continuous growth of the country and in the provision of education for women in cooperation with Ethiopia.

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With respect to the extension of AGOA, Senator Stabenow said support is voiced at both Congress and Senate, although decision would be reached later.

http://213.55.98.22/enae/index.php?option=com_k2&view=item&id=2186:premier-calls-for-extension-of-african-growth-and-opportunity-act&Itemid=260

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US-African summit bears fruit for Ethiopia

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Foreign direct investment (FDI) from the US to Ethiopia has been increasing after the latest US-Africa forum earlier this month. In his latest press briefing, Redwan Hussein, minister of the Government Communication Affairs Office, stated that the interest of US based companies is growing.

Even though most of the investment interest in Ethiopia is still dominated by growing economies like China, India and Turkey, Western Europe and the US have been taking notice of Ethiopia in recent years.

Redwan said that the latest Ethio-US Business and Investment Summit in Houston and Los Angeles attracted US based multinational companies who are interested in investing in Ethiopia. Several companies involved in mining, agriculture, tourism and energy among others may now want to get involved in what has become one of the world’s fastest growing economies.

“Chevron, one of the top three companies in the world, has showed an interest to begin oil exploration in the country,” Redwan added.

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“Previously the US companies were not that much interested in investing in Ethiopia, a country with a small economy, but now they are assessing the investment directions in the country,” he explained.

Other companies that are already engaged in investment are also interested in expanding their business. “There are also many companies that would like to construct five star hotels,” the minister added.

He said that the US-Africa Business Forum has also been a good opportunity for the country to promote itself. During the recent event held in Ethiopia between the US government and African countries, several US based energy firms stated that they are interested in engaging in the power sector and some of them have already contacted the relevant government offices to engage in the sector.

“We will strongly follow up and support the investors, who will be part of our development and interested to come into Ethiopia,” Redwan said.
He mentioned that the US-Africa event has been also very successful for the country, while it has presented its experience about development.

Top government officials including Mulatu Teshome (PhD), president of Ethiopia, and Prime Minister Hailemariam Desalegn attended the investment summit and US-Africa events.

http://www.capitalethiopia.com/index.php?option=com_content&view=article&id=4477:us-african-summit-bears-fruit-for-ethiopia&catid=35:capital&Itemid=27

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Japan to provide loan for geothermal power, other projects: Ambassador

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Japan has plans to provide loan for Aluto-Langano Geothermal Power Plant and other power generation projects.

According to Ambassador Markos Tekle, Ethiopia’s Ambassador to Japan, the Japanese government used to largely extend aid to Ethiopia in the forms of assistance and technical support.

This has now changed as the country has been registering rapid economic growth and its ability to refurbish loans is strengthened, he said, adding that as a result Japan has plans to extend loan to Ethiopia so that it could complete different projects.

Among the projects that would benefit from the loan are the Aluto-Langano Geothermal Power Plant and other hydro-power projects, the ambassador added.

Ambassador Markos further stated that the Japanese government is also willing to give additional loan to other projects based on the request of the Ethiopian government.

Trade and investment tie between the two countries has been growing as the relationship between the two countries has been strengthening, he noted.

Following the visit of the Japanese Prime Minister Shinzo Abe to Ethiopia, the interest of Japanese investors to engage in the Ethiopia market has grown, according to the ambassador.

Because of the increasing desire of Japanese investors to do business in Ethiopia, the Ethiopian Embassy in Tokyo has been organizing exhibitions and seminars to attract big Japanese companies, Markos stated.

Japanese, through Kaizen institute, are also providing support for the improvement of product and productivity in Ethiopia and to make the country’s industrial policy better, the ambassador added.

At present, 24 Ethiopian students have completed their education in Japanese universities and are doing internship in various companies, it was indicated.

Bilateral Cooperation Director with the Ministry of Finance and Economic Development (MoFED) Kokeb Misrak for his part said Japanese developmental assistance for

Ethiopia through Japan International Cooperation Agency (JICA) has been growing from time to time.

Infrastructural development, agriculture and rural development works as well as education are among the sectors that have been supported by JICA, he explained.

http://www.waltainfo.com/index.php/explore/14748-japan-to-provide-loan-for-geothermal-power-other-projects-ambassador

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Accountability, focus of Post MDG discussions

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Accountability was underlined as being extremely crucial at a meeting on the Post MDG Agenda at the UNECA on Thursday August 21st.

The round table meeting had present African stakeholders, which included academicians, government representatives’, the private sector and women and youth groups.

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According to the stake holders that participated in the in the discussions, Africa’s role in the formulation of the Millennium Development Goals (MDG’s) has been very limited which has resulted in weak ownership and slow progress by many African countries.

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The round table discussion is part of a substantial proactive effort to ensure African ownership of the forthcoming global development agenda that will replace the current Millennium Development Goals (MDGs). The event led by the African Union High Level Committee (HLC) on the Post-2015 Development Agenda comes as a result of a request, made by the AU Heads of State Summit held in Malabo from 26-27 June 2014, to explore the “emerging issues of accountability”.

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This includes the need for a data revolution – a central issue to monitor, evaluate and assess progress, which are, in turn, key aspects of accountability”, according to the Decision of African Union at the Malabo Summit.

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According to Anthony Maruping, Commissioner of Economic Affairs at the ECA, statistics will be very important because timely statistics are crucial to be able to see the extents of achievements.

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“Africa has indeed been a visible presence in the Post-2015 development agenda and as early as 2011 the continent initiated consultations to articulate its priorities for the successor global development framework” Dr Abdalla Hamdok, ECA’s Deputy Executive Secretary, stated speaking on the Common African Position (CAP), which reflects Africa specific needs and goals that need to be included in the Sustainable Development Goals (SDG).

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“The consultations are intended to build on existing accountability frameworks, so to design and formulate an accountability framework suitable for the post 2015 development agenda”, reiterated Hamdok. Such a framework is expected to provide alignment from the global to continental to national levels,” he further said.

http://www.capitalethiopia.com/index.php?option=com_content&view=article&id=4471:accountability-focus-of-post-mdg-discussions-&catid=35:capital&Itemid=27

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Political, Economic Stability Luring Multinationals Into Ethiopia

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VENTURES AFRICA – President Mulatu Teshome of Ethiopia has expressed satisfaction at the country’s economic success, noting that a stable political environment and enabling investment atmosphere is attracting a pool of international firms into the country’s business landscape.

According to the President, the number of foreign companies coming to set up shop in Ethiopia has increased recently unlike some twenty years ago when Ethiopia was a chief recipient of aid.

“Conducive condition for investment, abundant resources, political stability and economic development are the main reasons that attract more investors to Ethiopia. Cheap labour, power and raw material supply make Ethiopia preferable for investment compared to other African countries,” the President said.

He further noted that foreign companies can easily enter into the EU and US markets once they set up in Ethiopia because of its beneficial relationship with these regions which allows it to enjoy various duty and quota free agreements.

Also, the President has disclosed the move of his government in giving priority to the manufacturing and agriculture sectors such as leather, textiles and agro‐processing. Investors in those areas are therefore welcomed.

Information from the World Bank is consistent with the President’s claims; for instance Ethiopia’s economy has grown at an average of 10.9 percent per year over the past decade while poverty has reduced by 9.1 percent over the past half-decade. Also, Ethiopia is on track for achieving most of the eight Millennium Development Goals (MDGs) and has already achieved the goal for Child Mortality.

http://www.ventures-africa.com/2014/08/political-economic-stability-luring-multinationals-into-ethiopia/

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East African Bottling SC to invest $ 250 mln on new projects

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East African Bottling Share Company stated that it will be investing more than USD 250 million in the next five years in Ethiopia to increase the company’s capacity. “We are just finishing our strategic plan for the next five years and it has been approved, so we will spend more than 250 million dollars in Ethiopia during the next five years, which will allow us to increase our capacity and satisfy our customers across the country,” stated Xavier Selga, General Manager of East African Bottling Share Company bottler of Coca Cola.

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According to the General Manager, the company is in the process of launching a new production line in September 2014 and by 2015 and will be investing in a new production plant as well. He also stated that the company will be investing in trucks and coolers so as to be able to transport and supply its products in different areas of the country.

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The company is also working with Coba Impact, an Indian recycling company, to carry out recycling of plastic bottles.

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“We are working to empower 2,000 women in the recycling industry. We want to make sure that the environment in Ethiopia is more sustainable and we can also help these women economically. Right now we are training the women and explaining the routine and giving them the tools,” Selga stated.

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Recently, soft drink manufacturers have been facing some problems regarding the shortage of one of the most important inputs to their products; sugar. According to Misikir Mulugeta, Brand Manager, Coca-Cola Ethiopia, the shortage of sugar has not affected Coca Cola so far and the company’s products are still well supplied to the market.

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In related development, on Friday August 22, the Coca-Cola Africa Foundation (TCCAF) and World Vision announced a new Replenish Africa Initiative (RAIN) project to extend clean, sustainable water and sanitation to communities in the Tigray region of northern Ethiopia.

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The Tigray project, with a commitment budget of USD 1 million, is the third RAIN project in Ethiopia and expands a partnership which has been on-going since 2007.

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“We plan to implement a range of activities including boreholes, drinking water infrastructure, building of ventilated pit latrines and formation of school clubs to promote behavior change in sanitation as well as raise awareness about the health benefits of safe water handling and hygienic practices,” said Margaret Schuler, National Director of World Vision Ethiopia.

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Replenish Africa Initiative (RAIN) is a commitment of The Coca-Cola Company to provide access to safe drinking water for two million Africans by 2015.

http://www.capitalethiopia.com/index.php?option=com_content&view=article&id=4475:east-african-bottling-sc-to-invest–250-mln-on-new-projects&catid=35:capital&Itemid=27

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Corporate Income Tax Targeted in Bid to Boost Manufacturing Sector

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The manufacturing sector only achieved 30pc of the government’s plan during the last fiscal year

Sufian Ahmed

A government committee is finalising a draft amendment to reduce the 30pc corporate income tax levied on manufacturing industries.

The committee, drawn from the Ministry of Finance & Economic Development (MoFED) and the Ethiopian Revenue & Customs Authority (ERCA), has been at work for the past two months, according to an official close to the issue.

The corporate income tax is a flat rate of 30pc tax, which is levied on the service and manufacturing industries. The amendment, however, concerns only those in the manufacturing sector.

The draft will pass through the Council of Ministers and Parliament in less than two months’ time, says a source close to the case.

The 30pc rate was the subject of discussion during a two-day training programme for the private sector, given by Ahmed Abtew, Minister of Industry, at Millennium Hall, on June 30 and July 1, as well as the second Public Private Consultation Forum, chaired by Prime Minister Hailemariam Desalegn, on July 2, 2014 – also at Millennium Hall.

After the suggestions from the various businesspeople, officials from the ERCA, MoFED, Federal Investment Commission (FIC) and Ministry of Industry (MoI) held a meeting. At this time, they agreed that the rate must be reduced, according to an official who was part of the meeting.

The suggested rate will be somewhere between 20pc to 25pc. This could improve the private sectors’ engagement in the manufacturing sector, the official said. The sector only achieved 30pc of the government’s plan during the last fiscal year, 2013/14, according to data from the MoI.

“Tax rate reduction and investment incentives should not be confused; each has its own principle,” says an anonymous tax law expert. “Reduction in tax rate should be inclusive of all sectors, so that the tax system could be simple to understand and implement.”

In addition to the proposed tax incentive for the manufacturing sector, an overall tax review is in process by the MoFED and ERCA, including Income Tax, Excise Tax, Turn Over Tax (TOT) and Value Added Tax (VAT). This, too, could be approved by Parliament during the first quarter of the current fiscal year, according to an official from the ERCA.

The ERCA – created in 2008 as a result of the merger of the Ministry of Revenues, the Ethiopian Customs Authority and the Federal Inland Revenues – experienced a major tax revision of customs during the last quarter of the last fiscal year. The revision includes incentives on the import of semi processed products by the local manufacturing sector, in a bid to encourage manufacturers.

http://addisfortune.net/articles/corporate-income-tax-targeted-in-bid-to-boost-manufacturing-sector/

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Filed under: Ag Related, Economy, Infrastructure Developments, News Round-up Tagged: Addis Ababa, Africa, Agriculture, Business, East Africa, Economic growth, Ethiopia, Investment, Millennium Development Goals, Sub-Saharan Africa, tag1, United States

 Agriculture improvement summit in Ethiopia starts on Monday

It is the effort of African governments to energise the continent’s important but neglected agriculture sector, different players in the sector are meeting in Ethiopia to deliberate  how food production can be enhanced to feed the growing population in Africa.

The African Green Revolution Forum (AGRF) is behind the five-day meeting that kicks of on Monday in Addis Ababa.

Nearly 1,000 participants are expected to attend the meeting, including African Heads of State, ministers, farmers, and business leaders, representatives of youth and women’s organisations, and scientists.

The AGRF is the most significant Africa-wide gathering of agriculture experts, investors and farmers since the African Union issued its Malabo Declaration in June pushing for accelerated agricultural growth.

In the Declaration, African Heads of State called for the doubling of food productivity in Africa, halving of poverty and significant progress toward the elimination of child under-nutrition by 2025.

“These goals represent a renewed political commitment, at the highest level, for agriculture-led growth across our region,” said African Union Chairperson Nkosazana Dlamini Zuma, ahead of the AGRF. “We need to go further, faster. AGRF gives us the opportunity to hit the ground running and set in motion the plans and measurable steps needed for an inclusive, sustainable transformation of African agriculture by all actors.”

The theme of this year’s AGRF is “Beyond the Tipping Point: A New Vision and Strategies for Inclusive and Sustainable Transformation.”

The meeting is supported by AGRA, the African Union, and the International Fund for Agricultural Development (IFAD) and the Southern African Confederation of Agricultural Unions (SACAU)

The meeting will also address issues like  increasing food productivity, promoting agricultural investment that generates benefits at all economic levels, increasing financing for agricultural development and support for modernising commodity markets and removing barriers to intra-regional trade.

AGRA is expected to release  its second annual Africa Agricultural Status Report at the AGRF. The report focuses on the issue of African agriculture and climate change, and how to accelerate the adoption of climate smart agriculture by Africa’s smallholder farmers.

The African Green Revolution Forum (AGRF) is an initiative which seeks to bring together African Heads of State, ministers, farmers, private agribusiness firms, financial institutions, NGOs, civil society, scientists, and other stakeholders to discuss and develop concrete investment plans for achieving the green revolution in Africa.

http://www.monitor.co.ug/Magazines/Farming/Agriculture-improvement-summit-in-Ethiopia-starts-on-Monday/-/689860/2436352/-/389vv0z/-/index.html

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Indian company to build textile industry in Mekele

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An Indian Company, Velocity Apparel, has received 100 hectares of land in Mekele to build a modern textile industry with a starting capital of USD 150 million.

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Montero to buy majority stake in Moyale graphite project in Ethiopia

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Montero Mining and Exploration has signed a binding agreement to acquire around 80% stake in Ethiopia-based Hulager General Import and Export’s Moyale graphite project in Ethiopia.

Under the deal, Montero will have six months to carry out a technical due diligence and the deal is subject to regulatory approval.

The company will initially gain control of 51% interest in the property by committing to complete a report in compliance with NI 43-101 within two years with $1.5m investment.

A further 29% interest will be acquired after conducting a feasibility study within three years to a maximum expenditure of $10m.

Montero president and CEO Tony Harwood said: “The Moyale Graphite Project has seen limited mapping, sampling and trenching in addition to limited geophysical surveys with no drilling conducted to date.

“Montero intends to define a high quality large flake graphite resource in compliance with NI 43-101 whereby a long life mine plan is outlined.

“We look forward to working with our partner in developing the Project.”

Located in southern Ethiopia, the project lies 5km to the west of the Moyale town in the Oromia region connected by an asphalt road to the capital, Addis Ababa.

http://carbon.energy-business-review.com/news/montero-to-buy-majority-stake-in-moyale-graphite-project-in-ethiopia-270814-4357206

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Ethiopian delegation to participate at Canada-Africa business summit

An Ethiopian delegation led by Tedros Adhanom (PhD), minister of Foreign Affairs, will partake at the first annual Canada-Africa Business Summit to be held next month in Toronto, Canada.

It’s overrated? Egyptian minister downplays consequences of Ethiopia dam

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Egyptian Irrigation Minister Hossam al-Moghazi downplayed Friday the negative effects on Egypt’s water supply of the ongoing construction of Ethiopia’s Renaissance Dam, saying the first phase of construction would not cause any tangible harm to Egypt.

“The results of additional studies will appear in March 2015, six months before construction of the first phase of the dam is complete,” Moghazi told Anadolu Agency.

He added that the first phase of the multibillion-dollar hydroelectric dam would feature a water storage capacity of 14 billion cubic meters, which would not cause any “tangible” harm to Egypt. “This [continued construction of the dam] does not worry us,” Moghazi said.

Relations between Cairo and Addis Ababa soured last year over Ethiopia’s construction of the $6.4-billion hydroelectric dam on the Blue Nile. The project raised alarm bells in Egypt, which relies on the river for almost all of its water needs and feared its historical supply of Nile water would be reduced.

Last year, an international panel of experts recommended that two studies be conducted: a hydrological simulation model and an environmental, social and economic impact assessment.

The two countries agreed to resume tripartite talks over the dam – along with fellow riparian state Sudan – after Ethiopian Prime Minister Hailemariam Desalegn and Egyptian President Abdel-Fattah al-Sisi met in Equatorial Guinea in June.

The tripartite meetings came after an eight-month hiatus due to ongoing differences between Cairo and Addis Ababa.

Ethiopia, for its part, says the dam is necessary for its national development plans. It insists the project won’t impact Egypt’s traditional share of Nile water, which has long been governed by a colonial-era water-sharing treaty – a treaty that Addis Ababa has never recognized.

Construction of the dam should be complete in June 2017, according to Ethiopian officials.

Moghazi said Egypt was only concerned about the dam’s projected storage capacity, which, he says, could erode Egypt’s historical share of Nile water. He stressed that Egypt had made a goodwill gesture by not asking Ethiopia to halt work on the project – a request Cairo made one year ago without effect.

The irrigation minister added that additional studies would determine whether the projected height of the dam – along with its storage capacity – would have any negative consequences for Egypt.

http://www.albawaba.com/business/egypt-ethiopia-water-dispute-600169

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Ethiopian Electric to rehabilitate hydro-power stations

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The Ethiopian Electric, the sole power utility company, is contemplating to rehabilitate two hydro-power dams. 

Ethiopia Sees Greener Energy With Advent Of New Meters

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VENTURES AFRICA – Smart electric meters, called IT‐plus, are expected to revolutionize the electricity user experience in Ethiopia; these meters are centrally controlled and can determine the amount of power each individual client gets.

The Ethiopian Electric Utility (EEU) has received supplies of these smart meters from the Metal & Engineering Corporation (MetEC). The meters, which can also selectively turn off the power supply to specific clients on an individual level, are manufactured collaboratively by Hi‐Tech Engineering, Ethio Plastic Industries, Metal Fabrication Industries and Hibret Manufacturing Industry.

Following a successful testing by the EEU, the first batch of meters are soon to be delivered. The deal leading to the local manufacture and supply of these meters was signed in 2003 between the EEU and Hi‐Tech Engineering. The launch was formally done at the Hilton Hotel last week.

These new meters are expected to facilitate power redistribution in times of power shortage and technical problems. According to Berihu Gidey, General Manager of Hi‐Tech Industries, the system has intelligence value as power blackouts could easily be achieved at a national level if the need arises.

Plans are already underway to establish a smart grid system at a national level once the company starts manufacturing its full capacity of 1,200 meters daily. The new meters will arrive programmed to adjust to a three‐phase electric power system; this is expected to reduce the processing time for industrial applicants.

Bitweded Gebrealise, CEO of the EEU Wire Business, said; “The main advantage of the electric meter is that it saves electric power, especially for industries. The next process will be the replacement of previously installed electric meters through different phases.”

http://www.ventures-africa.com/2014/08/ethiopia-sees-greener-energy-with-advent-of-new-meters/

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Africa Oil to pull out of oil exploration blocks in Ogaden

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Africa Oil, the Canadian oil company, which is prospecting for oil in different parts of Ethiopia, is to pull out of two exploration blocks in the Ogaden basin, eastern Ethiopia.

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East African coffee farmers turn to specialty

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By Nicholas Bariyo

A worker sorts coffee berries at a factory in East Africa

Farmers across East Africa are rushing to revive their coffee plantations as prices have soared due to a historic drought in Brazil, the world’s largest coffee producer.

But farmers are still concerned about the huge swings in coffee prices from year to year. A sudden surge in production could lead to a slump in prices, and that could be disastrous for their finances.

One way to try to mitigate some of the risks is by turning to specialty coffee beans, which can attract a premium of around 40% over ordinary beans, according to Emanuel Mukasa, who runs a one-acre farm located in Mpigi, around 30 kilometers west of the Ugandan capital of Kampala.

Mr. Mukasa says he’s investing heavily in specialty coffee beans, which now account for around 20%-25% of his harvest.

The beans require special attention during harvesting, drying and storage, to meet strict standards set by the buyers, he says. He collects manure from the four milking cows he keeps in his kraal, or “corral,” to use as fertilizer, instead of using chemicals.

“With the specialty coffee, the buyers are looking for specific qualities which sometimes are not easy to meet, but I keep trying,” Mr. Mukasa said.

While the specialty market has long been dominated by Central and South America, analysts say African producers could gain an upper hand if they can keep improving quality as well as yields, given the favorable conditions on the continent. High altitudes and steady rains in countries such as Kenya, Uganda, Rwanda and Ethiopia provide perfect growing conditions for specialty coffee beans, industry officials say.

“African producers can only compete for quality at the international market, not quantity,” said Edward Johns, the head of research at Ecobank. “Producers such as Uganda have the potential to earn more, if they can improve more the quality of beans, in addition to the yields.”

http://blogs.wsj.com/moneybeat/2014/08/29/coffee-farmers-in-east-africa-turn-to-specialty-beans/

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Nation launches livestock development master plan

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The Ethiopian Ministry of Agriculture disclosed that a 15 year livestock development master plan has been launched to maximize the benefit earned from the sector.

State Minister of Agriculture, Dr. Gebregziabher Gebreyohannes, said that the 15 year plan incorporates detailed directives including the amount and type of investment needed to boost the productivity of the livestock sector in Ethiopia.

Accordingly, the implementation of the master plan has commenced.

The plan envisions building the sector’s capacity to supply global markets, beyond local needs, he noted.

The State Minister called on all stakeholders to contribute their level best to the fulfillment of the master plan.

http://www.ertagov.com/news/component/k2/item/3019-nation-launches-livestock-development-master-plan.html

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Indian company’s failure with sugar plant causes in house manufacturing, repair

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The Indian company that won the restricted overhaul bid of Metehara Sugar Factory last year has failed leading the factory for in-house manufacturing of machinery and repair, according to employees and the new management. 

Freight’s wait at Djibouti Port reduced by new rules but private sector asks for more balanced competition

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Logistics and transportation have trended differently than other economic sectors in Ethiopia, despite the fact that the government has introduced several adaptations to enhance the sector. Logistics and transportation, which mainly engage in import and export services, are vital to the nation’s economic development. However, despite the attempts by the government to keep freight moving, it still lags behind other sectors in terms of results. Logistics and transportation of goods imported and exported into the country costs more than other countries. To alleviate this problem the government has attempted several strategies.

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Because Ethiopia is landlocked, logistics and transportation have to be very efficient, especially at the ports of entry, in order to minimize costs.

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Constructing dry ports is one of the things the government has done to alleviate some of the problems. It has also encouraged the private sector to import modern trucks and introduced the multimodal transportation scheme. A proclamation was also passed addressing the demurrage process. Additionally, private transporters are now required to adhere to  associations that now have complete responsibility for transporting freight to and from the country.

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The new system was introduce late last fiscal year and 47 associations engaged in cross border transportation and 14 that work in cross-country transportation have been established. Additionally12 companies are operating under the cross border scheme, according to Abelneh Agidew, public relations head of the Federal Transportation Authority.

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The idea behind the new regulation is to control the activity of trucks crossing the border. By modernizing transportation and logistics, the government hopes it can improve its results and make the system more cost effective.

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“We introduced this system with the goal of making the improvements we felt needed to be made based on the studies conducted,” Abelneh Added.

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The public relations head and other officials close to the issue say that previously brokers and other traders who worked in the informal economy ‘gamed the system’ while truck owners had little control over how they conducted business.

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He said, since the new way of doing business was fully introduced in May this year they have seen significant improvements. There are also several other changes that have come about in the attempt to improve cargo transportation. The first one is that truck owners that are members of associations must now pay a commission to the associations for cargo they carry from the port.

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The transport market had been controlled by illegal market actors and brokers but now it is being completely led by the associations formed under the new scheme, explains Abelneh.

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“If anyone sees the past year’s performance, the amount of demurrage charges on cargo is almost zero. This is the result of the new system which has accelerated cargo transportation from the port,” the public relation head explained.

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He said that previously trucks took nine days on average to travel back and forth from the Djibouti port, but that has declined to about four days since the new scheme was fully applied.

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He argued that the current associations are not only engaged in collecting commissions from the business, but they also bring businesses for their members.” Furthermore truck owners now are able to obtain more information about their trucks whereabouts and the business that they are undertaking, which was previously not the case,” he added.

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“Currently around 250 cargo trucks provide transportation between Ethiopia and Djibouti; previously trucks would wait at the port for as much as three weeks which was very expensive,” the authority official said.

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He said that stakeholders like the Ministry of Transport, Ministry of Trade and others evaluated the changes by visiting Djibouti.

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Before the transport associations were restructured, they were considered weak and they would not take the responsibility of finding a market to support the truck owners.

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Under the new arrangement the associations are expected to be staffed with qualified employees based on the standards set by the authority.
Even though the authority stated that the new system has registered significant changes, the private sector involved in the transportation business claims there is a problem with the new ways.

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Although the number of days for transporting goods round trip between Djibouti and Ethiopia has been reduced to around four days, often the trucks are ‘deadheading’-returning back to the port without freight which reduces the profit they can make.

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“There are several costs, including fuel and tyres (tires) that still exists when you return back to the port with an empty truck,” some owners of transportation companies said. “We are driving 925km to the port of Djibouti from central Ethiopia without cargo or empty containers, which is very damaging to the nation’s economy,” the same transporters said.

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“Previously we would at least return with empty containers, even though we would have to wait for days in the country. Under the current rules we have to return to Djibouti without waiting for containers to transport back,” they complained.

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Some transporters however agree that the new system has brought about some improvements.

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They also want more clarification about the process of establishing associations. According to the new system trucks are classified in different levels. Every level has unique grades based on their loading capacity and manufacturing date or type of service provided.

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For instance the associations included on level one are divided into two different grades; the manufacturing date of a truck included on level 1 (A) is from 0-10 years and has a capacity to load from 30-40 tons of cargo and level 1 (B) has a similar manufacturing date but the loading capacity is from 20-29.9 tons of cargo. An association organized under level 1 should have 125 trucks for both A and B grades. The associations included on level 1 must have four offices including the head office at the center and a branch at the port of Djibouti.
Level 2 is for trucks from the age of 10.1-20 years and is classified in two grades with a loading capacity similar to level one, but the association that is included under this category must have at least 100 trucks, and at least three offices including the head office and a branch at the port.

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Level 3 associations are made up of trucks that have a manufacturing date of over 20 years and they have two offices and 75 trucks in each association, and level 4 is classified for only companies that have over 50 trucks. The other level included in this system is level 5 or a specialized category, which is used for transporting machines, construction materials, or very large cargo.

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With the current status a businessperson involved in the transport sector can own trucks of different ages, because it would be difficult for the business actors to be involved in different associations based on different levels. To eliminate this challenge the authority has allowed the truck owners to be in just one association, based on the majority number of the trucks that they own. For example business people who have ten trucks, a majority of which are between the ages of 10.1-20 years and few new brands will be included in the association organized on level 2, while the businessperson who has a majority of brand new trucks and few older trucks would be a member of level 1.

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“It is not clear what happens under the rules when trucks that are currently considered new become older. The government has to clarify the process,” the transporters said. “Even the way of organizing the associations has a problem, because one association might not have trucks with different loading capacities,” the transporter said.

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The Transport Authority argued that it implemented the system after several discussions with stake holders and transporters.
Transporters also claimed that the multimodal system still has room for improvement. They said that Ethiopian Shipping and Logistics Services Enterprise (ESLSE) has to work efficiently. “Even though transporting cargo from the port of Djibouti to Ethiopia has been reduced to about four days now, the container demurrage issue still remains. This is because containers still remain in Ethiopia for a long time and that mean demurrage fees which are paid in hard currency,” the transporters noted.

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They also stated that even thought they expect to sign an agreement with the enterprise to pick up cargo quickly based on the demurrage law; it is difficult to get approval or a signature from the enterprise. “For this reason it is hard to get a demurrage charge from the enterprise,” they complained.

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But the transportation actors agree that the new system has reduced port costs and storage fees.

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The latest World Bank report on Ethiopian international trade stated that high fixed costs are driven by a mix of factors ranging from infrastructure and trade logistics (where individual companies may need their own fleet to transport their inputs and outputs) to low regulator quality to constraints on the credit market (where new market entrants of smaller sizes have little chance of receiving finance from private banks).

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It stated that smaller firms suffer most in a high fixed cost environment, and the few firms that are able to overcome high costs of entry are then those that are large enough to stay in business for a longer period. “It is no surprise that this produces an environment where incumbent firms have relatively high survival probabilities beyond the second year,” the report stated.

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In fact, high rates of protection on outputs combined with high transport costs change the profit incentives for producers by influencing which sector to invest in and which markets to serve.

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The report recognized that Ethiopia is currently undertaking some crucial investments to improve trade logistics in the medium-term.
With several new public investments in roads, a rehabilitated rail link between Addis Ababa and the rapidly modernizing container port of Djibouti, the expansion of the dry port in Mojo, expanded coverage of the multi-modal transport system and coordinated reforms between customs and shipping-related agencies, trading is expected to be improved according to the report.

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Currently the sole Multi modal operator, Ethiopian Shipping and Logistics Services Enterprise, a public enterprise, also plays a role transporting cargo to and from sea ports. The enterprise currently operates 60 freight trucks and has ordered an additional 115 new trucks with 60 tons of hauling capacity. These Renault trucks should help the logistics service. Based on the latest government decision the enterprise will also get another public freight transporter. Comet Transport which has about 205 trucks, and has also ordered 100 Renault trucks with the logistic enterprise and will merge with the state giant shipping enterprise, which is considered to be one of the biggest shipping firms in the continent.

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The new trucks purchase by the enterprise and Comet was signed with a Dubai based supplier Van Vliet XL. Some transporters consider this to be unfair competition. “The government needs to consider ways for private truck companies to be more involved,” they claimed.

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“We will be forced out of business when the state enterprises boost their capacity,” the transporters, some of which are also engaged in freight forwarding and transit services, said.

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A government official who requested anonymity stated that the government is responsible for expanding the public enterprises with the goal of improving logistics service to meet the growing demand and improve the nation’s development.

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“The private sector does not have that much capacity to invest as the government does,” the official said.

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“It is a monopolistic market that is fully owned by ESLSE and that is highly damaging the private sector. They can buy the trucks, but it is difficult for the private sector to get finance to purchase trucks like state enterprises,” the private actors complained. “We are expected to privatize state enterprises, but the government is actually excluding the private actors,” they added.

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Market competition is crucial not only for efficiently transporting cargo from the port but returning back empty containers to the port, the transporters suggested. According to experts, containers have stayed at the Ethiopian dry port for less time, 71 days, whereas previously it would take several months. Still private companies say they could do even better if they were allowed to fairly compete.

http://www.capitalethiopia.com/index.php?option=com_content&view=article&id=4495:freights-wait-at-djibouti-port-reduced-by-new-rules-but-private-sector-asks-for-more-balanced-competition-&catid=49:feature&Itemid=48

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By Sebastian Anthony

As you probably know, from sucking down cans of Coke and masticating on candy, sugar — glucose, fructose, sucrose, dextrose — is an excellent source of energy. Biologically speaking, sugar molecules are energy-dense, easy to transport, and cheap to digest. There is a reason why almost every living cell on Earth generates its energy (ATP) from glucose. Now, researchers at Virginia Tech have successfully created a sugar-powered fuel cell that has an energy storage density of 596 amp-hours per kilo — or “one order of magnitude” higher than lithium-ion batteries. This fuel cell is refillable with a solution of maltodextrin, and its only by products are electricity and water. The chief researcher, Y.H. Percival Zhang, says the tech could be commercialized in as soon as three years.

Now, it’s not exactly news that sugar is an excellent energy source. As a culture we’ve probably known about it since before we were Homo sapiens. The problem is, unless you’re a living organism or some kind of incendiary device, extracting that energy is difficult. In nature, an enzymatic pathway is used — a production line of tailor-made enzymes that meddle with the glucose molecules until they become ATP. Because it’s easy enough to produce enzymes in large quantities, researchers have tried to create fuel cells that use artificial “metabolism” to break down glucose into electricity (biobatteries), but it has historically proven very hard to find the right pathway for maximum efficiency and to keep the enzymes in the right place over a long period of time.

Now, however, Zhang and friends at Virginia Tech appear to have built a high-density fuel cell that uses an enzymatic pathway to create a lot of electricity from glucose. There doesn’t seem to be much information on how stable this biobattery is over multiple refills, but if Zhang thinks it could be commercialized in three years, that’s a very good sign. Curiously, the research paper says that the enzymes are non-immobilized — meaning Zhang found a certain battery chemistry that doesn’t require the enzymes to be kept in place… or, alternatively, that it will only work for a very short time.

The Virginia Tech biobattery uses 13 enzymes, plus air (it’s an air-breathing biobattery), to produce nearly 24 electrons from a single glucose unit. This equates to a power output of 0.8 mW/cm, current density of 6 mA/cm, and energy storage density of 596 Ah/kg. This last figure is impressive, at roughly 10 times the energy density of the lithium-ion batteries in your mobile devices. [Research paper: doi:10.1038/ncomms4026 - "A high-energy-density sugar biobattery based on a synthetic enzymatic pathway"]

If Zhang’s biobatteries pan out, you might soon be recharging your smartphone by pouring in a solution of 15% maltodextrin. That battery would not only be very safe (it produces water and electricity), but very cheap to run and very green. This seems to fit in perfectly with Zhang’s homepage, which talks about how his main goals in life are replacing crude oil with sugar, and feeding the world.

The other area in which biobatteries might be useful is powering implanted devices, such as pacemakers — or, in the future, subcutaneous sensors and computers. Such a biobattery could feed on the glucose in your bloodstream, providing an endless supply of safe electricity for the myriad implants that futuristic technocrats will surely have.

Sourced here  http://www.extremetech.com/extreme/175137-sugar-powered-biobattery-has-10-times-the-energy-storage-of-lithium-your-smartphone-might-soon-run-on-enzymes

More here  https://uk.news.yahoo.com/battery-powered-sugar-run-ten-times-longer-lithium-122814252.html#3omJzkP

“Only when the last tree has died and the last river has been poisoned and the last fish been caught will we realise that we cannot eat paper” Wolf Robe

VENTURES AFRICA – When I was a kid, my grandfather always told me, “Always know your reality”. So my question around this train of thought is, ‘by then should you grasp what this reality is’? This would be critical, because if you know your reality and as soon as you do, a person of action will act accordingly.

Africa has experienced independence from colonialism for more than 60 years now. Only South Africa, Zimbabwe and Namibia enjoy infancy democracy. Their efforts towards economic prosperity can also be regarded as being in their infancy stages. Either that or we just don’t know what we are doing. Africa has the resources, especially land with some of the lowest agricultural production intensities considering we have 60 percent (uncultivated) of the world’s arable land.

Let me take the argument further. Post the Korean War, South Korea was literally one of the world’s poorest countries – with only $64 per capita income. By the 1960s it lagged behind the Democratic Republic of the Congo (DRC). Like Africa, South Korea also received aid from the US. But the difference? In less than 30 years, South Korea is a model for economic development globally, at an unprecedented level. For this period, South Korea received the same aid – $60 billion and for the same period $68 billion for Africa – as Africa and still receives the similar inflow.

Maybe I like arguing? Let us look deeper! South Korea has a population of what stands at approximately 50 million people. South Africa, who for the last 20 years has also enjoyed the same levels of aid, also has the same population size, give or take. South Africa though has minerals and natural resource that South Korea lacks, yet South Africa after a similar period, with similar aid funding patterns at every level cannot compete with South Korea on a performance barometer.

Africa as a continent should thus outperform South Korea, not only as the benchmark but also as a continent that has more at its disposal to become a continent with the largest middle-class, for one.

Now that we have the foundation out of the way, why is it that Africa after so many years of independence and 60 percent of the world’s arable land, holds 75 percent employment in agriculture (mostly female) and yet none of these woman own the land even though they physically produce through labour, more that 80 percent of agricultural products in Africa (WEF 2013, Cape Town).

Sometimes the delicate issues need to be dealt with. Is this the result of incompetence, political positioning (because poverty and hunger are political tools or suppressive mechanisms), is it lack of education at and within the echelons of the political corridors, can it be that African leaders are more in love the idea of prosperity for their people and what has really changed across the face of Africa, that African leaders themselves have brought to the table to make Africa an economic force? For now we won’t answer.

Some things Africa is considerably rich in, is; History, Wars, Political rhetoric (Meme), and Arable land – to feed ourselves.

Yesterday we dealt with a primary structural cause of unemployment in Africa, that being education. To this extent, Africa also has the lowest levels of advanced education programmes for agriculture and associated industries. Today, if you can start tech company with solid yields for investors of VC’s and angel funders, you are more likely to get equity investment than if you wanted to start a sustainable venture in agriculture that has long term yields and “feeds” the real needs to Africa, especially bringing down the cost of food to the African consumer. But our business executives in Africa and abroad, and certainly not our politicians have even scratched the surface when it comes to dealing with the issue.

We’ll take it a notch deeper. Do you know, the United State alone grocery stores discard $10-15 billion in food close to its sell-by date or “damaged”. Significantly, sell-by dates are a myth serving merely as a guide and measure optimal quality rather than food safety.

“In July 2013 the head of the United Nations Food and Agriculture Organization (FAO), Graziano da Silva, told participants at the Global Green Growth Forum (3GF) in Copenhagen that every year an estimated one-third of all food produced for human consumption is lost or wasted – around 1.3 billion tons. This costs around $750 billion per annum”. Astronomical given that per household it costs us more to throw away food than to take it with us the next morning and give it to the little kids standing at the robot! The values we have! Here is the next fragment to this argument – should such wastage of edible food be use to feed the poor, the extent and results of donor funding would be more significant! So much so, the United Kingdom is stopping aid to South Africa in 2015.

We are going to start rounding up our argument bearing in mind some reliable solutions we have at hand. However, these solutions we will not share. It does seem this will be pointless, given the amount of money spent of drafting legislation and policies to address – still no headway.

Striking at the heart now; the number of youth in Africa will double by 2045. Between 2000 and 2008, Africa’s working age population (15-64 years) grew from 443 million to 550 million; an increase of 25 percent – Africa Economic Outlook 2012. In Africa, there are at least 700 – 800 million unemployed people in Africa. Of the 600+ million working, 65 percent are in the agriculture sector – the most undeveloped across the continent.

Here is the fundamental reason why Africa has and is failing in agriculture – The World Bank is the single largest donor for improving Sub-Saharan Africa’s agricultural sector, assistance that is key to reducing hunger, poverty, and environmental degradation. So governments are not the major investors, proving my above argument, support by our findings that investors least consider the people with the skills – woman – who are already creating most of the value in the continents agriculture sector. – Surely, these very women can also be taught the inner dealings of managing a farm.

Finally, for how long while receiving international aid have we known “our” reality? Knowledge is power – it just depends for better or worse. Zimbabwe is a prime example that even education is no guarantee of leadership success, because it succumbs to the attraction of power. More than ever, no matter the leader, Africa’s history under its own leadership continues repeating itself – and the consequences become calamitous.

The DRC boasts 75 million to 80 million hectares of arable land that could feed a billion people, according to Thomas Kembola Kejuni, a former secretary general at the ministry of agriculture – only 10 percent of this potential is tilled.

For the last ten years, foreigners have been swooping up the arable land in Africa either through ownership or leasing negotiations. The most significant consistency in Africa has not been colonialism – its hunger. History and time, do not lie!

Sourced here  http://www.ventures-africa.com/2014/08/land-grabs-or-agricultural-development/

Chinese Company Decides to Build Textile Factory with Over 500 Million USD

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A Chinese delegation disclosed here that it has finalized pre-investment assessment to build a huge textile factory with over 500 million USD.

President Mulatu Teshome held talks on September 2, 2014 with a four-person Chinese business delegation led by Kong Xiangjun, Board Chairman of Giangsu Lianfa Textile Company Limited.

During the discussion with the President, Xiangjun said his company decided to invest in Ethiopia, specifically Addis Ababa, after making similar pre-investment assessments in Kenya, Uganda, and Tanzania.

The textile industry will create more than 20,000 jobs when it goes operational.

President Mulatu on his part said the Ethiopian Government will provide all the necessary support for the company which has decided to engage in textile industry, which is the priority of the government.

He added that cheap labor and electricity, vast arable land as well as various quota and duty free opportunities to the U.S and EU markets would make the company profitable.

http://213.55.98.22/enae/index.php?option=com_k2&view=item&id=2204:chinese-company-decides-to-build-textile-factory-with-over-500-million-usd&Itemid=260

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H&M and Swedfund Initiate Cooperation in Ethiopia’s Textile Industry

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H&M and Swedfund have come together in a unique cooperation in Ethiopia. The aim is to contribute to the development of a responsible Ethiopian textile industry characterized by both high social and environmental standards. The partnership will start this autumn.

The first steps of this collaboration were taken after talks between Swedfund and H&M. The plans were further developed during a joint trip to Ethiopia in May this year when they were examining factories together.

– We see the cooperation as an opportunity to get involved in Ethiopia’s growing textile industry at an early stage and to contribute to more jobs. We have for many years worked in existing manufacturing countries to improve working conditions and the environment. This experience is included with the establishment of cooperation with Ethiopian suppliers, says Karl-Johan Persson, CEO at H&M.

Building a strong domestic industry is crucial for job creation in Ethiopia. Investing in production ensures that added value from the textile industry will to a larger extent remain in the country. In this cooperation H&M will contribute with expertise and knowledge of the textile market as well as purchase of products from suppliers that Swedfund will invest in. Swedfund will provide local market expertise and expansion investments in suppliers to H&M.  The cooperation will also involve both parties setting standards for sustainable production and following up indicators such as water use and wages.

– Through this unique partnership with H&M, our goal is to contribute to developing the textile industry in Ethiopia, thus creating jobs with good working conditions that lift people out of poverty, especially women, says Anna Ryott, CEO of Swedfund.

Through Swedfund’s role as investor, H&M:s purchase of products and each parties respective knowledge and expertise, a strong and viable textile industry can be developed that will be able to operate and thrive with financial strength and on a sustainable basis.

About Swedfund
Swedfund, owned by the Swedish state, provides risk capital, expertise and financial support for investments in the emerging markets of Africa, Asia, Latin America and Eastern Europe. Our mission is poverty reduction through sustainable business, contributing to economic and environmental development as well as a positive impact to society. Since 1979 Swedfund has been engaged as an active, responsible and long-term investor in more than 230 companies in our countries of operation. www.swedfund.se

http://3blmedia.com/News/HM-and-Swedfund-Initiate-Cooperation-Ethiopias-Textile-Industry

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AHIF places spotlight on hotel shortages in Addis Ababa, Ethiopia

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The increasing rate of inbound tourist arrivals and planned events/conferences is widening an already huge gap between demand for international-standard hotels and supply of accommodation in Addis Ababa, Ethiopia’s capital.

A search on TripAdvisor reveals just two international-class, five star hotels in the city, the Sheraton and the Radisson Blu – and anecdotes about delegates attending meetings at the Africa Union’s headquarters having to travel up to 60 miles to find a bed for the night are not unknown.

According to research carried out by the Awash International Bank, the projected unsatisfied demand for hotel nights in Ethiopia in 2015 will be 1.3 million, rising to over three million by 2020 if new hotels are not built.

The accommodation shortage will be high on the agenda at The Africa Hotel Investment Forum, Africa’s top event for hotel investors, taking place at the end of September in Addis Ababa.

Its organiser, Matthew Weihs, managing director, Bench Events, explained: “The country’s overall growth and the continued progress in the tourism industry is forecast by the World Travel & Tourism Council to be 4.8 per cent per annum over the coming decade.

“Increasing the supply of high-quality, top-end hotel accommodation through hotel construction is necessary for improved competitiveness and the economic success of the sector.”

Currently, Ethiopia has only six internationally-branded hotels comprising 990 rooms, in the development pipeline, compared to 40 hotels (6,614 rooms) in Nigeria and 29 hotels (4,828 rooms) in Morocco.

“We’d be interested to look at more in Ethiopia,” said Alex Kyriakidis, president, Middle East & Africa, Marriott International, who recently signed an agreement to manage two properties in Addis Ababa owned by Sunshine Business.

“However, choosing the right local partner is critical, because it gives an international brand the weight of developed market experience with local know-how on the ground.

“The partnership decision is more than just market experience though.

“It has to be a fit of business cultures and values, like-minded industry leadership thinking and – in the service industry – a similar commitment to flawless service and brand standards.

“It’s been Marriott International’s business model since the brand first launched in North Africa several years ago and it’s served both the company and the countries well from a job creation, training and capital investment perspective.”

Until recently Ethiopia was not considered to be very attractive to investors due to the relatively low number of tourists and planned events and conferences.

However, this is changing as Ethiopia is growing at more than seven per cent per year and is forecast to be the third largest economy in Africa by 2015.

Addis Ababa now has the fourth largest international diplomatic community in the world, partly due to the fact that it is the seat of the Africa Union, which was launched in 2002.

Also, according to The African Development Bank, Africa’s middle class is expected to grow from 355 million to 1.1 billion in the next 50 years and these people will have an appetite to travel.

Africa Hotel Investment Forum will take place from September 29th-October 1st at the Sheraton Addis Ababa, Ethiopia.

http://www.breakingtravelnews.com/news/article/ahif-places-spotlight-on-hotel-shortages-in-addis-ababa-ethiopia/?utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A%20breakingtravelnews%20%28Breaking%20Travel%20News%29

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The Lesser Of Two Goods: Ethiopian Flowers Or Food?

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By Anna B. Wroblewska

Ethiopian flower farmer

Ethiopian flowers are likely to become a hit in the international auction market bolstered by foreign investment such as KKR & Co., an American private equity fund, maiden venture into Africa through Ethiopia’s sweetheart rose producer Afriflora.

But where does this leave the country in terms of food security? This question becomes poignant when considering that 40 percent of the nation’s 80 million people are undernourished, according to an estimate by the International Food Policy Research Institute.

The horn of Africa Nation is the second-largest producer of cut flowers in Africa after Kenya, with 2012 exports reaching $168 million in value. Total exports from Ethiopia total about $3 billion annually, and coffee is its most prominent commodity.

The country’s flower-growers could, by many measures, be considered an example of true commercial success with a major potential benefit of creating much needed jobs. For example Afriflora, a Fairtrade International certified company, employs over 8,700 people.

“Normally one hectare of land merely supports one household consisting of five members. But when this land is used for the production of flowers, it can employ as much as fifty people,” says Mulugeta Ayalew, a consultant and researcher in Addis Ababa.

Jobs are fantastic, but such deployment of land for export agriculture rather than food might give one pause.

Africa as a whole tends to be very reliant on food imports; according to Tinashe Kapuya, manager of international trade and investment intelligence for South Africa’s Agricultural Business Chamber, “Africa’s food import bill is in the excess of $40 billion, which translates to at least 47 percent of the continent’s total food consumption.” 

“A major share of the food bill is basic staples, which can easily be produced in Africa.” 

There are two major factors driving a lack of local food production. One is policy-related.

International trade and policy

In a broad conversation about agricultural investment, Kapuya stresses that the main drivers of underutilization include population growth, low productivity, policy distortions, weak infrastructure, and poor institutions.

Indeed, he stresses that a lack of investment in staple crops is a reflection of government interventions that make these activities less profitable.

He says, “Export bans, price controls, and input subsidies for smallholder farmers often lead to market distortions that affect farm-level profitability.”

Another factor is foreign agricultural policies, namely in the European Union and United States, which effectively reduce global food prices and make it difficult for African farmers to compete. In this regard, it’s hardly surprising that flower farmers prefer to invest in this high-value commodity, rather than cheaper staple crops.

So could the job growth stimulated by export-driven investments make food security a non-issue? The answer is not yet clear, and it surely depends on some combination of wages, job stability, and the growth of the sector.

It could also hinge on monetary policy: The World Bank recently encouraged Ethiopia to devalue its currency, the birr, in order to strengthen exports. Of course, the downside of a devaluation would be price increases on imports. With relatively little local production of foodstuffs, one has to wonder how the average Ethiopian will manage.

The other potential hazard is a lack of investment in more competitive activities, which command higher pricing from differentiation and value-added processing. Despite being the second largest country in Sub-Saharan Africa, the World Bank notes that “Ethiopia has the lowest ratio of merchandise exports to GDP in the world.”

Such investments could significantly boost Ethiopia’s economic growth, according to a World Bank report. If successful, incomes could rise further and provide some measure of insulation from volatile commodity prices. Perhaps then the issue of where Ethiopia’s food is produced would become less pressing.  

Foreign Investment 

Further concerns about the floriculture industry lie in the pervasiveness of foreign, rather than local, investment in Ethiopia. Indian companies are, according to the Oakland Institute, the biggest investors in Ethiopian agriculture, and China’s Export Import Bank provides financing backed by sales of sesame to China (Ethiopia is the fourth-largest producer in the world). 

So there’s money on the table, but is it the right kind? And who is responsible for ensuring that it is?

Ayalew emphasizes that these investments can provide major benefits for local landholders. “If you take flower farms which are closer to established village centers and main transport lines,” he says, “The investors have acquired them… on the basis of voluntary contractual leases. In these farms, the landholders are earning not only rents but also an opportunity to be employed.” 

To ensure that interests are aligned between commercial investors and domestic policy goals, Kapuya endorses the use of private public partnerships (PPPs). “The advantage of PPPs is that they allow for a balanced approach which caters for both investors, and the government which is acting in the public interest.” 

However, there are a lot of commentaries to be found criticizing foreign-direct investment programs’ lack of benefits for the people — these include issues of governmental “land grabs” and the disenfranchisement of those such as pastoral farmers. In 2012, Human Right Watch issued a report on forced relocations of villages in Ethiopia that condemned the program’s abuses and lack of compensatory resources for those affected. 

On this issue, Kapuya notes that the main failures in farm investment and acquisitions have arisen from a lack of governance. In other words, governments must take responsibility for protecting their citizenry. 

However, ensuring that governments do just that is far from a simple matter. Especially where potentially significant revenues arise, the balance between public policy and self-enrichment can lead to some powerful conflicts of interest. 

Defining success is never easy, but if Ethiopia can encourage the right stuff without falling victim to the wrong stuff, there could be a bright future ahead. The main risks — food security, commodity price exposures, and disenfranchisement — could all conceivably be avoided in the future, and the potential is certainly there. 

It’s a matter of having the will and the fortitude to ensure that it does.

http://afkinsider.com/70642/lesser-two-goods-ethiopian-flowers-food/

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Ethiopia aims to launch satellite

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It is disclosed that Ethiopia has planned to launch medium research satellite within the next five years.The Entoto Observatory and Research Center (EORC) signed a Memorandum of Understanding on Sunday with Finland based Space Technology and Science Group (STSG) to this effect.

The main objective of the satellite development agreement is to develop, build and launch 20-25 Kg medium research satellite within the next five years.

Signing the agreement, Director of EORC, Dr. Solomon Belay said Ethiopia will benefit a lot by owning Satellite.

STSG headquartered in Espoo, Finland, is the first Pan-Central European, Nordic and Baltics technologically integrated industry and research group offering end to end design, manufacture, testing, launch and operation of highly capable small and medium advanced satellites.

CEO of STSG Sali Ahmed said his institution is ready to do its level best to develop space science in Ethiopia using its matured experience.

Based on the agreement, after the evolution of the first project both institutions will further upgrade the agreement into large scale satellite technology development.

According to Board Chair of EORC Tefera Walwa, Ethiopia is working hard paying attention to Space Science.

Since its establishment, the EORC has been working a lot and now Ethiopia is becoming known in the world of Space Science, he added.

American, Chinese and European Researchers are showing interest to work in the area with Ethiopia, Tefera added.

EORC has been established in 2013 by 32 Public universities, Ethiopian Space Science Society and one private University as an independent and autonomous institute, with the objective of promoting and developing earth observation and space science and Technology in Ethiopia.

In a bid to achieve its objectives, EORC works with STSG to work together in the area of space and science technology in Ethiopia.

http://www.ertagov.com/news/component/k2/item/3036-ethiopia-aims-to-launch-satellite.html

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Filed under: Ag Related, Economy, News Round-up Tagged: Agriculture, Business, East Africa, Economic growth, Ethiopia, Investment, Millennium Development Goals, Sub-Saharan Africa, tag1

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Programme *.pdf  -  http://www.ipipotash.org/udocs/463-ssa-2014-program.pdf

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Turkish Company to Supply Textile Factories Through Bonded Warehouse

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The scheme enables foreign countries to test the water in Ethiopia, before deciding whether or not to invest

A Turkish chemicals manufacturer, Eksoy Chemical Industries Ltd, is to become the second supplier of chemicals and dyestuff to the textile factories in Ethiopia through a bonded warehouse Scheme.

This scheme is available for chemical manufacturers outside Ethiopia. They can have their products in a bonded warehouse, from where the customs clearing will take place as the products are sold. This is supposed to enable them to test the domestic market for two to five years, during which time they will be expected to open a factory in Ethiopia or leave. The manufacturer’s proposal is evaluated by the TIDI, which makes a recommendation to the Ministry of Industry (MoI). The Ministry of Industry gives approval for companies to be involved in the bonded warehouse transaction. They get their trade and investment licenses and customs certificate after that, according to Yared Mesfin, marketing director at the Ethiopian Textile Industry Development Institute (TIDI).

The first was Bezema Dyestuffs & Chemical, a Swiss based company, which has been supplying various chemical and dyestuffs to the local textile manufacturers through its warehouse in the Jemo area and its outlet in Lafto since September 2012.

Eksoy has finalised all the requirements to be licensed by the Ethiopian Revenue & Customs Authority (ERCA), which is basically the last requirement to begin the import and distribution of all sorts of chemicals and dyestuffs necessary in the production process of textiles.

It has renovated a warehouse leased around Kality, with a total area of 1,000sqm, in accordance with the specifications set by the ERCA, which has a stake in the chemicals and dyestuffs to be stored in the warehouses.

Based on the scheme, the companies that have already secured a permit from the Ethiopian Investment Commission (EIC) to undertake the trading will import and store the products in bonded warehouses under the supervision of the ERCA. The stored items will be handled by Eksoy and the customs authority, and both will follow the transaction of the products.

Eksoy had to make adjustments to its warehouse based on comments from experts at ERCA, Hadgu Araya, a representative of the Company, told Fortune.

“We are in the final stage and will secure the customs certificate within a week,” he said.

Left with the last go-ahead from the ERCA, the Company has made arrangements for the importation of the first batch of its chemicals and dyestuffs to arrive in two weeks time, according to Araya. The Company has secured its license with an initial capital of one million Birr and is set to hold a stock of chemicals worth eight to 10 million Br, depending on the demand of the market, he says. The Company could open the factory in three years’ time.

“The scheme provides the manufacturers with the opportunity to test the market and build confidence,” Yared said. “Then they are required to establish a manufacturing company within two to five years.”

Based on this obligation, Bezema has already submitted its request for land to the city administration to establish a dilution plant in Addis Abeba, according to Yared.

Bezema has supplied a total of 217tns of different chemicals and dyestuffs for 21 textile factories through the bonded warehouse arrangement in 2013/14 fiscal year, according to the annual performance report of the manufacturing industry sector.

http://addisfortune.net/articles/turkish-company-to-supply-textile-factories-through-bonded-warehouse/

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Yabelo-Mega Road connecting Ethiopia and Kenya is open for traffic

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The Yabelo-Mega road that connects Ethiopia and Kenya has been inaugurated and is open for traffic.

http://www.english.fanabc.com/index.php/news/item/1089-yabelo-mega-road-connecting-ethiopia-and-kenya-is-open-for-traffic

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Africa Losing up to 23 Percent Harvest

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http://213.55.98.22/enae/index.php?option=com_k2&view=item&id=2211:africa-losing-up-to-23-percent-harvest&Itemid=200

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Awash Bank Takes Leap Forwards with New Advanced System

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The first of its kind in Ethiopia, the technology will enable the bank to provide numerous new services

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The system, BankFusion Universal Banking (BFUB), is being brought to AIB by Misys International Financial Systems Ltd – a UK based software development company – for 200 million Br. Misys boasts on its website that the front-to-back integration achieved by its universal banking solution allowed “for the accelerated launch of financial products from design straight through to distribution – across any channel”, slashing time-to-market and achieving increased profitability by decreasing the cost-to-income ratio.

“Unlocking operational data from the core, FusionBanking Essence turns data into actionable intelligence – helping you identify new business opportunities,” it says.

The CORE banking currently in use by the bank, Bankmaster, is a centralised system that handles all retail banking operations, such as savings, time deposits, loans, demand deposits, subsidiary ledger and general ledger. This application was also supplied by Misys, which has branches in the United Arab Emirates (UAE), Germany, Amsterdam and India, with customers in 130 countries.

Misys has sent its own people here to install the system, which it says could remain in operation for 10 years without failing. One of the strong sides of the new system is that data can be smoothly transferred from the existing setup, according to an official of the bank, without the bank having to interrupt the services it is giving to its clients.

Misys took the responsibility for any risk that might be caused by the system during installation,” said the official, adding that most vendors did not take such measures.

The new system is being installed at a new three-room data centre in the basement of the Awash headquarters with one room each for, servers, network operation and power unite. The data centre is already housing servers for production, backup, test and disaster recovery, all newly supplied by Misys itself as part of the 200 million Br deal.

Once set up, Awash will be able to offer new services in internet banking, mobile banking, agent banking, portal transaction and point of sale, according to bank officials. The new system will minimise the cost of building new products and will also make processes easier, said another official close to the issue.

“It will increase the productivity and competiveness of the bank,” he said.

Awash expects all tests for the new system to be completed and to begin service by the end of September 2014. The system has the capacity to give services for the coming 10 years without any trouble.

AIB was established in 1991 with 486 founding shareholders and a paid-up capital of 24.2 million birr. Licensed on November 10, 1994, it started banking operations on February 13, 1995. It now has 3000 shareholders and a paid-up capital of 1.2 billion Br. The bank and its sister company, Awash Insurance, have been headquartered in Awash Towers – a twin-towered building that cost 217 million Br – since the buildings inauguration in 2010.

Awash deployed 100 ATMs and 400 Point of Sale machines in Addis Abeba during the fourth quarter of the last fiscal year. These are on top of those it jointly uses with other private banks.

http://addisfortune.net/articles/awash-bank-takes-leap-forwards-with-new-advanced-system/

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Roads re-open as AALRP progresses

http://www.english.fanabc.com/index.php/news/item/1080-roads-re-open-as-aalrp-progresses

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Nyota Minerals Continuing Discussions With Ethiopian Ministry For Mines

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LONDON (Alliance News) – Nyota Minerals Ltd Wednesday said it has recently submitted renewal applications for both of its Northern Block licences, and added that technical reports for the license and field work for the year just ended are being prepared.

In addition, the company said it is continuing discussions with the Ethiopian Ministry for Mines over the potential for its Towchester subsidiary to mine and treat the alluvial river gravel deposits adjacent to the Abay River, or Blue Nile, that bisects the Northern Block licenses.

According to Nyota, the gravels are known to be gold-bearing and are being hand dug and panned for gold by local people at a number of localities within the licenses.

“The areas will, within a few years, be flooded by the Grand Ethiopian Renaissance Dam; a new hydroelectric power dam being constructed on the Blue Nile. Alluvial gold deposits in Ethiopia are usually reserved for exploitation by artisanal miners. However, as the deposits will be flooded, large scale mechanized mining to maximize potential gold recovery is receiving favorable consideration,” Nyota said in a statement.

“The flooding caused by the dam will not affect the highest priority hard rock gold exploration targets in the Northern Block licenses,” the company added.

Nyota shares were Wednesday untraded at 0.27 pence.

http://www.lse.co.uk/AllNews.asp?code=bc5gtsk2&headline=Nyota_Minerals_Continuing_Discussions_With_Ethiopian_Ministry_For_Mines

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U.S. will continue strengthened cooperation with Ethiopia

U.S. Ambassador to Ethiopia, Ambassador Patricia Haslach said efforts being made to enhance investment ties between the U.S. and Ethiopia are bearing fruit.

In an exclusive interview Ambassador Haslach gave to Fana Broadcasting Corporate (FBC), she stated that in addition to cooperation of the two countries in investment endeavors, the U.S. is providing assistance for Ethiopia’s Growth and Transformation Plan (GTP), especially in areas of health care, agriculture and education.

Trade between the U.S. and Ethiopia reached USD 1.1 billion in 2013, although the trade balance favors the U.S. Haslach said talks and lobbying are in progress in the U.S. to extend the Africa Growth Opportunities Act (AGOA) which can potentially narrow the trade imbalance.

Accordingly, various tasks aimed at finding markets for Ethiopian products in the U.S. are taking place. Haslach added major U.S. investment firms and multi-national companies are being made aware of all the investment opportunities in Ethiopia, intended at bolstering their presence here. Efforts to bring major U.S. companies to Ethiopia have been successful.

The special focus the Ethiopian government has dedicated to the sector will prove important in transforming Ethiopia into an investment hub, Haslach said. In this regard, Ethiopia’s remarkable achievements through its extensive investment on educating its young, manifested in the tens of thousands of university graduates, is crucial to attract global investors. The ambassador said, this will open a new chapter and boost investment and trade relations between the two countries.

Ambassador Haslach expressed her Government’s commitment to continue its support for the implementation of Ethiopia’s GTP. She added, Ethiopia’s successive double-digit economic growth is encouraging and the Ethiopian Government’s policies and strategies are vital to keep the growth sustainable.

Ambassador Haslach appreciated Ethiopia’s role in East Africa in maintaining peace and security and fighting extremism and terrorism, stating that peace and security is a major aspect of Ethio-U.S. cooperation. The U.S. and Ethiopia will continue to work together to fight al-Shabab in Somali, she said.

The ambassador concluded the various bilateral relations between Ethiopia and the U.S. will transcend their relationship to a higher level and the U.S. will strengthen its cooperation with Ethiopia.

http://www.english.fanabc.com/index.php/news/item/1092-u-s-will-continue-strengthened-cooperation-with-Ethiopia

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Giant American Clothing Company Eyes up Ethiopia’s Industrial Zones

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The company, Phillips-Van Heusen (PVH) Corporation, generated a revenue of 8.2 billion dollars in 2013

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PVH has 700 outlets all over the world which sell Tommy Hilfiger, Calvin Klein and Heritage brands it sourced from factories in Bangladesh, Sri Lanka, China, Honduras, Hong Kong, Indonesia, Philippines, Malaysia, Mongolia, Singapore, Thailand and Taiwan.

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Phillips-Van Heusen (PVH) Corporation – a giant American clothing company and owner of the Tommy Hilfiger, Calvin Klein and Heritage brands – has set 10 investment preconditions to the Government of Ethiopia (GoE).

Officials of the company made a visit to Ethiopia, along with 27 textile and garment factories from different countries, last week, for the third time in two months. The second round visit was made by 40 companies led by Mark Green, vice president of the company in May 2014.

The third stay saw a high level meeting between the representatives of PVH and government officials, including Sisay Gemechu and Tadesse Hiale, both state ministers for Industry, and Likyeleshe Abay, deputy commissioner of the Federal Investment Commission (FIC), as well as representatives from the Textile Industries Development Institute (TIDI), on Wednesday August 28, 2014, at the Radisson Blu hotel on Tito Street.

During the discussion, the officials of the Company forwarded 10 prerequisites to the government to make adjustments. The prerequisites include consideration of tax incentives, logistics issues, priorities for electricity power and getting a ready-made industrial park, according to sources.

“The officials decided to form a government committee to review questions forwarded by the Company after they submitted them in written form, because some of the issues demand a policy reform,” said same source.

PVH, which was established in 1881, generated a revenue of 8.2 billion dollars in 2013, with a 967 million dollar profit. Its products are sourced from factories in Bangladesh, Sri Lanka, China, Honduras, Hong Kong, Indonesia, the Philippines, Malaysia, Mongolia, Singapore, Thailand and Taiwan. It sells these products through 700 outlets across different countries, where it employs over 12,000 people.

The government wants this company to take its investment to Dire Dawa or Hawassa, but the company has its eyes on the Bole Lemi Industrial Zone in Bole District. Phase one of this zone has 20 shades on 156ha; five of these shades have already been taken by various companies, including George Shoe; the remaining 15 shades, under construction have already been given to 22 companies. PVH wants the government to give it a ready-to-use industrial park for all the factories that it wants to bring to Ethiopia to dwell on phase two which will be constructed on 186ha of land.

The officials of PVH also visited Dire Dawa, 515km east of the capital, and Hawassa, 273km south of the capital in the Southern Region – two areas that the government wants to promote as industrial zones.

The company says it is coming to Ethiopia seeking to benefit from low labour and input costs, as well as enough land to invest in, according to the officials from the company during the meeting, who declined to comment further. Currently, there are 17 textile factories in Ethiopia and 1,120 cotton farms, despite the textile and garment export performance being disappointing over the last four years. The government has identified the unreliable inputs supply as a reason for the poor performance of the sector and is about to establish a four billion Birr enterprise to supply inputs to the local textile and garment industries.

Another company called H&M (Hennes & Mauritz), from Sweden, with its own brand clothes has maintained an office in Ethiopia for the last two years, although it has not done much.

 http://addisfortune.net/articles/giant-american-clothing-company-eyes-up-ethiopias-industrial-zones/

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Gov’t Introduces 4b Br Enterprise to Supply Manufacturing Inputs

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Enterprise will open factories in neighbouring countries to export inputs home

This will be part of the job for the four-billion Birr Ethiopian Industrial Inputs Development Enterprise (EIIDE), whose job will be supplying inputs to some parts of the manufacturing sector

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Eager to boost manufacturing export from Ethiopia, the government is planning to open factories outside the country to export inputs that manufacturers in the country will need.

This will be part of the job for the four-billion Birr Ethiopian Industrial Inputs Development Enterprise (EIIDE), whose job will be supplying inputs to some parts of the manufacturing sector both by producing them and by procuring from local and international markets and by manufacturing them. The government expects this enterprise to undertake its manufacturing activities through factories it will establish both in Ethiopia and outside.

The bill for the establishment of this enterprise, which will come with the dissolution and take over of the resources of the Merchandise Wholesale Import & Trade Enterprise (MWITE), was approved by the Council of Ministers two weeks ago.

The new enterprise is meant to rescue the ever failing performance of the manufacturing industry, which has been largely challenged by the shortage of supply of inputs leading to continuously disappointing records, despite an ambitious Growth & Transformation Plan (GTP).

Ever since the beginning of the GTP in 2010/11, government plans have grown contrary to its actual delivery, with performance falling progressively short of targets – from 58.6pc in the first year to 54pc and 51.8pc over the following two years. It has now reached a new bottom of 25pc. During these four years, Ethiopia’s export revenue has been growing sluggishly – up from 207.9 million dollars to 255.4 million dollars, then 281.1 million dollars and finally 398 million dollars – up by nearly 117 million dollars from the previous year.

The performance of the three categories where the government had pinned its hopes and to which the new enterprise is going to supply inputs were textiles and garments, with a target of 350 million dollars; leather and leather products with 347 million dollars, and agro processing with 250 million dollars for the 2013/14 fiscal year. The performances in these areas, all below 40pc, were 111 million dollars, 133 million dollars and 76 million dollars, respectively.

Accordingly, the Enterprise will establish three leather processing factories in Sudan and one in Somali land, which will process raw leather at a pickle and wet blue level and export to Ethiopia, according a source close to the issue.

“The government has already conducted a study for the import of semi processed leather,” this source told Fortune. “Sixty million Birr budget is proposed for the establishment and operation of these factories.”

The bill, which was prepared by the Ministry of Industry (MoI), has counted on the experience of the India and China on the idea of investing abroad and importing semi processed inputs that the factory established abroad will produce, in order to match the growing demand of domestic industries, according to a source with knowledge of the drafting process.

The new enterprise will also have a 200.5 million Br budget to grow cotton in partnership with private investors, with the enterprise owning 51pc share, according to a document that Fortune has acquired.

A little more than half a billion Birr will also be allocated to the enterprise for the purchase and transportation of inputs for leather and leather products and agro-processing industries as well as cotton for textile industries that will be used for the running fiscal year of 2014/15, according to sources close to the issue.

This is a “principled approach” by the MoI, says Fasil Tadesse, president of Ethiopian Textile & Garment Manufacturers’ Association (ETGMA).

“It will make sure that inputs are delivered to the textile and garment manufacturers appropriately,” he told Fortune. “Stabilising the market, it will enhance the competitiveness of the sector in the international market.”

Out of the close to four billion authorised capital for the new enterprise 1.4 billion Br is paid up both in cash and in kind, according to the constituting law of the enterprise. Close to half of this is an amount that is transferred to the new enterprise from the dissolved MWITE, according to sources. In addition to its assets and capitals the liabilities and rights of MWITE are also transferred to the new enterprise, according to the establishment regulation, which has also repealed the law that established MWITE.

Established in 1993 by the merger of two previous trading corporations, the Ethiopian Domestic Distribution Corporation (EDDC) and the Ethiopian Import Export Corporation (EIEC), MWITE currently has 83 branch offices in Ethiopia, out of which 35 supply basic commodities. Its authorized capital is set at 90 million Br, out of which 50 million is paid-up. The products it supplies are also more varied, ranging from basic commodities like sugar and palm oil to building materials, foodstuffs, paper, stationery items, textiles and government.

On top of ensuring the availability and adequate supply of industrial inputs for the sectors that the government has pinned its hope in the transformation of the country’s economy, the new enterprise will also engage in the export of the inputs, which are found to be in excess of the domestic industries consumption.

This has to do with the experience of the country in 2011/12 when the production of cotton had by far exceeded the domestic demand of textile factories. A total of 29,710tn of cotton were found to be a surplus out of the 79,710tn produced in the year. That had led to many cotton growers shifting to other cash crops such as sesame, which in turn led factories to import cotton from India, China and Turkey. Three textile factories have imported an aggregate of 3360tn of processed cotton from these countries, according to the latest data available from the TIDI.

This is also welcome news for the cotton growers though with uncertainties.

“The existence of an entity that will make timely purchase at times of excess production will solve the marketing problem we have been facing for the last two years,” said Yusuf Umer, managing director of Amibara Business Group and a board member of the Ethiopian Cotton Producers, Ginners & Exporters Association (ECPGEA).

The price at which the Enterprise will buy from them will be an issue to worry about when the time comes, he adds.

http://addisfortune.net/articles/govt-introduces-4b-br-enterprise-to-supply-manufacturing-inputs/

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Holetta central Biotech Laboratory

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Genetically modified organisms are created by the scientific intervention of man, mixing the genes of different organisms to get certain qualities in one. For example, Bt cotton, a popular GMO crop, has the genes of a bacteria added to it so that the cotton plant can produce toxins that kill pests. As with cotton, the same technology has been employed in different food crops as well. There is also the Golden Rice, which has been engineered to be rich in vitamin A.

GMOs are shrouded in controversy, however, with those in favour arguing that they could transform the food security of the world, while those against speak of the risks to the environment and biodiversity, as well as the exploitation of farmers who will be dependent on expensive seeds from companies such as Monsanto.

Ethiopia’s bio-safety proclamation of 2009 did not close the door on GMOs, but made entry very difficult. It required that the government of a GMO’s country of origin was responsible for any damage caused in Ethiopia – a guarantee that no government wanted to give, say sources. These sources declined to say how or why, but there has been a strong pressure from government to amend the law fast.

The push to change Ethiopia’s stringent proclamation and to ease the environment for access to the controversial GMOs came from the highest level in government, according to sources. Government agricultural researchers, who found it hard to partner with “sister institutions from foreign countries” under the existing law, also see the amendment as something that needed to happen.

The existing law had very strict rules for GMO transportation and storage in Ethiopia. Someone involved in the transport, storage or processing of GMOs must have adequate insurance to cover any possible harm caused by GMOs and can only transport the GMOs after special training by the Environmental Protection Authority (EPA) and with a license for drivers or pilots. After release to the environment and commercialisation, one has to monitor and present an annual report to the EPA for (Directive No.3/2009) at least 150 years for GM trees, 30-150 years for GM perennial crops and 30 years for annual crops. A researcher who recommends the use of a GMO could be imprisoned for up to 15 years if it is imported for research and study, and commercial release causes any problem to the environment or the general public. In addition, the proclamation treats low risk activities, like contained use for research and teaching, in the same way as commercial planting/environmental release. The jurisdiction to administer issues in relation to GMOs is also given to the EPA, now a Ministry, under the law.

This law did not allow Ethiopian researchers to collaborate with researchers in other countries on GMOS, said Endale Gebre (PhD), Director of Biotechnology Research at the Ethiopian Institution of Agricultural Research (EIAR).

The amendment states that any person can engage in transactions destined for the release of GMOs to the environment by obtaining an Advanced Informed Agreement from the MoFEP. Any applicant can engage in any contained use transaction with a special permit from the Ministry. This bill, which was submitted to Parliament’s Forest and Natural Resource Standing Committee at the end of July 2014, was drafted by the Ministry of Forest & Environmental Protection (MoFEP), Ministry of Agriculture (MoA), Ethiopian Institution of Agricultural Research (EIAR) and the Ministry of Science & Technology.

Allowing the use of GMOs is not a choice, but a necessity, argues Endale, stating that Ethiopia’s population is projected to reach 140 million in 2025, although he adds that only 20pc of arable land is cultivated in Ethiopia. The current law disappointed researchers, foreign exporters, investors and NGOs, says Endale.

“Enter the age of BT in Ethiopia,” says Maryam Mayet, who reviewed the amendment on behalf of a local NGO, Melka Ethiopia.

GMOs are the only solutions to mitigate food insecurity, which might occur as the population grows, says Abay Yimer (PhD), a researcher at the Institution for Science & Sustainable Development (ISSD). Abay downplays the risks, saying that 400 European researchers have undertaken studies at a cost of 200 million dollars over the past 10 years, proving that risks from GMOs were no different from the risks posed by the use of pesticides, herbicides and fertilisers.

“Currently, there is shortage of cotton production in Ethiopia and Ethiopian imports cotton from Tanzania and China every year,” says Endale. “Applying biotechnology in cotton production would minimise cost and save foreign currency.”

And the most common technology in cotton, as well as other food crops, is adding some genes of a bacteria, Bacillus thuringiensis, to produce the so-called BT crops, with the ability to produce the bacteria’s natural toxin. In cotton, the pest that is the target of the toxin is the bollworm.

It was in 2009/2010 that the Ethiopian Institution of Agricultural Research stared constructing a Central Biotech Laboratory in Holetta town, complete with a molecular lab, plant biotech, livestock biotech, microbial biotech and genetic engineering facilities. All laboratories are now working except the Genetic Engineering, which has not been able to do so because of the stringent laws. The research institute, a government body, built the genetic engineering lab, complete with most facilities except a green house which will be completed in six month, despite the government’s own law making it nearly impossible to dabble in the practice through its stringent requirements, which put the researchers at risk of harsh punishment.

Research conducted in the other labs included such crops as cassava, sweet potato, cowpea, groundnut, banana, rice, sorghum, wheat, plantain and millet, as well as fruits and vegetables, such as citrus fruit, grape, mango, plum, cucumber, tomato, eggplant and peppers. Cash crops, like sugarcane, cacao and coffee, are also included. The institutes are conducting research on GMO enset (false banana) – a source of the staple food, kocho, for many in Ethiopia’s south – in Nairobi, Kenya, in collaboration with other researchers at the International Institution of Tropical Agriculture Laboratory (IITA).

When Ethiopia drafted its stringent bio-safety law in 2009, the Ethiopian consumer association was one of those involved in the process. However, during the production of the new draft, the association was excluded, despite efforts to be part of the process, said Gebremedhin Birega, the Assocation’s director.

Consumers should be aware of what they consume and have the right to get organic and GMO free products, he says, adding that Ethiopia is making the amendment in the interest of other countries, such as the United States, China and India, who are home to the world’s largest GMO company, Monsanto, and the largest producers of BT cotton.

More in line with that argument is the interpretation of the amendment given by Maryam Mayet, who believes that the government had some foreign exporters to Ethiopia in mind when drafting the new amendment. The amendment has inserted a definition for foreign exporters, and she thinks that “a special definition for such an actor must denote some intention that such an actor – a foreign exporter – will play a key role in this shift towards an openness to GM experimentation” in Ethiopia.

Her argument is enhanced by another element in the amendment which says that the objective of the amendment is to “enhance access to and transfer technologies, including modern biotechnology, that serve for conservation and the sustainable use of biological diversity.”

“And we know that the main arguments of industry as to the benefits of GMOs on the environment especially is insect resistant GM crops. Enter the age of Bt cotton for Ethiopia.” She said

The amendment includes several articles where the definitions and requirements, as well as risks and accountabilities, have been made more lax and where licenses to operate will be easier to obtain in Ethiopia. A possible interpretation of the phrase “into the environment” could mean “cultivation”, which would eliminate the need for an Advanced Informed Agreement for “food, aid food, greenhouse experiments, aqua-culture, animal feed or other inputs for animals, and medicines for humans or animals”, according to Maryam.

“The overriding imperative of these amendments are to signify a major shift in Ethiopia’s policy on GMOs, from a precautionary approach to an openness to, at the very least, experimentation in contained use conditions,” she said.

The United States government, through the US Agency for International development (USAID), is already working to build “the leadership capacity of the Ministry of Agriculture and Regional Bureaus” to harness “biotechnology for agriculture in collaboration with the Ethiopian Academy of Sciences, the Ethiopian Institute of Agriculture Research, the USDA Mission in Ethiopia and the Institute for Science & Sustainable development”, according to a press communiqué from USAID.

Attending the meeting, which was held at the Hilton Hotel on August 21 and 22, 2014, was Diran Makinde (Prof), Director of the AU-NEPAD African Bio-safety Network of Experts (ABNE), who spoke of the success of BT cotton farming in several countries, including the neighbouring Sudan. He argued that national regulations could be harmonised with international regulations for bio-safety, adding that the full range of potential risks needed to be assessed and managed.

Ethiopia’s state minister for Science & Technology, Mohammed Ahmed, told the meeting of his government’s recognition of the role of science and technology, and that “biotechnology alone cannot solve the Ethiopian agricultural challenges.Public policy should appeal more to pragmatism and less to ideology when seeking solutions to Ethiopian agricultural challenges”.

The Ministry of Agriculture believes that “Biotechnology should be a big project, in order to improve the economic growth of the country” and that it “will be a solution for low and insufficient agricultural productivity and also for economic growth”, according to Aster Stifanos, an advisor at the Ministry, who spoke on behalf of minister Teferea Derebew.

The Ministry of Forest & Environmental Protection (MoFEP) is expected to defend the amendment before Parliament sometime in October.

It was in 2009/2010 that the Ethiopian Institution of Agricultural Research stared constructing a Central Biotech Laboratory in Holetta town, (above) complete with a molecular lab, plant biotech, livestock biotech, microbial biotech and genetic engineering facilities.

Sourced here  http://addisfortune.net/articles/biosafety-bill-to-open-door-to-gmos-in-ethiopia/

Debora Van Brenk, The London Free Press – September 3, 2014

Ethiopia working to utilize potassium fertilizer to improve soil fertility

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Tekalign Mamo

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Ethiopia is working to properly utilize potassium (K) fertilizer to improve soil fertility thereby increase agricultural productivity the Ministry of Agriculture said.

Speaking at the 1st International Potash Institution Symposium held here today the State Minister Prof. Tekalign Mamo said Ethiopia has considered the need to use potassium fertilizer and boost soil fertility.

Considering the necessity of potassium for crop growth, the country started to use six new blended fertilizers including potassium.

After four decades of detachment from potassium fertilizer, researches conducted in recent years revealed the importance of potash for soil fertility, he said.

Nitrogen and phosphorus have been considered as the nutrients least present in soils; therefore, DAP and urea fertilizers have been the only fertilizer sources that have been in use in Ethiopia and in several other SSA countries.

A shift in this thinking in Ethiopia was triggered by research activities conducted during the last few years, the results from nationally launched soil fertility mapping, and ongoing new fertilizer demonstration trials being conducted in many areas.

Results from these studies proved that several nutrients including potassium are limiting crop yield. Based on these results, Ethiopia introduced six new fertilizers (including potassium) for distribution to farmers.

The IPI Director Hillel Magen on his part said sub-Saharan African countries including Ethiopia haven’t been widely used potassium fertilizers.

Studies conducted in the country displays that the country could increase productivity by using proper fertilizers including potassium.

The two-day symposium “The role of potassium in cropping system of Sub-Sahara Africa” on the current status and potential for increasing productivity is deliberating on soil fertility, quality of mineral fertilizers, and efficient use of fertilizers.

The symposium is also expected to address issues related to role and benefits of potassium fertilizers, focusing on chemical, physical and biological processes in soil and plants, farm management and economic application of fertilizers.

http://213.55.98.22/enae/index.php?option=com_k2&view=item&id=2219:ethiopia-working-to-utilize-potassium-fertilizer-to-improve-soil-fertility&Itemid=260

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Seven Sugar Factories to Go Operational This Fiscal Year

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Corporation Director-General Shiferaw Jarso

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Ethiopian Sugar Corporation announced that it is working hard to boost its annual sugar production to more than 1.2 million tons and earn over 310 million USD foreign currency from the sector.

Corporation Director-General Shiferaw Jarso told ENA that the government has been building ten sugar factories to meet the  demand of sugar in the country and to transform the sector during the Growth and Transformation Plan period.

From among the factories under construction across the country, seven would be completed this Ethiopian fiscal year, he said.

The sugar factories that would go operational in the budget year are Kesem, Arjo-Dedesa, Tendaho Numbers One and Two, Omo-Kuraz One, Beless One and Two, according to the director-general.

The factories would boost the 325,000 tons of sugar produced last fiscal year by the existing Metehara, Wonji Shoa and Fincha sugar factories to over 1.2 million tons.

According to Shiferaw, more than half a million ton of the projected sugar production would be covered by the old factories.

The shortage of sugar, which was caused by the failure of Tendaho Sugar Factory to go operational and the inability of Fincha Factory to meet its annual target due to heavy rainfall, was alleviated by importing sugar in the past fiscal, he noted.

In this budget year the corporation is working to not only meet the local demand of sugar in the country but also earn 311 million USD by exporting over 665,000 tons of sugar, Shiferaw added.

Besides, out of the 189MW electric power the factories would produce from residue they would utilize 143 MW and save the remaining 46 MW, he elaborated.

http://213.55.98.22/enae/index.php?option=com_k2&view=item&id=2215:seven-sugar-factories-to-go-operational-this-fiscal-year&Itemid=260

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Ethiopia ranked least corrupt nation in Africa.

The 2013 survey released by anti-graft body, Transparency International, ranked Ethiopia the least corrupt nation in Africa.

The survey, which was carried out in 95 countries worldwide indicated that Ethiopia is the least corrupt country in Africa with corruption levels standing at 6 per cent
Rwanda ranked second at 13 per cent.

In East Africa, Uganda is the second most corrupt with 61 per cent of the people having said they bribed public officials to access services in 2013. Tanzania is at 56 per cent and Sudan stands at 17 per cent.

South Africa is at 47, Nigeria 61, Libya 62, Senegal 57, Mozambique 62, Morroco 49, Zimbabwe 62 Ghana 54 and Madagascar 28 per cent.

Sierra Leone is the most corrupt country in the world with corruption levels standing at 84 per cent.

Liberia comes second at 75 per cent, followed by Yemen at 74 and Kenya completes the list of the top four most corrupt nations at 70 per cent.

In the world, the countries with the lowest reported bribery rate are Denmark, Finland, Japan and Australia; they all have a bribery rate of one per cent.

Only 16 out of the 95 countries posted corruption levels of less than five per cent.

http://www.waltainfo.com/index.php/editors-pick/14841-ethiopia-ranked-least-corrupt-nation-in-africa-

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Ethiopia keen to share best practices in agriculture

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Ethiopia says it is ready to share its best practices in improving agricultural production and productivity with fellow African countries.

Prime Minister Hailemariam Desalegn held talks on Tuesday with Kofi Annan, former United Nations Secretary General, who is in Addis Ababa for the 4th African Green Revolution Forum (AGRF).

PM Hailemariam told Mr. Annan that Ethiopia, 85 percent of whose population is relies on agriculture, is taking measures to improve the livelihoods of its farmers.

He said the country is willing to share its best practices in the sector with fellow Africans.

Mr. Annan for his part said Ethiopia’s effort to enhance agriculture is exemplary to other African nations.

He said young Africans should join the agriculture sector in their respective countries and support national development endeavors.

Also same day, Prime Minister Hailemariam Desalegn conferred with Mr. Strive Masiyiwa, Chair of the Alliance for a Green Revolution in Africa (AGRA).

On the occasion, Mr. Masiyiwa conveyed interest to work to extend Ethiopia’s best agricultural practices to other African countries.

http://www.ertagov.com/news/component/k2/item/3059-ethiopia-keen-to-share-best-practices-in-agriculture.html

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Allana Sons Finalizing U.S $ 9 Million Deal

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The Indian based meat processing company, Allanasons Group, is finalizing a deal for the purchase of Akshakar Export Abattoir for a total of U.S $ Nine Million.

The parties have already concluded the agreement, yet they have not secured authentication for the contract at the Documents Authentication and Registration Office (DARO).

According to Fortune, the process is being delayed for the parties could not reach on consensus over the issue of getting the contract authenticated after audits of Akshakar’s performance. Nonetheless, after officials of the Leather Industry Development Institute (LIDI) mediated the two parties, they agreed to get the registration and authentication of documents on the ground Akshakar’s financial auditing is done first.

It was only a year ago the Indian company secured a 75 hectare of land in Ziway town, Oromia State, for the purpose of erecting a meat processing plant. Allanasons plans to construct a facility with a capacity of producing 70 tons a day. The company estimates to spend U.S $ 20 Million for the facility.

In addition to this, according to ILDI, the facility will have an abattoir with the capacity of handling 400 cattles and 5,000 sheep and goats a day.

In 2014 the meat processing plant’s design work was commissioned to an Ethiopian firm, ETG Designers and Consultants Plc. The design is now completed and the construction work is soon to be given to contractors.

According to Ministry of Industry (MoI), the company is set to start to production in the current fiscal year.

Allanasons has also made payments to the Ethiopian Electric Utility (EEU) for the supply of 250KVA electric power it needs for the export abattoir it will operate.

In addition to this, the Indian company is under process to secure additional land in the Somali and Oromia States.

According to the Fortune, Akshakar has the annual capacity to process 6,000tn of cattle meat and a similar amount of meat from sheep and goats. It can also process 3,710 tons of by-products of the slaughter house.

http://www.2merkato.com/news/alerts/3246-ethiopia-allanasons-finalizing-us-9-million-deal

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IBM Experts Help Drive Economic and Social Change in Ethiopia

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A team of 15 IBM (NYSE: IBM) experts today presented its recommendations to Ethiopian leaders on a range of critical projects aimed at supporting Ethiopia’s national Growth and Transformation Plan.

The business and technology experts from 10 different countries spent four weeks on the ground in the country’s capital Addis Ababa, working with government ministries and NGOs to help them attract foreign investment, deliver healthcare services, and track economic growth. They explained the latest, most effective methodologies for achieving those goals, including mobile technologies, online portals and data analytics, along with the latest best practices in marketing, finance and project management.

The organizations with which IBM worked included the Ministry of Health, the Ethiopian Investment Commission, the Ministry of Labor and Social Affairs and NGO Digital Opportunity Trust. IBM also worked with Dow Chemical to provide counsel to International Medical Corps — the latest in a series of joint projects worldwide in which IBM has teamed with other companies looking to fortify their pro bono consulting programs.

The engagements come as the “Horn of Africa” country continues on its path of accelerated economic growth and works to transform the standard of living for a citizen population of over 90 million. Hailed by some as the “African Lion.” Ethiopia is one of the world’s fastest growing economies with an average annual GDP growth rate of over 10% for the past decade (World Bank) and with plans to become a middle-income country by 2025.

The pro bono consulting work that IBM performed is part its Corporate Service Corps (CSC) program – a global pro-bono initiative through which IBM deploys teams of its most talented people on projects aimed at driving social and economic development. Africa has become a strong focus for IBM’s CSC program as it expands its operations across the continent and forges new strategic relationships with government, clients and not for profits.

“Over the past decade, Ethiopia has become one of Africa’s biggest economic and social success stories,” said HE Dr. Kesetebirhan Admasu Birhane, Ethiopia’s Minister of Health. “As Ethiopia continues along its course of economic and social transformation, it is important that we work closely with experts like IBM who can bring their global expertise and leading technologies to bear to ensure that our nation’s success is sustainable and inclusive.”

This week IBM presented its recommendations and findings to 5 clients which include:

• The Ministry of Health: an IBM team identified opportunities to use internet and mobile technologies to support the country’s Health Extension Program. The IBM team recommended a text-based communications system to enable the Ministry to communicate better with its 39,000 Health Extension Workers and a system to enable citizens in rural areas to send in views and comments about healthcare via mobile phones. A key part of the proposed solution is text analytics software to help identify emerging healthcare trends such as the spread of disease or public misconceptions about healthcare issues.
• The Ethiopian Investment Commission (EIC): IBM developed plans for an integrated IT system to simplify and ease investment processes for foreign companies looking to set up business in Ethiopia. IBM recommended a “one-stop-shop” solution with web interfaces to enhance process automation and integration across collaborating departments and external entities.
• The Ministry of Labor and Social Affairs (MoLSA): an IBM team came up with a set of recommendations to reduce the time and effort spent on the collection and analysis of key labor market data such as employment rates and job vacancies. The IBM team performed an analysis of best practices from around the world and identified opportunities and technologies to speed up processes and reduce margins of error.
• International Medical Corps (IMC): an IBM team assessed IMC’s information management system and recommended a methodology to measure the effectiveness of its programs. The team proposed a roadmap that leverages mobile and analytics technologies to gather and analyze data about nutrition, water, sanitation, and hygiene, primary health and livelihood. It supports IMC’s work in helping local communities become less vulnerable to events like drought and disease outbreaks. As part of the project, the IBM team collaborated with Dow Chemical to study and promote enhanced sanitation facilities in rural areas.
• Digital Opportunity Trust (DOT): IBM consultants advised global NGO DOT on its program to roll out Business Development Service Centers, which provide entrepreneurial and IT training to young people across Ethiopia. The IBM team came up with a set of recommendations to optimize offerings such as mentoring and job placement, identify new sources of funding and raise awareness of DOT’s services.

“As we continue to forge relationships across the African continent, the Corporate Service Corps Program is a powerful way for IBM to provide national, municipal, civic and social institutions here with the same expertise that we provide our commercial clients,” said Solomon Mengesha, IBM Business Development Manager East Africa. “We see great potential in Ethiopia and strong interest in developing innovative solutions that can drive further economic and social transformation.”

IBM has an active commercial presence in Ethiopia, supporting clients across a range of sectors including banking, government and telecommunications. For example, IBM is supporting the Commercial Bank of Ethiopia (CBE) in its modernization and business expansion program as it rolls out core banking services across the country and launches new mobile and internet banking services.

About IBM Corporate Service Corps
IBM’s Corporate Service Corps is a global pro-bono initiative through which IBM deploys teams of top achieving employees to emerging market countries. These global and multicultural teams spend one month on the ground working with local government, non profit civic groups, and small business to develop blueprints that touch issues ranging from economic development, energy and transportation, to education and healthcare.  Participating IBM employees offer skills that include technology, scientific research, marketing, finance, human resources, law and economic development.

By the end of 2014, IBM Corporate Service Corps will have dispatched approximately 2,600 IBM employees originating from 56 countries on engagements to 37 countries — making this pro bono problem solving program one of the world’s largest. Africa, a growing market for IBM, is one of the focal points of the program. By the end of 2014, the CSC will have deployed 800 IBM employees for projects in South Africa, Ethiopia, Angola, Senegal, Tanzania, Nigeria, Ghana, Kenya, Morocco and Egypt.

http://www.itnewsonline.com/prnewswire/IBM-Experts-Help-Drive-Economic-and-Social-Change-in-Ethiopia/340699

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Filed under: Ag Related, Economy, Infrastructure Developments, News Round-up Tagged: Agriculture, Allana Potash, Business, East Africa, Economic growth, Ethiopia, Investment, Millennium Development Goals, Potash, Sub-Saharan Africa, tag1

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AFRICA INVESTMENT-Garment-making finds new low-cost home in Ethiopia

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By Aaron Maasho – ADDIS ABABA, Sept 5 / 2014

(Reuters) – As basic wages soar in China, low-end manufacturing is starting to shift to cheaper locations around the world, and frontier African nations such as Ethiopia are positioning themselves to reap the benefits.

With rock-bottom wages, cheap and stable electricity and improving transport infrastructure, the continent’s most populous nation after Nigeria is building a reputation for producing clothes, shoes and other basic goods.

The sector is still in its infancy in what was for decades a Communist-run economic backwater. Bureaucracy and poor transport links mean business costs aren’t quite as low as they might be.

But state investment in factory zones and the arrival of firms from Turkey, India, the Gulf and China suggest industrialisation is finally taking root in the east African giant, where many still rely on subsistence agriculture.

“We have to move because of manufacturing’s development in China, due to the high increase in wages and in raw materials,” said Nara Zhou, spokeswoman for Huajian, a Chinese company that makes over 300,000 pairs of boots and sandals a month for retailers such as Guess from a factory near the capital.

“Ethiopia enjoys stability, the government is eager to industrialise and there is also the low labour cost here – a tenth compared to China,” she added.

HIGH GROWTH RATES

For years, investors gave Ethiopia a wide berth, wary of the heavy role played in the economy by a government that shuns the liberalisation seen in other African nations and which has retained its monopoly on telecommunications and bar on foreigners in the financial sector.

However, in the last few years the commercial logic of factory production has started to outweigh those concerns, and the wider effects are dramatic.

The government is projecting gross domestic product (GDP) growth at 11 percent a year, and even though the International Monetary Fund is more sober its 8.5 percent forecast for this year indicates Ethiopia is one of Africa’s – and the world’s – fastest-growing economies.

Despite the government’s socialist roots, there is no minimum wage, letting firms such as Huajian pay salaries of $50-$70 a month – still higher than the average per capita income.

“Almost every young person in this locality now works here,” said Desta, one of 7,500 employees at Ayka Addis Textile and Investment Group, a Turkish-owned factory 20 km (13 miles) west of the capital.

“We all struggled to make ends meet beforehand. We can now afford proper healthcare or sending a child to school,” Desta, who did not give his surname, added.

CHEAP POWER

With 90 million people already and annual population growth forecast to exceed 2 percent until 2030, the government is desperate to attract labour-intensive investment and jobs.

To this end, it says it has introduced incentives such as tax holidays and subsidised loans to investors with interest rates as low as 8 percent – below even the 9.75 percent benchmark rate in South Africa, the continent’s most developed economy.

Ethiopia is also investing heavily in hydropower to boost the scope of a grid that offers electricity at 5 U.S. cents per kilowatt hour, compared with 24 cents in neighbouring Kenya.

“The availability of power and the cost is cheaper than any other country in the world. We are providing power, land and labour all very cheaply,” said trade and industry minister Tadesse Haile, who wants Ethiopia to export $1.5 billion of textiles a year in five years, from just $100 million now.

Other east African nations such as Kenya and Uganda are also chasing textiles investment but cannot compete on input costs against Ethiopia, where wages are 60 percent lower than the regional average, said Jaswinder Bedi, Kenya-based chairman of the 27-nation African Cotton and Textile Industries Federation.

“Ethiopia is a new player,” Bedi said. “They are growing and they are growing rapidly.”

BOTTLENECKS

Even so, bureaucracy and transport impose a major cost on companies, leaving Ethiopia languishing at 141 in a World Bank global trade logistics index published last year.

Importing or exporting a container takes on average 44 days, compared to 26 for Rwanda, another landlocked East African nation.

“Our logistics costs are second to input,” Ayka Addis chief executive Amare Teklemariam told Reuters. “It affects the competitiveness of the company.”

To this end, the government says it is pouring funds equivalent to two thirds of GDP into new infrastructure every year, expanding the road network to 136,000 km by next year, from just 50,000 km in 2010.

It also has grand plans to build 5,000 km of railway lines by 2020 from less than 800 km at the moment.

“Infrastructure development is something Ethiopia is working seriously on,” Tadesse said.

http://www.reuters.com/article/2014/09/05/africa-investment-idUSL5N0R61WH20140905

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Yara Plans $2.5 Billion Gas-Based Fertilizer Plant in Africa

By William Davison

Yara International ASA (YAR), the largest publicly traded nitrogen-fertilizer seller, said it plans to build a $2.5 billion plant in west or east Africa once gas projects come on-stream toward the end of the decade.

Yara has held initial talks with governments in countries such as Tanzania, Angola, Ghana, Nigeria and Mozambique about building a “considerable and world-class” urea factory to produce for African and foreign markets, Chief Executive Officer Joergen Ole Haslestad said in an interview yesterday in Ethiopia’s capital, Addis Ababa.

“We would very much like to participate in greenfield fertilizer production developments,” he said. “This is probably three to four years down the road before it will materialize.”

Mozambique may become the world’s third-largest gas producer in 2018 after companies such as Eni SpA of Italy and Woodlands, Texas-based Anadarko Petroleum Corp. begin output from reserves estimated at 250 trillion cubic feet. Tanzania, which has the biggest reserves in east Africa after Mozambique with 46.5 trillion cubic feet, expects that figure to exceed 100 trillion cubic feet within the next two to three years, Energy Minister Sospeter Muhongo said in February.

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Joergen Ole Haslestad, Chief Executive Officer of Yara International ASA.

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Latin America

Yara acquired Brazil’s Galvani Industria Comercio e Servicos SA for $318 million last month to expand further in South America. It bought Bunge Ltd.’s operations in Brazil for $750 million in December 2012 and OFD Holding Inc. from Omimex Resources Inc. for $425 million in November last year.

“Obviously the west part of Africa is good for Latin America where have big operations,” Haslestad said about the export possibilities from the planned fertilizer plant. “So we can take advantage of that.”

Yara, based in Oslo, plans to add to its existing seven African bagging and warehousing facilities by opening a $20 million unit close to the harbor in Dar es Salaam, Tanzania’s commercial capital, in October. It plans a similar venture in Ghana once the economic situation improves in that country, Haslestad said.

The West African nation has turned to the International Monetary Fund for help in rescuing its currency, which has lost 37 percent against the dollar this year.

A decision on whether to proceed with potash extraction at Yara’s majority-owned project in northeast Ethiopia will probably be made early next year, he said. Production of sulphate of potash for export could then begin three years later from what would be a $1 billion project, according to Haslestad.

“There will be resources enough for having mining operations there for the next 30 to 40 years,” he said.

The company expects to see sales grow “gradually” in Africa, which is the world’s fastest-growing fertilizer market, he said.

Yara rose 0.2 percent to 309.60 kroner at 3:49 p.m. in Oslo, extending the gain this year to 19 percent.

http://www.bloomberg.com/news/2014-09-02/yara-plans-2-5-billion-gas-based-fertilizer-plant-in-africa.html

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Under Construction: Uganda’s First Fertilizer Plant

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By Godfrey Olukya

http://in2eastafrica.net/tororo-fertilizer-plant-set-to-be-launched/” width=”620″ height=”350″ />

Tororo fertilizer plant

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More than 1200 local Ugandans and about 100 Chinese workers will be employed at Uganda’s first phosphate factory, under construction by a Chinese company, the Ugandan president promises.

President Yoweri Museveni launched construction in August of Sukuru Phosphate Project in Eastern Uganda Tororo district, promising jobs. He appealed to area residents to produce more food that they can sell to a large population of employees working in the factory.

Siraj Sinde lives near the site where the factory is to be established. “We welcome the project,” Sinde told AFKInsider. “It is going to get us jobs. Many youths here are unemployed and therefore such a project is appreciated.”

Until now, Uganda and neighboring countries have had to import fertilizer from other countries at exorbitant prices, according to a statement from the Ugandan government. With the $620-million factory, the country plans to change that.

Although phosphates were discovered in Eastern Uganda in 1960, the resource wasn’t exploited because the government said it had no capital to establish a factory to make fertilizers.

Ministry of Energy official Micheal Kizza blames Idi Amin’s dictatorship and subsequent regimes for making it difficult to get investors interested in exploiting phosphates. During Amin’s brutal rule from 1972 to 1979, Asians and other foreign investors were expelled from the country.

Museveni helped restore sanity and foreign investors started coming back, Kizza said.

“The Chinese expressed interest in exploiting the phosphate by making fertilizers and the government made an agreement with them,” Kizza said.

It is the only phosphate project in Uganda. Apart from making fertilizers, other byproducts of the mineral will also be manufactured at the site.

“I am glad to come here to start the construction of this project,” Museveni said on Ugandan national TV. “You people of Tororo will get jobs. You can grow more food and sell some to the workers. If I was here, I would get rich because I would sell my milk to the workers and earn money.”

The $620-million plant will include a complex of factories with an annual production of 300,000 tons from the phosphates plant, 300,000 tons from a steel plant, 200,000 tons from the sulphuric acid plant, 100,000 tons from a rare Earth factory, 300,000 tons of gypsum from a gypsum plant and 12-megawatts of electricity from the waste heat power-generation plant, according to a government statement.

The plant is expected to start production in December 2016 and to employ more than 1,200 Ugandans. The mineral deposits at Sukuru Phosphate Project are expected to last more than 100 years and generate $350 million annually, the Ugandan government says.

Museveni performed a groundbreaking ceremony with Lv Weidong, president of Guangzhou Dongsong Energy Group Co. Ltd.

In his speech, Museveni said the government spent more than $40 million to explore minerals in the country in a geological survey. He said the minerals belong to the state and proceeds will be used for strengthening infrastructure and education.

Museveni congratulated the Chinese company for overcoming hurdles that threatened the start of the construction, including corrupt government officials who wanted to bribes.

“I would like to congratulate these investors. They did what they told me within a short time. They will bring us other investors. These people have built a lot of capacity. They can help us also build our capacity,” Museveni said in a statement.

Prime Minister Amama Mbabazi said phosphates offer Ugandans opportunities, especially
in the agricultural sector which accounts for 30 percent of total economic output.

http://afkinsider.com/69632/uganda-getting-first-fertilizer-factory/

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American And Canadian Investors Meet Ethiopian Government To Explore Phase 2 Of Power Sector Transformation

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Powering Africa: Ethiopia will take place from 20-21st November 2014 in Addis Ababa

The Powering Africa Ethiopia Executive Meeting connects Ethiopia’s government and energy ministries with international and local power and infrastructure developers and financiers seeking new investment opportunities within the region.

Government Finalizes Preparations to Support Commercial Farmers

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Ministry of Agriculture announced that it has been making preparations to solve the challenges investors in commercial farming face.

The ministry is striving to engage more investors in farming cotton, wheat and the likes, it was also indicated.

Agricultural Extension Director- General with the ministry, Tesfaye Mangiste, said the government encourages investors that fill the demand and supply gap of agricultural produces.

Preparations are this Ethiopian fiscal year finalized to address well ahead the problems commercial farmers raise and provide inputs, experts and training to further motivate farmers, he added.

More than 183 investors are currently engaged in cultivating wheat and efforts are underway to increase the number of investors in the sector by expanding on their experiences, the director-general pointed out.

The ministry called on investors to effectively make use of the policy and benefit themselves and the country.

Even if many investors are engaged in the agricultural sector, the government would give special support to investors cultivating cotton and wheat in the present budget year, it was pointed out.

A consultative forum that brings together investors, associations and unions would be created to solve the problem of market raised by wheat producing farmers.

http://213.55.98.22/enae/index.php?option=com_k2&view=item&id=2226:government-finalizes-preparations-to-support-commercial-farmers&Itemid=200

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Relations between Ethiopia, European Union Register Significant Growth

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The relations between Ethiopia and the European Union (EU) have been showing significant growth as their friendship is based on mutual benefits and is strategic, Ethiopia’s Permanent Envoy and Plenipotentiary to EU said.

The envoy, Ambassador Teshome Toga, told ENA that Ethio-EU relationship is based on mutual benefits and on strategic principles.

Ambassador Teshome, who pointed out the close working relationship Ethiopia, has developed with the European Union Commission and the EU Parliament, said the country has been receiving huge support from the union for its development activities.

He also said the trade relationship is strong and 40 percent of Ethiopia’s export goes to EU member countries while foreign direct investment flowing from the union to Ethiopia has been increasing.

Ethiopia is benefiting from the development aid extended to 79 African, Caribbean and Pacific countries, the envoy said, adding that the union would further give 200 million Euros to Ethiopia for human rights and related issues through its development fund.

The support of the union to Ethiopia is strong and comprehensive as the EU appreciates the role Ethiopia has been playing in bringing about sustainable peace and stability to Africa, and East Africa in particular, Ambassador Teshome elaborated.

The peace keeping role of Ethiopia in Somalia and South Sudan has for instance been winning support in various ways, he added.

According to the envoy, the European Union has allotted 745 million Euros that would be used for agriculture, food security, infrastructure building, education and health from 2014 to 2020.

Out of the 28 EU member countries 20 have embassies in Addis Ababa.

http://213.55.98.22/enae/index.php?option=com_k2&view=item&id=2224:relations-between-ethiopia-european-union-register-significant-growth&Itemid=260

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Ethiopia’s Trade Relations with Middle Eastern Countries Growing

Ethiopia’s trade relation with Middle Eastern countries is growing, according to Ambassador Abdulkadir Rizku.

In an exclusive interview with ENA, Ethiopia’s Special Envoy and Plenipotentiary for United Arab Emirates Abdulkadir stated that demand for the agricultural products of Ethiopia in the Middle East market has been growing.

He also said investors in the region are making Ethiopia their investment destination.

The ambassador said Ethiopia decided to open its embassy in Abu Dhabi in January considering the fact that the city has a good market for any trade and investment.

Investors have channeled their capital into the country as the embassy carried out promotional works that explained the investment opportunities in Ethiopia to big businesspersons in Abu Dhabi and the surroundings, Ambassador Abdulkadir explained.

The ambassador recalled that a 35-person business delegation led by the country’s Economy Minister, Sultan bin Saeed Al Mansoori, visited Ethiopia in March to discuss about the investment opportunities in Ethiopia.

As a result, Emirati investors are currently engaged in exporting agricultural, horticultural and floricultural products as well meat and fattening animals.

The embassy is also working to protect the rights of Ethiopians living in the area, according to Ambassador Abdulkadir who added that associations of communities and coordinating office for mobilizing support for the Grand Renaissance Dam have been established.

In these regard, the embassy has facilitated the effort of the Ethiopian Diaspora to pledge 216,000 USD and deposit over 80,000 USD, he concluded.

http://213.55.98.22/enae/index.php?option=com_k2&view=item&id=2227:ethiopias-trade-relations-with-middle-eastern-countries-growing&Itemid=199

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EEP says Gibe III 87 % complete

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Some 87 % of Gibe III hydropower project has been completed, according to the Ethiopian Electric Power (EEP).

Once completed, the Gibe III project under construction on Omo River in Ethiopia will generate about 1,870 megawatt (MW).

Work on the project is being expedited,’ external relations head at EEP, Miskir Negash, told WIC. “Electrical and mechanical works are nearing completion,” he said.

Upon completion, the project housing 10 turbine units with a power of 187 MW each will increase the electric energy coverage in the country by 94 percent, he said.

According to him, two of the ten turbine units will begin generating electric power this Ethiopian budget year.

Installation of electric transmission line is also underway in conjunction with the construction of the project, he said.

In addition to improving their socio-economic benefits, the project protected residents of the area from frequent flooding, he said.

According to Misiker, over 7,500 Ethiopians and 120 foreigners are taking part at the project.

Gibe III hydropower project was commenced in 1999 EC, it was learnt.

http://www.waltainfo.com/index.php/explore/14870-eep-says-gibe-iii-87-complete-addis-ababa-5-september-2014-wic-some-87-of-gibe-iii-hydropower-project-has-been-completed-according-to-the-ethiopian-electric-power-eep-once-completed-the-gibe-iii-project-under-construction-on-omo-river-in-

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Ethiopia in Category 1 in Aviation Safety Assessment of FAA

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Following months of examination, the US Federal Aviation Administration (FAA) has reportedly confirmed that the Ethiopian Civil Aviation Authority (ECAA) is in category 1 in the aviation industry.

The Ethiopian Civil Aviation Authority told ENA that FAA’s official letter has reaffirmed that Ethiopia has maintained its status of belonging to category 1 in the aviation industry.

The Ethiopian Civil Aviation Authority is in the stated category for its operational organization, air space licensing and supervision as well as flight safety, it was indicated.

According to State Minister of Transport Getachew Mengiste, the certification by FAA has enabled the Ethiopian Airlines to secure flying permits to the US, Europe and other continents without difficulty.

He added that the air traffic of the country has registered over 20 percent growth on average during the previous years.

Authority Director-General Colonel Wesenyeleh Hunegnaw on his part said Bole International Airport alone has been accommodating over 200 airplanes in a day. Duration of landing and takeoff have also fallen under three minutes, he added.

http://213.55.98.22/enae/index.php?option=com_k2&view=item&id=2225:ethiopia-in-category-1-in-aviation-safety-assessment-of-faa&Itemid=200

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Filed under: Ag Related, Economy, Infrastructure Developments, News Round-up Tagged: Africa, Agriculture, Allana Potash, Business, East Africa, Economic growth, Ethiopia, Investment, Millennium Development Goals, Potash, Sub-Saharan Africa, tag1, United States

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Potassium to be the first chemical fertilizer for teff

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While kicking off the first international potassium symposium on the role of potassium in cropping systems of sub-Saharan Africa, Ethiopia looks to be ready to start using the compound as a chemical fertilizer on teff farms for the first time. 

http://www.thereporterethiopia.com/index.php/news-headlines/item/2471-potassium-to-be-the-first-chemical-fertilizer-for-teff

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Ethiopia working to utilize potassium fertilizer to improve soil fertility

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Prof. Tekalign Mamo Assefa

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Ethiopia is working to properly utilize potassium (K) fertilizer to improve soil fertility thereby increase agricultural productivity the Ministry of Agriculture said.

Speaking at the 1st International Potash Institution Symposium held here today the State Minister Prof. Tekalign Mamo said Ethiopia has considered the need to use potassium fertilizer and boost soil fertility.

Considering the necessity of potassium for crop growth, the country started to use six new blended fertilizers including potassium.

After four decades of detachment from potassium fertilizer, researches conducted in recent years revealed the importance of potash for soil fertility, he said.

Nitrogen and phosphorus have been considered as the nutrients least present in soils; therefore, DAP and urea fertilizers have been the only fertilizer sources that have been in use in Ethiopia and in several other SSA countries.

A shift in this thinking in Ethiopia was triggered by research activities conducted during the last few years, the results from nationally launched soil fertility mapping, and ongoing new fertilizer demonstration trials being conducted in many areas.

Results from these studies proved that several nutrients including potassium are limiting crop yield. Based on these results, Ethiopia introduced six new fertilizers (including potassium) for distribution to farmers.

The IPI Director Hillel Magen on his part said sub-Saharan African countries including Ethiopia haven’t been widely used potassium fertilizers.

Studies conducted in the country displays that the country could increase productivity by using proper fertilizers including potassium.

The two-day symposium “The role of potassium in cropping system of Sub-Sahara Africa” on the current status and potential for increasing productivity is deliberating on soil fertility, quality of mineral fertilizers, and efficient use of fertilizers.

The symposium is also expected to address issues related to role and benefits of potassium fertilizers, focusing on chemical, physical and biological processes in soil and plants, farm management and economic application of fertilizers.

http://213.55.98.22/enae/index.php?option=com_k2&view=item&id=2219:ethiopia-working-to-utilize-potassium-fertilizer-to-improve-soil-fertility&Itemid=260

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WAFA organizes Ethio-Canada business summit

WAFA Marketing and Promotion is organizing the Ethio-Canada Business and Investment Summit 2014 to be held on September 15 at the Fairmont Royal York Toronto Hotel, Canada.

In a statement sent to The Reporter, WAFA said the Ethio-Canada Business and Investment Summit is organized under the auspices of the larger Canada-Africa Business Summit, 2014 scheduled to be held from 15 to 18 September in the same venue.

The summit is organized by Wafa Marketing and Promotion PLC and the Ethiopian Embassy in Canada while the Ethiopian Ministry of Foreign Affairs and the Ethiopian Chamber of Commerce and Sectoral Associations (ECCSA) are co-organizers of the summit. According to WAFA, the Canadian Embassy to Ethiopia, Trade Facilitation Office-Canada (TFO-Canada) and Canadian Council on Africa (CCAfrcia) have been providing technical support for the success of the summit from the Canadian side.

WAFA said the event, which is the first of its kind to be held in Canada, aims to be the largest gathering of the Canadian and African economic movers and stakeholders. The summit will bring together prominent experts, government officials and business people who will discuss strategic topics for Africa’s economic development including construction, infrastructure and transport, agriculture and agri-business, education, natural resources and financing.

WAFA said as part of the larger Canada-Africa Business Summit, Ethiopia has already been provided with the opportunity of taking part as a Country of Focus , which entitles Ethiopia to have its own half-day  “Doing Business in Ethiopia Forum” session on  15 September. According to WAFA the forum will enable Ethiopia to showcase the existing business opportunities to the wider Canadian market and African businesspersons through networking, and business to business meetings.

WAFA said the half-day session will be held in a premium location at the summit hall in the presence of more than 300 participants, including senior Ethiopian government officials as guest speakers and panelists of both the Doing Business Forum in Ethiopia as well as the greater Canada-Africa Business Summit sessions. More than 65 local businesses comprising petroleum, mining, textile/garment, leather and leather products, coffee, construction and machinery, oilseeds, tour and travel, representatives of business associations as well as Canadian, African and other international investors will participate in the summit.

The Ethiopian delegation will be led by Minister of Foreign Affairs Tedros Adhanom (Ph.D.), – one of the keynote speakers in the greater Canada-Africa Business Summit on September 16. Tedros will be accompanied by the Minister of Mines, Minister of Water, Irrigation and Energy, the director of the Investment Commission and other pertinent institutions.

http://www.thereporterethiopia.com/index.php/news-headlines/item/2467-wafa-organizes-ethio-canada-business-summit

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Ethiopia to Contract Most Expensive Dam Ever

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Ethiopian Electric Power (EEP) to award a contract to build a dam on Gebba River, whose cost per megawatt (mw) is twice the amount spent on the Great Ethiopian Renaissance Dam (GERD)

Hydrodam on Gebba River, whose cost per megawatt (mw) is twice the amount spent on the Great Ethiopian Renaissance Dam

The Ethiopian Electric Power (EEP), a state monopoly tasked with the investment, expansion and operations of a generation as well as transmission of electric power, is to award a contract to build a dam on Gebba River, whose cost per megawatt (mw) is twice the amount spent on the Great Ethiopian Renaissance Dam (GERD), sources disclosed.

Although last minute negotiations were still underway at the time of going to press, a joint venture arrangement between Chinese and Ethiopian companies is to get hired to build the dam planned to generate 391mw electric power, sources disclosed to Fortune.

The company, which has been unbundled recently from its predecessor, the Ethiopian Electric Power Corporation (EEPCo), has selected SINO Hydro and CGCC, Chinese construction firms active in Ethiopia, to work with SUR Construction and Oromia Water Works Enterprise (OWWE), according to these sources. Nonetheless, while the involvement of the first three companies has been confirmed by officials of the company, these officials have declined from confirming the participation of OWWE in the project.

EEP’s Chief Executive Officer, Azeb Asnake, is expected to sign the contract worth over 700 million dollars (over 14 billion Br) at the Hilton on Monday, September 8, 2014. The 12th dam in the country and first after the launch of the GERD, Geba Dam will consume more investment than any of the 11 dams that preceded it.

The most expensive dam to date was put on Tana-Beles, with 15.4 million Br for a megawatt while Gebba will consume over 35 million Br, according to reliable sources. GERD is projected to take a little over 14 million Br for a megawatt electric power generation when it gets completed in 2017, according to the plan. “GERD has economy of scale,” said an expert with vast experience in the industry.

To be built on Gebba River, near the border between Jimma and Illubabur zones of the Oromia Regional State, the cost is to be financed with a loan provided by the Chinese government, these sources disclosed. The life of the project comes a long way since its inception in 2005, where the World Bank and African Development Bank (AfDB) had shown interest to finance part of the 535 million dollars project at the start.

AfDB had sent a team of appraisal two years to determine the feasibility of the project and its impact on the environment, with the hope that AfDB would provide a 100 million dollar loan.

“With AfDB only providing a loan of 100 million dollars, the difference will have to be covered by the Ethiopian government and other financiers,” Lamin G Barrow, resident representative of AfDB at the time, had told Fortune.

http://addisfortune.net/breaking-news/ethiopia-to-contract-most-expensive-dam-ever/  

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Inside Ethiopian’s plan to dominate African skies

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By ANDUALEM SISAY in Addis Ababa

 

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In the 1940s, the American aviation market witnessed a major breakthrough when Trans World Airlines (TWA), then controlled by the famous American maverick film producer Howard Hughes, emerged as the pre-eminent competitor to Pan American World Airways’ monopoly of the country’s air travel.

During the Second World War, TWA also produced aircraft and spying equipment for the US government, according to documentaries on the secret life of the business magnate. Following the end of the war, the government was left with a surplus of aircraft.

These airplanes are now behind the success stories of some modern-day airlines, after the US decided to use them to cement partnerships with other countries while also looking to counter the expansion of the Soviet-led communist bloc.

The US government also used TWA to train pilots from across the world, while helping to establishing national airlines for countries in Europe, Middle East and Africa where it set up its air bases during the Cold War.

These include Germany’s Lufthansa, Saudi Arabian Airlines, and today’s Ethiopian Airlines (known simply as Ethiopian).

Ethiopian’s international flight story begins in April 8, 1946 when it flew to Cairo using one of the five surplus C-47 aircraft acquired from TWA with whom it established the joint venture, the Ethiopian Airlines INC.

The national carrier, which is now fully owned by the Ethiopian government, has since become one of Africa’s top airlines, with a total of 59 aircraft and 7,300 full time employees.

It has over the years braved a number of important challenges to remain in the skies, including pressure from the country’s former communist regime to dump the US and buy Soviet planes instead.

Big deliveries

Over the past seven years Ethiopian’s revenue has grown by an average of 25 per cent. The airline recently announced $107 million in annual net profit for 2012/13, a 178 per cent leap from the previous year.

The profit comes as a result of transporting 5.5 million people and 174,000 tonnes of cargo, with 190 daily flights and 1,330 weekly.

It also received a record number of 14 new airplanes and set up nine new stations across the world last year.

“We’ve got new airplanes [such] as the B787, B777 which were fuel efficient so our fuel cost is managed, although our fuel cost has gone up,” said Mr Tewolde Gebremariam, the chief executive officer of Ethiopian.

“Also the fact that we’ve got the airplanes, and are able to open nine new stations, that enabled us to grow the revenue, but the management was prudent in managing costs, so the cost hasn’t grown as much as the revenue, allowing us to register very good profit,” he said.

The revenue boost followed its membership to the Star Alliance last year and the arrivals of Boeing Dreamliners that are said to save up to 20 per cent in fuel consumption.

Of its total 13 orders, Ethiopian–the first airline outside Japan to own the model–has already received five Dreamliners so far. Next year it expects to bring in an additional four of these planes which are also said to cut carbon emission by 20 per cent.

In addition to US airplanes, by 2016 Ethiopian also expects to get some 14 Airbuses from Europe.

Fair share

As Africa’s trade and investment within itself and the rest of the world is on the rise, Ethiopian is eying this opportunity to expand its business and contribute to the continent’s growth of the continent. Currently, about 80 per cent of flights to and from Africa are operated by non-African airlines.

“We have to develop African aviation, it is our continental obligation. We (African airlines) should at least get our fair market share, which is 50 per cent,” Mr Tewolde said.

Today, 46 out of Ethiopian’s 76 international destinations are in Africa.

By opening different hubs in Africa, Ethiopian is now working to increase the market share of African airlines, including by snapping up smaller rivals.

In 2010 the Addis Ababa-based carrier acquired 40 per cent of ASKY Airlines of Togo, followed by a 49 per cent stake in Malawi Air.

ASKY, currently plying 12 destinations in its region and transporting 500,000 people yearly is expected to turn in a profit next year, while Malawi Air is under formation.

In addition, Ethiopian is also negotiating the opening of another hub in central Africa, according to Mr Tewolde, who noted that the airline is also currently supporting Cameroonian and Cape Verde airlines.

Following TWA’s model, Ethiopian is also training pilots and technicians from different African countries. Its aviation academy now accepts 1,000 students annually, with plans to expand this to 4,000 every year.

The airline is also set to open a four-star hotel in the capital, a walking distance from its Bole International Airport hub.

Its revising its Vision 2015 to introduce seven profit centres, it hopes to increase its current $1.9 billion annual revenue to $10 billion by 2025.

These centres are Ethiopian cargo, Ethiopian aviation academy, Ethiopian maintenance and overhaul, Ethiopian international passenger, Ethiopian domestic and regional passenger, Ethiopian In-Flight Catering and Ethiopian Ground Services.

In today’s globalisation era, Ethiopian Airlines, a child of the Cold War, now flies to 194 countries, picking up several aviation awards, while its parent TWA airline was sold and merged with American Airlines a decade ago.

Opportunities abound.

http://www.africareview.com/Business—Finance/Inside-Ethiopian-Airlines-plan-to-dominate-African-skies/-/979184/1985070/-/fmm7rtz/-/index.html

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Germany to assist universities in science, technology, engineering

Germany signed a new grant commitment worth 123.8 million Euros to support Ethiopia in three priority areas for the coming three years, until 2017.

Ahmed Shide State Minister of Finance and Economic Development of Ethiopia (MoFED) and Thomas Silberhorn Deputy Minister of Economic Cooperation and Development of Germany identified three priority areas during their triennial negotiation concluded on September 4.

Education, agriculture and conservation of natural resources and biodiversity are the three priority cooperation areas identified for the coming three years from 2015.

“Ethiopia values very much the cooperation it has with Germany, it is a unique one,” Ahmed Shide told his German counterpart on the signing ceremony held at the MoFED head office located off King George VI Street.

Ethiopia will benefit from all three cooperation areas, for instance the accord to reform university programs will bring Germany’s expertise on science, technology and engineering fields, according to the state minister.

The program will be mainly carried out by two German implementing agencies, GIZ and KfW Development Bank. With this new commitment Germany’s total volume of bilateral technical and financial cooperation since its formal inception 50 years ago amounts to one billion Euros, according to information obtained from the embassy.

Germany’s cooperation during the last few years contributed mainly to education and sustainable land management.

According to the embassy’s information, more than 50 vocational schools and universities are now offering new training courses and better practical training, and more than 180,000 hectares of degraded land were taken back into productive use through farming methods, benefiting 194,000 households.

http://www.thereporterethiopia.com/index.php/news-headlines/item/2462-germany-to-assist-universities-in-science-technology-engineering

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Inflation considerations delays income tax reform

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Sufian Ahmed, Minister of Finance and Economic Development

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The Ministry of Finance and Economic Development (MoFED) is said to have halted the revision of Ethiopia’s income tax structure following advice

from Prime Minister Hailemariam Desalegn’s macroeconomic team on the inflationary implication of rolling out the tax amendment so close to when the government gave its employees a pay bump.

According to The Reporter’s sources, the PM’s macro-economy advisory team recommended exercising some precaution when thinking of introducing the revision made on the income tax structure mainly for the inflationary pressure it might have when coupled with the salary increment. As per the suggestion of the advisory team, MoFED delayed the tax revision proposal submitted to it by the Ethiopian Revenues and Customs Authority (ERCA) two years ago.

After conducting a thorough assessment of the country’s tax schedule, ERCA proposed a general tax reform affecting many of the tax proclamations including the Customs Proclamation, which had caught the attention of the authority much earlier. Both the proposal and the revision gained acceptance quickly, which culminated in the ratification of revised customs proclamation by the parliament a few months ago.

Among other tax categories that need revising, payroll and corporate taxes from the income tax category and those indirect tax types such as turnover taxes and value add taxes levied on the end user of products or a services are the main ones, according to sources.

However, the advice of the macro-economy team to MoFED focused more on the two stands of taxes from the income tax category; payroll and corporate taxes. According to the same sources, the team focused more on payroll taxes and corporate taxes due to their potential to start inflationary pressure on consumer prices in the local market. They further explained that a reform on income tax categories would directly affect the disposable income left in the consumers’ pockets after paying their taxes, and that would directly affect the price of the commodities that they buy from the market.

“It is mandatory for us to delay the revision on employment and corporate taxes categories at least for one year,” the source said.

The proposed revision on the payroll tax for instance is anticipated to have a significant effect on the existing minimum taxable income bracket or the threshold beyond which income will not be taxed, the 150 birr mark, and the 35 percent flat rate levied on salary bracket exceeding 5,000 birr. In fact, the two have always been identified to be the most controversial areas of the payroll tax structure in Ethiopia. For the 150 birr minimum threshold, the basic idea behind leaving income below that of the tax system seems to have been the main driving factor for its long time revision. According to experts, the basics of exempting income brackets below 150 birr is that if a person is perceived as an enterprise that is producing but getting the reward in the form of a salary as opposed to corporate income of businesses, then 150 birr is supposed to be the minimum amount of money that a person needs to ensure its survival. Just as costs in the case of businesses, which is deductible from the income of businesses before taxes are paid, 150 birr is assumed not to eligible to be taxed, hence deducted from the whole of the income of individuals before taxes. But, revision was long overdue since the value of 150 in market has long lost its value to achieve what it is assumed to achieve, pundits argue.

Hence, with this revision forthcoming together with the recent move of salary increment to government employees means that employees could have received much more money in the form of disposable income which could in turn be inflationary.

It is to be remembered that aiming to adjust the existing cost of living, the government of Ethiopia has decided to make adjustments to the pay of its employees by as high as 46 percent, incurring a total 10 billion birr additional cost per annum.

http://www.thereporterethiopia.com/index.php/news-headlines/item/2472-inflation-considerations-delays-income-tax-reform

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Catering service demand surges

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Sheraton Addis

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A recent report by Bench Events, a London-based event organizer, said that Ethiopia is well among the ten top African nations experiencing an unprecedented rise in development of hotel chains in the region.

According to the report, Ethiopia currently has some six international standard hotels in the pipeline, which upon completion would add 990 rooms to the existing capacity of the hospitality industry. Still, the report indicated that Ethiopia remained one of the bottom ranked countries compared to Nigeria and Morocco, which have 6,614 and 4,828 rooms in the pipeline respectively.

However, a research by Awash International Bank suggested that Ethiopia might fail to accommodate tourists expected to come to the country both in 2015 and 2020. By 2015, Ethiopia plans to attract some one million tourists and sees to amass USD 3 billion. The country also envisages being one of the top five tourist destinations in Africa by 2020. Assuming a tourist would want to stay at least for a night, the demand for hotel rooms is projected to be some 1.3 million a day by 2015. The bank’s projection also shows that the single night demand will swell further to 3.1 million by 2020.

The current state of the tourism sector reveals that a little over half-a-million visitors come to Ethiopia every year, from whom the nation gets close to USD 300 million. For critics, such poor performance is way behind the targets set for the years to come and manifests the nature of the unrealistic targets set by the government for the tourism sector. However, in his recent interview with The Reporter, Solomon Tadesse, chief of the newly established Ethiopian Tourism Organization (ETO), said that the government has realized this and is taking measures to transform the sector. The establishment of ETO along with the Ethiopian Tourism Council, chaired by Prime Minister Hailemariam Desalegn, Solomon says reflects the commitments of the government.

In his statements, Matthew Weihs, managing director of Bench Events, said that Ethiopia should increase the supply of good quality, high-end hotel accommodations to grasp the opportunities in the catering industry. Bench Events is scheduled to organize the Africa Hotel Investment Forum (AHIF), which will be hosted here for three days starting September 29th. High-level international players, African officials and experts are planned to attend the forum.

Currently, the most high-end star rated hotels in Ethiopia include Sheraton Addis, Hilton and the recently opened Radisson Blu.

http://www.thereporterethiopia.com/index.php/news-headlines/item/2461-catering-service-demand-surges

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Next month, Eritrea is holding an Asmara Mining Conference (October 1-5). Eritrea has a variety of mineral deposits: the Canadian company, Nevsun, has produced gold for two years at its Bisha mine, switching to copper production at the end of last year; and the Colluli Potash Deposit is currently undergoing a feasibility study by South Boulder Mines of Australia. The Conference is being hosted by the Eritrean Ministry of Mines and the Eritrean National Mining Corporation (ENAMCO), and it is billed as providing a number of presentations on Eritrea’s mining prospects as well as providing a forum for discussion.

One subject that is unlikely to be raised is the use of forced labor in the mining industry, the subject of another report last week by Human Rights Concern – Eritrea. Eritrea has no human rights organizations and HRC-Eritrea is forced to operate in exile. This report deals with the use of forced labor at the Colluli Potash Project, a joint project between Australia’s South Boulder Mines, based in Perth, and ENAMCO. Human Rights Concern – Eritrea says ENAMCO, the mining investment arm of the Eritrean government negotiates all the terms and conditions with foreign investors. It provides “no transparency or accountability and neither the Eritrean Ministry of Energy and Mines, nor the Commercial Bank of Eritrea are aware of the management of the mining resources and revenue in Eritrea. They do not know what is going on and they are not allowed to ask.”

South Boulder Mines are currently carrying out a feasibility study of the substantial Potassium Sulfate deposits at Colluli. This is now due to be published in February next year, but South Boulder has already been highly optimistic about the prospects for the project. Colluli is about 350kms from Asmara and some 180 kms south of the port of Massawa in the south east of Eritrea. It lies in the area of the Danakil Depression, the hottest place on earth. Colluli potash deposit site is about 400 sq. km, within the Danakil depression, and its estimated expected production amounts to two million tonnes of potash per year, producing an estimated annual revenue is around up to 2 billion dollars.

The HRC-Eritrea report says that while the feasibility studies are being carried out, part of the preparation for future development is already under way, including the construction of a road from Colluli to the nearest part of the coast, which is about 70kms away. Other planned developments include the construction of a port and storage facilities as well as local infrastructure. The road, currently under construction, is being “rebuilt using the forced labour of underfed and overworked Eritreans in terrible living and working conditions.”

The report notes that the road construction is being done by Mereb Construction, a military construction company, set up by the Ministry of Defense, and run under the overall authority of the Segen Construction Company, which is owned by the country’s only political party, the Peoples Front for Democracy and Justice (PFDJ). The report claims all the workers for Mereb Construction are conscripts who are forced to work for six days per week and up to 12 hours per day, and are paid 500 Nakfa (equivalent to 10 US dollars) a month. This is the standard wage paid to all national conscripts. “They are citizens who have been held in the military against their will for many years, and treated like slaves.” Eritrea’s National Service, now the Warsai-Yikaalo Development Campaign, originally required 18 months from its members when started in 1994: six months military training and a year’s development activity. However, since 1998 when Eritrea attacked Ethiopia leading to a two year war, the Eritrea Government has never demobilized more than a handful of conscripts. The original conscripts have now been in service now for well over a decade, and more are recruited every year. This, the report underlines, is why some 4,000 Eritreans are fleeing across the borders into Sudan and Ethiopia every month.

The report underlines that Mereb Construction will also be responsible for building the accommodation at the mine and for other infrastructure, all being similarly built with its conscript labor force, in other words by forced labor. Mereb and Segen are two companies which have been frequently named as being responsible for the use of forced labor in other mining sites, notably Nevsun’s Bisha mine.

In 2009, an article by noted Eritrean academic, Gaim Kibreab, on the basis of fieldwork in Eritrea going back a decade or more earlier, concluded that the national service and the Warsai-Yikaalo Development did qualify as forced or compulsory labour as defined by relevant international conventions. The author noted that whatever the original ideas and benefits of the National Service program, the Warsai-Yikaalo Development in May 2002 turned the program into an indefinite and open-ended obligation, and concludes that “the Eritrean government ….uses forced labour as a means of political education and mobilisation, and for purposes of economic and infrastructural development, as well as for instilling work-ethic and discipline under a rigorously enforced punishment regime. It has also failed to suppress the use of forced labour by the ruling party’s firms and high-ranking officers of the armed forces… [and] in addition, the government also hires out conscripts to the private sector” All this is contrary to the international conventions to which Eritrea is a party.

He also noted that the major beneficiaries of the national service and the Warsai-Yikaalo Development were the government, the ruling party and senior army officers. He visited “construction sites where the large majority of the workers in the PFDJ construction firms were agelglot (conscripts).” In 1997–8, “Segen, the PFDJ’s construction company, built fifty-eight villas behind the Cagnew Station in Asmara. The villas were subsequently allocated to generals, high-ranking security and party officials, and selected ambassadors. Soon afterwards, about fifty additional houses were built by the same firm in the same area using conscripts’ unpaid labour, and given to high-ranking members of the armed forces…. When the asphalt road between Agordat and Tessenei was built, I was undertaking fieldwork in the area and most of the workers were conscripts. I also saw conscripts working in different ministries, departments, regional governments, agricultural schemes, digging wells, etc. The party’s firms, such as Segen, Bidho and Horn Construction, are the main property developers throughout the country, and the large majority of the manual workers, engineers, consultants, guards, cleaners, etc. are agelglot”.

More than a decade ago, former Eritrean Attorney-General, Adhanon Gebremariam, described the use of national service conscripts to provide workers for party, military and government companies, and even for individuals from these organizations, as a system of “slave labor”. He described it as a process defying “all standard international laws”. The services exacted from the conscripts, he said, had only been used for the benefit of the government, the ruling party and senior military officers, not for the benefit of the people. He noted that “the most productive section of the workforce in the country is tied up to the army and is forcibly engaged in road construction or toiling in farms belonging to army officers and the ruling party while the rest of the population are dependent upon international handouts. When such handouts [do] not arrive in time, the people [are] left with no alternative but to flee to neighboring countries.” In fact, he said, the main reason for the displacement of labor from life-sustaining economic activities to other areas was to provide for “the enrichment of the ruling party and high-ranking military officers.”

Other reports have detailed the use of conscripts in government agricultural and construction projects. A report in 2011 noted that all the big farms were owned by the PFDJ as were all the main construction companies, among whom it mentioned the major national companies, “Asbeco, Bidho, Ghedem, Rodaab and Segen and smaller ones such as Badme, Haben, Mereb, Musa Ali and Sawa.” Several reports on Nevsun’s Bisha mine identified Segen and Mereb as the major contractors, with both employing largely conscript labor. They said the overwhelming majority of Segen’s employees and labor force come from “the slave labor pool of youngsters brought from the national service and army.” Interviews of former workers provided detailed evidence of the poor treatment of Mereb’s workers and of the fact that the national service con scripts were paid no more than the then national service “salary’ of 400 Nakfa a month.

The second report of the UN Special Rapporteur for Human Rights in Eritrea, submitted to the UN Human Rights Council on May 13, focused on the country’s indefinite national service and on arbitrary arrests and detention. In its conclusion the report says firmly: “violations of human rights in Eritrea included indefinite national service; arbitrary arrests and detention, including incommunicado detention; extrajudicial killings; torture; inhumane prison conditions; infringement to freedoms of movement, expression and opinion, assembly, association and religious belief; sexual and gender-based violence; and violations of children’s rights.” The Special Rapporteur specifically labelled the endless compulsory national service as “forced labor” under the laws and norms of international law. The report says: “since the length of national service in Eritrea is of an indefinite nature, it effectively constitutes forced labor as provided for in article 8, paragraph 3 (a) of the Covenant on forced labor. The ILO Committee of Experts has also declared the practice of the National Service as incompatible with ILO Abolition of Forced Labour Convention No. 105.”
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Source: Ethiopian Ministry of Foreign Affairs’ weekly bulletin, Sept. 05, 2014.

Sourced here  http://hornaffairs.com/en/2014/09/06/eritrea-the-use-of-forced-labor-at-colluli-potash-project/

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Allana Potash Initiates Preliminary Economic Assessment on Production of Sulphate of Potash (SOP)

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TORONTO, ONTARIO–(Marketwired – Sep 8, 2014) – Allana Potash Corp. (AAA.TO) (“Allana” or the “Company”) announces that it has engaged ERCOSPLAN Ingenieurgesellschaft Geotechnik und Bergbau (“ERCOSPLAN”) to complete a Preliminary Economic Assessment (“PEA”) on Kainitite resources that may be amenable to SOP production on its Danakhil Project in Ethiopia. SOP is commonly used on chloride sensitive crops such as tobacco, fruits and vegetables and vineyards and typically commands a premium price to Muriate of Potash (MOP). The price differential between MOP and SOP is substantial, and has averaged approximately US$ 125-150/tonne above the MOP price over the past several years. However, recently the differential has increased to over US$350/tonne.

Farhad Abasov, President and CEO of Allana, commented, “We are pleased to have engaged ERCOSPLAN to complete a PEA evaluating the potential of the vast Kainitite resources on the Danakhil Project. As we move to completion on the development of our MOP operations, it makes sense to start to plan for the development of SOP as an Allana product line, particularly given the extent of our estimated SOP-based resource. The SOP PEA will proceed independently but in parallel with our development and optimization work on our MOP production facility as outlined in the MOP project’s Feasibility Study completed in 2013. The Kainitite is ubiquitous on our project license and management believes a positive PEA may allow Allana to add significant value for our shareholders. If the results of the SOP PEA are positive Allana may consider establishing a special purpose company dedicated to developing the SOP resources for sale in the global market.”

The Kainitite mineral resources on Allana’s Danakhil Project are extensive (see table below) and dominated by the mineral kainite (4KMg(SO₄)Cl x 11H₂O). For details on the Kainitite mineral resources see Technical Report entitled “Resource Update for the Danakhil Potash Deposit, Danakhil Depression, Afar State, Ethiopia” dated effective April 17, 2013 filed under the Company’s SEDAR profile at www.sedar.com on August 7, 2013.

Notes

1. MT=Million Tonnes, tonnage is for in-situ resource with no discount for recovery as mining method is to be determined.

2. Mineral resources that are not mineral reserves do not have demonstrated economic viability. The estimates of mineral resources may be materially affected by environmental, permitting, legal, title, taxation, sociopolitical, marketing, or other relevant issues.

3. The quantity and grade of reported inferred resources in this estimation are uncertain in nature and there has been insufficient exploration to define these inferred resources as an indicated or measured mineral resource and it is uncertain if further exploration will result in upgrading them to an indicated or measured mineral resource category.

The PEA will outline the potential to produce SOP (K₂SO₄) from kainite derived from the Kainitite Horizon in the project area. The Kainitite Horizon is interpreted as a primary evaporite unit in the basin and has been intersected in diamond drilling in most of the mining license area. The PEA will examine the use of solution mining to mine the Kainitite Horizon and produce 1,000,000 tonnes per year of SOP product from the brine as a separate operation from the current development program which will produce 1,000,000 tonnes per year of MOP.

The PEA will focus on six main areas covering the following:

1. Preliminary Brine Field Design
2. Preliminary Evaporation Ponds Design
3. Preliminary Process Development
4. Preliminary Definition of Additional Infrastructure
5. Preliminary Cost Estimates (CAPEX and OPEX)
6. Preliminary Market Study and Financial Model

ERCOSPLAN has extensive experience with potassium sulphate minerals and processing through its work in the potash industry in Germany where SOP is and has been produced from different combinations of potassium chloride and/or magnesium sulfate bearing minerals. The PEA is expected to be completed by Q1, 2015

http://finance.yahoo.com/news/allana-potash-initiates-preliminary-economic-110000394.html

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GIZ plans major off-grid electricity project in Ethiopia

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The project falls under the Energizing Development Program – a joint global initiative by Germany, the Netherlands, Norway, Australia, United Kingdom and Switzerland

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Ethiopian, Chinese joint venture sign deal to build 391MW hydropower plant

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Addis Ababa, 9 September 2014 (WIC) – SUR Construction PLC teamed up with two giant Chinese companies to build a new hydroelectric dam in Illu Aba Bora and Jimma zones of Oromia region.

Representatives of the contractors on Monday signed a 583 million USD agreement with Ethiopian Electric Power (EEP) to build the Geba Dam, which will have 391 MW installed power generating capacity.

In the past, SUR teamed up with the same Chinese companies – Sinohydro Corporation and China Gezhouba Group Company (CGGC) – to build the Tekeze dam, a 300 MW hydroelectric dam in Tigray region.

CGGC was also the contractor for Fincha Amerti Neshe (97 MW) and is currently building the Genale Dawa III hydropower project, a 254 MW hydroelectric dam on the border of Oromia and Somali regional states.

Based on the contractual arrangement, SUR will have 25 percent share of the project while Sinohydro and CGGC take a 40 and 35 percent share, respectively.
“Depending upon our performance, our share in the project could rise up to 40 percent, making us the lead partner,” Tadesse Yemane, general manager of SUR, told WIC.

The local company is expected to undertake the construction of two rock-fill dams, spillways and roads with its experts also participating in tunneling and foundation treatment.

“The project will, undoubtedly, contribute for knowledge and technology transfer to our local companies,” Alemayehu Tegenue, minister of Water, Irrigation and Energy, said.

‘Low cost’

Pending a loan approval process, 80 percent of the Geba Dam project will be financed by the EXIM bank of China with preferential credit modality.

“Compared to other similar hydropower projects, Geba is found to be reasonably low cost power plant,” Azeb Asnake, CEO of EEP, said during the signing ceremony.

Located some 540 km south west of Addis Ababa, the Geba Dam is a priority project planned for completion during the second phase of the Growth and Transformation Plan (GTP II).

The hydropower plant, which constitutes Geba I (226 MW) and Geba II (165 MW), is expected to be completed in four and a half years.

“The [joint venture] will pre-finance the project construction works and commence immediately without waiting for the approval of the loan,” Azeb expressed her hope.

The dam is also expected to create a possibility for the irrigation development of some 480,000 hectares in the lower Geba plane.

The launch of the project takes the number of hydroelectric dams under construction to four including Genale III, Gibe III (1,870 MW) and the Grand Ethiopian Renaissance Dam (6,000 MW).

http://www.waltainfo.com/index.php/editors-pick/14914–ethiopian-chinese-joint-venture-sign-deal-to-build-391mw-hydropower-plant

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Ethiopia to Join COMESA’s Free Trade Area

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The government of Ethiopia is on the move of joining the Common Market for Eastern and Southern Africa (COMESA) Free Trade Area (FTA) which enables the country to have preferential trade interaction between member countries.

The FTA covers core issues of tariff liberalization, rules of origin, customs procedures and simplification of customs documentation, transit procedures among other issues.

This decision came from following findings and recommendations of a research titled “Ethiopian Industrial Competitiveness” conducted by the COMESA and the Ministry of Finance & Economic Development (MoFED). The research recommended that the country is ready to join the free trade area because the county’s competitiveness in terms of quality and price improved from the previous times, according to Geremew Ayalew director general of trade relations & negotiations at the Ministry of Trade (MoT).

Two researches conducted 10 years ago had identified two main negative outcomes of joining the FTA at that time – that Ethiopia industries would be no match for cheaper imported products from the regional economic community and would be closed, and that 72,000 individuals would lose their jobs as a result of the closure of the industries.

The COMESA was established in the mid 1960s with the idea of regional economic cooperation. COMESA’s FTA was launched on October 2000 with nine Member States with the aim of trading on a full duty free and quota free basis, with the remaining countries at various stages of joining the FTA, which now has 13 members. The FTA has boosted intra COMESA trade, increasing it by nearly six-fold from 3.1 billion dollar in 2000 to 18 billion dollar in 2013.

Ethiopia was not able to join the membership because of incompetency in both the quality and quantity of its industrial products, according to Germew.

To be beneficiary of the preferential treatment goods should be in conformity with the rules of origin of COMESA’s FTA. The criteria generally require the goods should be wholly obtained or have undergone sufficient transformation in the production processes in the FTA..

The Ethiopian Industrial Competitiveness research was conducted by the support of the COMESA and the MoFED. The research was started a year ago and handed over to the MoFED recently after finalization. As a stakeholder the MoT was invited to give comments on the results and recommendations.

“The country will not join the FTA once but in five phases gradually to liberalize and cope up with the trade competition expected from industries of member states,” says to a source who wants to be anonymous.

The arrangement has already been prepared for joining the FTA and submitted to the parliament for parliamentary oversight and reflection before the parliament session was close on July, 2014.

“The parliament has a positive response for the arrangement,” said Germew.

Same like the COMESA’s FTA membership Ethiopia is also in the preparation of joining World Trade Organization (WTO) which was established in 1995 at Marrakech, Morocco, replacing its predecessor, the GATT formed at the end of WWII. Ethiopia is one of 23 countries with observer status to be an additional member to join the current 159 member countries at the WTO.

http://addisfortune.net/articles/ethiopia-to-join-comesas-free-trade-area/

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World Bank Chief to visit Ethiopia

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The World Bank Managing Director and Chief Operating Officer is set to visit Ethiopia. DireTube has learnt that the visit by Sri Mulyani Indrawati is part of the World Bank Groups’ effort to further strengthen the partnership with Ethiopia. 

The Director is expected to arrive in Ethiopia on September 14 for a three day visit. Indrawati is scheduled to meet Prime Minister Hailemariam Deslegn and members of his cabinet to discuss opportunities and challenges the country is currently facing. Indrawati will also meet with representatives of the donor community, the private sector, civil society and the media.

According to the schedule, several site visits are planned to assess firsthand how World Bank supported projects are benefiting the poor and are contributing to Ethiopia’s economic transformation.

The Director will also meet implementers and beneficiaries of projects promoting productive safety nets and improving urban local government development.

She will see firsthand how initiatives that increase competitiveness and create jobs play significant roles in reducing poverty.

http://www.waltainfo.com/index.php/explore/14921-world-bank-chief-to-visit-Ethiopia

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US $91.10 million for Ethiopia’s One Water, Sanitation and Hygiene National Programme (OWNP)

The Board approved a loan of UA 60 million (US $91.10 million) and a technical support grant of €7.63 million (US $10.06 million) from the Rural Water Supply and Sanitation Initiative (RWSSI) Trust Fund to finance the country’s mega water, sanitation and hygiene program, one of the biggest of such projects in the world.

The One Water, Sanitation and Hygiene National Programme (OWNP) is expected to deliver improved and sustainable water supply facilities in rural and pastoral areas, institutions and urban areas; improved sanitation facilities and better hygiene; improved WASH sector capacity for planning, budgeting, monitoring, reporting and sustaining services at decentralized and federal levels.

The direct beneficiaries are people based in rural and pastoral areas, who will benefit from improved and more inclusive provision of WASH services at household and institutional levels, and who will benefit from the attendant well-being, time-saving, and productivity gains.

The program will lay emphasis on the least served majority of Ethiopians (about 83% of the population who live in rural areas). The youth and women will especially benefit from the establishment of sector-related employment opportunities.

Ultimately, the OWNP is estimated to cost US $2.4 billion. Other institutions funding the project include the UK Department for International Development (DFID), UNICEF the World Bank and the Government of Ethiopia.

The Board meeting followed a flag-raising ceremony formalizing the Bank’s return to its headquarters after more than 11 years in its temporary relocation agency in Tunis.

http://www.afdb.org/en/news-and-events/article/afdb-approves-us-256-million-investments-in-infrastructure-water-sanitation-and-health-13476/

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InterContinental Hotel Group Unveils Ethiopian Branch

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VENTURES AFRICA – British multinational hotel company, InterContinental Hotels Group (IHG) is expanding its business in Africa with the launch of a 210-key hotel in Addis Ababa, Ethiopia, bringing its African total to 13 countries.

The hotelier said it has signed a management deal with Tsemex Hotels and Business Plc to develop its “Crowne Plaza” brand of hotel in the Ethiopian capital city.

It will be strategically located close to the headquarters of the United Nations Economic Commission for Africa, the African Union headquarters and the United Nations Convention Centre. And will also have seven large meeting rooms, a ballroom, a boardroom and other facilities like the health club and spas.

Pascal Gauvin, IHG CEO for India, Middle East and Africa, said the hotel is currently developed to exploit the growing inflow of tourists and foreigners, particularly with the Bole International Airport now serving almost 20 million passengers yearly.

“Addis Ababa has great potential for tourism but is currently under-supplied in catering to business travellers and meetings and events,” he said.

With presence across 12 African countries, IHG currently has 29 hotels, under five popular brands. These brands include Holiday Inn Express, Crowne Plaza, Holiday Inn, InterContinental, and Staybridge Suites.

http://www.ventures-africa.com/2014/09/intercontinental-hotel-group-unveils-ethiopian-branch/

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Lack of competition affects mobile data markets of ​​Congo and Ethiopia

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Mobile communications markets in the Democratic Republic of the Congo (DRC) and Ethiopia face challenges due to lack of competition, poor economic conditions and limited infrastructure availability, says a new report from Frost & Sullivan.

Additionally, mobile operators in these markets are largely focusing on subscriber acquisition and network expansion for voice services. This causes delay in the rollout of advanced networks such as Long Term Evolution (LTE) compared to other developed market, the report said.

The two markets earned revenues of $1.78 billion in 2013 which is expected to reach $3.27 billion by 2018, says a new report from Frost & Sullivan.

While population densities of both countries are among the highest in Sub-Saharan Africa, their active mobile penetration rates in 2013 were 36.4 percent and 24.1 percent respectively, well below Sub-Saharan Africa’s average of 61 percent, the research said.

The markets will see substantial growth in the next three to five years, mainly driven by the growing infrastructure investment in the region.

Data services and mobile money solutions are the key drivers of the market. Data revenue will be driven by the proliferation of low-cost mobile devices and the growing popularity of social media platforms. Mobile money will gain prominence as the number of Ethiopia and DRC’s unbanked populations have prompted their respective governments to place financial inclusion at the forefront of their socio-economic plans.

“While voice is still by far the dominant contributor to service revenue, data services and mobile money solutions are expected to fuel growth in the long term,” said Frost & Sullivan Information & Communication Technologies Research Analyst Lehlohonolo Mokenela.

Frost & Sullivan also finds that the growth of Ethiopia’s mobile communications market has been mostly been limited by a lack of competition; state-owned Ethio Telecoms is still the only provider in the market owing to tight regulatory protection.

Upon the completion of the country’s Growth and Transformation Plan (GTP), it is expected that the regulator will gradually open the market to competitors, Mokenela added.

In order to grow customer base in rural areas, mobile operators need to consider cost-effective network expansion strategies in the DRC, added Mokenela. “Leveraging infrastructure-sharing models and using hybrid base stations can help operators lower their operational site costs and mitigate the country’s intermittent electricity supply.”

http://www.telecomlead.com/telecom-services/lack-competition-affects-mobile-data-markets-%E2%80%8B%E2%80%8Bcongo-ethiopia-52829

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 Ireland Pledges to Consolidate Dev’t Assistance to Ethiopia

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Foreign Affairs State Minister Ambassador Birhane Gebrekristos held talks on Tuesday, September 9, 2014 with Niall Burgess, Secretary-General of the Department of Foreign Affairs and Trade of Ireland, on ways of improving the bilateral relations of the two countries.

During the occasion, Ambassador Birhane called on Irish investors to seize the investment opportunities created in Ethiopia and invest in agriculture, health, hotel and tourism as well as industry sectors.

He further urged Ireland to consolidate its development assistance in the spheres of agriculture, food security, potable water and other infrastructural activities.

Stating the importance Ethiopia attaches to the development support it get from Ireland, Ambassador Birhane finally asked the government of Ireland to uphold its contributions to the peace keeping effort underway in East Africa.

Niall Burgess on his part said Ireland would consolidate the development assistance it extends to Ethiopia.

He pointed out that Ireland would continue providing support for Ethiopia in its endeavors to meet the Millennium Development Goals; poverty, maternal and infant mortality reduction, and in development activities in general.

According to the Secretary-General, his country will strengthen its support to the effort underway to bring peace to East Africa and Africa in general.

Ireland has also the desire to jointly work with Ethiopia in climate change, peace and stability as well as African and other international issues, he added.

Ministry of Foreign Affairs Spokesperson, Ambassador Dina Mufti, stated that the relationship between Ireland and Ethiopia has registered tremendous growth within a short period.

The President of Ireland is expected to visit Ethiopia after two months, it was learned.

http://213.55.98.22/enae/index.php?option=com_k2&view=item&id=2246:ireland-pledges-to-consolidate-devt-assistance-to-ethiopia&Itemid=260

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Globe says Prattas likes Allana Potash’s latest move

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2014-09-09 09:14 ET – In the News

The Globe and Mail reports in its Tuesday, Sept. 9, edition that Allana Potash (31 Canadian cents) has hired a German company Ercosplan to complete a preliminary economic assessment on kainitite resources for sulphate of potash (SOP) production at its Danakhil project in Ethiopia.

The Globe’s Darcy Keith and Sonali Verma write that SOP is commonly used on chloride-sensitive crops such as tobacco, fruits, vegetables and vineyards. SOP typically commands a premium price to muriate of potash.

The price differential between the two has averaged approximately $125-$150 (U.S.) per tonne over the past several years and has increased to over $350 (U.S.) per tonne recently.

Allana Potash says the kainitite mineral resources at its Danakhil project are extensive.

Cantor Fitzgerald analyst Peter Prattas says, “In our opinion, this is a prudent move requiring only modest investment toward proving the economic validity of this resource with the potential to create value for shareholders.”

Mr. Prattas has a “buy” rating and $1.15 (Canadian) price target on the company’s shares. Mr. Prattas maintained his “buy” call on Allana in The Globe on Oct. 10, 2013. The shares were then worth 47 Canadian cents.

http://agoracom.com/ir/Allana/forums/discussion/topics/622245-globe-says-prattas-likes-allana-potash-s-latest-move/messages/1949978

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Turkey outdoes China in terms of Ethiopia investment

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While Turkish investors had arrived later, they had since poured some $1.2 billion worth of investment into Ethiopia, Habte said.

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Allana Potash Continues To Drift Amidst Ag Malaise

Stephen Simpson, CFA

Sep. 12, 2014                                                  

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Summary

• Allana shares continue to drift lower, despite a strong and engaged strategic partner in Israel Chemicals.
• If efforts to increase royalties and taxes on resources produced in Israel stick, Allana’s Ethiopian Danakhil project may become even more valuable to ICL.
• Allana still needs to secure project financing, but these very risky shares look undervalued below $0.80/ADR.

The bloom is definitely off of the ag bull market, as lower crop prices have soured investors on seed, ag equipment, and fertilizer companies. None of that is positive for Allana Potash (OTCPK:OTCPK:ALLRF, (AAA.TO)), nor is the fact that potash pricing remains stuck around $350 per ton. These shares have continued to weaken since the company announced a major tie-up with Israel Chemicals (OTCPK:ISCHY) and since my last piece. While the Global X Fertilizers/Potash ETF (NYSEARCA:SOIL) is down about 2% since my mid-March update on Allana, the company’s shares themselves are down another 20% or so.

Granting that investors were disappointed in the terms of alliance with ICL, and granting that there is still more dilution likely on the way (as the company still needs to raise debt, and probably equity, to fund its Danakhil project), I continue to believe these shares are undervalued. By no means is Allana anything other than a high-risk investment, but ICL appears committed to the project, and I believe the current price doesn’t give much credit to the value of the project.

While I generally recommend avoiding “F-type” ADRs and buying shares on local exchanges when possible, Allana’s ADRs are more liquid than most unsponsored ADRs. Even so, I’d advise owning the Toronto-listed shares when/where that is an option.

Some Progress, But Not Headline-Grabbing Stuff

Allana isn’t just sitting on its hands. There is a lot of work for the company to do as it moves toward building the mining capex needed to turn the Danakhil project in Ethiopia into a potash-producing asset.

The company has successfully relocated two villages, and received a water extraction permit from the Ethiopian government. With the permit covering 30M cubic meters/year, Allana has more than enough to cover the 18.5M or so cubic meters it will need to produce 1Mtpa of potash and some left over for production expansion. The ECPM contractor selection process is ongoing, and the company is presently working on optimizing the project (including hydrology work and in-fill drilling).

Elsewhere, important logistics projects are moving forward, including the construction of a road and port.

That’s all well and good (and necessary), but it is not the sort of activity that is going to lead to the market reconsidering the shares. What could prompt such a move is the company’s ongoing efforts to obtain financing for the project. Management expects to secure debt financing in the late fall or early winter. Investors shouldn’t expect great terms (this is a risky project in a risky jurisdiction), and there is a risk of delay in securing the financing, but less onerous terms or a creative structure could be a positive.

Developments At ICL Should Be Generating More Interest

While things at Allana have been fairly quiet, the same cannot be said of the company’s partner, ICL. The company is exploring the sale of its German cleaning/disinfectants business, a move that would make the fertilizer business even more prominent, and is pursuing a dual listing in the U.S.

More specific to Allana, ICL has relocated a managing director from its Cleveland Potash operation to Danakhil to help oversee the project. ICL has also been active in lobbying the Ethiopian government for support on the Danakhil project and sponsoring educational programs via Ethiopia’s Agriculture Transformation Agency on fertilizer application – part of a wider effort to start developing the African fertilizer market.

All of that may pale next to what happened in May, though. ICL lost on arbitration ruling regarding royalties, and saw Israel’s Sheshinski Committee recommend higher taxes and royalties on natural resources produced in Israel – a 5% royalty and a 42% natural resources tax to be applied after an 11% operating return calculated on depreciated assets. In response, ICL froze $1 billion in planned investments in its Dead Sea operations, and indicated that further investments in Israel are likely not viable under that sort of structure.

I would think that this should make the Allana Danakhil asset even more valuable to ICL. True, ICL has other projects in countries like Brazil and Vietnam, but this project should be able to produce a meaningful amount of potash in a relatively short time. I’d also note that Allana just recently announced that it had engaged a company to conduct a preliminary economic assessment of its kainitite resources at the Danakhil site. Kainitite can be processed into sulphate of potash (or SOP), a more valuable form of potash than murate of potash (or MOP) that is the initial focus of the project.

All told, it seems to me that Israel Chemicals is looking at the prospect of reduced expected economic returns from its Dead Sea potash assets, while it looks to increase its presence in the potash market and sell more into emerging markets like India, the Mid East, and Africa. I should think that would make Allana’s Danakhil project even more valuable to the company and perhaps motivate an outright acquisition of the remaining shares of the company, given the current slump.

No Change To My Outlook

While it is true that low crop prices have led investors to flee the ag sector, I don’t believe that the current price of corn or potash should have too much bearing on a project/company that won’t be producing for a few years. What’s more, fertilizer is still under-applied in many parts of the world, and I believe that demand for fertilizers like potash will continue to grow.

In valuing Allana, I use a lower assumed price than management’s feasibility report ($375/t versus $430/t), higher opex cost assumptions ($80/t-plus), and a higher discount rate. I also assume that the project will be expanded in 2024, though, so my life-of-project production forecast is higher. Including expected dilution and financing, I believe Allana shares should still trade at almost C$0.90/share, or just a bit under $0.80/ADR.

The Bottom Line

If Allana shares continue to drift lower, I believe ICL has to at least consider stepping up and buying up the remaining shares. At a minimum, I would think that such a transaction would lead to lower project financing costs. Taking the bearish side, what’s the rush? The off-take agreement lets ICL control the project’s expected production, and that would likely discourage a rival bidder, so other than an unexpected spike in potash prices, ICL might be thinking that there’s little risk of the share price of Allana running away from them.

Allana is the sort of stock/investment where it’s tempting to run the numbers over and over again, because it seems strange that the shares trade where they do. Even though the ICL deal was more dilutive than investors may have wanted, ICL’s commitment to the project is a positive, and the NAV looks attractive even with more conservative pricing and cost assumptions. Again, this is a high-risk opportunity, but one that I’m finding increasingly appealing as the shares drift lower on no apparent negative news, and in the face of what I believe ought to be positive news regarding the importance of Allana/Danakhil to ICL.

http://seekingalpha.com/article/2490885-allana-potash-continues-to-drift-amidst-ag-malaise

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US listing sought by ICL Chemicals

Israeli manufacturer of fertilizers and specialty chemicals Israel Chemicals Ltd had recently submitted to US regulatory authorities, documents seeking its registration with the New York Stock Exchange. ICL has permits to extract potash and bromine from the Dead Sea.

The application placed the nominal fundraising target at USD522.4 million with an initial public offering volume of 62 million ordinary shares. The company is a subsidiary of Israel Corp and is the second largest company in terms of market value listed on the Tel Aviv Stock Exchange.

The company was established back in 1968 as a government owned corporation. In 1992, the Israeli government decided to privatize the company, thus had it listed on the Tel Aviv bourse. In 1995, the government sold its controlling interest to Israel Corp., allowing the company to hold 52.4% shareholdings in ICL.

The second largest shareholder in ICL is Potash Corp of Saskatchewan Inc’s Israeli subsidiary, who owns 13.86% of ICL.

The Israeli government though still has approving authority on any sale or transfer of assets of ICL to any other company. This may prove to be a sticking point since they don’t own any shares in the company to be listed on NYSE.

The application had identified Morgan Stanley & Co and Barclays Capital Inc as lead bookrunners in the IPO. Also included are Goldman, Sachs & Co and Deutsche Bank as bookrunners with BMO Capital Markets Cop as co-manager for the IPO.

The move was precipitated by the Israeli government’s thrust to update its current policy on royalties and taxes for non-oil and gas natural resources. Just last May, a government panel had recommended the imposition of a new tax on mining companies in the country. In this scenario, ICL would be hit the hardest.

In response, the company may focus its efforts abroad should these recommendations come into force.

With the IPO, only Israel Corp’s shareholdings would be diluted, lowering from the current 52.4% to just 46.68%. The company would be listed under the symbol ‘ICL’ on the NYSE board.

The sales of ICL declined by 13% to just USD1.54 billion in the quarter ending June 30. This was attributed to the fall in prices as well as a decline in the volume sold. The company reported an adjusted profit earning of USD214 million for the period, which was lower than the previous quarter’s USD316 million.

Included in the application is a 30 day option granted to the underwriters to purchase an additional 6.2 million shares. Part of the sale would be structured as a derivative transaction to allow the selling shareholder with exposure to possible increases in the price of ICL shares. Alongside this provision is the corollary rejoinder that there is also protection when there are losses in the share price.

ICL’s shares are currently traded in the Tel Aviv Stock Exchange and the registration with the New York Stock Exchange would pose no issue for the company, shareholders and future buyers of the shares during the initial public offer.

http://gantdaily.com/2014/09/13/us-listing-sought-by-icl-chemicals/

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Company, Authority sign Dire Dawa–Dawale road upgrading project

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The Ethiopian Roads Authority yesterday signed an agreement with Chinese CGC Oversees Construction Company to upgrade 220-kms Dire Dawa–Dawale road at a cost of 3.9 billion Birr.

Shandong was also another Chinese company which won the bid to consult the project.

Signing the agreement, Authority Director General Zaid Wolde-Gebriel said that the road would be an alternative to connect Ethiopia to Djibouti port and ease the traffic burden of Awash- Mille-Djibout road which is now serving beyond capacity.

Cognizant of the traffic congestion on Awash-Mille-Djibouti road, the Authority conducted research to look for an alternative road  which it finally identified Dire Dawa-Dawale road to connect  the country to Djibouti with relatively shorter distance., he said.

According to him, the road is expected to serve as the second import-export corridor thereby accelerating trade.
He also said that the road would be completed with quality standards in three years time as the company is experienced in the area.

Company Vice President to Ethiopia Kin Lijing for his part said that the company would finalize the project on schedule. He said that so far, the company has undertaken survey work for 100-kms. He noted that the construction of this road would be done in accordance   with all quality specifications.

Some 85 per cent of the project fund is from Chinese Exim Bank in loan and the remaining 15 per cent would be covered by the government of Ethiopia.

http://www.waltainfo.com/index.php/explore/14955-company-authority-sign-dire-dawadawale-road-upgrading-project

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Solar Cookers Get Hot

By Glenn Zorpette

Guro Grytli Seim, the CEO of Morpho Solar, and Catlin Powers, COO of One Earth Designs, prepare a meal on a One Earth solar cooker.

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Of all the innovations that could markedly benefit humankind, a reliable solar cooker remains one of the most imperative. Countless people across the developing world still cook their food by burning wood or even cow dung, causing respiratory problems and severe deforestation in some regions.

The quest for a practical solar cooker has gone on for decades and produced dozens of models ranging from $70 cheapies to $400 deluxe models. But none of them have caught on significantly for use in the developing-world because they can’t store heat. Without the ability to store heat, a cooker cannot be used, for example, on cloudy days.

But now a group based at the Norwegian University of Science and Technology (NTNU) in Trondheim is reporting a breakthrough in solar cookers. They say it will lead, within a year and a half, to the production of practical solar cookers that can store enough heat during a sunny day to work for an entire additional day, even if it is cloudy. The breakthrough was recognized with a US $8,000 award from the Norwegian Ministry of Petroleum and Energy this past August.

“Our vision is to solve problems in developing countries,” says Guro Grytli Seim, the CEO of a company, Morpho Solar, that was formed recently to capitalize on the Norwegian advance. She notes that nine Ph.D. students and 20 Master’s degree candidates worked on the heat-storage technology, with funding from the university, the Norwegian Investment Fund For Developing Countries, and the electric utility Trønder Energi. The system uses the principle of phase-change to store and release heat. The key ingredient is a salt with a melting temperature of 220 °C, Seim says. Sunlight concentrated by a parabolic reflector melts the salt; when heat is needed, the salt is allowed to solidify, which releases heat.

The system can have a thermal efficiency of 80 percent, Seim explains. For comparison, an electrical system based on photovoltaic cells and batteries would be only about 15- to 20-percent efficient.

The team also developed two different techniques to transfer heat from the parabolic collector to the cooking surface. These technologies, one based on steam and the other on oil, allow the sunlight-collecting parabolic dish to be outside a home and the cooking surface to be inside.

The project began in 2011 with Asfafaw Haileselassie Tesfay, a mechanical-engineering researcher at NTNU. Tesfay came to Norway from his native Ethiopia, which has a particular need for a solar cooker. Eighty five percent of Ethiopians lack access to electricity. And the country has been severely deforested: 40 percent of Ethiopia’s land was once covered by forest; the figure is now 4.6 percent.

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Ethiopian cuisine, too, has a very specific requirement: a cooker that can reach a temperature between 200 °C and 250 °C. Such a temperature is needed to bake injera, a spongy pancake that is eaten with most meals in Ethiopia. Tesfay says the experimental cooker built by him and his colleagues can sustain a temperature of 220 °C (430 °F) for 24 hours, even if clouds roll in. This capability was demonstrated in March during trials with the cooker at Mekelle University in northern Ethiopia, he adds.

Seim says that Morpho Solar plans to complete a prototype of a commercial model in early 2015, and begin production in 2016. The company will begin selling the cooker in Europe and in the United States as well, under an agreement with Cambridge, Mass.-based One Earth Designs, one of the largest makers of solar cookers. Morpho’s strategy is to establish the product in the developed world before selling it at a lower price in developing countries, Seim explains. She is confident that it will appeal to environmentally conscious suburban families.

“It reduces your carbon footprint,” she notes. “And it’s fun. Many people value showing their kids that you can make food using only the sun. It’s less hassle, because you don’t have to buy charcoal or gas. You don’t have any recurring costs. We see that as a value proposition as well.”

http://spectrum.ieee.org/energywise/green-tech/solar/solar-cookers-get-hot

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Aluto-Langano geothermal plant to be operational in April

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The government of Ethiopia is striving for the operationalization of the Aluto-Langano geothermal power plant with installed capacity of 70mw power in this fiscal year, the Ministry of Water, Irrigation and Energy said.

Energy Study and Development Follow-up Director, Gosaye Mengistie told ENA over 78 percent of construction of the geothermal plant has so far finalized. It is expected that the plant will commence operation in April.

Launched in 2013, the expansion of the Aluto-Langano geothermal power plant will increase the country’s generation capacity from geothermal to 70mw power from the current 7mw.

The expansion project is financed by assistance from a 12 million dollar grant from the government of Japan, a 13 million dollar loan from the World Bank and 10 million dollars from the Ethiopian government.

Located in the Rift Valley Lakes Region, the Aluto Langano Geothermal Power Plant is the first geothermal power plant in Ethiopia. The plant was established in 1998 as a pilot plant to test the geothermal resources in the area.

The nation has set target to generate 1,000mw power from two geothermal plants, Tendaho and Corbeti geothermal plants, in the coming few years, he added.

The Tendaho power plant due to be undertaken in Afar regional state, north eastern part of the country, will have a capacity to generate 100mw power.

The nation has also signed agreement with a US- Icelandic private developer Reykjavik Geothermal (RG) to construct Africa’s largest geothermal plant. The Corbeti geothermal project the country due to built with 4 billion USD will be Africa’s largest geothermal plant, with 1,000mw installed power.

Construction of this plant, which will be undertaken in two phases, each with 500mw installed capacity with an eight to 10 year period.

These projects are part of the government’s plan to raise power output to 10,000mw by 2015, in order to meet the growing demand.

It is estimated that Ethiopia has a potential to generate up to 5,000mw power from only geothermal.

“Althou the nation has huge potential for geothermal energy, it doesn’t so far benefit from it. We set target to undertake various activities and change this situation.” he said.

Twenty two power generator sites, with huge geothermal potential have identified so far in the rift valley system, he added. Activities are being undertaken to develop this potential.

“First we have been conducting survey on about 18 places with huge geothermal potential. But now the number of places identified as having with huge potential has reached 22.”

Places like Dalol, Tendaho, Abi, Tiye, Meleka, Dafan, Fentale, Gedemesa, Tulu, Moye, Aloto Langano, Corbeti, and Abaya are among the places identified with huge geothermal potential.

Development of renewable energy will have economic and environmental benefits, said the Director. These projects will help the nation realize the vision to build green economy by 2025.

Utilizing the country’s potential for geothermal energy would help address the increasing demand for electricity, he added. It is estimated that the country’s demand for electricity increases by 25 to 30 percent annually.

http://213.55.98.22/enae/index.php?option=com_k2&view=itemlist&task=user&id=74%3Ameseretbekele&Itemid=260

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Filed under: Ag Related, Economy, Infrastructure Developments, News Round-up Tagged: Agriculture, Allana Potash, Business, East Africa, Economic growth, Ethiopia, ICL, Investment, Millennium Development Goals, Sub-Saharan Africa, tag1

Spuds are nutritious and hardy, and a research centre collaboration is helping defeat hunger in Africa

Gebremedhin Woldegiorgis, senior potato researcher at the Ethiopian Institute of Agricultural Research, and Denis Griffen, potato breeder at Teagas, inspect potato plants at the Teagasc Research Centre in Oakpark, Carlow.   photograph: Dylan Vaughan

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Ethio-Canada business summit opens in Toronto

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Alongside the first Canada-Africa 2014 Business Summit, the Ethio-Canada Business and Investment Summit also opened on Monday in Toronto.

This four-day meeting is co-organized by Wafa Marketing and Promotion PLC, the Ethiopian Embassy in Canada and Ethiopian Chamber of Commerce and Sectoral Associations in collaboration with the Canadian Embassy in Ethiopia, Ethiopia’s Ministry of Mines, TFO Canada, and CCAfrica.

It is specifically showcasing the value of doing business in Ethiopia.

It also aims at bringing together the two business communities to build more comprehensive and closer bilateral ties based on mutual benefit and common prosperity, deepen business-to-business ties through success stories from business persons and industry experts.

The summit in addition briefs Canadian investors on Ethiopia’s current and future economic trajectory, investment landscape and opportunities.

Ambassador Taye Atske-Selassie, Director-General of American Affairs in Ethiopia’s Foreign Ministry, opening the meeting, called for the continued growth of the bilateral ties of the two nations.

Ambassador Birtukan Ayano welcomed the role of Ethiopia as a Country of Focus within the auspices of the Canada-Africa Business Summit.

She said: “Ethiopia is poised to become a new frontier for FDI in Africa,” adding that this Summit would encourage and help Canadian investors to participate in Ethiopia’s rapid and sustainable economic growth and tap into the tremendous investment potential of the nation.

She stressed Ethiopia has a lot to offer Canadian development partners including a vibrant and trainable labor force, easily accessible and cheap utility services and a decade of double digit economic growth.

Permanent Representative to the AU, Ambassador David Usher said that this Summit could be seen as a reflection of the need for a growing cooperative economic partnership.

He also noted Ethiopia’s fast growing economy underlined the need to renew the strategic partnership of the two countries.

The current economic growth in Ethiopia, he said, was already generating an increasing business interest from Canadian companies.

Zemedneh Nigatu, Managing Partner of Ernst and Young, presented reasons of investing and doing business in Ethiopia with the theme “Investing in Emerging Ethiopia.”

He detailed ten reasons including Ethiopia’s growing economy and macro-economic stability, demographic advantages, rapid urbanization, its role as a manufacturing hub of Africa, massive infrastructure development, and energy infrastructure development, untapped agricultural resources, tourism, and favorable operating business environment.

The Ethio-Canada Business and Investment Summit is also showcasing panel discussions, question and answer sessions, and deliberations on Ethiopia as a Country of Focus within the Canada-Africa Business Summit.

http://www.ertagov.com/news/component/k2/item/3157-ethio-canada-business-summit-opens-in-toronto.html

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Eleven Companies in Tight Run to Win 900,000tn Fertiliser Tender

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Farmers are recommended to use one quintal of DAP and one quintal of Urea for a hectare of land in which the quantity varies based on the type of the soil.

(Editor’s note:) The 1-1 urea-DAP application is found to be inappropriate in many of the soils after testing and trials, thus the operation of numerous blending plants in various parts of Ethiopia will mix fertilisers in future to match crop and soil requirements more adequately. The blends will feature much more potassium and other nutrients than has been the case to now.

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- The tender has been split into 11 different lots, in order to avoid overlaps

The government will shortly announce the companies it has selected for the supply of nearly 900,000tns of fertiliser.

A total of 11 companies have responded to the August 2014 tender by the Agricultural Input Supply Enterprise (AISE), only one of them making an offer for each of the two kinds of fertiliser the Enterprise wants, Urea and NPS. This is the second year in a row that the enterprise is buying NPS, a replacement for DAP, which it dropped two years ago.

The Enterprise seeks to procure 521,000tn of NPS and 373,000tn of Urea. NPS has become favoured over DAP, because it has everything DAP has and Sulphur, according to Amarech Bekelle, communications directorate at the Enterprise.

The financial opening, on September 10, 2014, showed that the lowest offer for Urea was 381.5 dollars a tonne – nearly 90 dollars cheaper than the 470 dollars the previous year. NPS was also slightly cheaper, going down from 435 dollars to 416 dollars a tonne. The highest offers now for Urea and NPS were 458 dollars and 632 dollars.

The least offer for Urea, 381.5 dollars, came from Yara Switzerland Ltd – a Swiss based international grain and fertiliser trader with a history of financial awards to Ethiopian officials through yara International, of which it is a subsidiary. Its first awardee was the late Prime Minister Meles Zenawi, who received 300,000 dollars. Then followed another prize of 30,000 dollars to Eleni Gebremedhin(PhD), former CEO of Ethiopian Commodity Exchange (ECX). Its latest award of 60,000 dollars, about 1.2 million Br, went to Tekalign Mamo (prof.), state minister for Agriculture and advisor to the Minister, early this month. Yara has been a regular in Ethiopia’s fertiliser market for many years.

The lowest bid for NPS, 412 dollars, was made by NAMPGC Holding Corporation – a Chinese international grain and fertiliser trader.

From the total 11 lots, Yara offered the lowest price for eight of both Urea and NPS, NAMPGC Holding Corporation for two lots and CHS Europe SA, a Swiss based company, for the remaining one lot. The tender was floated in five lots for NPS and six for Urea.

The price of a tonne of Urea stood at 321.88 dollars in the international market on August 31, 2014, according to YCharts – a provider of financial information based in Chicago and New York (US). This is an 18 dollar increase from a month ago, July 31, but a decrease of 53 dollars from the same time a year ago.

The auction was divided into 11 different lots to avoid overlaps in the delivery to the Enterprises and at the Djibouti port, said Amarech.

The Agricultural Inputs Supply Enterprise (AISE) is a public enterprise established in 1985 and accountable to the Ministry of Agriculture (MoA). The Enterprise has 31 million Br in assets, including 22 warehouses, seven distribution and sales outlets and 36 vehicles. It managed to achieve a net profit of 35.4 million Br during the 2011/12 fiscal year and 35.6 million Br during the following year.

The AISE buys and distributes agricultural inputs, including fertilisers, farming chemicals, different kinds of seeds, plant and animal medicines and vaccines, and laboratory equipment.

The Enterprise imported 552,000tn in 2010/11 and 560,000tn the following year. Its import s in 2012/13 was down to 477,000tns.

The government is constructing four fertiliser factories in the Tigray, Amhara, Oromia and Southern regional states, with annual capacities of 25,000tns each.

The fertiliser steering committee will select the companies that will make the supplies in a short period of time, after analysing the financial offers and the companies that produce the fertilisers, said Getenesh Ashenafi, director general of the Enterprise. The committee is composed of representatives from the Ministry of Agriculture (MoA), the National Bank of Ethiopia (NBE), the Commercial Bank of Ethiopia (CBE) and the Ministry of Finance & Economic Development (MoFED).

http://addisfortune.net/articles/eleven-companies-in-tight-run-to-win-900000tn-fertiliser-tender/

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Tecno Group favours Ethiopia ahead Nigeria for third assembly plant

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China-based handset manufacturer, Tecno Group has concluded plans to build a factory in Ethiopia to enhance its presence in African market, investigations have revealed.

BusinessDay learnt that Tecno, which already runs two factories in the Ethiopian capital, chose Ethiopia for the ‘third phase’ mobile phone assembly and production plant ahead of Nigeria because of what industry sources linked to security challenges facing Nigeria.

It is not clear whether the Tecno Group would still consider Nigeria for assembly plant in the future.

According to AllAfrica, an online news report, the “Ethiopian government has already dedicated an investment area for the establishment of an ICT park to support the development of ICT. The foundation stone preparatory to the plant was laid for Tecno Group in the park which is under construction.”

Although the group vice president of the mobile phone brand, Arif Chowdhury, had last year assured that the company would build its African plant in Nigeria, it is not clear whether the company would live up to this promise or it has made a u-turn.

On the planned plant in Nigeria, Chowdhury says in a report that “Nigeria is Tecno’s biggest market in terms of volume, and Lagos will be the location of the plant because Lagos is not just the commercial nerve centre of Nigeria but also the economic capital of Africa.”

The company is still waiting for the right policies of government on duty structure for mobile phone imports to finalise their plans in building the plant, he says.

But reports indicate that the Tecno Group has made significant progress in its factory construction in Ethiopia where it started operations in 2009, and has employed about 400 workers.

Nigeria, the largest market in Africa with largest population, must have over time influenced Tecno’s business growth, a situation analysts believe would have influenced the company’s choice of where to set up its third African assembly plant.

http://businessdayonline.com/2014/09/tecno-group-favours-ethiopia-ahead-nigeria-for-third-assembly-plant/

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Lavrov to talk oil, Ukraine next week

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A delegation of eight giant companies headed by the Russian Foreign Minister, Sergey Lavrov, will visit Ethiopia on Wednesday, September 17. Sources told Capital that Lavrov will come to Addis Ababa for a one-day official visit. The purpose is to strengthen economic and political ties between Ethiopia and Russia.

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According to the information obtained by Capital, Lavrov will meet with Prime Minister Hailemaraim Desalegn, Foreign Minister Tedros Adhanom (PhD) and other senior government officials and discuss bilateral issues. He is also expected to hold talks with Dr. Nkosazana Dlamini Zuma, Chairperson of the African Union Commission. He first came to Addis Ababa in 2006.
The visit of Lavrov, apart from the business talks, will focus on the embattled region of Ukraine.

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According to sources, Russian energy and oil and gas company executives will be part of the business delegation that include officials from Gazprom.

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In July this year, officials of GPB Global Resources, a unit of Russia’s state-owned Gazprombank Group, said that the company may invest about USD 60 million searching for petroleum in northeastern Ethiopia. The company announced it won approval from the Ethiopian government for a production-sharing agreement that covers seven years for exploration and 25 years for production. Investment for exploration will focus on conducting surveys and drilling test wells in a 42,000 square kilometer (16,200 square mile) area in the Afar region that forms part of East Africa’s Rift Valley.

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Russians are not new to the Ethiopian oil exploration sector. During the socialist era, Soviet Petroleum Exploration Expedition (SPEE) was prospecting for oil and gas in the Ogaden Basin in the 1980s. Russians were involved in the mining sector too. It was Russian Geological Survey that discovered the Kenticha tantalum deposit in Borena Zone, Oromia Regional State. They also discovered the Legedembi primary gold reserve, which MIDROC Gold is currently mining. Russian companies also want to develop hydropower projects in Ethiopia. Sources said the Russian delegation will meet the minister of Water, Irrigation and Energy, Alemayehu Tegenu, to discuss the investment opportunities in the energy sector.

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There are currently more than 30 Russian companies investing  in Ethiopia. Russian companies are also interested in the Ethiopian national railway network development. Russia is a major arms supplier to the Ethiopian army. The Ethiopian Air Force and ground forces are equipped with Russian military artillery.

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Ethiopia exports agricultural products to Russia. So far Russians buy Ethiopian flowers from the Netherlands. Ethiopian Airlines is in the process of starting passenger and cargo flights to Moscow.

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According to the official website of the Ministry of Foreign Affairs, Ethiopia and Russia have longstanding historical relations going back to the period of the Russian Czar Machilovich, the father of Peter the Great, in the 17th century. Historical records indicate that Alexander Pushkin, a renowned Russian writer, was a grandson of Abraham Hannibal, an Ethiopian who was presented to Peter the Great by Suleiman the Magnificent. He was baptized in Vilnius, Lithuania, by Peter the Great on his return from defeating the Swedes.

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Other early contacts between Russia and Ethiopia include the visit of an Ethiopian delegation sent by the Emperor Menelik II to Russia, and visits of several Russians to Ethiopia during Menelik’s reign, at least one of whom was given the title of Dejazmatch for his travels on behalf of the Emperor along Ethiopia’s southern boundaries. These contacts laid the foundation for close relations of the two countries, based on mutual respect and friendship between the two peoples. And it is notable that regardless of the differing political systems that existed at various times, relations between them have continued to be close and friendly.

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One demonstration of that friendship has been that Russia has always, and without fail, stood with Ethiopia whenever the sovereignty of Ethiopia was threatened. Russian solidarity with Ethiopia was first illustrated when the Russian Red Cross Society came to Ethiopia in 1896, at the time of the Battle of Adwa when Italy attempted to attack the country. It made an outstanding contribution in the provision of medical supplies at Menelik Hospital and care to the Ethiopian patriots on the battlefield and subsequently. Again, during the fascist invasion of Ethiopia in 1936, Russia was one of those countries which stood in solidarity with Ethiopia. It has done so on every occasion throughout the 20th century whenever Ethiopia faced challenges to its sovereignty and its core national security interests. In short, the bonds that exist between Ethiopia and Russia have stood the test of time and have proven their strength time and again.

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In recent years, there have been increased visits of high level officials between the two countries. Major visits have included former Prime Minister Meles Zenawi’s trip to Moscow in December 2001 and the then Foreign Minister Seyoum Mesfin in November 2007. Prime Minister Hailemariam Desalegn (the then Deputy Prime Minister and Minister of Foreign Affairs) and Alemayehu Tegenu, Minister of Water, Irrigation and Energy, visited Russia in August and October 2011 respectively.

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From the Russian side former Russian Prime Minister, Mikhail Kasyanov, came to Ethiopia in September 2002; and Russian Foreign Minister Sergey Lavrov came here in September 2006.

http://www.capitalethiopia.com/index.php?option=com_content&view=article&id=4541:lavrov-to-talk-oil-ukraine-next-week&catid=35:capital&Itemid=27

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Aluto-Langano Geothermal Plant to go operational in April

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The Ministry of Water, Irrigation and Energy said the Aluto-Langano Geothermal Power Plant with installed capacity of 70MW would go operational this fiscal year.

Energy Study and Development Follow-up Director Gosaye Mengistie told ENA over 78 per cent of construction of the geothermal plant has so far finalized. It is expected that the plant will commence operation in April.

Launched in 2013, the expansion of the Aluto-Langano Geothermal Power Plant will increase the country’s generation capacity from geothermal to 70MW power from the current 7MW.

The expansion project is financed by 12 million USD grant from the government of Japan, 13 million USD loan from the World Bank and 10 million USD from the government of Ethiopia, the Director added.

Located in the Rift Valley Lakes Region, the Aluto-Langano Geothermal Power Plant is the first geothermal power plant in Ethiopia. The plant was established in 1998 as a pilot project to test the geothermal resources in the area, according to Gosaye.

The nation has set target to generate 1,000MW from two geothermal plants, Tendaho and Corbeti geothermal plants, in the coming few years, he added.

The Tendaho power plant due to be undertaken in Afar state, north eastern part of the country, will have a capacity to generate 100MW.

The nation has also signed agreement with a US- Icelandic private developer Reykjavik Geothermal (RG) to construct Africa’s largest geothermal plant. The Corbeti geothermal project the country due to built with 4 billion USD will be

Africa’s largest geothermal plant, with 1,000MW installed power.

Construction of this plant, which will be undertaken in two phases, each with 500MW installed capacity with an eight to 10 year period.

These projects are part of the government’s plan to raise power generation capacity to 10,000MW by 2015, in order to meet the growing demand.

It is estimated that Ethiopia has a potential to generate up to 5,000MW from only geothermal.

“Although the nation has huge potential for geothermal energy, it doesn’t so far benefit from it. We set target to undertake various activities and change this situation,” he said.

Twenty two power generator sites, with huge geothermal potential have identified so far in the rift valley system, he added. Activities are being undertaken to develop this potential.

“First we have been conducting survey on about 18 places with huge geothermal potential. But now the number of places identified as having with huge potential has reached 22.”

Places like Dalol, Tendaho, Abi, Tiye, Meleka, Dafan, Fentale, Gedemesa, Tulu, Moye, Aluto Langano, Corbeti, and Abaya are among the places identified with huge geothermal potential.

Development of renewable energy will have economic and environmental benefits, said the Director. These projects will help the nation realize the vision to build green economy by 2025.

Utilizing the country’s potential for geothermal energy would help address the increasing demand for electricity, he added. It is estimated that the country’s demand for electricity increases by 25 to 30 percent annually.

http://www.waltainfo.com/index.php/explore/14994-aluto-langano-geothermal-plant-to-go-operational-in-april-

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Ethiopia Establishes National Kaizen Council

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Addis Ababa September 16/2014 – A National Kaizen Council that aims at disseminating the Kaizen philosophy throughout Ethiopia was established here on Wednesday, September 16, 2014.

Speaking during the establishment of the council, Prime Minister Hailemariam Dessalegn, who is also chairperson of the council, said Ethiopia has the capacity to implement Kaizen philosophy assisted by its numerous educational institutions.

The premier stressed that the council should be a champion of change in disseminating Kaizen philosophy and creating nationwide mobilization.

Regional Kaizen councils need to take a lead in disseminating Kaizen philosophy in their respective areas, he added.

The Prime Minister also underscored the need to mobilize the required human resources by designing curricula that incorporate Kaizen philosophy at different levels of education.

According to Hailemariam, the council should give priority to creating awareness among the general public and making the public clearly understand the essence of Kaizen. The mass media need to play big role in instilling Kaizen philosophy among the public.

The Prime Minister finally declared Meskerm, this first month of the Ethiopian year, ”Kaizen month”.

Industry Minister Ahmed Abitew on his part said the establishment of an Ethiopian Kaizen Council, in addition to the formation of Kaizen Institute earlier, shows the country’s commitment to the realization of Kaizen philosophy.

Ahmed added that the Ethiopian Kaizen Institute has played substantial role in transferring, implementing, sustaining and owning the Kaizen philosophy, despite its only two years existence.

According to him, the steady assistance of Japan International Cooperation Agency (JICA) and the Ethiopian government are the reasons for this success.

The minister said 79 industries have implemented the Kaizen philosophy and  20,467 management and frontline workers trained and organized under 3,590 Kaizen Promotion Teams (KPTs) during the past two years.

He further cited JICA’s evaluation report as saying that Ethiopia’s Kaizen project is one of the best in Africa and the achievements can be bases for JICA’s human resource development project in Ethiopia.

Director-General of the Ethiopian Kaizen Institute (EKI), Getahun Tadesse, told ENA that the institute has undertaken significant change in work place relations and modernized work practices that ultimately improve product and productivity.

The philosophy also brings success in increasing productivity, decreasing wastages, improving work place safety and quality of production, he added.

Sugar Corporation and the privately-owned Peacock Shoe and Awash Leather companies have made significant change by implementing Kaizen, according to the director-general.

The Ethiopian Kaizen Council, chaired by Prime Minister Hailemariam Dessalegn, consists of ministers, university presidents, Ethiopian Chamber of Commerce and Sectoral Association, Media CEOs and professional associations.

http://213.55.98.22/enae/index.php?option=com_k2&view=item&id=2272:ethiopia-establishes-national-kaizen-council&Itemid=260

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First Ethiopian science museum opens in Addis

The first Science Museum of Ethiopia, which is said to help promoting science and research in the country, has been opened Monday at the Addis Ababa Science and Technology University.

The University has established the museum and Engineering and Mathematics Center, in cooperation with Israeli aid agencies based in the US.

Minister of Education Shiferaw Shigutie said on the opening ceremony that the museum levels up students understanding for science, and as a result contributes for the industry led economic policy of the nation to be followed in the near future.

The Addis Ababa Science and Technology University president Dr. Tarekegn Tadesse said for his part that students at all levels can make use of the museum with the center, for upgrading their knowhow in science.

The center built with 16 million Birr displays different research results and indicates the level of science at present, he added.

Students and educators can visit the museum and the center to help advance their knowledge and expertise in science, it was indicated.

http://www.ertagov.com/news/component/k2/item/3153-first-ethiopian-science-museum-opens-in-addis.html

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ERA Awards Two Chinese Companies 5b Br Road Projects

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-  The two projects are part of the ERA’s Fourth Road Sector Development Program (RSDP IV)

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The 220Km asphalt road from Dire Dawa to Dewalle will be constructed by CGC Overseas Construction Group for 3.99 billion Br.

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The Ethiopian Roads Authority (ERA) has awarded two contracts worth five billion Br to two Chinese companies for the construction of two roads in eastern and southern Ethiopia.

CGC Overseas Construction Group will contruct a 220Km asphalt road from Dire Dawa to Dewalle for 3.99 billion Br, while China Tiesiju Civil Engineering Group Co Ltd will be paid 1.1 billion Br for a 107Km asphalt road from Konso to Yabelo.

The CGC’s road will have a 10m carriageway in urban areas and 15m elsewhere. It is expected to finish the road within three years from September 2014, with the consultancy of Shandong XinQiDian Overseas Consulting Ltd Co.

Fifteen percent of the project’s finance will be covered by the Government of Ethiopia and the remaining by the Export Import (EX-IM) Bank of China. The 3.73 billion Br loan was approved by the House of Peoples Representatives (HPR), on June 26, 2014.  The loan, which has a two percent interest and a seven year grace period, is payable in 20 years.

CGC Overseas has been operating in Ethiopia since 2003. It has so far completed five projects and is currently working on eight others. The completed projects include a 22Km asphalt road from Chole to Magna, the Dodola Junction to Goba road and the Dera to Gololcha Mechara road, all in the Oromia region, as well as a road project from Kombolcha to Mekaneselam.

The China Tiesiju Civil Engineering Group Co Ltd will make an asphalt concrete road from Konso to Yabelo, a 107Km distance it is expected to complete in three years and five months.

The road has a 10m carriageway in rural areas and 19m in urban areas. It includes 340 drainage pipes and five bridges, along with other structural works. It will be consulted on by the joint venture of Omega Consulting Engineers Plc, a local firm, and a Ugandan firm, Prome Consultants Limited.

China Tiesiju has already constructed an asphalt road from Yabelo to Mega for 770 billion Br. The Yabelo-Mega 100Km long road is part of the 1,000Km Mombasa-Nairobi-Addis Abeba Road Corridor.

The first contract was signed between Zaid Woldegabriel, the ERA’s general director, and Qin Lijing, deputy general manager of CGC Overseas Ethiopia, at the ERA’s headquarters on Ras Abebe Aregay Street, near Mexico Square. But the second project signing ceremony was put back until the coming week because of the absence of the representatives of the contractor who were at project sites.

Qin Lijing, deputy general manager of CGC Overseas Ethiopia (left) promising to Zaid Woldegabriel, the ERA’s general director, to deliver the road on time.

The Dire Dawa-Dewalle road will improve the road link with Djibouti and help to transport raw materials and finished products to and from the industrial zone soon to be constructed at Dire Dawa, as well as simplifying the traffic flow of the route, according to Ziad.

The above two projects are part of the Fourth Road Sector Development Program (RSDP IV) of the ERA, for which implementation costs are estimated to reach 125.3 billion Br. Out of this, 84.5 billion Br is allocated for federal projects, 14.4 billion Br for regional ones and 26.4 billion Br for weredas.

The RSDP was formed as part of the government’s Growth & Transformation Plan (GTP), and is in charge of the rehabilitation of 728Km of trunk roads, the upgrading of 5,023Km of trunk and link roads, the construction of 4,331Km of new link roads, the heavy maintenance of 4,700Km of paved and gravel roads and routine maintenance of 85,649Km of road network. The ERA has rehabilitated, upgraded, constructed and maintained 41,664Km of roads as of June 2013, at a cost of 81.8 billion Br, of which 60.6 billion Br was on federal roads.

The ERA expects the total road network in the country to reach 136,044Km by the 2014/15 fiscal year, from the 48,793Km coverage it had in 2010. Ethiopia’s road density has increased from 24Km in 1997 to 78Km in 2013, with total roads growing from 26,550Km in 2009/10 to 100,000Km in July 2014.

http://addisfortune.net/articles/era-awards-two-chinese-companies-5b-br-road-projects/

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Roads Authority Plans 600km of New Roads at Cost of 6.6b Br

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-  The authority has a long-term plan to increase the road coverage in the city to 25pc by 2020

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The Bole road which extends from the Mesqel Square to the Bole Bridge along with the Africa Avenue.

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The Addis Abeba City Roads Authority (AACRA) has allocated 6.6 billion Br to add just over 600kms to the city’s road network during the current 2014/15 fiscal year. The plans for the year include the temporary expansion of the crowded Akaki Kaliti-Tulu Dimtu road.

The city currently has 4671km of road, which it wants to increase to 5275km – a coverage increase from 17.5 to 19.8pc, with a long term plan of 25pc coverage by 2020, according to Fekade Haile (Eng), head of the Authority, who spoke during a press conference at his office on Tuesday, September 09, 2014.

The authority has secured 6.12 billion Br from the Addis Abeba City Administration (AACA), 43 million Br from the Road Fund and a loan of 204.2 million and 178.2 million Br, respectively, from the Government of China and in aid from France.

The Authority will, however, require an additional 3.8 billion Br to complete its projects for the year, according to Fekade.

Fekade Haile (Eng) AACRA

“We are planning to ask the city administration to transfer unused budgets from other sectors to us at end of the fiscal year,” said Fekade.

The City Administration has allocated a 27.5 billion Br budget for the 2014/15 fiscal year for 10 sector offices. The Addis Abeba Water & Sewerage Authority (AAWSA) received 4.3 billion Br followed by the Housing Development Project Office, with 1.6 billion Br. The Education and Health bureaus got 1.4 billion Br and 1.1 billion Br, respectively.

The Authority’s expected 50 million Br from the Road Fund, which is only used for the maintenance and rehabilitation of existing roads, but got only 43 million Br, with Fekade blaming the shortfall to an outdated formula that the city started applying in 2006.

The AACRA will undertake its projects for the year using its own resources and by hiring contractors. Its projects include 49.66kms of new asphalt roads, all of which will be given to contractors, 35.75kms in the expansion of existing roads by itself and 26.64kms of asphalt roads at condominium sites.

It will also undertake the expansion of the Kaliti Akaki–Tulu Dimtu road project and the reconstruction of the Akaki Bridge. Additionally, it will undertake various projects around the light rail transit. It will also make 450kms of cobblestone roads, as well as increasing the number of people working at the cobblestone quarries to 50,000. The Authority says that it will complete the construction of 21 main bridges during the current fiscal year.

The Authority is still facing challenges to resolve right of way issues, including relocation of residents from project areas and the payment of compensation, which are delaying some of its projects. A taskforce will be established with the support of the city administration to solve the problem, Fekade said.

When the AACRA, which today employs 1,980 people, was established in 1999, Addis Abeba had 2,777km of road, with 11.8pc coverage.

http://addisfortune.net/articles/roads-authority-plans-600km-of-new-roads-at-cost-of-6-6b-br/

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Mexico working to deepen economic ties with Ethiopia

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The government of Mexico will work to expand the existing diplomatic relation with Ethiopia into economic cooperation, Mexican Ambassador to Ethiopia Alfredo Miranda said.

Speaking in a meeting organized to celebrate the 204th anniversary of Mexican Independence, the Ambassador said in spite of strong diplomatic ties, the economic cooperation between the countries doesn’t reach the desired level.

The two countries in the future should focus on implementing previous bilateral agreements to boost economic ties, he said.

Foreign Affairs State Minister, Ambassador Birhane GebreChiristos noted that Ethiopia is the first African country to start diplomatic relation with Mexico.

Mexico is among the few countries in the world that opposed the Italian invasion of Ethiopia.
He urged Mexican investors to come to Ethiopia and utilize the favorable investment atmosphere, business and investment opportunities and untapped resources.

Ethiopia and Mexico has enjoyed diplomatic ties for the past 65 years.

http://213.55.98.22/enae/index.php?option=com_k2&view=item&id=2271:mexico-working-to-deepen-economic-ties-with-ethiopia&Itemid=260

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Tigray undertakes watershed development on 1,300 hectares

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Watershed development was carried out on 1,300 hectares of land in Tigray regional state last Ethiopian budget year.

The development activities were carried out in all 186 kebeles (district) of the Regional State, Michael Miruts, public relations coordinator at the regional state agriculture and rural development bureau told WIC.

According to the coordinator, more than 22.7 million people organized in more than 90,000 teams took in the ecosystem-based approach for development.

In addition to fencing the over 267.9 hectares of land available in the regional state, some 174 million tree seedlings were planted in the reported period, he indicated.

He said the bureau is taking care of the 25 million seedlings planted in 670 Meles parks established in the regional state in 2005 E.C.

http://www.waltainfo.com/index.php/explore/14996-tigray-undertakes-watershed-development-on-1300-hct-

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Industrial minerals ‘widely’ used for manufacturing

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Industries are ‘widely’ using industrial minerals as inputs for the manufacturing of various products so as to lead the way for the nation’s vision to develop industry-led economy, the Ministry of Mines (MoM) said.

Potash, limestone, granite, marble, coal and minerals used to produce cement are the main industrial minerals being widely used in the country, according to Bacha Fuji, PR and Communications Director with MoM.

These minerals are being used by industries for the production of cement, marble, ceramic, paper and glass as well as fodder for cattle and poultry.

The country has huge potential for potash with 1.3 billion tons reserve. It is currently being used in industries engaged in chemicals, textiles, paints, detergent, glass and ceramic production.

In addition to being used as input for industrial products, these minerals are helping the country earn foreign currency. Last year alone the nation earned 541 million USD from export of these minerals, according to the Director.

Industrial mineral deposits in Ethiopia occur in various geological formations and are being used in a wide set of industries prominent among those being glass, ceramic and cement industries.

The main minerals available in large quantities include soda ash, potash, diatomite, bentonite, clay, common salt, gypsum, anhydrite, feldspars, talc, kyanite, magnetite, dolomite, graphite, quartz, mica, apatite, pumice, silica sand, kaolin, phosphate and silica.

The Ethiopian Geological Survey (EGS) has been generating, collecting and managing geo-information of the country for the last four decades.

It is working to identify major mineral reserves of the country and prepare a map which includes areas of mineral reserves and best locations for development, according to Tamru Mersha, PR and Communications Director with EGS.

According to him, the government has prioritized to develop industrial minerals that can be developed using small capital.

Development of minerals which improve soil fertility, such as phosphate, potash and limestone is also a task to which the government has given due attention, Tamru said.

http://www.ertagov.com/news/component/k2/item/3138-industrial-minerals-‘widely’-used-for-manufacturing.html

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COMESA – Australia Begin to Implement Mining Agreement

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COMESA and the Government of the State of Western Australia have begun to implement a Memorandum of Understanding (MoU) they signed in January this year on cooperation in various fields of development.

The MoU signed by Premier Colin Barnett of the State of Western Australia (WA) and COMESA Secretary General Sindiso Ngwenya in Lusaka, Zambia proposed to establish a framework for cooperation covering mineral and petroleum resources, agriculture, vocational training and capacity building.

The two principals and their technical officers met Thursday 4 September 2014 in Perth Australia and developed a draft work programme to implement the key pillars of the agreement. The meeting was held in the side-lines of the “African Down-Under (mining) conference” that took place from 3 to 5 September 2014. In the agreement, six focus areas are identified in the minerals sector; they include fiscal frameworks and mineral policy, strengthening human and institutional capacities, collection and management of Geo-scientific information, research and development, environmental and social issues; and linkages, diversification and cluster development.

A Joint Working Group (JWG) of experts drawn from COMESA and WA presented the draft work program for operationalizing the MOU which is expected to be finalized by the end of this month and implementation to begin in October.

The key priority areas identified include strengthening the legal and institutional framework of COMESA Member States, capacity building, and taxation and fiscal frameworks.

“We need to strengthen the legal and institutional frameworks of our member states to create the enabling environment to unlock the full value of our minerals and other natural assets and their full integration into local economies,” Mr Ngwenya said. “This was a crucial prerequisite for unlocking the value of minerals in the value chain thus contributing to regional economic transformation.”

He disclosed that COMESA has already started mobilizing resources to implement the articles of the agreement and that the United Nations Economic Commission for Africa (UNECA) had promised to support the initiative. He further said that request for additional funding has been made to the African Development Bank and the Africa Legal Resources Centre and favourable responses were expected.

He appealed to the Government of Western Australia and the Federal Government to also provide funding for the program to ensure its objectives are realized.

Premier Barnett said WA will work with COMESA States to ensure the host countries get a fair return on their natural resources and putting in place legal framework to secure the tenure of mining enterprises and environmental conservation. This include safety in the mines.

“We want to share our mining experience of 120 years with African States so that they do not make the mistakes that we did,” the Premier said.

The agreement with WA was borne of the fact that despite the often spectacular performance of mining in many African economies, the region continues to be the least developed in the world and its people remain the poorest. Further resource rich countries experience high levels of conflict and strife a situation that is described as the “Resource Curse”.

“It is a proven fact that successful resource driven economies have to employ six core elements to benefit from minerals resources,” Mr Ngwenya said.

These are; building the institutions and governance of the resources sector, developing infrastructure, ensuring robust fiscal policy and competitiveness, supporting local content, deciding how to spend a resources windfall wisely and transforming resource wealth into broader economic development.

The agreement with WA acknowledges that institutions that support mineral development in Africa are generally weak due to human skills deficiency and financial constraints and therefore inappropriate to effectively facilitate the role of minerals in development.

Further, the fiscal frameworks have largely been blamed for the failure of Governments in Africa to benefit from the boom in mineral prices during the last decade. In addition, mining expect a fair return based on risks taken while Governments wish to maximize the value of mining investment to fund social and economic infrastructure, as well as other national development priorities.

However, the capacity to negotiate mineral development agreements, and to monitor and regulate the exploitation of mineral resources is highly challenged. This has led to weak policy formulation and implementation, poorly managed regulation of company mining operations and mineral development contracts that do not deliver the full development benefits from mineral resources.

There is also need for research and development capacity in the COMESA region to support beneficiation and value addition to mineral products and the development of linkages and clusters in the sector. This is a key per-requisite for industrialization and the evolution of new products from mineral commodities.

http://www.comesa.int/index.php?option=com_content&view=article&id=1321:comesa-australia-begin-to-implement-agreement&catid=5:latest-news&Itemid=41

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30m Br Ethio-Swiss JV Set to Pilot Plastic Flakes for Export

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-  Production foreseen to create jobs through 604 SMEs to be involved in collection of waste

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The company was established in 2012, with a capital of 104 million Br, by Swiss and Ethiopian owners to recycle plastic products. Over the past two years, it has been producing plastic bottle preforms and closures using Polyethylene terephthalate (PET) – waste plastic bottles – which it recycled at its own plant. The new plant rests on a 5000sqm plot in Kality, Addis Abeba, whereas the existing factory is located in the Hana Mariam area.

Coba has been using up to 1,600kgs of waste plastics a month – supplied in jumbo bags holding 40kgs to 45kgs – for its operations so far. The commencement of the plastic flakes production could push its demand up to 15,000kgs a month, says Gabriel Amara, the Company’s general manager. The new plant has a production capacity of 700kgs of flakes an hour.

The Company has signed a memorandum of understanding with the Addis Abeba City Administration Cleansing Management Agency (AACA CMA) and the East African Bottling Company (EABC) – the maker of Coca Cola – to organise 604 small and micro enterprises (SMEs) to collect and supply waste plastic materials, including bottles.

The agreement made between the parties is a PET recycling project for which the EABC will spend 700,000 Br for the provision of safety materials, such as gloves, mouth masks, push carts and aprons, for the SMEs that will collect the waste plastics materials, said Anteneh Tegegn, the director of EABC’s Human Resources, public relations and legal department.

The EABC proposed combining this project with their Women Empowering Project, said Coba’s recycle head, leading to their involvement within three districts of Addis Abeba.

Coba will provide green bags for organic waste and blue bags for plastic waste. It will buy the plastic waste for three Birr a kilo, increasing the price to 3.60Br when the SMEs start issuing receipts.

The two companies together with the Cleansing Management Agency gave a one day training on solid waste collection to representatives from 604 SMEs on August 20, 2014, at the Hager Feker Theatre. The training addressed effective time usage, discipline, quality materials provision and business development.

The money from the EABC is now being used in the Arada, Lideta and Yeka districts, says Anteneh.

“The program will be continued in other districts and regional towns, such as Hawassa, Bahir Dar, Mekele and Dire Dawa,” Anteneh added.

The challenge to the plastic bottle collection, according to Nigussie Estifanos, collecton department head at Coba, is that bottles come with water, milk and even rocks in them, which exaggerates the weight of the bottles. Coba will resolve this issue through training, he said.

http://addisfortune.net/articles/30m-br-ethio-swiss-jv-set-to-pilot-plastic-flakes-for-export/

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World Bank Extends 4.1b Br Water, Sanitation Loan

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-  The loan will help Ethiopia to achieve the GTP target of 100pc access to safe water

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The Ethiopian One National WASH Program under the WASH Implementation Framework (WIF) has received a 4.1 billion Br loan from the World Bank (WB) to improve access to water, sanitation and hygiene.

The program was launched in September 2013 to modernise water and sanitation services, improve health, decrease school drop-out rate and make financing for WASH more effective, according to Abiy Girma, the One WASH Coordinator at the Ministry of Water, Irrigation and Energy (MoWIE).

The World Bank’s money will be used for the construction of water and sanitation facilities in Ethiopia, excluding Addis Abeba.

“We will construct toilets for health centres, public schools and upgrade our water supply by constructing new water wells,” said Abiy.

The WB already provided five million dollars to the project in January 2014 because of a government push; the five million dollar loan is part of the approved 4.1 billion Br effective from July 2014, according to a source who requested anonymity.

The four line ministries – Ministry of Health (MoH), Ministry of Finance & Economic Development (MoFED), Ministry of Education (MoE) and Ministry of Water, Irrigation & Energy (MoWIE) – are the core actors who signed the Memorandum of Understanding (MoU) on the integrated implementation of a water supply, sanitation and hygiene program in Ethiopia and WASH Implementation Framework in 2013.

“The policy and strategy of the project was designed in 2005 and it passed through many ups and downs because of a lack of commitment from the government’s side,” said the source.

The core policy document of the Ethiopian WASH program, the Universal Access Plan (UAP), aims to achieve 98.5pc and 100pc access to safe water and sanitation, respectively, by 2015.

To implement the project, a taskforce was organised with members from the four ministries, Civil Society Organisations and the DAG Water Technical Working Group,  chaired by Yohannes Gebremedhen, the director of the Water Supply & Sanitation Directorate at the MoWIE.

“The government has gaps in implementing this project. No meeting has been held by the steering committee since the launch of the project and planned regional offices are not yet open,” said the source.

The loan from the World Bank will be provided in four phases for four years, says Abiy.

“We are moving towards implementation after we have secured the money,” he said.

The project was designed for the coordination and implementations of the multi-donor consolidated WASH account, approval of harmonised and integrated annual WASH plans and budgets, coordination of operational WASH structures, preparing harmonised guidelines and core materials for capacity building and facilitating tools and procedures necessary for integrated planning, reporting and monitoring, said Abiy.

This national strategy was launched with the intention to harmonise, align, integrate and accelerate the WASH implementation, in order to achieve the Millennium Development Goals (MDGs) and Growth and Transformation Plan (GTP) targets.

http://addisfortune.net/articles/world-bank-extends-4-1b-br-water-sanitation-loan/

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Alecto update on Ethiopia JV

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Alecto Minerals says it has been formally notified by its joint venture partner Centamin that, following the completion of the recent exploration programme, it will continue to satisfy the initial expenditure commitment at the company’s 945 sq. km. Wayu Boda gold project in Ethiopia.

Under the agreement, Centamin is required to fund exploration costs of US$1.8m over a two year period in order to maintain an initial 51% interest in the project.

The JV agreement also extends to the company’s 1,954 sq. km. Aysid Metekel gold project which is located in the Aysid-Metekel region of north-west Ethiopia. Centamin has already indicated that it will satisfy its initial expenditure commitment for the Aysid-Metekel project of US$1.2m over two years to maintain its initial 51% interest in the Aysid-Metekel project.

Centamin has an option to fund up to a further US$5m of work at the Aysid-Metekel project and US$6m of work at the Wayu Boda project to increase its interest in each of the projects up to 70%.

Alecto chief executive Mark Jones said: “The fact that Centamin would like to continue fulfilling the initial expenditure commitment for the Wayu Boda project of US$1.8m is excellent news and, considering that the results and analysis from their recent exploration programme are yet to be received and assessed in full, we are encouraged by their decision.

“Our positive experience with Centamin, with them already having committed to the initial expenditure commitment for the Aysid-Metekel Project, endorses our company-wide joint venture strategy and provides us with exposure to exploration upside without capital expenditure, and we look forward to providing updates regarding both projects at the appropriate time for both ourselves and Centamin.”

http://www.stockmarketwire.com/article/4885484/Alecto-update-on-Ethiopia-JV.html

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Filed under: Ag Related, Economy, Infrastructure Developments, News Round-up Tagged: Addis Ababa, Agriculture, Business, Economic growth, Ethiopia, Fertilizer, Investment, Millennium Development Goals, Sub-Saharan Africa, tag1, United States, World Bank

FTF’s Jim Barnhart (above, far left) visits Ethiopia’s first fertilizer blending factory, operated by a local cooperative union.

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