China to pour US$1 trillion into African investments

The Chinese government and state-run banks will offer loans of up to US$1 trillion to Africa until 2025 as the continent emerges as China’s newest top destination for investment, according to an analyst with the state-owned Export-Import Bank of China.

At a recent conference in Hong Kong on investments in Africa, Zhao Changhui said his bank would provide between 70% and 80% of the US$1 trillion in loans to Africa.

“For many enterprises in China, Africa is poised to become China’s top overseas destination for commercial activities and investments over the next two decades,” Zhao stated.

“With US$3.5 trillion in foreign reserves, China should not only buy US debt but should inject its funds into other overseas investments,” Zhao said.

The analyst said his bank is seeking cooperation with Africa’s infrastructure projects, including transnational highways, railways and airports. He estimated work on a railway network linking various states in Africa would cost US$500 billion.

Jeff Gable, head of the unit of non-equity research in Africa for Barclays Africa Group, hinted at an area that investors might be interested in examining, saying there is a huge need for the electrification of the railway in Africa. The infrastructure is far from complete in Africa, he remarked.

Another area that might draw funding from the Chinese government is the agriculture sector, according to Zhao.

With fertile lands on the African continent, Zhao said he believed cooperation between China and Africa on agriculture may help alleviate starvation in the continent over the next 10 to 15 years.

This view was echoed by Gable, who pointed out that Africa has the potential to grow into a leading global exporter of grains in the next 20 years, with output likely to climb from US$280 billion to US$880 billion during the period.

According to media reports, China Machinery Engineering signed a deal with the government of Equatorial Guinea in October to develop electric grids in the central African state.

Under the agreement, inked on Oct. 14, the Chinese company will build six new grids and expand existing grids in Equatorial Guinea for US$127 million, with construction expected to be completed in 21 months, according to the reports.

http://www.wantchinatimes.com/news-subclass-cnt.aspx?id=20131122000004&cid=1102

Telecom expansion project taking shape

- Huawei takes over Addis Ababa’s 4G project
- Firm denials over imported equipment controversy

Ethio Telecom has concluded the task of telecom vendor allocation and proceeded to the launch of the telecom expansion project to realize the government’s Growth and Transformation Plan (GTP) for the sector in the remaining two years.

Abdurahim Ahmed, corporate communications director for Ethio Telecom, told journalists at…

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By Eurasia Review

December 3, 2013

The World Bank’s Board of Executive Directors has approved major financing for Ethiopia to transform the quality of its teaching and learning for more than 21 million children in primary and secondary schools across the country. The impact of such a large-scale project is expected to be transformational as the fast-growing country continues to invest heavily in its children.

Ethiopia’s primary school enrollment rate has tripled in recent years, from 25 percent in 1996/97 to 88 percent in 2009/10. It is also one of the few countries in Africa that implements National Learning Assessments for specific grades at four-year intervals. Test results have shown that quality is a serious issue, with 55 percent of Grade 12 students lacking basic competency in science, mathematics and English.

“While Ethiopia is still working to bring every child into school, it is very encouraging that so much attention is being paid right now both to measure and improve the quality of education in the country,” said Guang Zhe Chen, World Bank Country Director for Ethiopia. “As with all modern economies, better-quality education is necessary to create a skilled labor force which is a prerequisite for Ethiopia to sustain its recent rapid economic growth and to realize its goal of becoming a middle income country.”

The Ethiopia General Education Quality Improvement Project, which is supervised by the World Bank, will receive coordinated financing of US$550 million from many partners. Of this, US$130 million is an IDA* credit, while US$100 million is a Global Partnership for Education grant. Bilateral contributors include the UK’s DfID (US$185 million), Finland (US$27 million), USAID (US$20 million), and Italy (US$10 million).

The project will help students gain proficiency in mathematics, the sciences and languages and aims to improve learning conditions. It will work towards these goals by improving the curriculum, making more textbooks available, and strengthening the National Learning Assessment and school inspection systems. It also includes programs for teacher development, support to school management through school improvement plans, school grants, and the use of ICTs to improve teaching and learning.

“A significant dimension of this nationwide project is that girls and women will greatly benefit from it,” said Tazeen Fasih, World Bank Task Team Leader for the Project. “Of the millions of students whose needs will be addressed through the project, over half are girls; and a targeted 60 percent of the teachers benefitting from training are women.”

* The World Bank’s International Development Association (IDA), established in 1960, helps the world’s poorest countries by providing zero-interest loans and grants for projects and programs that boost economic growth, reduce poverty, and improve poor people’s lives. IDA is one of the largest sources of assistance for the world’s 82 poorest countries, 40 of which are in Africa. Resources from IDA bring positive change for 2.5 billion people living on less than $2 a day. Since 1960, IDA has supported development work in 108 countries. Annual commitments have increased steadily and averaged about $16 billion over the last three years, with about 50 percent of commitments going to Africa.

Related articles

• Education Budget Pushed Up Over Br25 Billion
• Ethiopia: Bridging Education Gaps Key to Developmental Path
• Human Resources Development Key to Balancing Banking Boom
• The World Bank’s promise (allanapotashblog.org)
• Ethiopia achieves development target on reducing child mortality

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Ethiopia Will Seek Sovereign Credit Rating to Lure Investors

By William Davison – Dec 3, 2013

Ethiopia, Africa’s fastest-growing economy over the past five years, plans to obtain a credit rating to attract more foreign direct investment and offset a decline in exports.

The Horn of Africa nation’s government will select two or three rating companies within weeks to assess the country, Finance Minister Sufian Ahmed said in an interview yesterday in the capital, Addis Ababa. The state has no plans at this stage to tap international debt markets for funds to finance its infrastructure development program, he said.

“The intention is basically to show foreign direct investors where Ethiopia is in terms of those criteria,” Sufian said.

Ethiopia, Africa’s largest coffee producer and the origin of the plant, grew an average of 10.3 percent from 2008 to 2012, according to International Monetary Fund data. The economy is forecast to expand 7.5 percent next year, compared with an estimated 7 percent this year, the Washington-based lender said in October.

The country needs increased foreign investment to offset a current account deficit that has become a “major concern,” Sufian said at the African High-Growth Markets Summit in Addis Ababa. The deficit grew to $3 billion in the 12 months to July 7, the end of the fiscal year in the Ethiopian calendar, from $2.8 billion a year earlier as export growth slowed, according to the IMF.

Ratings Companies

Fitch Ratings’ London-based spokesman Peter Fitzpatrick and Moody’s Investors Service spokeswoman Kirsten Knight didn’t immediately respond to e-mailed requests for comment. No one was available for comment when Bloomberg called Standard & Poor’s offices in London outside normal business hours.

Foreign direct investment is expected to total 2.8 percent of gross domestic product this fiscal year and average 4.5 percent in the “long run” if the government adopts policies that promote private business, the IMF said.

The government won’t allow foreign investment in banking, telecommunications and other industries monopolized by the state or barred to non-Ethiopian companies until regulation is strengthened, Sufian said.

“Once we are comfortable, then the government will consider,” he said. “I can’t give you an exact date.”

The Ethiopian government plans to spend 105.2 billion Ethiopian birr ($5.5 billion) on infrastructure and industry including hydropower dams and sugar plants in the 12 months ended July 7 and 70.7 billion birr next year, according to a five-year growth plan that ends in mid-2015.

“The main challenge is investment financing needs,” Sufian said. “We know it’s huge.”

Funding targets will be met by increased domestic financing and borrowing as much as $1 billion a year on non-concessional terms from China, India and Turkey, he said. Key projects will also be prioritized, he said.

Ethiopia is Africa’s second-most populous nation, after Nigeria.

To contact the reporter on this story: William Davison in Addis Ababa at  wdavison3@bloomberg.net

To contact the editor responsible for this story: Antony Sguazzin at  asguazzin@bloomberg.net

http://www.bloomberg.com/news/2013-12-03/ethiopia-will-seek-sovereign-credit-rating-to-lure-investors-2-.html

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Saudi Billionaire Plans Two Cement Plants in Ethiopia

By William Davison - Dec 3, 2013

Saudi billionaire Mohammed al-Amoudi, the biggest private investor in Ethiopia, plans to build two more cement factories in the Horn of Africa nation amid an improving investment environment.

The plants will add to the $351 million facility al-Amoudi’s MIDROC Derba Cement opened in December 2011, the 67-year-old investor said in an interview today in the capital, Addis Ababa. Derba Group, an amalgam of three Ethiopian companies owned by al-Amoudi, plans to invest $3.4 billion in Ethiopia over the next 5 years, the company said in March 2012.

“Africa’s opportunity lies in involvement of private sector working with stable and responsible government like Ethiopia,” al-Amoudi said in a speech at the African High-Growth Markets Summit in Addis Ababa. Continuing improvements in the business climate will probably to lead to a “great” increase in investment, he said, without elaborating.

Ethiopian-born Al-Amoudi ranks as the world’s 134th richest person, with a net worth estimated at $8.7 billion, according to the Bloomberg Billionaires Index. He is the second-richest person in Saudi Arabia, after Prince Alwaleed bin Talal. Ethiopia’s economy is projected to expand 7.5 percent next year, compared with an estimated 7 percent this year, the International Monetary Fund said in its World Economic Outlook in October.

Three farming companies owned by al-Amoudi developed 62,000 hectares (153,205 acres) of land in Ethiopia, al-Amoudi said. Elfora Agro-Industries, Horizon Plantations Ethiopia and Saudi Star Agricultural Development will have prepared an additional 160,000 hectares in the next 2 1/2 to 3 years.

“We are focusing on agriculture and industry,” he said.

Agriculture Projects

Horizon bought three agricultural projects from Ethiopia’s government for $59.4 million in April. The company plans to invest 400 million Ethiopian birr ($21 million) over the next two years in Upper Awash Agro Industry Enterprise, Gojeb Agricultural Development Enterprise and Coffee Processing and Warehouse Enterprise.

Saudi Star, a Derba company, has been unable to finance the completion of an irrigation canal at its 10,000-hectare rice project in the western Gambella region, the company said last month.

“There were certain problems which we are trying to solve,” al-Amoudi said. “Now we are getting in deeply and I’m going to follow it up myself.”

Al-Amoudi also announced that an “agreement has been reached” with London-based Hikma Pharmaceuticals Plc (HIK) to produce drugs in Ethiopia for the domestic market and export to Africa. He didn’t provide further details.

To contact the reporter on this story: William Davison in Addis Ababa at  wdavison3@bloomberg.net

To contact the editor responsible for this story: Paul Richardson at  pmrichardson@bloomberg.net

http://www.bloomberg.com/news/2013-12-02/saudi-billionaire-al-amoudi-plans-two-cement-plants-in-ethiopia.html

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South Africa’s Vodacom opens office in Ethiopia, eyes foothold

Dec 3 (Reuters) – South Africa’s Vodacom Group opened its first office in Ethiopia on Tuesday, eyeing a foothold in a nation which is the last remaining large market on the continent to maintain a state monopoly in telecoms.

Africa’s rapidly expanding telecoms industry has come to symbolise its economic growth, with subscribers across the continent totalling almost 650 million last year, up from just 25 million in 2001, according to the World Bank.

Ethiopia’s state-run Ethio Telecom signed a $1.6 billion deal in July and August with Chinese firms Huawei  and ZTE Corp to expand mobile phone infrastructure, including rolling out 4G services in the capital.

But Addis Ababa has ruled out liberalising its telecoms sector, saying the 6 billion birr ($321 million) it generates each year is being spent on vital infrastructure projects.

Romeo Kumalo, Vodacom Group’s chief executive, told Reuters in the Ethiopian capital the firm would apply for a licence to provide value-added services – essentially all services other than standard voice calls – in the Horn of Africa country.

“But more importantly we want to position ourselves so when the market opens and the government does decide to grant licences in the consumer sector,” he said.

“We would invest here tomorrow. Ethiopia is probably the most fantastic telecoms market on the continent. One operator, 80 million people, the economy growing at 7 percent – it’s a great market.”

The Ministry of Communications and Information Technology says it has received applications from more than 200 firms to provide such services.

South Africa’s MTN Group, Africa’s largest mobile phone company, has already been granted a similar licence to open an office and offer value-added services.

Kenya’s top telecoms operator Safaricom has in the past expressed an interest in Ethiopia.

Ethiopian Prime Minister Hailemariam Desalegn, who took office last year, told Reuters in October that the government would not sell Ethio Telecom, which has a monopoly.

He said foreign investors were attracted to telecoms because it was a “cash cow” that required none of the effort to make profits that was needed to establish factories in manufacturing, an area which would create more jobs and growth.

(Reporting by Aaron Maasho; Editing by Duncan Miriri and David Evans)

http://www.reuters.com/article/2013/12/03/vodacom-ethiopia-idUSL5N0JI3TD20131203

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Ministry of Mines Signs Agreement with Chinese Firm for Ogaden Gas Reserves

The reserves have attracted international investment on multiple occasions, but nothing has yet been realised

The Ministry of Mines (MoM) signed a petroleum production sharing agreement (PPSA) on November 16, 2013, with Chinese firm Poly GCL Petroleum Investment Ltd, for the Ogaden basin’s Calub & Hilala gas reserves, Fortune learnt.

The area, which was first identified as a potential natural gas reserve in the 1930s, has repeatedly attracted the attention of foreign investment, but nothing has been realised thus far.

About a dozen companies have obtained licences for the fields after the presence of gas was confirmed in 1972 by Tenneco – aUScompany. This has created an extensive collection of seismic and other data on the area, which is estimated to hold 76 million cubic metres of natural gas.

The companies that have gathered the information include Malaysia-based Petronas Carigali, Soviet Petroleum Exploration (SPE), Hong Kong-based PetroTrans and Chinese company Zhoungyan Petroleum Exploration Bureau (ZPEB). The latter drilled eight wells in two different sites in order to ready them for exploitation.

The exit of Petronas in 2010 was followed by an international tender in March 2011, which was won by PetroTrans after it agreed to invest close to four billion dollars to develop the gas fields. It won after beating six other bidders, including South West Energy (SWE), the National Oil Company (NOC) ofEthiopia- largely owned by Mohammed Ali Al-Amoudi (Sheikh) – and Cobramar of Seychelles.

PetroTrans then signed a PPSA agreement with the Ministry in July 2011, but the deal was terminated by the Ministry exactly a year later. This was because the company reportedly did not undertake any field works as was required according to the agreement. This created a dispute with the company, which claimed that it was analysing and interpreting old data collected from the concessions.

Since the new agreement comes against the backdrop of numerous unsuccessful precedents, the Ministry will heavily follow-up on the investment by the latest company to show interest, according to Tolosa Shagi, the state minster of Mining.

“The area has not been productive,” he said. “The government wants to see something concrete in the area, so the Ministry will be keeping a close eye on it,” Tolossa told Fortune.

http://addisfortune.net/articles/ministry-of-mines-signs-agreement-with-chinese-firm-for-ogaden-gas-reserves/

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Ethiopian Prime Minister Arrives in Khartoum, About 30 Agreements to Be Signed

Khartoum – President Omer Al Bashir and Ethiopian Prime Minister Hailemariam Desalegn held a presidential summit yesterday following the arrival of the latter in Khartoum on the evening of the same day.

Desalegn was received at the airport by President Al Bashir, ministers and diplomats. Ethiopia expressed satisfaction over the level of relations with Sudan in the political and economic fields.

The ministerial meeting between the two countries which was chaired by the foreign ministers of the two countries was concluded yesterday. The meeting agreed on 13 agreements covering most of the areas of cooperation between the two countries and will be submitted to the two leaders for approval.

According to the Ethiopian Foreign Minister, Tadros Adhanon, the meeting of the Joint Ministerial Committee will discuss horizons of new cooperation between the two countries.

We look forward to strategic relations, Tadros said, adding that the two countries are linked by historic relations. We should prove, through economic cooperation, that the Horn of Africa is not a backward region, he said.

He commended the positive development in relations between Sudan and South Sudan, citing the responsible approach of both sides to address issues by amicable means. “We are committed to cooperate with Sudan to resolve and settle differences” he said, adding that his country, the head of IGAD, will continue efforts to improve relations between Sudan and South Sudan.

He stressed the importance of relations between the two countries, hoping that the meetings will come up with positive results to further strengthen bilateral cooperation between the two countries.

He said commercial cooperation is progressing and so does investment, adding that many Sudanese businessmen are investing in Ethiopia and underlined the great role that could be played by businessmen in the two countries.
Tadros added that joint commercial agreement between the two sides contributed toward increasing revenues between the two countries by 23% ($320 million).

He underscored the need to establish joint mechanisms between the two countries to ensure the implementation of all agreements.

He added that President Al Bashir and Desalegn have agreed to achieve stability along the joint border between the two countries, stating that his country will not allow any quarters to destabilize the common border.

The Sudanese Foreign Minister, for his part, praised the constructive efforts Ethiopia has been undertaking on all Sudanese issues particularly the issue of relations between Sudan and South Sudan.

Ali Karti considered the framework agreement prepared by the experts as important steps towards strategic integration between the two countries.

The Foreign Minister expected the two leaders to decide a date for start of fixing landmarks along the common border.

http://news.sudanvisiondaily.com/details.html?rsnpid=229662

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Increase in Electricity Tariffs Required to Realise Power Generating Projects

The report, funded by the World Bank, seeks to support the massive increase in Ethiopia’s power capacity

Ethiopia will need to increase its domestic electricity tariff by 400pc in order to realise its planned 28 power generating projects over the next 25 years.

The 1.5 million-dollar expansion masterplan study, financed by the World Bank and conducted by Parsons Brinckerhoff – a multinational engineering and design consultancy firm – was undertaken as a tool to put guidelines onEthiopia’s ambition to increase its power capacity from the current 2,300MW to 37,000MW by 2037.

This would require 156 billion dollars spread over the next 25 years, which amounts to around 48 billion dollars in current money, the study claimed. The study recommended that a large increase in export tariffs is necessary, or else the current domestic tariff of 0.028 dollars a kWh must increase to more than 0.14 dollars a kWh.

Ethiopiacurrently exports electricity for 0.07 dollars a kWh, but even raising this to 0.10 dollars – a 43pc increase – would still require a domestic rate of 0.13 dollars a kWh. This is because the study projects exports of 5,300MW by 2037, up from the current 200MW. Though this is a large jump, the study recommended a rise in the export tariff in order to ease the strain on the domestic tariff.

The study was tabled for discussion on November 26 and 27, 2013, in the presence of representatives from the World Bank and the African Development Bank, as well as diplomatic communities from North America andEurope.

The issue of securing finance seemed to be the concern of the participants, as well as Mihret Debebe, chief executive officer (CEO) of the EEPCo.  Given that the government does not subsidise the sector, the Corporation is expected to source the financers.

As a result, the Corporation is eyeing financers from international financial institutions and the private sector, as well as loans from the Ministry of Finance and Economic Development (MoFED).

Among the participants, some commented that the project is too ambitious and far from recognising the financial capacity of the country.

The Corporation does not, however, agree with the view that it is unrealistic. The government “badly needs to see the project realised”, according to Mihret.

“What would happen if we listened to everything that others say?” He said in an interview with Fortune. “We would not even reach 800MW.”

In order for the GDP to grow at a rate of 10pc per annum, the electricity demand that rises by 24pc annually must be addressed, according to the available estimation at the Corporation.

Currently, the Great Ethiopian Renaissance Dam (GERD), with 6,000MW; the Gilgel Gibe III, with 1,870MW and the Genale Dawa III, with 254MW, are the hydropower plants under construction. They are expected to be completed by 2017 for the GERD, and 2015 for the other two.

By 2019, total generation is expected to reach 9,265MW, according to the study, which is five times larger than the 1,843MW that was available in 2012.

“To have great electric power capacity is to have great political sovereignty as well. To this effect, we will continue expansion,” Mihret said.

Parsons Brinckerhoff will amend the study based on feedbacks from the two-day meeting and deliver the final report to the Ministry of Water and Energy (MoWE) by January 2014.

http://addisfortune.net/articles/increase-in-electricity-tariffs-required-to-realise-power-generating-projects/

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Ethiopia’s Chief Trade Negotiator Cancels WTO Summit Attendance

Ethiopia’s chief trade negotiator, Mekonnen Manyazewal, has cancelled his attendance at the Ninth Ministerial Summit of the World Trade Organisation (WTO) in Bali, Indonesia, at the last minute. The summit is set to open today, December 3, 2013.

No official explanation has been made available for his absence from the global summit on trade, which will be opened by the President of the host nation, Soesilo Bambang Yudhoyono.

Up to 13,000 delegates are flocking to the island, from 159 member countries and 25 non-voting observers – a group in which Ethiopia is included. Claiming a status of observer since the Organisation’s formation in 1995, Ethiopia is also among the countries  to have begun the process of joining the world’s trade police – known in the Organisation’s jargon as “accession”. Yemen is the latest country expected to complete its transition from an observer to fully fledged member this week.

Accession to the WTO is a long and arduous journey that may take as long as 15 years. Ethiopia’s bid to join as a full member began in 2003, and the country remains halfway through this journey. It has yet to place its offers on services – one of two crucial documents that enables member countries to negotiate with Ethiopia’s trade policy negotiators.

Mekonnen, who is also chief of the National Planning Commission – a newly-established federal agency trying to emulate the one in Indonesia – was scheduled to lead Ethiopia’s five-person team of trade negotiators.

Ethiopia’s team is, therefore, now led by Menelik Alemu, Ethiopia’s ambassador in Geneva; and comprises of Geremew Ayalew, the national technical committee chair of the WTO; Lesanework Zerfu, head of multilateral trade relations at the Ministry of Trade (MoT); and Azanaw Tadesse, counselor for the WTO.

Mulu Solomon, president of the Ethiopian Chamber of Commerce & Sectoral Associations (ECCSA), and her Secretary General Gashaw Debebe, who was formerly a negotiator, are also present in Bali.

The Summit, which will close on Friday, is considered important for poor countries such as Ethiopia, because of the issues it is expected to agree on: trade facilitation and food security. However, since summits like this have a history of collapse in the final hours, major negotiators often try to lower expectations.

http://addisfortune.net/articles/ethiopias-chief-trade-negotiator-cancels-wto-summit-attendance/

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Small, But Proportionally Significant Results Expected at WTO Summit

The Ninth Ministerial Summit of the World Trade Organisation (WTO) opened in the resort Island of Bali, Indonesia, with the declaration of Indonesia’s Trade Minister that the results expected may appear “small, but proportionally significant”.

What has come to be known as a “Bali Package”, trade negotiators across the world are to decide on what Roberto Azevedos, the new director-general of the WTO, described as a balance on the fate of WTO relevance to the world. There is indeed a sense of urgency in his tone when he called delegates to finish the deal “now and here”.

“Members want a deal,” he told delegates. “Well, now is the time to deliver. We are almost at the finish line.”

An important element in the Bali Package is the support members are hoping to give to the accession of the least developed countries, such as Ethiopia. He sees that demand in customs reform is not enough, but there ought to be technical support to enhance their negotiating capacity.

It is what Ethiopian trade negotiators have come to Bali for, according to members of the delegation. A technical assistance, which could reach three million dollars, is under discussion with the WTO, under an enhanced framework arrangement.

http://addisfortune.net/articles/5621/

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WB to finance Climate Innovation Centre establishment

The World Bank,AAU and the Horn of Africa Regional Environment Center (HoA-RECN) yesterday agreed to establish Climate Innovation Centre (CIC) in Ethiopia.

The grant agreement was signed by Gbang Z. Chan,WB Country Director for Ethiopia and Dr. Admasu Tsegaye President of Addis Ababa University. The World Bank provides 5 million USD grant for the establishment of the Centre.

The Ethiopia CIC, spearheaded by infoDev, a global innovation programme of the World Bank, will accelerate the use of emerging technologies in locally owned and developed solutions to climate change. The center, which is supported by the government of Norway, UK Aid and the World Bank, will provide financing as well as mentorship and advisory services to a growing number of local climate innovators and entrepreneurs.

Through its support to local entrepreneurs,the Centre will propel innovative solutions to climate change while creating jobs and improving livelihoods. It is expected to support up to 20 sustainable climate technology ventures in its first year, and more than 200 over the next ten years leading to up to 12,000 direct and indirect jobs.

At the signing ceremony, Dr. Admasu said: “Once the project is launched, it is expected that the CIC will be fully operational over the next 5 years, providing a suite of advisory, partnership and support services to Ethiopian innovators, entrepreneurs and Small and Medium sized Enterprises (SMEs) within climate technology sectors.”

He further said that support might come in the form of grant or business mentoring,and women and rural-based business owners will be especially encouraged to make use of the CIC.

Guang Z.Chen on his part said: “Through its support to local entrepreneurs, the CIC supports key private sector-driven components of the Government of Ethiopia’s GTP and the Climate Resilient Green Economy (CRGE) strategy.”

According to him,CIC will provide early stage financing, business mentorship and technical assistance to these innovators and entrepreneurs who develop environment friendly products and services.

http://www.ethpress.gov.et/herald/index.php/herald/news/5041-wb-to-finance-climate-innovation-centre-establishment

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MELKA-Ethiopia inaugurates indigenous seed bank

The bank is expected to store 300-400 quintals of different seeds as of this harvest season

A local NGO MELKA-Ethiopia has inaugurated a seed bank aimed at preserving indigenous varieties by the farmers themselves. Farmers and students have also staged exhibition of indigenous crops, vegetables and root crops.

Speaking at the inaugural ceremony held at Telecho Kebele of Wolmera Woreda of West Shoa Zone last Saturday, Organization Founder and Director Million Belay(PhD), said the construction of the seed bank is part of the organization’s effort to save indigenous crop varieties from extinction. The inauguration of the seed bank and the exhibition could enable imparting knowledge about indigenous varieties from elders to posterity, he noted.

Million said the organization’s work with the farmers since the last couple of years has helped the latter examine different varieties of crops based not only on productivity but on other criteria like health and impacts on environment as well. Different tasks have been undertaken to conserve water and soil in the area to rehabilitate formerly impoverished plots, the Director said.

He also said that instead of focusing only on improved seeds, preserving various crop varieties could help the country to withstand climate change and related challenges.

Oromia Special Zone Surrounding Finfine Administration Deputy Head Admasu Teshome on his part commended the organization’s intervention which helps farmers preserve indigenous crop and plant varieties along with using improved seed from agricultural research institutes. “ It is helping the farmers by supplying various tools and skills of rehabilitating eroded farming plots. The organization has also pledged to continue its support this year,” he noted.

Admasu said the seed bank is vital for the preservation of different indigenous crop and plant species and use them as basis for future research for improved seeds that could boost agricultural productivity in the country. In addition to collecting the indigenous seed and plant varieties from the community, the zone is working in collaboration with the organization to use some of them on farmers plots and expand use of organic fertilizers like compost, he added.

Meanwhile, an exhibition of more than 17 indigenous varieties of wheat, 20 varieties of barley, beans, peas, crops and vegetables was staged by the farming community and students. The bank is expected to store 300-400 quintals of different seeds as of this harvest season.

http://www.ethpress.gov.et/herald/index.php/herald/news/5040-melka-ethiopia-inaugurates-indigenous-seed-bank

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Ministry introduces National e-MTCT Strategic Plan

During routine antenatal services, all pregnant women receive information and screenings—for the prevention of mother to child transmission of HIV. That way, women who need further care are identified and better served.

The Ministry of Health said that National Prevention of Mother to Child Transmission of HIV (PMTCT) services coverage has reached 42 per cent due to the dramatic increase in the provision of health facilities. However, the desired objective has not been met due to missed opportunities and dropout rates in addition to low coverage of services. Cognizant of these facts, the Ministry has prepared a three-year National Accelerated Plan aimed at eliminating MTCT (e-MTCT) by 2015.

At a workshop organized at Dessalgen Hotel yesterday, State Minister Dr. Kebede Worku said the national plan was set to boost both the rapid expansion and delivery of integrated quality PMTCT services to ensure that all pregnant women living with HIV and AIDS have access to prevention and treatment services, and that new HIV infections among children will be eliminated by 2015.

The objective of the strategic plan is to provide guidance on programming and prioritizing e-MTCT services with clearly set cost effective interventions that will lead to elimination of new infections among children and keeping their mothers alive, he added.

“I strongly encourage all stakeholders across all corners of Ethiopia to work towards successful implementation of this plan and contribute to our national elimination goal. I also urge strong collaboration and partnership with development partners to scale up their support,” Dr. Kebede remarked.

Afar State PMTCT focal person Momina Abdella on the occasion said they have a low prevalence of MTCT, but they are not lax on the subject. “We have a total number of 29 sites giving the service. Since pastoralist lifestyle is common in the State, the expectant mother visits health stations only when she is sick not for the required four prenatal care visits. The State Nursing College trains women midwives to raise access to health service during delivery. We believe that taking the service to where the women travel helps cut the dropout rate. We request the Ministry to increase support to this effect, ” she added.

http://www.ethpress.gov.et/herald/index.php/herald/news/5022-ministry-introduces-national-e-mtct-strategic-plan

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Sudan-Ethiopia committee reaches agreements

The Joint Sudanese – Ethiopian Higher Committee (JSEHC) has concluded its meetings at the experts level, and reached several economic and political agreements and understandings aiming to develop bilateral relations, as Ethiopian Prime Minister expected to arrive on Tuesday.

The Sudanese side of experts committee was headed by the general director of bilateral relations at Sudan’s ministry of foreign affairs, Abdel-Mahmoud Abdel-Halim while the Ethiopian side was headed by director of the African department at Ethiopia’s foreign ministry, Solomon Ababa.

The two delegations reached agreements to enhance trade in areas of transportation, customs, standards and metrology, civil aviation, media, and communication. The understandings covered social, cultural, sports, and tourism domains.

The meeting further applauded progress in work of the joint borders committees in the previous meetings and underscored the need to enhance cooperation between border regions.

The Sudanese foreign ministry spokesperson, Abu Bakr Al-Siddig, on Monday also denied existence of border disputes between the two countries, pointing that there are small differences on limited points at the border area.

Farmers from two sides of the border used to dispute the ownership of land in the Al-Fashaga area located in the south-eastern part of Sudan’s eastern state of Gedaref.

Ambassador Al-Siddig, disclosed that technical committees which are currently meeting in Khartoum have embarked on putting border signs for the border re-demarcation in order to organise trade and movement between the two countries.

He added that the two countries agreed to coordinate positions on the regional and international issues particularly the situation in Somalia besides signing a memorandum of understanding for cooperation and coordination between the foreign ministries, pointing that the Sudanese side briefed its Ethiopian counterpart on the progress of cooperation with South Sudan.

This fifth JSEHC meetings would witness the signing of a strategic framework agreement by president, Omer Hassan Al-Bashir, and Ethiopia’s Prime Minister, Hailemariam Desalegn.

Desalegn will arrive in Khartoum on Tuesday at the head of a high level delegation to participate in the meetings JSEHC and inaugurate the power linkage network between the two countries.

The JSEHC meetings at ministerial level would begin on Tuesday. The Sudanese side would be headed by the foreign minister, Ali Karti, while the Ethiopian side would be headed by the foreign minister, Tedros Adhanom. (Sudan Tribune)

http://www.waltainfo.com/index.php/editors-pick/11481-sudan-ethiopia-committee-reaches-agreements-

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A cooperative union working for the good of farmers

Four years into its operations, Dansha Awraro cooperative union enjoys much success.

Based in western Tigray, the cooperative is striving to better the lives of farmers in the area by finding markets for their produce, investing in social services and stabilizing the market.

“We believe the cooperative is playing its part in the country’s ongoing development,” said Birhane Mezgebo, Tsegede Woreda cooperative union work process coordinator.

The cooperative union also extends loans to farmers who, in the past, have been victims of loan sharks. It has, so far, extended 727 million birr in loans to farmers, enabling them to maximize the quality and quantity of their products.

Farmers in the area predominantly produce sesames, maize and spices. The farmers are no longer concerned about lack of market as the cooperative union buys their produce with a bigger profit margin.

“We are also encouraging and assisting them to maintain the quality of their produce to meet export standards,” acting manager Hagos Mamo said. He said the union has already started exporting the agricultural outputs to China.

With the cooperative union’s effort, whose capital has risen from 40,000 birr when it started to 14.3 million bir, some farmers are starting a small-scale mechanized farming, using tractors instead of oxen to plough their plot.

Their success is also acknowledged by the government. Egri Mitkal Multipurpose Farmers’ Cooperative Union, a member of the Dansha Awraro, has received an award for best practice.

http://www.waltainfo.com/index.php/explore/11482-a-cooperative-union-working-for-the-good-of-farmers-

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Ethiopia earns over $121 mln in revenue from gold, gemstones

Ethiopia has earned over 121 million US dollars in revenue from various minerals supplied to the national bank and overseas markets in the first four months of this fiscal year.

Ministry Public Relations Senior Expert, Ethiopia Bedecha, told WIC the revenue was secured from 2, 541.3 kg of gold supplied to the National Bank of Ethiopia by tradition gold miners as well as 1,264.2 kg of raw and 12.98 kg of value added gemstones exported to various countries.

Some 101.2 of the income was earned from gold produced traditionally and supplied to NBE, while the remaining 20.5 million US dollars was generated from gemstones exported by various companies, he said.

The revenue fell short of target, however, efforts are underway to achieve the target in the remaining months by diversifying export items and devising other options, he said.

http://www.waltainfo.com/index.php/explore/11456-ethiopia-earns-over-121-mln-in-revenue-from-gold-gemstones-

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ODA to raise half a billion birr for planned boarding schools

The Oromia Development Association (ODA) has launched a fund-raising campaign to build three modern boarding schools in Oromia region.
The association expects to raise 500 million birr this year, Abadula Gemeda, board chairman of the association, said during a press conference.
By mobilizing 4.8 million members of the association and its partners, ODA expects to raise the fund required to construct the boarding schools.
The school, primarily, aims to enroll high performing and exemplary students who would be recruited from various schools in the region, ODA said in a statement.
The schools are designed to accommodate well equipped library and laboratory, dormitory for students and teachers, clinic, workshops and sport facilities including a swimming pool, the statement said.
“One of the schools alone, which will accommodate 640 students, could cost not less than 330 million birr,” Abadulla said.
The board chairman said the association was making preparations for the past five months by setting up a committee to oversee fund-raising activities.
Some 51 of the committee members have played an exemplary role by raising over 50 million birr, Abadula said.
“This is indicative that with a more robust effort, we will be able to raise the necessary fund,” he said adding that fund-raising campaigns will be launched in Addis Ababa and major cities in Oromia region.
ODA was established in March 1993 as a non-for-profit, non-partisan organization with the objective of mitigating the developmental problems in Oromia region by mobilizing local and external resources. It claims to have carried out over 2,000 projects in education, health, provision of clean water, environmental protection and food security areas.

http://www.waltainfo.com/index.php/explore/11457-oda-to-raise-half-a-bln-br-for-planned-boarding-schools

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Bahir Dar University working to improve education quality

Bahir Dar University has been working to improve the quality of education through designing and implementing various strategies.

University Vice President for Academic Affairs, Frew Tegegn, told WIC recently the university has been doing its level best to achieve and implement the country’s strategy to improve the quality of education.

The mission of the university is to produce competent and skilled manpower that contribute for the success of the ongoing overall development activities of the country, Frew said.

Hence, the university has been implementing student-centered learning environments, including peer-teaching, to equip students with the skills and knowledge they need to be successful, he said.

The university has also attached due attention toward training marine engineers for shipping lines and becoming one of the ten leading universities in Africa in 2025, he concluded.

http://www.waltainfo.com/index.php/explore/11479-bahir-dar-university-working-to-improve-education-quality-

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Premier lauds job done by INSA in reducing vulnerability

Prime Minister Hailemariam Desalegn has commended the job done by the Information Network Security Agency (INSA) over the past few years in reducing information security vulnerabilities.

After visiting INSA’s exhibition which went on display on Saturday under the motto “Nationwide institutional synchronization for information and cyber security”, Hailemariam said the Agency shoulders a huge responsibility in ensuring the security of the nation’s massive development projects.

According to ERTA, it is also a key to nurturing the youth with knowledge and skills as well as mobilizing the society, he said.

http://www.waltainfo.com/index.php/editors-pick/11454–premier-lauds-job-done-by-insa-in-reducing-vulnerability

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Giant Real Estate Developer Bids to Construct Ten LRT Stations

Property giant P3 International has expressed an interest in the ongoing light railway project and various government housing schemes, and will provide cash finance together with design and operational resources if successful with its proposals, The Reporter learnt.

Assefa Woldemichael, head of P3-Africa in Ethiopia, told The Reporter that his company is willing to have a business relationship with the government through a Public Private Partnership (PPP) framework. “We are the pioneers of introducing PPP to the world. We have the expertise to plan, design, operate and finance a number of projects at a time,” Assefa said.

The Light Railway Transit (LRT) project is currently planning to develop some ten major stations out of the 39 in the capital. Following the initiative of the Ethiopian Railways Corporation (ERC), P3 is pushing to undertake the development. The new Transit Oriented Development (TOD) scheme plans to develop stations with commercial, residential and recreational buildings, aimed to finance the USD 470 million the government borrowed from China.

According to Assefa, P3 has the resources to manage the construction of ten stations, and it has proposed a model for the Laghar station, where some 1.2 sq kms of land is set to be renovated.

In related news, P3 is also keen to take part in the 40/60, 20/80 and 10/90 government housing projects. To date, more than one million Addis Ababa residents have registered in the schemes. According to Assefa, P3 will bring as much as 60 percent of the total finance, and by the schedule of the government will complete one million houses in just two years.

Assefa said that P3 has submitted letters to the Ministry of Urban Development, Housing and Construction, and is awaiting a response.

It is a busy time for P3, as the company also plans to construct a continental referral hospital in Ethiopia which, according to Assefa, will save the expense and time for some 60,000 Ethiopians who travel to Asian countries for budget care. And it is also keen to develop a children’s village in Addis Ababa, which Assefa says will be similar to the world-class projects that P3 operate in Dubai.

The US-based P3 International Development Company has been operating across Africa, the UK, North America and Arab states for the past 30 years. It also advises government leaders in Africa on business design, development and consulting. One of the company’s subsidiaries, commonly known as ARUP, is reputed for its innovative designs for the 2008 Beijing Olympics.

http://www.ethiopiainvestor.com/index.php?option=com_content&task=view&id=4610&Itemid=88

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SUR Construction Signed Contract for Dansha-Abdrafi-Maycadran Road Project

Ethiopian Road’s Authority and SUR Construction PLC signed a contract to build the 104 km long Dansha-Abdrafi-Maycadran asphalt road, Fortune reported.

The 1.6 billion birr contract was signed on Tuesday, November 26, 2013, at the Ethiopian Road’s Authority’s headquarters in Addis Ababa, Ethiopia.

The 10m wide road which includes seven bridges, is located on the import-export corridor between Ethiopia and Sudan. The projected is scheduled to be completed in three years.

The road will start 10.5kms off Dansha and end in Humera at the Lugdi junction and will cover an area which currently has only gravel roads for part of the way and no roads at all for the remaining stretch, Fortune reported citing a press release from the Ethiopian Roads Authority (ERA).

SUR won after competing against 13 local and international firms. The design of the road was carried out by Core Consulting Engineers PLC., a local company. Highway Engineers & Consultants PLC is the consultant for the project.

http://www.2merkato.com/news/alerts/2729-ethiopia-sur-construction-signed-contract-for-dansha-abdrafi-maycadran-road-project

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New Road Construction to Enhance Ethiopia-Sudan Trade

SUR Construction Plc is building a 104 km asphalt road for 1.6 billion Br along Ethiopia’s import-export pathway to Sudan.

The road – Dansha-Abdrafi-Maycadran – will start 10.5kms off Dansha and end in Humera at the Lugdi junction. It will cover an area which currently only has gravel roads for part of the way and no roads at all for the rest, according to a press release from the Ethiopian Roads Authority (ERA). SUR beat 13 local and international firms to the project, which was designed by a local firm, Core Consulting Engineers Plc. It will be 10m wide and have seven bridges. Highway Engineers & Consultants Plc are the consultants for the project.

The contract – signed on Tuesday, November 26, 2013, at the ERA’s headquarters at Mexico Square – requires that the construction be complete within three years.

The road traverses an area famous for its sesame and cotton production and is one of the locations identified for potential agro-industries.

The trade volume between Ethiopia and Sudan is expected to increase following the completion of the road, says Samson Wondimu, public relations director at the ERA. The trade volume, through Humera, between the two countries included 12,760tn of grain, 12,753tn of pulses and 19,066 cattle heads in 2010, according to a World Food Programme (WFP) report.

The project is part of the fourth Road Sector Development Programme (RSDP), which runs from 2010 to 2015, and focuses on raising road standards, building subsidiary roads and improving roads with high traffic. The Authority has budgeted 30 billion Br for this fiscal year, on top of the 142.1 billion Br spent in total over the 16 years of the programme, according to the performance report released in November 2013.

Through this programme, road coverage in Ethiopia has risen from 26,550km in 1997 to 85,966km by the end of the last fiscal year. Asphalt roads in particular, rose from 3,708km to 11,301km during the same period, and this new road will now add to that total.

Another goal of the ERA during this phase, which is to raise the participation of local contractors and consultants in federal road projects, will also be met during this project, as all companies involved are local.

SUR was established 22 years ago. Its capital during this time – during which it has handled 90 projects – has grown from 108 million Br to 1.5 billion, according to Tadesse Yemane, the general manager of the company.

“We are familiar with the area, and we currently have a number of projects there,” Tadesse said.

SUR previously built the 128km Gonder-Dansha asphalt road in Amhara Regional State, completing the project in December 2010. Currently, the company is handling the construction of the Welkayt Sugar Development Project’s 150m high dam in Tigray region, according to Tadesse.

But the agreed construction timeline of three years may be a challenge for the company.

“Usually this kind of timeframe is set for 60km or 70km roads,” said the general manager.

In order to meet the deadline, two teams will be deployed to work on the project. Personnel and heavy machines will start arriving in the area within the coming week, according to Tadesse.

http://allafrica.com/stories/201312030637.html?viewall=1

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Additional Loan Approved for New Addis-Adama Expressway

On Thursday, November 28, 2013, Parliament approved the 320 million-dollar additional loan from the Export-Import (EXIM) Bank of China for the completion of the Addis-Adama expressway and two feeder roads.

The bill presented to Parliament by the Budget & Finance Affairs Standing Committee – one of 16 committees in the 547-seat legislative assembly – indicated that 143 million dollars of the stated amount has been earmarked for the completion of the Addis-Adama expressway. The remaining 177 million dollars will go towards financing the Akaki-IT Park (Guro) and Akaki-Lebu outer-Addis Abeba ring roads, which will link with the expressway on the outskirts of the capital, around the Kality area.

The new expressway, which has the capacity to handle up to 20,000 vehicles a day, was awarded to the China Communications Construction Company (CCCC), to which the EX-IM has decided to lend the money. The Ethiopian Roads Authority (ERA), the developer of the project, signed a deal with CCCC in June 2009 and construction work commenced in April 2010. The deadline was set for four years later.

The project, which is estimated to cost more than eight billion Birr, is financed through a 350 million-dollar loan from the EX-IM, with the remaining 262 million dollars coming from the Ethiopian Government.

The new six-lane and 12 m-wide expressway lies 3.5km west of the existing Addis Abeba-Adama road. Meanwhile, the new interchange roads will be six-lanes, with the potential to be upgraded to eight lanes if required in the future, according to the ERA.

The expressway will also be equipped with eight toll booths along with cameras, as well as lighting throughout the entire 80km stretch.

The Bank has advanced a 13-year 320 million-dollar loan for the project with a seven-year grace period and two percent annual interest fee, out of which 0.25pc will go towards administrative costs.

“The need for additional finance has arisen despite the commencement of construction prior to the signing of the deal,” the report and resolution presented to the Parliament stated. “The construction was delayed because of an increase in foreign currency and construction materials.”

The main road of the expressway continues 2.8km along the proposed Addis Abeba outer ring road and then passes to the East of Dukem, Bishoftu and Modjo. It passes the existing Addis-Adama road at 62km and bypasses around Adama on the south side. The expressway ends on the east side of Adama and connects with the Adama-Awash road.

It also indicated that members of the Committee unanimously supported the bill, taking into consideration that the project lays along Ethiopia’s main export corridor.

About 270 of the 547 members present during Parliament’s seventh regular session of its fourth year unanimously supported the bill.

http://allafrica.com/stories/201312030632.html

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Related articles .

• 01 December 2013 Development News Round Up
• 28 November Development News Round-Up
• 27 November 2013 Development News Briefs
• 26 November 2013 Development News Briefs
• 25 November 2013 Developmental News Round Up (Updated)
• 22 november development news briefs
• 20 november 2013 development news briefs

Tigrai Onlne  December 03, 2013

The Canada-Ethiopia Energy Stakeholders Forum was held in Addis Ababa this week in the presence of representatives of the relevant governments and of Canadian energy companies, industry specialists and financiers. Those attending included the State Minister of Water, Irrigation and Energy, Wondimu Tekle; the CEO of the Ethiopian Electric Corporation, Mihret Debebe; Canada’s Ambassador to Ethiopia, Ambassador David Usher and the Director General of the Americas in the Ministry of Foreign Affairs, Ambassador Taye Atskeselassie.

Opening the Forum, the State Minister for Water, Irrigation and Energy, highlighted Ethiopia’s commitment to the development of the energy sector to meet the targets set in the five-year Growth and Transformation Plan. He noted the necessity of sustainable energy sector development to maintaining the country’s rapid socio-economic development. State Minister Wondimu also underlined the government’s aim of diversifying sources of energy, introducing renewable solar, biomass, wind, waste and geothermal sources. He said the private sector was encouraged to engage in engineering, financing and generating energy development in Ethiopia. He urged Canadian companies to invest in the sector development.

Ambassador Taye Atskeselassie, who hailed the long standing and warm relationship between Canada and Ethiopia centered on development cooperation to help alleviate poverty, said this cooperation was based on the development priorities set out in the GTP. He cited support to women entrepreneurs, improving the investment climate and other areas of cooperation as evidence of the growing relationships between the two countries. Ambassador David Usher noted energy was a strategic sector in which the two countries could work closely: Ethiopia had rich energy resources and Canadian companies had the right capabilities.

The Forum included two panel discussions. The title of the first was “Policies and Strategies and Direction of the energy sector in Ethiopia and the role of the Private sector in Power Generation and Procurement Procedures.” Ethiopia’s energy potential was detailed: 45,000mw of hydropower; 5,000-7,000 of geothermal power; 113 billion cubic meters of natural gas. In addition, due to Ethiopia’s proximity to the equator, there were huge untapped resources of wind and solar energy. With 10% economic growth per annum for over a decade, the demand for energy had been growing at 13% a year, and had now reached 25%. The country was now developing railway transportation, with initial construction of 2,500 kilometers of line, and the development of heavy industries.

The government’s energy policy prioritizes hydropower and the development of other renewable sources. It notes bio-fuels should be used for local production and the transport sector. The ten sugar factories under construction are expected to boost ethanol production, currently used in a mixture with petrol for cars*. The government’s Climate-Resilient Green Economic Strategy aims to build an environmentally responsible and carbon neutral energy sector with zero emissions by 2025, identifying details of energy generation, appliance manufacturing, including solar panels, and engineering procurement and construction of energy-generating plants. The private sector is to be involved in mini-grid energy development in areas where access to electricity from the grid operator is difficult. The recent US$4 billion deal between Reykjavik and EEPCO to develop geothermal power in Korbeti is hailed as a trail blazer.

The panelists also noted the emphasis that is to be given to energy development from various other renewable sources and reduction of energy wastage. Ethiopia’s 25-year master plan for energy development aims to achieve 95% electrification by 2037. The US$156 billion plan has been drawn up in line with the East African Power Master Plan, which aims to connect grids of all the countries of the region. Underlining the growing demand of power from Ethiopia, Ato Mihret Debebe noted that EEPCO will soon be signing a Memorandum of Understanding with Tanzania to export power there. Overall, the panelists emphasized that Ethiopia’s energy sector offered substantial and lucrative opportunities for Canadian energy companies.

The second panel discussion covered “Evaluation Procedures to Financing Ethiopia’s Energy Sector and Access to Finance”, with panelists drawn from the International Finance Cooperation (IFC), the African Development Bank (AfDB), and the Ministry of Finance and Economic Development (MOFED). MOFED explained that much of Ethiopia’s energy finance currently comes from government funds, though off-budget resources coming from donors, development partners and international financers were second tier financial sources. The IFC explained various financial services provided to private investors interested in infrastructure development and said the IFC had facilitated a US$1.8 billion loan for infrastructure development in Africa. He detailed the IFC’s standards and requirements in financing energy development in geothermal and mini-grid projects. The AfDB, which financed the first phase of Ethiopia’s rural electrification program with US$180 million and had continued to support the second and third phases, shared the Bank’s commitment to supporting private firms in energy development. The AfDB also offers advisory services and assistance in mobilization of resources. The AfDB is currently co-financing the US$1.4 billion Ethio-Kenya transmission line as part of the East African power project.

Canadian companies briefed Forum participants regarding their services and their interest in Ethiopian markets. Among the challenges for engagement in Ethiopian energy development, they identified the low feed price for private generation and the absence of multiple grid operators. Government representatives noted the promulgation of the new energy law which gives more space to the private sector as well as the successful negotiation of feed-in prices in the case of the Korbeti [geo-thermal] project. These, they stressed, underlined the very real opportunities of successful, and profitable, energy development in Ethiopia.

Related articles

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• Meeting the local one Ethiopia’s electric power supply could address the demand of neighbouring countries too (allanapotashblog.org)
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• Have UK businesses missed the train in Ethiopia?
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• EEPCo to Pay $630.7m Annually for 1,000MW Geothermal Power
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• Full of Energy (allanapotashblog.org)
• Ethiopian Government and Reykjavik Geothermal Announce 1,000 MW Geothermal Power Agreement
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Ethiopia looks to become a powerhouse of the region in renewable energy. The nation has launched the continent’s largest hydro-power and wind-farm projects in a bid to rapidly boost its generating capacity over the next three to five years. The Ashegoda Wind Farm, and the Grand Renaissance Dam which is under construction on the River Abay, are just two of the major projects outlined in the Ethiopian government’s five-year Growth and Transformation Plan (GTP). Both developments will see Ethiopia’s transition into one of the regions biggest energy exporters as electric output surges from 2,000 megawatts (MW) to 10,000 MW. More than half of this is expected to come from the Renaissance Dam. And with further commitments to geothermal power, Ethiopia’s energy resources are set to be among the most diversified in Africa.

This being the case, on the other hand, the country’s is registering a rapid economic growth which in turn is creating new and widely dispersed centres of high electricity demand. These are necessitated to power industrial zones, large mechanized irrigation farms, national railways, real estate developments, and also rural towns and village communities on which the country’s future economic well-being highly depends on. In parallel to domestic developments, the country has signed multilateral and bilateral agreements with its neighbors and the region at large to build power system interconnections and create markets for its abundant energy potential.

However, according to Mehiret Debebe, the Ethiopian Electric Power Corporation (EEPC), CEO, the power sector’s current state so far is incapable of meeting the supply and service demand of the rapidly growing economy. In particular shortages of transmission and distribution capacities as well technology have alternatively been a problem and an impending factor to achieve the expected standard.

Recently a two-day workshop was held on the Ethiopian Power System Expansion Master-Plan study for the next 25 years . The Ethiopian Electric Power Corporation with the International Development Assistance (IDA) hired Parson Brinkerhoff UK through competitive bidding to undertake the highly required power system master plan update study.

Mehiret on the occasion noted that the government recognizing the above deficiencies, has allocated significant portion of its financial resource to enhance the sector’s power supply capacity in areas of generation, transmission, distribution and rural electrification.

Taking note of the technological and multidisciplinary advancement the sector reached today in other parts of the world, it is clear that the expansion requirement cannot be achieved in the conventional way. The state of art new technologies introduction within the biomass, wind and solar power generation options, AC and DC extra high voltage transmission line and Flexible AC Transmission System (FACTS) with ICT applications and qualified human resource are required for proper and reliable operation of the rapidly growing power system. As to the CEO, when noting the huge investment involved and also the complexities expected in the coming expansion process, the need for rigorous update of the existing power system expansion master plan becomes evident.

He further noted that the main objective of the study is to develop the least cost transmission and generation expansion plan for the rest 25 years. “The contract has also bestowed huge responsibility to the consultant to capacitate EEPCo with the appropriate staff skill, software resource and also power system database for future updating of the study by own force,” he said.

The World Bank, through its representative also affirmed that it would provide support to Ethiopia’s energy projects. The Master-Plan study has been in progress for over a year. The consultant has already delivered the load forecast report which proofed with scientific rigor and models that the expectation of high demand could reach over 37,000 MW by the end of the study period, which is 2037. According to Meheret, while some 33,000 MW is for local consumption, the rest 4,000 MW is to be exported to countries in the region. Currently, the country produces some 2300 MW while many hydropower, wind and solar energy generation projects are underway.

In the interim report presented on the workshop, EEPCo and the consultant have documented their findings as to how Ethiopia’s power system shall develop in the coming years to meet reliably the anticipated demand with the least cost investment.

According to Mehiret the final recommendation plan centres on huge hydro power development, which the country is abundantly endowed with, and as energy mix incorporates wind, solar, biomass and geothermal plants.

Regarding hydro plants, it is stated in the volume three of Master-Plan study’s Interim Report that the installed hydro-power capacity in 2013 is around 1.8 GW with twelve existing plants under construction and one plant under refurbishment. When the committed projects are commissioned, the installed capacity will exceed 10 GW.

Moreover, there have been many hydro-electric schemes proposed over the years. EEPCo and the Ministry of Water and Energy have provided information and reports for twenty eight schemes that reach an overall capacity of 12.4 GW. Some schemes are at the stage of inception study or reconnaissance study but for most of them there was a pre-feasibility or feasibility study available.

The consultant also has carried out an initial review of the various sources in order to understand the present context and development potential for geothermal in the country. The only existing geothermal plant in the country is at Aluto Langano. The plant is a 7.2 MW pilot plant that was commissioned in 1999, but was in operation for barely 18 months before shutting down when leaks developed in the heat exchanger tubes. The low capacity factor observed during the initial years of operation was mainly due to design issues and maintenance problem. It was rehabilitated by Geothermal Development Associate (GDA) in 2007 and currently it is generating about 5MW. Regarded committed plants, it is stated that the 70 MW Aluto Langano II project has a planned Commercial Operation Date in 2017. The exploration and field appraisal phase has already been completed. Drilling will take place first and be followed by an EPC contract of USD 230 million. The project will be financed by the World Bank and a Japanese company. Candidate plants for geothermal development were also stated on the report which included cumulative new developments of 450VMW by 2018 at six sites including Alulto Langano II and 1000 MW by 2030.

Then again, the Adama wind farm, completed in 2009, was the first wind-farm to be constructed in Ethiopia and consists of thirty four 1.5 MW Goldwind GW77/1500 wind turbines, giving a maximum capacity of 51 MW. The Ashegoda wind-farm (Phase one) expected to be completed mid-2013, and consists of thirty 1MW Vergnet GEV HP turbines. Phase 2 is due to be completed by the end of 2013, and consists of 54 1.67 MW Alstom Ecotecnia 74 turbines. Further, it also lists candidate projects. The report also included sections on solar and biomass energy developments.

In addition, not to compromise the system security during poor hydrologic conditions, the consultant has proposed thermal generation operating almost as standby with very low average plant factor for short term. High efficiency Combined Cycle gas turbines with higher plant factor are also proposed after year 2025 when the candidate hydro resources in pipeline with lower cost of generation are exhausted.

“This is an indication to the need of identifying other potential projects for further consideration in the future plan update activities as we believe that Ethiopia has more than 45GW hydro potential,” the CEO said. Even though not incorporated in the final plan due to economic and other complex reasons, Nuclear power plants were also examined as possible candidates.

“We have to give serious attention to recommendations which are within ten years horizon”, he said. “According to the plan we need to finalize feasibility studies for Gibe IV, Gibe V, Upper Dabus, Birbir, and Genale Dawa V and others within a very short time.”

Further, he added that “ we need to implement with a sense of urgency more than 15 hydro plants with a total capacity of about 10,000 MW on top of the ones which are currently under construction.”

The plan also indicates that 900 MW wind, 300 MW solar and 1000 MW geothermal are needed within the 10 years period. Moreover, more than 16,400-kms extra and high voltage transmission lines needs to be implemented.

The 25 years Expansion Plan requires more than 150 billion USD for its full implementation. This is a huge task requiring the coordination of resources from government, the private sector and financing institutions and other stakeholders who have common interest from this prospect full market, Mehiret underlined.

 Sourced here:  http://www.ethpress.gov.et/herald/index.php/herald/development/5047-planning-to-become-regional-powerhouse

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Related articles

• A Canada-Ethiopia Energy stakeholders Forum held in Addis Ababa (allanapotashblog.org)
• Meeting the local one Ethiopia’s electric power supply could address the demand of neighbouring countries too (allanapotashblog.org)
• 25-year Power Expansion Master Plan study tabled for discussion (allanapotashblog.org)
• Ethiopia working on new $100bn energy strategy (allanapotashblog.org)
• US companies awarded 300MW PV project in Ethiopia (allanapotashblog.org)
• Earth, wind and water: Ethiopia bids to be Africa’s powerhouse (allanapotashblog.org)
• Ethiopia Turns On Biggest Wind Farm in Africa (sustainablebusiness.com)

Members of the African Chambers of Commerce and Industry met at the Hilton for two days last week and establishing a Continental Free Trade Area (C-FTA) within the next three years was a major part of their agenda.

“As your conference comes on the eve of the World Trade Organization (WTO) Ministerial conference where we will be pressurized to enter into deals that are not so beneficial to developing countries, the out come of your two day reflection here will surely give us more ammunition to resist the pressure,” said Fatima Haram Acyl, AU Commissioner for Trade and Industry speaking during the opening session of the conference.

The WTO Ministerial conference is to take place in Bali, Indonesia from December 3rd to 6th with discussions on trade facilitation in Africa which some feel will have a positive effect on the continent’s trade performance as well as priority areas in the African Union Action Plan, towards boosting intra-African trade.

“The continent is being transformed at a pace the world has yet to grasp fully. In this regard, the growth in trade is having and will continue to have a profound effect on people’s lives,” said Hailemariam Desalegn in his opening remarks.

He also stated that the realization that trade has a far reaching impact in propelling Africa’s growth further was evident in the AU’s decision to make establishing a Continental Free Trade Area (C-FTA) one of its key objectives.

In January 2012, the 18th AU Summit agreed on fast tracking the establishment of C-FTA by 2017. The C-FTA plans to eliminate tariffs on almost all originating trade between C-FTA member states. Along with measures to further reduce the cost of cross-border trade, it will not only help to increase intra-Africa trade but also to improve Africa’s competitiveness in the global market place. “There are evidently opportunities, but it is also fair to say that Africa can be, and often is, a challenging environment in which to work. Our economies are far less integrated than should have been the case. One important challenge and a topic for which this forum is deservedly dedicated is intra-Africa trade. We need to find a way of unblocking intra-Africa trade, which will be the real motor of Africa’s growth,” Hailemariam also said.

The conference also held discussions on the issue of mainstreaming and implementing coherent efficient trade policies, reducing time and cost for moving  to destinations as well as creating regional and continental value chains, increasing local production and trade in goods that are made in Africa.

Sourced here:  http://www.capitalethiopia.com/index.php?option=com_content&view=article&id=3785:trading-freely-by-2017&catid=35:capital&Itemid=27

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Office blocks under construction in Ethiopia‘s capital, Addis Ababa. But the reality is also many very poor neighbourhoods. (Pictured, above)

Michael Buerk‘s famished Ethiopia of 1984 has become a nation achieving 93% GDP growth in six years, finds study

David Smith - Africa correspondent

theguardian.com - Wednesday 4 December 2013

“Dawn. And as the sun breaks through the piercing chill of night on the plain outside Korem it lights up a biblical famine, now, in the 20th century. This place, say workers here, is the closest thing to hell on earth.”

That television news report by the BBC’s Michael Buerk in 1984 framed Ethiopia for a generation as a place of famine and in need of salvation.

Almost 30 years later the country is hailed by pundits as an “African lion” after a decade of stellar economic growth.

Now further evidence of its turnaround has arrived with research showing that Ethiopia is creating millionaires at a faster rate than any other country on the continent.

The number of dollar millionaires in the east African nation rose from 1,300 in 2007 to 2,700 by September this year, according to New World Wealth, a consultancy based in the UK and South Africa.

That figure puts the country well ahead of Angola, up by 68%, and Tanzania, which had a 51% increase. Zambia and Ghana completed the top five.

The study finds that the rise in millionaires has been closely tied to GDP growth, in which Ethiopia has also fared best over the past six years achieving 93%, followed by Egypt (81%) and Angola (61%).

The authors note, however, that Ethiopia started from a very low base, and its per capital wealth is still just $470 (£287), compared to $3,187 (£1,948) in Egypt and $7,508 (£4,588) in South Africa.

Andrew Amoils, a senior analyst at New World Wealth, said: “The economic and wealth growth in Ethiopia over the last five or six years has been really strong. There has been a lot of privatisation and certain sectors are growing well. It’s a huge upswing but it started from a low base.”

As in other parts of Africa, however, the growth is not necessarily shared.

“The millionaires are growing at a faster rate than the middle class, which doesn’t really exist in a lot of African countries, including Ethiopia,” Amoils said. “Angola, for example, has had massive millionaire growth in the last 10 years but that hasn’t spilled through to the average Angolan.”

But whereas much of Africa’s boom has been driven by mineral resources, leading sectors for millionaires in Ethiopia include agriculture, manufacturing and transport.

The richest Ethiopian is said to be the businessman Mohammed Al Amoudi, who divides his time between Ethiopia and Saudi Arabia, where he now has citizenship.

A construction boom is underway in the capital, Addis Ababa, but Amare Abebaw, a social entrepreneur, said the rest of the world does still did not appreciate the country’s extraordinary transformation.

“When I go home and watch TV I still see the famine from the 80s and I wonder how do they still show this on the BBC when things have improved here? It is painful for us. We know it is part of our history but we want to focus on the present.”

Nevertheless, while the number of millionaires is definitely increasing, they remain a fraction of the population.

“There are a few at the top but the majority of people are at the bottom, like in other countries,” Abebaw said. “There are self-made millionaires and people are proud to know them. There are others where you don’t know where they got the money from, and suspicions may arise from the population.”

South Africa is the top African country for millionaires with 48,700 in 2013, followed by Egypt with 22,800 and Nigeria with 15,700.

Richard Dowden, director of the Royal African Society, said he had witnessed the rise of tower blocks, traffic jams and people now “walking with a purpose” in Addis Ababa.

He added: “You don’t see many Ethiopians in flashy cars, like you do with Luanda or Lagos [citizens in their respective countries]. Flaunting your wealth is not part of the culture.”

The Ethiopian government claims credit for the growth but is criticised as authoritarian by human rights groups; there is only one opposition MP.

In a recent blog post, Dowden noted that  the former prime minister Meles Zenawi once observed: “There is no connection between democracy and development.”

Sourced here: 

http://www.theguardian.com/world/2013/dec/04/ethiopia-faster-rate-millionaires-michael-buerk

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Menelik Alemu, Ethiopia’s ambassador in Geneva, and Geremew Ayalew, chair of a national technical committee for WTO at the Ministry of Trade (MoT), in Bali, Indonesia, on Wednesday, December 4, 2013. Currently negotiating Ethiopia’s entry to the world’s police on trade rules, Menelik is scheduled to address the Ninth Ministerial Summit of the WTO, where many delegates say a deal is within reach, on Thursday afternoon. (Pictured, above)

Ethiopia sees itself joining the WTO in 2015, and the proposed deal this week, known as the “Bali Package” is crucial to least developed countries such as Ethiopia, for it is to agree on agricultural subsidies, trade facilitation and support to least developed countries. A disagreement from one single country could stall a consensus among the 159 member countries. India, in particular, is seen as a major force that could halt talks at the multilateral trade talk platform this week, due to its strong position against banning agricultural subsidies to its farmers.

Some of its citizens were vocal inside the Nusa Dua Conference facility this morning, protesting the ongoing meeting and demanding it to stop the talks.

“USA; Hands Off Our Food!” decried one of their placards.

But it is delegates from the least developed countries who are opposed to agricultural subsidies. In fact, the United States (100 billion dollars), the European Union (80 billion euro) and India are major countries blamed for such subsidies deemed to have distorted exports of primary goods from poor countries.

Yet, most delegates from developing economies and least developed countries are fearful of a draft agreement on trade facilitation. A deal, if reached, would force them to lift entry barriers to trade. Praised by its proponents for its potential to add an estimated one trillion dollars to the world economy, trade facilitation allows the free flow of good and merchandises among member countries, with countries required to change their systems that impede free flow of trade.

“It is about reforms,” said Yonov Frederick Agah, deputy director of the WTO, speaking to journalists here in Bali. “And reform, in any circumstances, is always controversial. There are countries that want to do certain things, but they want to do it in their own sequence, time and money.”

Time and money is indeed what countries such as Ethiopia, which is one of the 25 countries still in the accession process, lack in their bid to join an organisation that was formed in 1995, and is created to treat the rich and the powerful equal to the poor and the weak. The weak are however in a constant look out for support in the form of enhanced capacity to negotiate better deals.

The European Union (EU) claims the moral high ground in its support to least developed countries.

“We are already the biggest donor in respect to aid for trade and trade facilitation,” Karel de Gucht, EU Trade Commissioner, said in an exclusive interview with Indonesia’s daily, The Jakarta Post. “We are going to continue this and we have earmarked 400 million euro for that purpose, for five years.”

It is not clear if part of this money goes to a newly established funding facility under Enhanced Integration Framework (EIF), which is chaired by Ethiopia’s Ambassador to Switzerland, Menelik Alemu. In addition to helping Ethiopian trade negotiators enhance their skills in trade talks, with an outlay that may eventually grow to three million dollars, close to 300,000 dollars is immediately available to finance programmes that support small scale farmers and those active in the hospitality industry, Geremew Ayalew, chair of a national technical committee for WTO at the Ministry of Trade (MoT), told Fortune.

Sourced here:

http://addisfortune.net/articles/food-subsidies-could-stall-wto-deal/

Tariff to increase over 300%

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Entire Nation expected to have electric access by 2037

Even though EEPCo’s main focus is hydroelectricity that may change in the future.  Its new 25 year plan, ratified after a two-day meeting with stakeholders this week, calls for nuclear power, increased reliance on renewable resources and lighting up the entire nation by 2037.

All this will come at a high price, however as the expansion is expected to cost over USD 150 billion and a 300 percent rate increase may be in the works for consumers. Green Power In the new plan, hydropower will remain the chief energy producer but other resources like wind, solar, geothermal, biomass and combined cycle gas will be tapped. This is because Ethiopia actually has the potential to generate 45,000 MW from hydro resources but it is only generating 2,000 MW right now. EEPCo plans to construct 24 hydroelectric projects with a capacity of generating 12,406MW, until 2023. This will cost USD 38.477 billion and, except for Beko Abo, Upper Mendaya, and Karadobi, should all be finished by 2020.  Karadobi should finish in 2021, Beko Abo will finish in 2022 and Upper Mendaya in 2023. These figures do not include current major endeavours like the Grand Ethiopian Renaissance Dam (GERD) and Gibe III.   In the plan, EEPCo and the Ministry of Water, Irrigation and Energy addressed 28 schemes with the potential to generate over 12.4GW. Most were at the pre-feasibility or feasibility stage although some were closer to inception.

Going Nuclear

The CEO said that even though it was not incorporated into the final plan nuclear power plants were examined as a possible option that could be put into effect by 2021. According to the study, the potential power generated from uranium could be as high as, 1,200MW by 2021. However the plan says nuclear power is not cost effective because they take longer to construct and are more expensive than other power plants. Growing Demand Parsons Brinckerhoff, a UK based firm, is consulting for EEPCo on the 25 year plan. “In addition to trying to get more power at a lower cost, the contract expects the consultant to provide EEPCo with the appropriate staff, skills, software, resources and a power system database for future updating of the study,” MihiretDebebe, CEO of EEPCo said. Even though the original master plan was created in 2000, experts said it needed to be adjusted because Ethiopia has been growing so fast that the demand for power has been increasing dramatically. “We revised the previous baseline so more projects could be completed in line with the current economic conditions,” EEPCo officials explained. Energy sales are expected to grow from around 744 GWh in 2011 to 15,436 GWh in 2037. Currently, approximately 3.68 million, out of 16.16 million households in the country, have access to electricity. Of these households, 1.493 million (40.6pct) are reported to have private connections, whereas the balance share meter connections. Yet, these figures mean that only 22.8pct of households in Ethiopia have access to electricity.

Lighting up the Nation

However, according to the EEPCo plan, by 2018 the number of households that use electricity will double and the master plan calls for every house to be able to receive electricity if they want to. When this factor is combined with export demands that are forecast to grow to 4,030MW by 2037 from 165MW in 2012, the best case scenario is for electric sales to be about 61 percent higher, with the highest growth coming in the next five years.   In fact for the next 10 years massive growth anticipated in industry, agriculture (irrigation) and the new railway is anticipated to create a huge demand. Privatization? The biggest challenge will be securing financing. According to the master plan, at least USD four billion is required every year to meet the target. In the future this could mean that the state monopoly begins to open up to private investment. “The new law amended by parliament last week will allow the private sector to provide power. The proclamation permits the private sector to generate, distribute and transmit, while the national grid owner (the utility, which is EEPCo in Ethiopia) will be the operator,” the CEO said. “A win-win situation has to be created to cover the expected cost,” he said.  Exports will support some costs until local consumers can afford to pay the real price. The government said that it is subsidising power rather than passing on the full cost to customers.  Although the study does recommend a price increase. The current average flat tariff charged to customers in Ethiopia is just under three US cents per kilowatt hour. The tariff level has diminished in real terms and in recent years has been insufficient to generate profitability for EEPCo, particularly when rainfall is poor. This means that consumer price increases for electricity are almost certainly in the works. There is significant growth in the export of power anticipated over the period of the expansion plan; therefore securing higher tariffs for exports will be critical to on-going financial viability. The master plan study recommended that without such an increase, a hike in domestic consumer tariffs from 2.8 US cents per kilowatt hour, to more than 14 US cents per kilowatt hour, are needed to afford the expansion especially when inflation is factored in.

Planning for Growth

In the new plan different regions and industries will receive power based on their projected demand. According to the study, five industrial zones (Kilinto, Bole, Meleka Jebedu, Kombolcha, Awassa) will require 1,127.7MW of power until 2019. Of the stated industrial zones, Kombolcha and Melaka Jebedu will need 336.9 and 315.3 MW respectively.  Industrial zones requiring power from 2019 onward are Bahirdar, Gonder, Mekele and Jimma, with a total demand of 1,200 MW. Additional industries are projected to require 1,966MW. This includes: cement factories (729MW), steel and metal factories (691MW), general industry (530MW) and mining (16MW). The report added that the expected demand is scheduled to increase, hitting its maximum need in 2019. Irrigation is expected to tax energy demand from around 80MW to 5,257MW by 2037 and the new railway will mean an increase from 101MW in 2015 to around 1,571MW in 2037. The Addis Ababa light railway will demand 15MW per 42,119 passengers across five trains. The report also added that sugar factories would demand 100.9MW of energy by 2014, up from 49.5MW in 2013, and 190MW by the end of the five year Growth and Transformation Plan. According to the document, industrial, transportation, and irrigation requests for power supply connections received by EEPCo will be about 4,879MW of peak power demand until 2020. The total electricity sales forecast for the industrial, commercial and domestic sectors are 7,013MW, 2,635 MW and 5,624MW respectively by 2037. Substations The short term expansion plan for substations and transmission lines states that 114 new transmission substations, 63 substation reinforcements and 13,560km of new 500kV transmission lines will be required at various stages up until 2020. The plan includes extensive expansion of both the 250kV and 400kV system. The 500kV developments are limited to the GERD-Addis Ababa corridor and the international interconnection with Sudan. On the other hand, the long-term expansion plan proposed a network comprising a 400kV super-grid that interconnects the main load centres with the major power plants by 2037. The long-term plan includes 78 new transmission substations, 41 substations and 9,257km of new 400kV transmission lines required at various stages up to 2037. The study indicated that USD 12.15 billion dollars would be needed for the short and long-term transmission and substation projects.

Sourced here:  http://www.capitalethiopia.com/index.php?option=com_content&view=article&id=3784:going-nuclear&catid=35:capital&Itemid=27

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Featherstone: G8 land deal to boost land rights in Ethiopia

On Dec 09, the Governments of Ethiopia, the United States of America, the United Kingdom, and the Federal Republic of Germany announced agreeing to enter a land country partnership to work together to improve rural land governance for economic growth and to protect the land rights of local citizens in Ethiopia.

This partnership builds on existing programs and represents an important vehicle for increased coordination and collaboration among the Government of Ethiopia and its development partners. The announcement came after the representatives of the heads of state from G8 member states gathered in London to mark the handing over of the G8 Presidency from the United Kingdom to Russia.

The partnership with Ethiopia will support improved rural land tenure security for all, including through appropriate land use management in communal and pastoral areas. It will strengthen transparency in land governance, including by promoting responsible agricultural investment through an improved legal framework and practices.

Speaking for the UK, International Development Minister Lynne Featherstone said:

“I welcome this announcement that the Governments of Ethiopia, the United States, Germany and the United Kingdom are entering a land country partnership.

“Having secure rights to land will help people across Ethiopia to grow the food they need, boost incomes, defuse conflicts and deal with the impact of climate change. This joint partnership will make sure Ethiopia can make the most of its valuable resources and attract the investment and income needed to boost growth and fight poverty.”

Ethiopia’s Minister of Agriculture Tefera Derbew said:

‘’The Ministry of Agriculture of Federal Democratic Republic of Ethiopia welcomes this joint partnership in the context of supporting the implementation of Ethiopia’s Rural Land Administration and Use plan under its policy and strategic frameworks. It will help the country to ensure and sustain its economic development by strengthening rural land governance in view of fostering food security and realising constitutionally recognised rural land related rights of Nations, Nationalities and People of Ethiopia. I hope the current harmonisation, co-ordination and alignment mechanisms of Rural Economic Development and Food Security Working group (RED-FS SWG) and Sustainable Land Management Platforms will serve as an engine to further deepen our joint partnership on rural land.’’ German Federal Minister for Economic Cooperation and Development Dirk Niebel said in Berlin:

“Germany highly welcomes this partnership between our four Governments that will contribute to better land management in Ethiopia, thus promoting transparent, fair and sustainable investments in land. Access to land and land tenure security are crucial for food and income security for the rural population in Ethiopia. This partnership will complement and strengthen the Government of Ethiopia’s efforts in the sustainable land management program to which Germany has been committed for years. This partnership also shows that the G8 is delivering upon its commitments promptly and with a view to the needs and priorities of our partners.”

U.S. Agency for International Development (USAID) Administrator Dr. Rajiv Shah said in Washington:

“We welcome this joint partnership in the context of the G8 and congratulate the Government of Ethiopia on redoubling its dedication to achieving improved land governance and land tenure security for all. The Government of Ethiopia has made great progress in recognizing the rights of smallholder farmers with support from USAID, and we look forward to broadening and deepening this collaboration in the country’s pastoral areas.”

This follows the announcement of seven partnerships made last June at the G8 Open for Growth Summit. These partnerships between G8 member states and developing countries are designed to support governments in aligning their country frameworks with the globally agreed-upon Voluntary Guidelines on the Responsible Governance of Tenure of Land, Fisheries, and Forests in the Context of National Food Security and to improve rural land governance and the security of land tenure for individuals, communities, and investors.

The partnership represents the continuation of the commitments made under the New Alliance for Food Security and Nutrition, an effort by African heads of state, corporate leaders and G8 members to increase food security and nutrition in sub-Saharan Africa, and takes note of theAfrican Union Declaration on Land Issues and Challenges.It will also coordinate and harmonize support from existing and potential new development partners in the land sector. These objectives will be achieved through ongoing and potential additional future programs in support of improved rural land governance.

The partnership will enable better collaboration, coordination, and sustainable impact. This will be achieved under the on-going RED-FS Working group and Sustainbable Land Management Platforms. Further details on the partnership will also be communicated over the course of the next year through the G8 and the Global Donor Working Group on Land, which was recently established by bilateral and multilateral donors to improve coordination of their respective efforts in the rural land sector.

http://addisstandard.com/featherstone-g8-land-deal-to-boost-land-rights-in-ethiopia/

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GRD construction well in progress

Written by ABEBECH TAMENE

The construction of the Grand Ethiopian Renaissance Dam (GRD) is well in progress through well-organized integrated efforts, Project Manager Engineer Simegnew Bekele said.

Eng. Simegnew said in a recent interview that progressive performance is seen on main civil works, electromechanical and hydraulic steel structure as well as transmission and sub-station works. He said currently construction of two power houses is underway for the Dam.

Eng. Simegnew said filling concrete as well as soil and rock excavation is in progress at the main Dam while civil and steel structure work is being undertaken to divert the river permanently using four culverts.

Building of two steel manufacturing factories meant to supply steel for construction of the Dam is also well underway, he said, adding, one of the factories has already gone operational while work on the remaining one is nearing completion.

The factories have capacity to produce 12,500 cubic meters steel per day.

The workforce on the construction of the Dam has reached 6,500 while 1,700 different types of machinery deployed for the same purpose, the Manager said.

National Council on the Coordination of Public Mobilization for Dam construction Deputy Director-General of the Office Zadig Abraha on his part said agreement is signed for construction of 400kV transmission line covering 240km stretching from Tana Beles Dam to the GRD.

Zadig said farmers in the areas contributed labour support valued at nearly 35.7 billion birr in natural resource conservation activities carried out in 2004/2005E.C.

A total of about 5.7 billion birr was secured from bond sale for construction of the Dam, he said. The top performers in buying bond are salaried government employees, he said.

The project site lies at Guba in Beneshangul- Gumuz State approximately 750km northwest of Addis Ababa. It will increase the power generation capacity of the country and strengthen the power export program. The late Prime Minister Meles Zenawi laid foundation stone for the Dam on April 2, 2011. Ethiopia covers the entire cost for construction of the Dam, which will be the largest hydroelectric plant in Africa, when it becomes completed.

http://www.ethpress.gov.et/herald/index.php/herald/national-news/5112-grd-construction-well-in-progress

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Furthering bilateral development ties to a new level high

Written by  SAMUEL ALEMU

Growing relationship between the two sisterly nations

“Russia and Ethiopia are two sisterly countries that have enjoyed long-standing and amicable relationship. As part of the effort to further strengthening this relationship the two governments have been working together on ways of increasing the level of cooperation in the areas of economic, scientific, technical and trade relations, according to Co-Chair of the Ethiopia-Russian Intergovernmental Commission (IGC) and Minister of Water, Irrigation and Energy, Alemayehu Tegenu.

The Fourth IGC meeting of the two countries was held here in Addis Ababa from the 26th to 28th February 2013, where reviews of the bilateral activities in various sectors were concluded by indicating the way forward to further strengthen the relationships. Recently, a follow up meeting was held preceded by a two-day technical experts meeting from the two nations. During the meeting progress of implementation initiatives and prior agreements was made, and recommendations were made to explore and initiate new possibilities for new areas of cooperation, and also seal concrete agreements that will take the bilateral relationship to new heights.

Speaking at the recent meeting which was held at Hilton Addis, Alemayehu remarked, “ We are here to take stock of the progresses made so far in the implementation of agreements reached previously in major areas of cooperation spanning to wider fields of interests, and to find ways of speeding up the process where progress has been slow.”

He explained that IGC had helped to take stock of the progresses in bilateral cooperation so far, to identify areas that needed continued efforts and interventions, as well as new potential for future cooperation. Progresses have already been made in cooperation particularly in the areas of science and technology, education, transport, tourism and culture sectors and in relation to that communications and discussions are going on between relevant institutions from both countries, which hopefully will lead to more forthcoming agreements that will strengthen the relationships, according to the Minister.

Presently, the government of Ethiopia is in the middle of executing the five year Growth and Transformation Plan (GTP) covering the period 2011-2015, and which has set out targets that will see the socio-economic transformation of Ethiopia. The plan calls for a substantial increase in infrastructure building, growth in various sectors like agriculture, industry, mining, export trade, rapid and universal expansion of vital services like education and health, Alemayehu noted. “It is thus with great expectation that we see the growth of our bilateral cooperation contributing towards the achievement of our GTP goals. Ethiopia would like to see continuing results and outcomes that are mutually beneficial,” Alemayehu said.

In this respect, Ethiopia’s expectations are that the two countries take measures aiming at further strengthening ties in trade and investment, according to the Minister. “ In this respect Ethiopia highly appreciates the support given by Russian partners in terms of expanding trade opportunities, finance, technical and scientific know how and capacity building and growing Russian investments in Ethiopia, all of which are helping Ethiopia in its development in the not-too-distant future, he noted.

Ethiopia realizes the fact that the potential for cooperation between two countries is vast and lends more opportunities for both sides, way beyond the current level.

Although the overall trade turnover has grown on average by 46.84 per cent a year since 2006 to reach 145 million USD in 2012, it accounted for only 0.52 per cent of export and 1.12 per cent of import trade of Ethiopia in 2012, with Ethiopia’s imports accounting for the lion’s share of the trade.

Therefore future, collaborations between the two countries will need to focus on increasing and balancing the volume of trade and, promoting trade and investment in Ethiopia, especially in areas of high priority and also look forward to seeing mutual cooperation in the fields of agriculture, geology and mineral resources, water and energy, science, health and tourism bringing even greater win-win results, Alemayehu Tegenu indicated.

He also pointed out that in this context regular meetings of the Intergovernmental Commission are held as part of the framework to help advance the cooperation in important sectors.

In view of this the Ethiopia-Russian Intergovernmental Commission on Economic, Scientific, Technical and Trade Cooperation signed Memorandum of Understanding (MoU) to improve the services provided by the Ethiopian Electric Power Corporation and with the Ministry of Health.

Ethiopian Electric Power Corporation Chief Executive Officer, Mihiret Debebe noted on the occasion that the signed MoU will help to rehabilitate the 153MW Melka Wakena Hydro Electric Power plant which went operational 25 years ago in, 1988. By then, the project was financed by the then Soviet Union and went into operation with technical support in terms of design, construction and supply.

Mihret also indicated that the power plant requires innovation in terms of technology and upgrading capacity. Accordingly, the Russian stated-owned group will work with its Ethiopian counterpart to undertake the technical study, assessment, and provide supports of financial and other aspects. Then in a few months time, they will come up with technical and financial proposal in financing scheme based on the decision to be made after the negotiation of the two parties and government level decision. There up on, MoU will transfer into implementation phase.

As the part of holistic hydro electric development, he said, the Russian group had shown interest to be engaged in big scale hydro electric power development. Russia was one of the leading countries for the past decades in all aspects of hydro electric power engineering.

State Minister of Health, Dr. Amir Aman on his part said that the MoU signed with Russia will have significant contribution in prevention and control of communicable diseases, with strengthened collaboration in pharmaceutical issues such as in drug, medical equipment and other related issues. It will also enable to work together in the areas of reducing maternal and child mortality through the provision of support aiming at filling knowledge gaps in short and long term training.

Deputy Minister Ministry of Natural Resources and Environment and Head of the Federal Agency for Mineral Resources of the Russian Federation, Valery Pak, on his part said that the implementation of bilateral agreements in the electrical and engineering was strategically important.

Alemayehu expressed commitment on the side of Ethiopia to continue working tirelessly in the coming weeks and months for the realization of the various agreements, decisions and recommendations made during the meeting.

http://www.ethpress.gov.et/herald/index.php/herald/development/5096-furthering-bilateral-development-ties-to-a-new-level-high

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Ethiopia: Building the base for green diplomacy

For centuries, the relationships of nations and peoples have been blooded and reddened by their disputes over religion, ideology, territory or other competing interests. They have made the planet a stage for the dramatization of conflict and war. Today, however, the more important areas of hostility lie in the relationship between humanity and nature as climate change has become the major issue of world affairs bringing some areas to the brink of apocalypse. Africa is one of the most affected regions, and Ethiopia, in the often drought-affected Horn of Africa is no exception. Global warming in fact has provided an additional dimension to the problems of the region, and in response Ethiopia, together with other stakeholders, has launched the concept of green diplomacy to encourage adaptation and mitigation of the effects of climate change and try to bring renewed harmony between nature and humanity.

Ethiopia’s commitment to promoting the interest of humanity long pre-dates the more recent frenzies over the effects of climate change. A long time member of the League of Nations and a founded member of the United Nations, Emperor Haile-Silassie encouraged the country’s diplomats to wage diplomatic battles for peace and security, strongly supporting the concept of moral consensus of collective security to prevent further conflict. In a similar fashion, the late Prime Minister, Meles Zenawi, was a vigorous spokesperson for Africa and for the world, speaking strongly about the current catastrophe of global warming, proposing inter alia a new pattern of international relations. This is to be based on cooperation and coordination to tackle the challenges now facing the continent. It was also intended to demonstrate that Africa could be an equal partner in the war to overcome the problems of global warming: “We are here not as victims of the past but as stakeholders of the future reaching out across continents, so that together we can build a better and fairer future for all of us,” he remarked in Copenhagen Climate Change Conference in 2009.

Ethiopia itself has now set out an unprecedented course, aiming to surmount the summit of ecological development, to create a vibrant society on the basis of sustainable green ecosystem. It is not a traditional economic model but a new one based on ‘green’ development. It will deploy the usual elements of ’green’ development, but in addition it will also deploy new factors including the concept of ‘green’ diplomacy as part of its ‘green growth architecture’. This all part of what can be described as a ‘green’ revolution intended to make development and the environment properly sustainable.

A central element in this is the Government’s Climate Resilient Green Economic Strategy, a carefully crafted strategy that is designed to be emulated by other nations, both in Africa and elsewhere, to provide for the building of a properly resilient world to tackle the repercussions of global warming. As this strategy is being translated into action, Ethiopia is abandoning traditional development strategies characterized by carbon intensification and environmental degradation. In Ethiopia, the lilies of green development are blooming as the country starts to ‘green’ its social, economic and political transformation.

The strategy involves activity on a number of levels, providing the instruments and institutions to push forward policies to impede and overcome the threat of ecological collapse. The Climate Resilient Green Economy Facility, for example, will help the Government achieve a middle income economy with carbon-neutral growth by 2025. It is specifically designed to welcome environmental friendly projects, organizations and individuals. Another fundamental factor is the way Ethiopian farmers are working to tame nature by re-establishing their relationship with the natural systems of the weather and the seasons. Having experienced the extremes of drought, degradation and famine, they are now working on a large scale to restore the country’s ecological capital, including its forests, its wetlands, and its grasslands. The aim is to heal the damaged natural systems to restore their economic and environmental health. Well aware that the ecological destruction of the planet threatens to make political, economic, and social activities unsustainable, they are demonstrating to the world that they are rebuilding a sustainable future for the children of tomorrow. Their actions to protect the environment underline the importance of reversing the destructive policies of today.

Another central element in these developments is the way Ethiopia is beginning to utilize its water, wind, solar, and geothermal energy assets and, equally important, to share these with its neighbours in order to bring a halt to the ecological destruction of the region. This is being done in cooperation on the basis of win-win remedies aiming to heal the environment and to sustain social, economic, and cultural integration. This approach was strongly emphasized by Prime Minister Haile-Mariam who has stressed that his vision is that “over the next 30 years, we will need to harness as much as 80,000mw of hydro, geothermal, wind, and solar power, not just for Ethiopia, but for our neighbouring countries as well.” He underlined the point that Ethiopia’s green growth strategy is not only confined to Ethiopia. It is also intended to help save the peoples of the IGAD region from the menace of ecological collapse by defying traditional attitudes of national ‘selfishness’. In other words the values of environmental development are being used to mitigate and deal with the effects of ecological collapse and social disintegration.

Ethiopia is diversifying its energy resources by tapping the potentials of geothermal, solar and wind power as well as bio-fuel production. The large scale hydro projects like Tana Beles, Gilgel Gibe and the Grand Ethiopian Renaissance Dam; the Adama and Ashegoda wind farms; the biofuel development program; and other projects, make up the crucial base for a clean energy programme to promote a fundamental eco-societal relationship in partnership with neighbours to reduce carbon emissions. Importantly, these renewable energy resources will be instrumental to the country as it enters into the planned extensive industrialization programmes by generating a multitude of green jobs for youth. It is not just neighbours which are involved.

Ethiopia is cooperating with international organizations to bring about this ‘green’ economic transformation. The UK’s DFID is ready to help finance Ethiopia’s plans to build a Climate Resilient Green Economy by 2025, and is supporting the idea of knowledge transfer in renewable energy technologies to advance the ‘g5.997reen’ economic transformation. Indeed, the construction of renewable energy projects is providing a ‘green’ diplomatic card in support of “collaborative agreements and regimes to place effective limits on human action.” It is all part of creating an international order to save the planet from the scourge of environmental destruction.

Again, Ethiopia was too instrumental at the UN Climate Change Conference in Copenhagen in proposing a finance deal with the developed nations to mitigate the impact of climate change on poor countries and pursue a carbon-neutral growth. In this regard, the late Prime Minister assiduously made the calculus on how to adapt the debilitating effects of global warming with the partnership of rich countries by exerting his utmost efforts on the establishment of Copenhagen Green Climate Fund and, perhaps, Africa Green Fund. This succinctly shows how Ethiopia was dedicated for the success Copenhagen accord that, in turn, paved the way for Cancun and Doha Climate Summits. It is meant that Ethiopia has had unswerving stance in establishing a ground for green diplomatic negotiation and discussions. Lastly, it is devoted to promoting bilateral relations so as to the fight against global warming. For instance, it has recently engaged in cooperation with US, Iceland, UK, France, Norway, and multilateral institutions like AfDB and WB to increase renewable energy production, including geothermal, wind, hydro and solar energy.

Ethiopia’s paradigm shift from traditional development models to green development ones is a critical and timely choice for this century, doing justice to the necessity to help provide for sustainable development which alone can save the world from the danger of climate change. ‘Green’ development strategies promote ‘green’ jobs and clean energy services as well as regional integration, providing for peace and stability. In the longer term, we can be sure the ‘green’ development of Ethiopia will persuade others to copy the model and improve their environmental performance. In the same way, we can be equally certain that ‘green’ diplomacy, a weapon to win over the hearts and minds of others, can also produce the required changes for sustainability in international relations.

http://www.ethpress.gov.et/herald/index.php/herald/development/5097-ethiopia-building-the-base-for-green-diplomacy

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Ethiopian Renaissance Development Exhibition, National Symposium open

The exhibition is an opportune platform where all states learn from one another especially the development progress they are registering.

Written by  SAMUEL TAYE

As part of the 8th Nations, Nationalities and Peoples’ Day, the Ethiopian Renaissance Development Exhibition and National Symposium were officially opened here yesterday.

At the opening ceremony, House of Federation Speaker Kassa Tekle-Berhan said that the overriding objective of the exhibition is to assess the level of development activities so far thereby getting lesson from it for further improvement.

“The economic, social and political progress we are experiencing today is all the fruit of our Constitution which has provided us with opportunities to battle against our deep-rooted socio-economic and other related national problems. Thus, we are gradually bringing about comprehensive development, sustainable peace and togetherness,” he said.

He further noted that the exhibition is an opportune platform where all states learn from one another especially the development progress they are registering. It is also an event that each state government could acquire experience for improvement next year, he added.

Somali State Chief Abdi Mohammed on his part said that the exhibition would create a sense of development competition among state governments and provide a platform to share experiences. “Besides, it offers opportunity to all of us to enhance production and productivity year-in-year-out,” he added.

All the nine states and the two City administrations Addis Ababa and Dire Dawa displayed their respective progress in various development sectors.

A national symposium is also underway in which two papers entitled ‘History of Ethiopian Somali and Ethiopian Constitution’ and ‘Ethiopian Constitution and Benefit of Somali People’ were presented. Extensive discussion was held on the two papers under the chairmanship of Speaker of House of People’s Representatives Abadula Gemeda.

http://www.ethpress.gov.et/herald/index.php/herald/news/5092-ethiopian-renaissance-dev-t-exhibition-national-symposium-open

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Processors can bypass ECX to buy commodities

The Ministry of Trade is drafting a new law that allows processors to buy selected commodities, in places other than the Ethiopian Commodity Exchange (ECX).
Reliable sources at the Ministry told Capital that the Ministry is drafting a law giving permission to processors who add value to products (like haricot beans and sesame) to buy those products outside of the ECX .
Sources said that the law would allow three products, including those stated, to be purchased outside, whereas in the past these commodities were only available through the ECX.
According to the sources, the new law was drafted by the Prime Minister in order to alleviate quality and product shortages.
“The main aim of the law is to give the opportunity for processors to get quality products that are not blended with other types of similar products,” sources said.
The new law will allow the traders to get the product directly from farmers rather than purchase them through the Exchange.
Previously processors have complained that they could not get quality or unblended products since products were by law exclusively traded at the Exchange.
ECX officially launched in 2008 with agricultural commodities is currently trading coffee, sesame, and haricot beans exclusively and it is also trading other agricultural products like wheat and maize.
According to sources, the law will be applicable only to processors, while other trading actors at the ECX, like exporters, must continue to use the trading floor to buy these products.

http://www.capitalethiopia.com/index.php?option=com_content&view=article&id=3794:processors-can-bypass-ecx-to-buy-commodities&catid=54:news&Itemid=27

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Cooperative Bank of Oromia registers robust growth

Cooperative Bank of Oromia (CBO) continues to profit and grow as they announced plans to reach 86 branches this fiscal year.

Established in October 2004 with  300 million birr of authorized capital, CBO held its  general assembly at Galma Aba Gadda in Adama on Saturday November 30  and announced that they made a gross profit of 267 million birr. Abera Deressa (PhD), the board chairperson, told shareholders that despite the fact that the global economy has yet to shake off the economic crisis, Africa and Ethiopia are still enjoying economic prosperity. “Global growth dropped to almost three percent in this past year, which indicates that about a half a percentage point has been shoved off the long-term trend since the crisis emerged,” he said. “Yet, economic conditions in sub-Saharan Africa have remained generally robust against the backdrop of a sluggish global economy,” he said. The Chairperson said that the macro-economic performance of Ethiopia is still performing spectacularly, with the economy growing at twice the rate as that of the African Continent as a whole. “This condition has helped banks to benefit despite some challenges, like the underperformance of export earnings due to low coffee prices,” he said. Abera said the bank performed soundly in both financial and non-financial activities despite such challenges., “The bank registered admirable steps forward in all major areas including: assets, deposits, capital, profitability, and market expansion,”.

According to his report, the number of customer accounts grew 47.5 percent during this past fiscal year. Likewise, the deposit balance grew by nearly 60 percent to reach 4.47 billion birr. The annual report also shows a gross profit of 267 million birr, a 90.7 percent increase from the previous fiscal year, in which gross profit was close to 140 million birr. The total assets of the bank increased by 78.07 percent to 6.54 billion birr from the preceding fiscal year, in which assets were only 3.67 billion birr, according to the annual report. The bank’s total outstanding loans during this fiscal year increased to 2.12 billion birr from 1.38 billion birr at the end of the previous fiscal year, according to the same report. Earnings per share of the bank during the same period stood at 52 birr for 100 birr investment, while the dividend was 38 birr. Wondimagegnehu Negera, President of the bank, attributed the bank’s incredible performance to a considerable liquidity position, a good reputation and growing base of loyal clients, strong fund management practices, improved corporate governance and culture, enhanced staff efficiency and productivity, strong business linkages with potential exporters and importers, improved customer service delivery and a strong bond with development partners and foreign banks. The president also said that his bank has made significant investments in its infrastructure and plans to continue investing in new technology in order to improve its efficiency.

At the end of the assembly, most of the shareholders expressed their satisfaction at the bank’s performance and their respect for the board and the management team. “I almost forgot about my shares in the bank a couple of years ago,” said one shareholder who opted for anonymity. “The bank’s performance was terrible and everybody I know felt the same as I did because of that,” he told Capital. “But this management team came and revived the bank as well as our hope in our investment.” Most of the people Capital talked to appreciated both the management and the board, especially the president. “I hope he will further transform the bank,” another shareholder told Capital.

http://www.capitalethiopia.com/index.php?option=com_content&view=article&id=3798:cooperative-bank-of-oromia-registers-robust-growth&catid=35:capital&Itemid=27

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Tullow Oil Abandons Dry Well in Ethiopia

Tullow oil drilling in Western Uganda. Photo/FILE

Tullow Oil has today said that it will stop drilling for oil reserves at the Tultule-1 wildcat well in the South Omo onshore block in Ethiopia after failing to strike oil despite reaching a 2,101 metre depth.

The oil drilling firm said that recorded gas in the course of drilling point to the presence of a hydrocarbon source in the region. However, this result which was found in another drilling site, the Sabisa-1 well will be analysed to determine the future exploration campaign for the area.

The company said that focus will now shift to Chew Bahir basin still in Ethiopia to drill the Shimela prospect. Tullow Oil also added that significant exploration activities continue in Kenya with the Amosing-1 well currently drilling and the Ewoi-1 well expected to start by the end of the year.

http://www.the-star.co.ke/news/article-146692/tullow-oil-abandons-dry-well-ethiopia

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Ethiopia: Tullow Oil to Conduct Well Testing

The British Oil company that is prospecting for oil in South Omo basin in South Ethiopia, Tullow Oil, is to conduct well testing in the second oil exploration well named Tultule-1.

Tullow Oil started drilling Tultule1 last September. Reliable sources told The Reporter that the drilling crew had reached the targeted depth. Sources said the drilling crew will soon conduct well testing in Tultule-1 that will enable them determine if there is oil in the well. According to sources, the company expects a positive result from Tultule-1. However, it will take some time to announce the result of the well test.

Early this year, Tullow drilled a wild cat well (the first exploration well) dubbed Sabisa-1 in South Omo near the Kenyan border which demonstrated oil and gas shows. In a report issued last July the company stated that the Sabisa-1 well confirmed a viable hydrocarbon system in the region. According to Tullow, the well was drilled on the South Omo Block in Ethiopia in the northern portion of the Turkana Basin, over 300 kilometers north of the Ngamia and Twiga discoveries in Kenya, to a total depth of 2082 meters. The company said the well encountered reservoir quality sands, oil shows and heavy gas shows indicating an oil prone source rock and a thick shale section which should provide good seals for the numerous fault bounded traps identified in the basin.

Based on the encouraging result of Sabisa-1, a decision was made to drill the nearby Tultule, 4 kilometers to the east. A Polish company subcontracted by Tullow, OGEC, is drilling the exploration well. Tullow said numerous additional follow-up prospects have been mapped in this part of the South Omo Block and in the adjacent Chew Bahir Basin. Encouraging seismic data had been collected from Chew Bahir.

The other UK company that is prospecting for oil in the Ogaden basin, New Age, is expediting work on a well-drilling project in the Elkuran locality. The company is drilling an appraisal well in the Ogaden basin, Elkuran locality.

New Age had encountered a technical problem on the drilling rig when it was about to start drilling the appraisal well last September. The company was supposed to start the drilling in September. However, after erecting its drilling rig at the drilling site, New Age’s drilling crew identified a technical problem on the rig. Reliable sources told The Reporter that the crew repaired the rig and started the drilling early October.

The depth of the well is estimated at 2800 meters and it will take three months to reach the targeted depth. Well testing will be conducted to determine the presence of oil and the amount of the deposit found in the region.

New Age (African Global Energy) Limited works in the Ogaden basin Block 7, 8 and the Adigala concessions with its partner, Africa Oil, the Canadian oil firm. New Age (the operator) and Africa Oil selected the drilling site in the El Kuran locality to drill the appraisal well.

http://allafrica.com/stories/201312090945.html

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Ethiopia: Internal Intel Chief Charged With Power Abuse

A former high-ranking official and head of internal intelligence at the Ethiopian National Intelligence and Security Service (NISS), Woldeselassie Woldemichael, was charged with abuse of power on Thursday at the Federal High Court 15th criminal bench.

The defendant and four others were charged on 12 counts, nine of which were against Woldeselassie. While charging the former official, prosecutors of the Federal Ethics and Anti-Corruption Commission (FEACC) said that he had abused the power bestowed upon him by the government.

According to the charge, the defendant used his position to have a book he had written be sponsored by state-owned printing presses, Berhanena Selam Printing Press and Artistic Printers.

The book was entitled “Terrorism in Ethiopia and the Horn of Africa”, and the defendant is alleged to have used his position to attract investment and buyers, but then failed to deliver any publications to the relevant parties. Additional charges include unpaid tax on the profit he made from the book and renting his house but failing to pay taxes.

The charges went on to say that the defendant had used a government-owned vehicle for the purpose of transporting a close friend, and had used an employee of the NISS to carry out his own personal work, thus preventing this person from doing the job for which they were hired.

According to the charge, the defendant, by using his power asked a businessman, to get him Italian made ceramics worth 65,000 birr.

The defendant, while he was a government employee, earned a monthly salary from 1,600 birr to 6,000 birr from the year, 1991 to February, 2013, however, he managed to build a 3-storey house and has accumulated millions of birr, the charge read. Also charged were the defendant’s brother, Zeray Woldemichael, sister, Terhas Woldemichael, and his close friend Dori Kebede, accused of covering up money earned by corruption. According to the charge, Zeray is the legal representative for Woldeselassie, and is therefore an active participant in the criminal charges.

Upon conclusion of the charges the defense lawyers requested bail, pointing out that Terhas has a two-year-old child and there is only a 75-year-old lady able to look after him/her. They added that as the article stated by the FEACC prosecutors does not impose punishment for more than ten years, their clients could be bailed. But the FEACC prosecutors argued that the article stated implies punishment for ten years or more, so pleaded for the court to deny bail. After hearing both sides of the argument, the court denied bail to the defendants and adjourned the case for December 16.

http://allafrica.com/stories/201312090947.html

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Ethiopia: Big Chinese Presence in Town

Close to 150 Chinese private and, most predominantly, government-owned or controlled companies have been in Addis Ababa’s Millennium Hall since Thursday, to demonstrate how interested the Chinese government is in relocating most labor-intensive companies into Africa, where comparative advantage prevails.

The presence of the Chinese companies in town is based on the event 2013 Africa, China Commodities, Technology and Services Expo, hosted by the Ministry of Commerce of China. Han Shengjian, deputy director of the Chinese Trade Development Bureau, said at a press conference on Thursday that the coming of 150 Chinese companies is to cement cooperation between Africa and his country. However, he said labor-intensive companies at home are facing challenges since cheap labor is no more the reality in China.

“Ethiopia lacks some important factors, important industries potential for economic pillar. From the global point of view, we see relocation from European countries to the Eastern Asia in the early 1970s and China had benefited from that relocation. In China those factor endowments are changing. Especially those labor- intensive factories in China have faced some difficulties by the increasing costs,” Han said. The Expo, hence, is organized with the intention of introducing Chinese companies where they can be relocated. According to Han, the government of China has selected Ethiopia as it could be a destination for industrial relocation for most Chinese ventures. From the Expo participating companies, Han says a dozen of them are believed to come back and start operation after the Expo is over on Saturday. However, the Africa China Expo is planned to be held every year in Ethiopia.

Most of the Chinese companies were interested to know the challenges they might be faced with in Ethiopia for their engagements, The Reporter learnt. Some were posing questions in relation to where the Ethiopian government is able to give financial guarantees, full expatriation of profits and related benefits of their operations. The Chinese companies were eager to know how the labor laws are functioning here.

The interests of Chinese companies to invest here is elapsing and newcomers are also taking part. One good example is Tsehay Real Estate which has been in town for a while and started developing 180 thousand sq.m land in the Eastern part of the capital, specifically at CMC area, in front of the roundabout.

The company chose a local name, Tsehay, to easily assimilate and become closer to the local community. And most meaningfully, that part of Addis Ababa is where the sun rises. The urban complex will be completed in the coming three and a half years’ time where the company will spend some 20 billion birr to erect 13 blocks of 12-storey residential buildings. Two four-star-rated hotels, offices and commercial blocks are under construction. Qian Tang Construction Plc is the Chinese contractor which has already begun the construction of the foundations in just about three months.

Tsehay real estate developer will sell out the buildings on cash and carry basis upon completion.

The other company which has been in Ethiopia for some four years is Foxtail Millet Institute of Zhangjiakou Academy of Agricultural Sciences in China. This institution is not here for research alone. They have come to introduce what they call “yellow grain and golden kernel” to Ethiopia. The millet grain is still under research yet becoming a real alternate and substitute to the predominant Ethiopian staple food injera which is made from teff grain which is defined by some food and nutritional as a member of the millet family. And for visitors of at the Expo, it was hard to differentiate foxtail millet injera from the regular teff injera.

The institute is now collaborating with the Ethiopian government-led agricultural research institutes to familiarize the golden millet in Ethiopia and get into households by half price down against teff in the coming years. Currently, foxtail millet is under research in many places to which productivity per hectare has jumped to 45 quintals.

Well and already established companies like Lifan Motors, Huawei, ZTE, Sino Hydro and many others are also taking part in the three-day expo. Liafn is set tol launch its new 530 model car at the new premise at Eastern Industry Zone in Dukem town by the coming February and March, 2014. Sino Hydro, another big Chinese company under the subsidiary is bidding to develop Beles phase two project, according to a representative approached by The Reporter at the Expo, Hydro China will develop a 25 thousand hectares irrigation scheme and sugar factory plant. The company will also be involved in developing a 3,041 hectares of irrigation from the Rebbi River in the Amhara Regional State. Hydro China is also bidding to pave a 125 km road in the South Omo, where the town of Jinka and Hanna will have a standard paved roads.

Vehicle and spare parts, electric power and new energy technology equipment, textile and leather processing industry, engineering and machinery, agricultural engineering and machinery are some of the companies exhibiting their products at the expo.

According to the data obtained from the Ministry of Industry, since 1999 a total of 131 Chinese projects have ventured in Ethiopia’s investment landscape. They have invested some 5.8 billion, creating some 55 thousand permanent and temporary jobs.

However, such an engagement of the Chinese is not far from criticism. David Shinn, former ambassador of the US to Ethiopia, said on a number of occasions that Chinese involvement in Africa is based on China’s interest to access Africa’s natural resources. “China sees Africa and its population of one billion people as a growing market for Chinese exports,” Shinn said in 2010, at a symposium by Social Investment Forum International Working Group. The former diplomat noted that these are some of the interests of China vests in Africa.

http://allafrica.com/stories/201312090969.html?viewall=1

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Khartoum and Ethiopia Agree on Establishment of Free Trade Zone at Joint Border

Sudan and Ethiopia have agreed on establishment of a free trade and economic zone at the joint border between the two countries, half of it is to be inside Sudan and the other half is to be in Ethiopia, with the aim to attracting investments of both countries.

At the joint press conference he held Wednesday evening at the Friendship Hall with the Ethiopian Prime Minister, Haile-Mariam Desalegn, President Al-Bashir said the proposed free trade zone will push ahead the economic and trade relations between the two countries, pointing the large potentialities enjoyed by Sudan and Ethiopia.

He said that the talks between the two sides were held in an atmosphere of fraternity and harmony that reflected the level achieved in the bilateral relations between Khartoum and Addis Ababa, indicating that the Sudanese and Ethiopian sides have signed 12 agreements and memos of understanding on cooperation in the trade, investment, electricity power, local and federal government, customs, youths, sports, banking and other fields.

Meanwhile, the President of the Republic affirmed Sudan keenness to contribute to realization of security and stability at the Horn of Africa area.

He said that Sudan distinguished relations with Ethiopia and Eritrea qualifies it to play a role for ending the tension in the relations between the two countries.

President Al-Bashir has appreciated the firm stance adopted by the African countries concerning the so-called International Criminal Court which is regarded by the African leaders as a mechanism of neo-colonialism.   [SudanNewsAgency]

http://www.ethiopiainvestor.com/index.php?option=com_content&task=view&id=4622&Itemid=88

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Tire importer inaugurates 15 million birr retread center

The largest importer and distributer of Bridgestone car tires, Cabey Plc, has inaugurated a tire maintaining and retread center at the cost of some 15 million birr.

 

The factory is situated on a 10,000 square meter plot in Akaki Kality Sub city, with the aim to diversify its market share inside the transport sector and supply up-to-date technologically aided products that meet an internationally practiced standard.

Cabey is owned by Saeed Alamoudi (a brother of Ethio-Saudi business tycoon Sheik Mohammed Hussein Al Amoudi). The company is the sole distributor of Bridgestone tires, exports coffee and is the sole agent of Saudi Airlines.

Furthermore, the center will offer multifaceted services such as providing various tire brands for trucks and buses.

The company added that its reasons for having a truck tire center include aligning with the “Bridgestone way”, providing a superior quality product in what it called the NEW+RETREAD choice.

The center will provide various tire-related services, including replacement, balancing, rotation, checking service and reporting (TCS), air and nitrogen filling and wheel alignment.

The production of tires in Ethiopia goes back to1973, when Addis Tyre SC (ATC) — the first of its kind in the country — was established with a yearly production capacity of 60,000 tires. In the factory was privatized and taken over by Sheik Al Amoudi, and is currently operated under its new name Horizon Addis Tyre.

http://www.thereporterethiopia.com/index.php/news-headlines/item/1333-tire-importer-inaugurates-15-million-birr-retread-center

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Related articles-

• 05 December 2013 News Round Up (allanapotashblog.org)
• 03 December 2013 News Briefs (Updated)
• 01 December 2013 Development News Round Up

Ethiopia enters crucial phase of WTO accession bid

Geremew Ayalew, head of the National Technical Committee for the WTO, Menelik Alemu, Ethiopia’s ambassador in Geneva, Azanaw Tadesse, counsellor for WTO in Geneva and Lesanework Zerfu, head of multilateral trade relations at the Ministry of Trade.

The Ninth WTO Ministerial Conference held in Bali, Indonesia . 

Menelik Alemu, centre, Ethiopia’s ambassador in Geneva, at the Ninth WTO Ministerial Conference. 

Ethiopia is about to enter into the most crucial phase of trade talks, having reached the stage of submission for its offers in services, which its negotiators declared had been finalised last week.

It is one of the two critical documents that it has to submit to the World Trade Organisation (WTO), in order to start negotiations on market access. Offers in services comprise of negotiations on issues such as telecoms and finance. These are areas of the economy that the Ethiopian authorities are known to be reluctant to open up – to domestic and international competition, respectively.

The country’s four trade negotiators, led by Ethiopia’s Ambassador to Switzerland, Minelik Alemu, were in Bali, Indonesia, last week, attending the ninth ministerial summit. Here, ministers from close to 200 countries have gathered.

Traumatised by failures to reach an agreement over the past 12 years, trade negotiators have whittled down issues of contention to just three: trade facilitation, food security and support to members from the least developed countries. Yet, even such mellowed issues were not free from sharp disagreements. India’s trade negotiators had held the WTO captive, denying what was required to pass rules – an explicit consensus from all of its members.

“The WTO is a good platform for trade talks,” said the EU’s Trade Commissioner, Karel de Gucht, speaking to journalists during the middle of ‘behind closed doors’ negotiations in Bali. “That is what is at stake.”

His voice of apprehension was echoed by his American counterpart.

“If we can’t get deals in this round, it will be hard to get into agreements on the more sophisticated issues,” Michael Froman, a United States Trade Representative, told journalists.

For over a decade, the legitimacy of the WTO has gone through a process of delegitimisation. In the eyes of Keith Rockwell, its chief of international relations, however, the organisation’s dispute settlement process and trade laws review mechanism remain solid and relevant.

Since a summit in Doha, Qatar, in 2001, where trade negotiators agreed to make deals considerate of agriculture and the development aspirations of poor countries, they have failed to strike a deal during five rounds, from Cancun to Geneva. Some spied a solution in avoiding contentious issues and focusing rather on the soft ones, described by experts as “low-hanging fruits”. However, ambassadors designated to the WTO in Geneva, its headquarters, were not able to come to terms with each other on the three issues, thus leaving the tough talks to their respective ministers.

One such minister is India’s Anand Sharma, who resolved to suggest that he would rather see, “no agreement, than to have a bad agreement”.

His country passed a food security act last year, pledging to offer welfare to 800 million of its poor by stockpiling food reserves in the same way Ethiopia does with its national food reserve, according to an Ethiopian trade negotiator. The problem with India, as a full member, is that the WTO has rules that punish countries which subsidise food aid at more than 10pc of total national production, for it is deemed as “trade distortion”.

India is not alone in its protest of this as unfair and damaging to the basic right of food for its population. The Social Movement for an Alternative Asia (SMAA) – one of the most vocal NGOs active against the WTO – described the whole negotiation as a “sham”.

“Why should humanity beg the WTO for a peace clause to guarantee the right to food?” The organisation questioned at the end of the summit on Friday night, while ministers were fine-tuning the last version of a text they were to agree upon. “The whole negation of the Bali Package is nonsense.”

India was asking for a “peace clause” to be granted, as an indefinite extension of the penalty until a permanent agreement had been reached. It also called for the review of prices used to determine the total cost of production, which are based on statistics from the late 1980s.

Although EU delegates said food security is not their issue, they joined the US and others in rejecting India’s demand and offered to limit the “peace clause” to only four years.

“They fear that leaving it open until a permanent solution is sought is a recipe for no agreement indefinitely,” a trade expert working for the WTO told Fortune anonymously.

Many delegates expressed their fears that another collapse of talks in Bali would mean that member countries resort to bilateral and regional trade deals. This could undermine the relevance of the multilateral – all inclusive and explicitly agreed – platform.

Despite such resistance from India, most delegates, – and Roberto Azevedo, the new director general of the WTO – declared their optimism that a deal in Bali was “within reach”.

“We are too close to success to accept failure,” said Azevedo, opening the summit on Tuesday, December 4, 2013. “It is all or nothing now.”

As the meeting drew in on its closing stages, India got what its negotiators held their position for. It was a price US and Pakistan paid to salvage the entire deal from collapsing, allowing them to be exempted from penalty over the coming four years for subsidising their poor farmers. Should there be no permanent agreement after four years, it was agreed that the exemption will continue for another term.

Despite India’s compromise, an unexpected rejection came in the eleventh hour from Cuba during a roll call. This was due to its delegates’ unhappiness on the way the process was conducted and because a mention of lifting embargo was taken out from the text, according to Rockwell.

“Disappointment” was the word used by Rockwell, during the early hours of the morning on Saturday, after negotiators from Cuba, supported by Venezuelan, Nicaraguan and Bolivian delegates, rejected the proposed text trade experts like to call “the Bali Package”, despite a consensus by the remaining 155 countries.

It is a package comprising of 15 documents, which consumed more than three hours of the ministers’ time to read, before midnight on Friday, and worked them up and “beyond the call of duty”, according to Rockwell. Delegates from the developed economies, the ASEAN, Arab and African groups had all accepted the package, however, to the delight of ministers from the least developed countries, for it would provide duty-free and quota-free access “for all products originating from LDCs”.

It is one of the four items agreed during what is known as the Doha Round. Most crucial to developing countries is the agreement reached to make preferential rules of origin “easier for them to identify products as their own and qualify for preferential treatment in importing countries”.

The objection from Cuba “is not a major trade issue between countries,” said a person knowledgeable of the process. “It is rather a political issue between the US and Cuba.”

With hardly anyone knowing what was to come, trade negotiators had continued their talk behind closed doors to resolve the objections raised in the final stretch of the summit.

Their efforts eventually paid off, with Cuba dropping its threat to veto the package, and a historic deal was reached, to conclude the marathon negotiation session.

While an agreement was reached, the other issues on trade facilitation – an agreement that would compell member countries to open their borders to the easy and fast transit of imported goods, and support for the least developed countries, like Ethiopia – were overshadowed by the issue of food security throughout the whole summit.

“There is nothing in the Bali Package for the people,” decried a statement issued by Pablo Solon, executive director of Focus on the Global South. “It delivers a legally binding agreement on trade facilitation that will open more borders for transnational corporations, and empty promises to the least developed countries.”

But, the EU’s Trade Commissioner argued that the promises from developed economies are not empty. He disclosed, in Bali, 400 million euros of support for five years to go to poor countries that will incur costs while facilitating their customs procedures and opening up their borders for imports.

“Much of these issues are about capacity,” said a trade expert working for the WTO. “Countries, like Ethiopia, with an observer position have the right to seek technical assistance from the WTO and other supporting facilities.”

One such support to poor countries comes through the Enhanced Integrated Framework (EIF) programme, with a fund to finance the capacity of their negotiators. It is chaired by Ethiopia’s Ambassador in Geneva, who addressed the WTO summit last week, on behalf of Mekonnen Manyazewal, chief of the National Planning Commission under the rank of a minister, and Ethiopia’s chief negotiator.

He failed to appear at the summit at the last minute, despite airline and hotel bookings, for reasons that remain undisclosed. In his absence, Minelik announced his country’s readiness to submit its offers on services to start the fourth round of talks, in its bid to join the organisation.

Joining the WTO is a long and arduous process for many countries. There are many, such as Sudan, Algeria and Bhutan, who started the accession process long before Ethiopia, but remain observers. Yemen, on the other hand, joined WTO this week as its 160th member, after 13 years of negotiations. It took China 15 years before it joined in 2001.

With some political reluctance, the Ethiopian government submitted its application for membership in 2003, under Girma Birru, Ethiopia’s current ambassador to the United State and a chief trade negotiator then. It begun its accession process two years later, with the government submitting a “memorandum on foreign trade regime” – a series of voluminous documents listing all of Ethiopia’s laws dealing with trade. However, the toughest phase began in February 2012, after it submitted initial offers on goods, listing all tariff rates for imported goods.

Ethiopia’s average weighted tariff rate of 17pc has not caused any distress to its negotiators, as the WTO rules allow countries to issue up to a 35pc tariff on agricultural imports and 50pc on industrial goods.

“That will no doubt give us a lot of policy room for manoeuvring,” said an Ethiopian trade negotiator, speaking anonymously.

Based on these offers, member countries, through a working group chaired by the Dutch citizen, Steffen Smidt, can enter into cutthroat negotiations with Ethiopia bilaterally and as a whole, according to the trade expert. So far, it is trade negotiators from Canada, the European Union and the United States who have carried out readings of the offers and returned with questionnaires that totalled into the hundreds.

“We’re very supportive of Ethiopia’s accession bid,” Froman told Fortune during a press briefing in Bali.

He met Prime Minister Hailemariam Desalegn and Trade Minister Kebede Chane in Addis Abeba during the summer, where he pledged his country’s support.

“It’s one we follow very closely,” he told Fortune.

However, reforms in telecoms and the financial industry are “very vital to the integration” of Ethiopia to the multilateral trade forum, according to Froman.

But, experts in international trade rules see the benefits that come from reforming domestic laws in order to become compatible with the WTO rules of transparency and predictability as being far more important to the national economy than simply joining it.

One of the texts agreed by member countries of the WTO last week, under trade facilitation, requires each country to upload online “a description of its importation, exportation and transit procedures, including appeal procedures that inform governments, traders and other interested parties of the practical steps needed to import and export, and for transit; the forms and documents required for importation into, exportation from, or transit through the territory of that Member and contact information on enquiry points.”

Accepting membership to the WTO has far more of an implication in rewriting all national laws to be complaint to WTO rules and translating them all into one of the international working languages.  This is as well as making it available to be viewed by anyone interested, according to the trade expert at the WTO.

Indeed, Ethiopia’s Council of Ministers is currently reviewing the nation’s customs laws and is soon to refer it to Parliament for approval. There have been several amendments designed to comply the country with WTO rules, according to a senior trade official.

However, it is the combined offers on goods, services and the protection of intellectual property rights that will help the working group produce a draft report to be submitted to the Council of the WTO, comprised of ambassadors of member countries designated to it, according to the trade expert in the WTO.

“Ethiopia is firmly convinced that trade is an engine of growth,” Minelik told the summit. “Completing the accession to the WTO is consistent to Ethiopia’s development plans.”

He was short of disclosing when the offer on services will be sent to the working group, though.

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Related articles-

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• WTO agreement condemned as deal for corporations, not world’s poor | World news | theguardian.com (theguardian.com)
• BREAKINGVIEWS-WTO’s small victory saves it from irrelevance – Reuters (in.reuters.com)
• WTO agreement condemned as deal for corporations, not world’s poor | World news | theguardian.com (theguardian.com)
• WTO Poised for Biggest Success in Years (the-american-interest.com)
• Historic ‘first’: Trade deal struck at WTO summit (worldnews.nbcnews.com)
• In Bali, Ministers put the world back into the WTO (thehindu.com)
• Food Subsidies Could Stall WTO Deal (allanapotashblog.org)

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Delegates highlight rural poor financial inclusion service access

Her Majesty Queen Máxima of the Netherlands and UN agencies- WFP, FAO and IFAD – senior officials paid a two-day visit in Ethiopia aimed at supporting efforts to make financial services more accessible, help improve the lives of the rural poor, among others.
In a press briefing held at Sheraton Addis Tuesday, UN Secretary-General Special Advocate for Inclusive Finance for Development (UNSGSA) Queen Máxima said: “Greater access to affordable, timely and reliable financial services such as savings, payments, credit and insurance can help low income households enhance their food security and resilience, as well as benefitting small business owners, smallholder farmers and other groups in terms of overall economic and rural economic development.”
She indicated that as Ethiopia has great potential, 80 – 85 per cent of the population live in rural areas, realizing financial inclusion service is extremely important for rural, agricultural development and transition.
“We had very good conversations with the Prime Minister including other senior government officials, donors, partners and cooperatives about how we can improve financial inclusion issue further,” Queen Maxima said.
WFP Executive Director Ertharin Cousin also said that they visited jointly implemented projects run by UN agencies to improve food security and income generation activities of smallholder farmers in Hawassa.
“Over the years, WFP has moved from food aid to food assistance. It has been working hard to ensure and provide the tools that would allow people to feed themselves. In Ethiopia, we have a number of programs working with IFAD and FAO to implement targeted projects.”
Designated in 2009 by the UNSGSA, Queen Máxima is an active global voice on the importance of inclusive finance for achieving development and economic goals.

http://www.waltainfo.com/index.php/explore/11618-delegates-highlight-rural-poor-financial-inclusion-service-access-

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ECX to launch online trade operations

The Ethiopian Commodity Exchange (ECX) is making preparations to introduce online trading that enables market players to participate directly in trade wherever they are.
According to a statement ECX sent to WIC today, the online trading is envisaged to increase access to ECX and its services; build capacity of various stakeholder groups; and increase efficiency.
The government of Ethiopia is implementing the online trade project in collaboration with Investment Climate Facility for Africa (ICF) in order to enhance the activities of ECX by creating a modern commodity trading platform which will introduce online trading, and establishing Remote Trading Centers in key locations across Ethiopia.
ICF is providing $2.2m of the $3.8m total project cost and the government of Ethiopia through the Ethiopia Commodity Exchange is matching the remaining balance.
ICF Board of Trustee visited ECX trade floor yesterday and got a chance to see how the trading is done and to speak to some of the farmers that have been benefiting from the facility. They also visited the laboratory that grades and certifies the commodities sold at ECX, a crucial factor in ensuring a good quality of commodities.
ECX Chief Executive Officer Anteneh Assefa told the visiting ICF Board of Trustees, “ECX is providing market actors with a trading marketplace, quality and certification, warehousing and electronic warehouse, receipting, trading, market data dissemination, and clearing and settlement, which ensure rust and transparency. With the implementation of the Online Trading System supported by ICF, ECX will become more accessible to its stakeholders, especially the million of small holder farmers.”

The ICF Board of Trustee Co-Chair, Neville Isdell, said “We are happy to be involved in this project. It is symbolic of what is happening all over Africa, in terms of opening u the true market to those concerned –the millions of farmers. We are thrilled to be here at the ECX to see, taste the goods, and get a feel of what the project is doing.”
The introduction of an online trading platform as well as Remote Trading Centers is expected to increase liquidity by facilitating access to ECX as well as build the capacity of various stakeholders to use the ECX effectively.
ECX information technology team is currently working on software design, development and other related functionalities to run a testing online trade platform. Locations have been identified for the establishment of the remote trading centers and the procurement of necessary hardware is well underway.
Buyers and sellers can use the Remote Trading Centers facilities consisting of IT hardware, software, skilled workforce, and infrastructure, to facilitate trading activities.
Capacity building needs of all stakeholders, including members, floor reps, clients, national exchange actors association, ECX Authority, ECX and banks were analyzed and the requisite training was given.
Floor representatives and members will be certified to trade 0nline upon successful completion of a certification exam and passing some preliminary screening.

http://www.waltainfo.com/index.php/explore/11621-ecx-to-launch-online-trade-operations-

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Political parties have indispensable role to sustain ongoing development, democracy: NEBE

Political parties have a key role for the sustainability of the ongoing development and democratization process in the country, the National Electoral Board of Ethiopia (NEBE) said.
The National Electoral Bard of Ethiopia held here yesterday a consultative forum with senior leaders of national political parties.
NEBE Chairperson Professor Merga Bekana on the occasion said that political parties have indispensable role to expedite development and build democracy by designing policies that lead to peace and prosperity.
He further said political parties have significant contribution in filling gaps that encounter during the implementation of policies and strategies.
Some 41 senior leaders drawn from 21 political parties attended the forum held at the NEBE’s training center located at Nifas Silk area.
A total of 75 political parties (24 national and 51 regional) are currently operating in the country.

http://www.waltainfo.com/index.php/explore/11625-political-parties-have-indispensable-to-sustain-ongoing-devt-democracy-nebe

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Reforms in public sector help Ethiopia to register encouraging results

Reforms implemented in the public service over the past decade helped the country to register encouraging results and make sure that the sector is on the right truck to support the development, the Ministry of Civil Service said.
The Minister Muktar Kedir made the remark while opening a three-day capacity building workshop on “Innovation and Performance Management Evaluation in Africa’s Public Service: the Role of Human Resource Managers”.
The Minister said the civil service program is an important component of the reform agenda. The program consists of five sub programs related to top management system, human resource and public expenditure management, public service delivery and ethics and anti-corruption.
He said an important part of this transformation movement has been the introduction of business process re-engineering and various performance measurement tools. The civil servants are familiarizing themselves with these tools, the Minister said.
Political Affairs Commissioner with the African Union Commission, Dr Aisha L. Abdoullahi said AUC believes that Public Service and Administration has a strong potential to strengthen the legitimacy of any government and to prevent destructive conflicts in Africa.
This alone makes public service and administration an important driver of development, peace, stability and human security in a country.

http://www.waltainfo.com/index.php/explore/11606-reforms-in-public-sector-help-ethiopia-to-register-encouraging-results

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Turkey Joins African Development Bank Group    

The Republic of Turkey participated in the African Development Bank Group’s Board Meetings for the first time last week in Tunis following the country’s admission as the 26th State Participant in the African Development Fund and the 78th Member State of the African Development Bank.

“Our Constituency is delighted to welcome Turkey as an official member of AfDB and to our Constituency,” said Executive Director Hau Sing Tse, who represents Canada, China, Korea, Kuwait and Turkey.

“Our Chair represented Turkey for the first time at the Board today [December 3, 2013]. I shared with the Board our excitement about Turkey’s membership at this juncture of Turkey’s engagement with Africa through its ‘Opening to Africa’ policy.

“It is especially timely for Turkey to join AfDB as Turkey enters into a new phase of deepening its engagement with Africa. Turkey values AfDB’s unique and pivotal role in helping to shape Africa’s transformation, and, as a new member, looks forward to making a useful contribution to support AfDB in this regard,” Tse added.

A Declaration issued by the Bank Group’s President, Donald Kaberuka, on October 29, 2013 formalized Turkey’s membership in the Bank Group.

Turkey’s admission to the Bank Group followed the completion of the membership process after the approval of its membership application by the Bank Group’s Board of Governors on May 14, 2008.

Membership of the Bank Group is subject to the completion of the membership process including signing of the Agreements establishing the Fund and Bank, deposit of the instruments of acceptance/approval of the Fund and the Bank agreements, and the payment of the initial subscriptions to the Fund and capital stock of the Bank.

The agreement establishing the AfDB was signed by 23 newly independent African countries on August 4, 1963 in Khartoum, Sudan. It became effective on September 10, 1964, when 20 member countries subscribed to 65 per cent of the Bank’s capital stock which then stood at US $250 million. The inaugural meeting of the Board of Governors (mostly Finance Ministers) was held from November 4-7, 1964 in Lagos, Nigeria. The Bank Group’s key mandate is to contribute to the sustainable economic development and social progress of its regional members, individually and jointly.

The African Development Fund (ADF), the concessionary window of the Bank Group was established on November 29, 1972, by the African Development Bank and 13 non-regional countries (State Participants). At the end of December 2012, cumulative ADF resources amounted to UA 22.3 billion (US $34.2 billion)

The AfDB Group’s authorized capital stood at UA 66.98 billion (US $103 billion) at the end of 2012. The capital subscription by the regional and non-regional countries is based on a 60/40 per cent ratio.

The Bank’s has approved 3,769 operations (loans and grants) totaling US $96 billion (UA 63.66 billion) from 1967 when it began operations to year-end 2012.

AfDB Group maintains AAA ratings from the main international rating agencies demonstrating its strong financial position.

http://addisstandard.com/turkey-joins-african-development-bank-group/

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World Bank support natural resource management in Ethiopia

Ethiopia and World Bank signed a US$50 million IDA credit, a US$40 million grant from Norway government and a US$13 million from the Global Environment Facility to support Ethiopia’s efforts to reduce land degradation.

The financing also aims to improve land productivity in selected watersheds in six regions through Phase II of the Sustainable Land Management Project (SLMP-2).

SLMP-2 will build on the success of the first project and support implementation of the broader SLM Program of the Government including replication of the successful technologies in 90 additional watersheds, promotion of climate smart agriculture, and supporting income generating and value addition activities in 135 watersheds.

http://newbusinessethiopia.com/index.php/health/health-news/natural-health/547-world-bank-support-natural-resource-management-in-Ethiopia

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UK continue to extend support to Ethiopia: DFID

Addis Ababa December 13/2013 Department for International Development (DFID) Permanent Secretary Mark Lowcock said UK will continue to extend its support to Ethiopia in a bid help the country realize development. After conferring with Prime Minister Hailemariam Desalegn on Friday, the Secretary told journalists that UK will extend its support to Ethiopia with a view to enhance development of the country. UK will continue to extend its support for poverty reduction and human resource development projects. He said UK will also extend technical support for projects in industrial development, capacity building and natural resource utilization, among others.  The Premier during the occasion said the two countries have been jointly undertaking a number of development projects. He expressed hope that the cooperation between the two countries will strengthened further, according to a high level official who attend the meeting. http://www.ena.gov.et/story.aspx?ID=14460

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President Mulatu hold talks with Indian business delegation

December 13/2013 President Mulatu Teshome on Thursday held talks with Indian Business Forum delegation led by the Chairperson Mayur Kothar. During the occasion the President called on Indian business persons to invest in Ethiopia and utilize the favorable investment atmosphere in the country. The President affirmed that the government of Ethiopia will provide the necessary support for companies wish to invest in the country, according to a high level official who attend the meeting. The Chairperson Mayur Kothar said Indian companies are undertaking huge investments in Ethiopia in leather and leather products, textiles as well as food processing. Indian companies need support from the Ethiopian government to expand their investments, the Chairperson said. The Forum is exerting maximum effort to attract Indian investors to Ethiopia, the Chairperson said.

http://www.ena.gov.et/story.aspx?ID=14458

. Africa’s Equity Market Performance Outpaces Emerging Markets  – Analysts VENTURES AFRICA – The performance of Africa’s equity market has been solid during 2013; equalling or outperforming emerging markets as robust economic reforms continues to foster the growth of local companies, which eventually become buyers and sellers of equity. David Lashbrook, Head of Africa Investment Strategies at Momentum Global Investment Management who made his analysis of the continent’s fledging stock market, predicted a more promising 2014, with significant build on this year’s progress expected to drive growth figures. When quizzed on how well the continent’s equity market performance, he said: “Unlike emerging equity markets, African equity markets have performed strongly in 2013, matching or even outperforming developed equity markets. Factors that encouraged this strong performance include insurance and pension reforms which is driving the creation of local business institutions poised to become major players in the stock market. Also significant growth in sector-specific industries including cement, telecom and retail, buoyed by an exploding consumer base, has offered premium value for investment, pulling additional interest from an increased pool of local and international investors. The rising interest in African equity was evident at the Closed Africa-focused Private Equity (PE) Fundraisers that has attracted over $2 billion investments this year from top international fund managers including Ethos and market debutants Vital Capital and Phatisa. Further evidence indicating a shift in investment trend is backed by the 2013 market index. A CNBC report revealed that while the MSCI Emerging Markets Index fell 1.44 percent this year, MSCI Emerging Frontier Markets Africa ex-South Africa Index surged 10.28 percent. According to article on the growth of continent’s stock market growth by The African Business Review, “Africa, particularly, Sub-Saharan Africa, has seen rapid growth in its number of stock exchanges, and has experienced a stock market capitalization boom in recent years.” http://www.ventures-africa.com/2013/12/africas-equity-market-performance-outpaces-emerging-markets-analysts/ . Related Articles: 11 December 2013 Development News Briefs 09 December 2013 Developmental News Round Up 05 December 2013 News Round Up 03 December 2013 News Briefs (Updated) 01 December 2013 Development News Round Up

Over 150 Chinese firms to attend expo in Ethiopia

ADDIS ABABA,  (Xinhua) – More than 150 Chinese enterprises will be participating in the first commodity expo to be opened here Thursday to showcase their products, technology and services.

The 2013 (Africa) China Commodities, Technology & Service Expo will be held till Sunday at Millennium Hall in the Ethiopian capital, where the Chinese enterprises are expected to put on display their products in the areas of agriculture, electricity, automobile, hardware,                 building materials, electrical appliances.

At a press conference on the premises of the Ethiopian Ministry of Industry on Wednesday, Han Shengjian, Deputy Director of Chinese Trade Development Bureau, said the Expo in Africa’s political capital serves as a platform for China-Africa cooperation.

It further deepens China’s comprehensive partnership and cooperation with Ethiopia and Africa in general, the official said.

In his congratulatory message in connection with the Expo, Gao Hucheng, Chinese Minister of Commerce, noted that China is keen to work with African counterparts to consolidate the progress achieved through the Forum on China-Africa Cooperation (FOCAC).

Gao said the Expo, held within the framework of FOCAC, provides a platform to display the Chinese products, technology and services, playing a crucial role in upgrading the Sino-African new strategic partnership.

“China is now willing to work with African counterparts to consolidate the progress made through the Forum, seize new opportunities, identify starting points for mutual benefits and common success, promote a comprehensive, coordinated and sustainable growth of bilateral business cooperation, carry out substantial activities to enrich this new strategic partnership, and make active, continued contribution to the economic development for both sides and the world economic recovery,” said the minister.

Han also revealed that Justin Yifu Lin, former chief economist and Senior Vice President of World Bank, Councilor of the State Council of China and Vice President of All-China Federation of Industry and Commerce, has also written a congratulatory letter in connection with the Expo. Justin Yifu Lin expressed hope that African countries draw upon the developing mode of China to identify and promote industries with latent comparative advantages based on their endowment structure, focus on their limited resources and efforts.

Justin also expressed hope that the Expo could establish a platform for the Chinese manufacturing sectors to combine their strength with                 corresponding sectors in Ethiopia and other African countries,                 supporting the growth of industries with comparative advantages                 in Africa, and achieving a win-win result for both Africa and                 China.

“Ethiopia and China are long-time reliable cooperative partners, “ said Hailemariam Desalegn, Ethiopian Prime Minister, in his message                 for the Expo. “The bilateral relation is faced with huge                 opportunities.”

The Prime Minister hopes that the Expo could become an important platform for China and Ethiopia to carry out economic and trade cooperation, and further promote the exchanges and cooperation between the countries industry and commerce circles thus achieving win-win cooperation.

Also in her message, Nkosazana Dlamini-Zuma, Chairperson of the African Union Commission, said the Expo becomes a platform to promote the exchanges and cooperation between Chinese and African countries.

It also serve as a platform to attract more Chinese enterprises, technology and services into Africa thus achieving common development by complementing the other with its respective advantages, said the chairperson.                

Speaking during the press conference today, Sisay Gemechu, Ethiopian State Minister of Industry, noted that the Expo is an important occasion for the Chinese enterprises and also to the Ethiopian side.

The deputy director of the Chinese Trade Development Bureau noted that in collaboration with the Ethiopian side such Expo would be held on an annual basis here in Ethiopia.

He said Ethiopia has been the venue for the Expo because the country is the seat for the AU Headquarters and that of the UN Economic Commission for Africa.        

http://www.coastweek.com/3650-focus-03.htm

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MeTEC to join forces with Kazakh companies

The Metals and Engineering Corporation (MeTEC)…

11 December 2013 Development News Briefs 

09 December 2013 Developmental News Round Up  

VENTURES AFRICA – Ethiopia and Sudan recently concluded their third Joint Commission Meeting, signing 13 agreements and an executive program covering numerous areas of cooperation. The signing of the Framework Agreement for Trade and Economic cooperation, in particular, signified a move towards the solid and multifaceted economic integration of the two countries. In the past decade Sudan and Ethiopia have gone a long way towards paving the way for regional integration and producing a model for the sub-region. The commitment by the political leadership of both countries has achieved important gains in economic integration. Nothing exemplifies the growing relationship between the two countries better than the increasing volume of trade, which reached $322 million in 2011, showing 27 percent annual growth.

One of the most important steps in this regard is linked to the Preferential Trade Agreement signed between the two sides in 2005. This abolished tariff barriers and had the effect of increasing trade volume significantly. Now the two countries are discussing ways to harmonize customs procedures and ease rules of origin. This again will certainly impact on trade relations, encouraging an increase in the diversity and quantity of commercial products traded. The easing of rules of origin will also increase the exchange of manufactured goods. The MoU covering cooperation in customs also envisages greater cooperation in controlling smuggling, fiscal fraud through joint administration links, capacity building and exchanges of information. The signing is certainly a step forward in controlling the sort of illicit trade which hampers regular trade in many African countries, and will therefore improve regional integration efforts.

The general agreement signed between Prime Minister Hailemariam Desalegn and President Omar Al-Beshir outlined a framework for further consolidation of economic integration endeavors. In a significant move, the agreement outlined a number of areas to be given special status in the relationship. These included trade, tourism, investment, intellectual property rights, energy and infrastructure, mining, water, agriculture, the environment and forestry. In terms of regional integration, the Framework Agreement stipulates provisions that encourage trade promotion through business-to-business relations, and one-stop border services to ease trade flow and movement of people. In addition, the opening of correspondent banks’ offices in both countries, harmonizing the nomenclature of goods, the agreement to operate through the COMESA Regional Payment and settlement system and the harmonization of standardization rules underline the commitment of the two governments for seamless economic integration.

In order to address infrastructural problems, one of the major impediments holding back realization of regional integration, the two countries have been jointly working on road network building projects. The first all-weather road connecting Azezo-Metema-Humera and Port Sudan is now operational. The Ethiopian side of the road connecting the Benishangul Region’s Kurmuk to Sudan’s Kurmuk-Demazen is complete and the Sudanese side is under construction. Ethiopia is also working on a new road from Gonder-Humera to Lugdi as a new addition to the road network. Fiber optics joining Ethiopia’s internet network through Port Sudan is another infrastructural development connecting the two countries. At the Joint Commission meeting a further bilateral agreement for passenger road transport was agreed, the result of years of work to build all-weather roads. The Agreement envisages commercial road passenger transport to be operated to and from the cities of the two countries. A ground-breaking agreement has been signed to study the launch of standard gauge railway transport. On the Ethiopian side this is expected to commence after 2015, during the second phase of the GTP. The commencement of the railway project will eventually enable Ethiopia to use Sudanese ports specially Port Sudan. The Framework Agreement commits both countries to jointly study ways that Ethiopia can use Port Sudan more effectively.

In relation to energy, the Ethio-Sudan power systems interconnection, inaugurated at Gedaref, is also part of the area of infrastructural integration. Increasing border trade is pushing the demand for power up and, given Ethiopia’s huge potential for power development, power integration will be an important part of the integration. The fact that Ethiopia relies on Sudan for its supply of petroleum makes the energy integration a mutual benefit for the two countries. On the same line, the air service agreement, which allows the national carriers of the two countries to operate in each other’s territory, compliments the road transport and railway plans to boost people-to-people relations and the trade and investment relationship. Another MoU was signed to coordinate settlement of foreign currency payment for contracting parties involved in import and export trade in each country. In the areas of tourism, agreement was also reached over joint promotional work and over protection of trans-boundary game reserves. Experience-sharing and capacity-building were central elements in the agreements over mining and energy. Ethiopia has requested assistance from Sudan in the administration of petroleum contracts and other related areas.

In a testament to this growing bilateral relationship, the communiqué issued after the meeting expressed their deep satisfaction with the progress made in economic, political and social areas. The two leaders firmly reiterated their commitment and determination to consolidate ties and relations between their peoples in all fields. They expressed their satisfaction over the encouraging progress registered so far in the areas of political, economic and social development cooperation, especially in infrastructural interconnection. They welcomed the signing of the framework agreement on Trade, Economic and Technical Cooperation, and further noted with satisfaction the signing of various agreements and MoUs. Both sides also recommitted themselves to the decision of the IGAD Assembly of Heads of State and Government to revitalize IGAD, in order to speed up the regional integration process and expressed their determination to coordinate their efforts to this end. Overall, as outlined, there can be no doubt that Ethiopia and Sudan are entering a new era of stronger economic and social ties leading to regional integration. The preferential trade area and the various elements of legal framework and infrastructural integration all point to the emergence of strong bilateral relation, which can become a model for the region.

Sourced here:  http://www.ventures-africa.com/2013/12/ethiopia-sudan-bilateral-relations-a-model-for-regional-integration/

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Related articles

• “No political motive” behind Sudan’s support to Ethiopia’s Nile dam: ambassador (sudantribune.com)
• Sudan, Ethiopia in cross-border power link (herald.co.zw)
• TPLF & Sudan reap the bounty: What has Ethiopia got from the latest round Khartoum deal? (zewashera.wordpress.com)
• Making Economic Integration Work in the Horn of Africa (allanapotashblog.org)
• SUDAN SIGNS CAADP COMPACT
• Sudan Mediates between Ethiopia and Egypt on Ethiopian Dam Construction

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Rome, 16 December 2013 – The International Fund for Agricultural Development (IFAD) will provide a loan of US$85 million to the Federal Democratic of Ethiopia to finance a third phase of the Pastoral Community Development Project. The Government of Ethiopia and the World Bank, will co-finance the $218.2 million project.

Gessese Mulugeta Alemseged, Ambassador, Permanent Representative of the Federal Democratic Republic of Ethiopia to IFAD and Kanayo F. Nwanze, President of IFAD, signed the loan agreement today.

Pastoralism relates both to an economic livelihood system that is based primarily on extensive livestock production and to the unique characteristics of communities that live in the arid and semi-arid lowlands of Ethiopia.

The first phase of the Pastoral Community Development Project provided the basis for scaling up into a second phase, which is being further scaled up into the third phase of this project. This underscores the importance the Government of Ethiopia attaches to pastoral development as a way of reducing poverty among the most neglected and vulnerable rural households in the country. The increased demand for livestock, both domestically in Ethiopian markets and in neighbouring countries, such as Djibouti, Kenya, Somalia and the Sudan, has been driving changes in pastoralist livelihood systems. Many pastoral households have been able to improve their livestock-based livelihoods, an increasing number have been unable to maintain their traditional livelihoods. As a result, a growing segment of the traditionally pastoralist population is dropping out of pastoralism.

The project aims to improve access to community driven social and economic services for Ethiopia’s pastoralists and agro-pastoralists. It is expected to improve their livelihoods by increasing and stabilizing their incomes, improving their nutrition, health and education status, and empowering them to be involved in decision-making on local development initiatives.

Implemented over a 15 year period by the Ministry of Federal Affairs, the project will cover more than 90% of pastoral and agro-pastoral woredas (districts) in the country. Improved access to public services will enhance the quality of life and support the livelihoods of about 4.7 million pastoralists and agro-pastoralists. In addition, the project will introduce community driven models of service delivery that will benefit pastoral and agro-pastoral communities throughout the country.

With this new project, IFAD will have financed 16 programmes and projects in Ethiopia since 1980 and brings the total of IFAD portfolio investment in Ethiopia to $ 387.9 million.

Press release no: IFAD/64/2013

The International Fund for Agricultural Development (IFAD) works with poor rural people to enable them to grow and sell more food, increase their incomes and determine the direction of their own lives. Since 1978, IFAD has invested over US$15 billion in grants and low-interest loans to developing countries through projects empowering more than 410 million people to break out of poverty, thereby helping to create vibrant rural communities. IFAD is an international financial institution and a specialized UN agency based in Rome – the United Nations’ food and agriculture hub. It is a unique partnership of 172 members from the Organization of the Petroleum Exporting Countries (OPEC), other developing countries and the Organisation for Economic Co-operation and Development (OECD).

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• Pastoralism and the Discrimination of Sustainable Livelihoods (climate-connections.org)
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• Pastoralism’s economic contributions are significant but overlooked
• Camel Milk Project to Support 50,000 Somali pastoralists
• Will leather exports outstrip coffee?
• Drought: the major factor threatening Borana pastoralists
• Corporation constructing projects for pastoralists in surrounding of Omo Kuraz Sugar Project
• USAID launches $52m project to support pastoralists in Ethiopia

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Gilgel Gibe III project to commence operation in September

The Gilgel Gibe III hydropower project would commence operation at the beginning of the coming Ethiopian New Year, the Ministry of Water, Irrigation and Energy said.

Related articles

• (UPDATED) 14 December 2013 News Wrap
• 13 December 2013 News Round Up
• 11 December 2013 Development News Briefs
• 09 December 2013 Developmental News Round Up
• 05 December 2013 News Round Up (allanapotashblog.org)

By ANDREW RICE

Published: November 16, 2009

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• Land Grabs In Africa – A Double-Edged Sword
• China to look towards Africa for food items
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BY Dinfin Mulupi  - 17 December 2013

The recently released Deal Drivers Africa report highlighted trends to expect in mergers and acquisitions (M&A) in the continent in 2014. The report’s research is based on interviews with 100 M&A practitioners operating in Africa, including corporate executives, private equity investors, investment bankers and legal advisers.

The report was published by media company Mergermarket in collaboration with law firm ENSafrica and South African-based bank Nedbank Capital. Here is what to watch out for in M&A activity in 2014.

1. M&A activity on the rise

M&A activity is expected to increase in 2014. Investors will be attracted by the region’s high rate of growth, improved governance and huge wealth of still relatively untapped natural resources.

“Our region is among the fastest growing in the world. This growth is set to continue over the coming years. Considering the sluggish economic recovery in many developed countries, and that M&A activity is essentially procyclical, it is natural that multinational companies that want to expand their businesses through M&A are turning towards high-growth African economies,” said a finance director in Zimbabwe.

2. China’s influence

The growth of M&A activity will be driven by acquisitions by Chinese companies. Most deals will be in the energy, mining and utilities sector as China seeks to secure raw materials to satisfy the huge demands of its own industries. Three of the top 10 deals of 2013 involved Chinese companies. The biggest of these transactions, with a value of US$4.2bn, was China National Petroleum Corporation’s acquisition of a 28.57% stake in Eni East Africa Spa from Eni Spa.

Chinese companies also see the potential to sell their products to the African market, and are looking to set up their own plants in the region by acquiring African companies.

3. Energy is the lead sector

The energy sector accounts for the largest share in terms of both volume of deals and value this year. Nearly all respondents (95%) tipped energy mining and utilities to be among the busiest over the 12 months. A South African head of corporate development said the energy sector has gained tremendous value and foreign investors are flocking in to acquire energy support so they can gain access to the energy resources available.

“Oil, gas and mining assets in Africa are crucial for global companies in terms of securing reserves and ensuring continued production with high margins. Indeed, most deals in extractive industries will have foreign companies partnering with local companies,” said the director of a private equity firm in Togo.

4. The middle class effect

Africa’s burgeoning middle class is inspiring increased M&A activity in the consumer sector as local and global firms capitalise on rising demand. More than half of respondents said the consumer sector will be busiest in terms of M&A in 2014.

“The opportunity presented by Africa’s booming middle class is proving irresistible for global consumer companies, which are increasingly expanding their operations to target brand-hungry consumers. This trend is not limited to foreign companies with domestic consumer companies also growing their business regionally through M&A,” said one Angolan financial director.

5. Outbound activity to Europe

Amongst respondents who expect an increase in outbound M&A from Africa, some 24% take the view that Europe will be the principal destination. This was attributed to favourable valuations in Europe. A financial director in Zimbabwe said outbound M&A activity will be directed towards Europe to acquire technology and distressed assets.

“African companies want to go global and learn the practices of foreign companies so that they can become more competitive in the global market. Considering the distressed situation in Europe and superior technology and famous brands they have, African companies will first prefer European countries for outbound deals,” said a partner at a private equity firm in South Africa.

6. Cross-border acquisitions by African firms on the rise

African companies expanding in the region account for the largest share of M&A deal volumes and this is expected to rise in 2014. The portion of African acquirers has remained broadly steady since 2006, generally accounting for 50%-60% of total deal volume in each year.

“I think African companies are looking to expand regionally and grow their market share so that they can reduce the competition from foreign companies and prevent foreign companies from dominating their markets,” said one partner from a law firm in Nigeria.

“African companies have a lot of cash on their balance sheets, which gives them confidence and aids getting the approval of stakeholders.”

7. South Africa is lead acquirer

South Africa was identified as the region’s most active cross-border acquirer. Notably, South African outbound M&A is expected to rise as South African companies continue to pursue opportunities across the continent.

After South Africa, Nigeria and Ghana were expected to be the next most active cross-border acquirers over the next 12 months in Africa. A managing director in Tanzania attributed this to the two countries’ strong economic growth.

8. Private equity exits on the rise

More than half of respondents expect a spike in private equity exits to increase over the coming 12 months due to the attractiveness of other emerging markets. Despite this, the vast majority of respondents expect an increase in private equity activity over the coming year.

“Price reductions in other emerging markets have given rise to exits in Africa. Valuations in Africa are rising as the demand for African operations increase, leading investors to look for new markets to invest where the valuations are lower and the return on investment is greater,” explained a finance director in Algeria.

Sourced here:  http://www.howwemadeitinafrica.com/report-highlights-2014-trends-in-mergers-and-acquisitions/33515/

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• In contrast to the rest of the world’s sluggish progress, African economies stand out for their high rates of growth and the effusive confidence they inspire – Report (sierraexpressmedia.com)
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• AFKI Market Journal: Africa’s 5 Fastest-Growing Stock Markets

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Visit of Permanent Secretary of DFID to Ethiopia

The permanent secretary of the Department for International Development (DfID), Mr. Mark Lowcock, paid an official visit to Ethiopia last week and held meetings with government officials and UK businesses operating in Ethiopia.

During his visit, Mr. Mark Lowcock noted UK would extend its support to Ethiopia with a view to enhance the development of the country. He added that the UK would continue to extend its support for poverty reduction and human resource development projects.

In his interview, Mr. Lowcock commended Ethiopia’s progress towards achieving the MDGs.

He said he has witnessed fantastic progress in reducing poverty and infant mortality and in ensuring the attendance of more boys and girls to schools.

Mr. Lowcock also pointed out that in earlier years the focus of the British development assistance was on human development and such things as health, education and water and sanitation.

However he noted that the government of Ethiopia and that of the UK have agreed that, while the human development assistance should continue, more will be done in the area of economic development. According to Mr. Lowcock, the UK would spend this year about 0.7pc of its national income, which amounts to 16 billion dollars, on Official Development Assistance (ODA) and Ethiopia is the largest recipient of the amount.

http://allafrica.com/stories/201312180783.html

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World Bank’s Fight against Extreme Poverty Gets Record Support

$52 Billion for IDA, the World Bank’s Fund for the Poorest

MOSCOW, December 17, 2013 – Despite tough economic times, a global coalition of developed and developing countries today pledged to accelerate the fight to end extreme poverty by committing a record $52 billion in financing over the next three years for the World Bank’s fund for the poorest, the International Development Association (IDA).

“This is a success for the global community,” said World Bank Group President Jim Yong Kim. “We are deeply appreciative of the extraordinary efforts made by countries, many of which are facing their own economic challenges, to stretch to help the poorest. We are committed to making the most of every scarce development dollar to create new opportunities and bring about transformational change in the lives of poor people.”

The coalition agreed that increased funding was needed to tackle the toughest issues in fragile and conflict-affected states to help those countries tip the balance toward stability. This IDA replenishment will see an increased focus on the most challenging frontier areas, greater private sector mobilization, and stronger, more targeted investments in climate change and gender equality, as key to shaping the future. A strong commitment to more equitable growth underpins these efforts.

IDA is the World Bank’s main instrument for achieving the goals of ending extreme poverty and boosting shared prosperity in the world’s poorest countries–home to nearly one billion people living on less than $1.25 per day. The funding will allow IDA to deliver customized and innovative solutions to help the poorest countries address their most pressing development challenges.

In line with the IDA17 overarching theme of maximizing development impact, this financing is expected to provide, for example, electricity for an estimated 15-20 million people, life-saving vaccines for 200 million children, microfinance loans for more than 1 million women, and basic health services for 65 million people. Some 32 million people will benefit from access to clean water and another 5.6 million from better sanitation facilities.

IDA17, which runs from July 1, 2014 to June 30, 2017, will span the target date for the MDGs and the launch of the post-2015 agenda—a pivotal crossroad in the global effort to end extreme poverty.

“We have a unique opportunity to harness a changing global economy to help the poorest countries get on a path to sustainable, inclusive growth, lift millions from poverty, and increasingly fund their own development,” said Sri Mulyani Indrawati, World Bank Group Managing Director and Chair of the IDA17 negotiations. “Investing in the future of the poorest countries is an investment in the future prosperity and security of all countries.”

A total of 46 countries pledged to IDA, and the World Bank Group is continuing the tradition of contributing its own resources to IDA.  IBRD and IFC are providing close to $3 billion to IDA over the next three years.

While grant contributions remain at the core of IDA’s financing framework, IDA17 is using Concessional Partner Loans as a way for countries to increase their contributions—in recognition of the exceptional circumstances of the current fiscal environment amid strong demand for resources.

“IDA is a unique partnership of developed and developing countries that share a commitment to invest in a better future for the world’s poor and for the global good,” said Joachim Von Amsberg, World Bank Vice President for Concessional Finance and Global Partnerships. “At a time of ongoing economic difficulty, this outcome is a testament to the spirit of global solidarity that underpins IDA.”

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The International Development Association, IDA, is the World Bank’s fund for the poorest countries. One of the world’s largest sources of aid, IDA provides zero- to low-interest credits and grants for investments in health and education, infrastructure and agriculture, and economic and institutional development to the least developed countries—40 of them in Africa. These countries are home to 2.5 billion people, 1 billion of whom live in extreme poverty, surviving on $1.25 a day or less. Since its inception, IDA has supported activities in 108 countries. Annual commitments have increased steadily and averaged about $16 billion over the last three years, with about 50 percent of that going to Africa. Funding for the fiscal year ending on June 30, 2013, enabled more than 160 new operations.

http://www.worldbank.org/en/news/press-release/2013/12/17/world-bank-fight-extreme-poverty-record-support

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Ethiopia splits state owned giant public utility into two

Tesfaye Ejigu

The government in Ethiopia split into two the Ethiopian Electric Power Corporation (EEPCO), one of the state owned giant public utilities and renamed it the Ethiopian Electric Power Office (EEPO) and Ethiopian Electric Service (EES). The two are tasked to undertake what industry analysts say is an over ambitious plan of becoming an international company. The government says it decided to split EEPCO after three years-long study and consultation with an international consultant.

“The corporation has to get modernized by the process Classification Framework (PCF) to meet the widening electric service demand,” Dr. Debretsion G/Michael, Ethiopia’s Deputy Prime Minister and Board Chairman of the now split EEPCO, told journalists at a press conference on Tuesday Dec. 18th. He added EEPCO could not carry out all the various responsibilities unless it is restructured in a way it upgrades its services. Dr. Debretsion further said the corporation was on a transitional phase since last August.

Dr. Debretsion G/Michael hopes splitting the state owned giant power utility will help improve its unsatisfactory record/ Photo: Addis Standard

According to the new arrangement, Power Grid Corporation India (PGCI) took the management of the Ethiopian Electric Service (EES) on a two and half year contract. According to the contract, PGCI will carry out power feasibility studies to determine the highest needed voltage power capacities of transmission lines. The company won the contract for 21 million USD.

The second half of EEPCO, the Ethiopian Electric Power Office, (EEPO), will be headed by Azeb Asnake, former project manager of Gilgel Gibe III hydroelectric power project, which is expected to go operational soon.

However, some industry analysts worry that the split will have human resource management concerns. Employees, especially on top management level will lose jobs, even if there are over 4,100 vacant positions to be made available as a result of the split. Currently, EEPCO has 13,372 employees. EEPO needs 5,600 workers, while EES needs 11,728 workers. Property sharing among the two companies has already been in effect. Dr Debretsion indicated “the issue of who pays which debt has already been stated clearly.”

According to Dr. Debretsion, PGCI’s services will proceed under quarterly evaluations. Key Performance Indicators (KPI) measurements such as finance, customer satisfaction, trouble shooting, automation, and human resource development are employed to evaluate PGCI’s undertakings.

Established in 1989, PGCI is engaged in the power transmission business in India and runs 150 substations.  According to the official website of the Corporation, about 45% of the total generated power in India is wheeled through PGCI. Its Ethiopian counterpart, however, generates all of the power produced (at the transitional phase of the contract) for the national grid and administers all of its transmission lines.

Currently, Ethiopia is the biggest power exporter in the horn of Africa and is aiming to be one of the continent’s biggest exporters upon completion of the construction of several ongoing hydro power projects. The government is working on its ambitious plan to make the power sector one of the major export earners for the country. However, EEPCO is best known for its inefficient handling of power distribution, and chronic power cuts. There was a minute long black out during the press conference, too.

http://addisstandard.com/ethiopia-splits-state-owned-giant-public-utility-into-two/

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Tendaho dam, irrigation project implementation progressing well

Addis Ababa, 18 December 2013 (WIC) – The implementation of the Tendaho Dam and Irrigation Project launched in Afar State is now well in progress as 90 per cent of the required construction materials are fulfilled.

Project Manager Eng. Abraham Berhe told members of the Natural Resource and Environmental Affairs Standing Committee of the House of Peoples’ Representatives during a recent visit to the area that the Dam will have a capacity to develop 60,000 hectares of land.

The stated area of land will be developed by using 1.86 billion cubic meters water harnessing the Awash River. Some 50,000 hectares of the stated area will be covered with sugarcane and the remaining for fodder development. The execution of the irrigation project, which has a capacity to develop 25,000 hectares of land, is expected to be finalized next June.

Upon completion, the project is expected to create jobs for up to 60,000 citizens, Eng. Abraham said.

Water, Irrigation and Energy State Minister Eng. Wondimu Tekle on his part said the Tendaho and Kesem projects were launched with the objective of developing and supplying sugarcane for the Tendaho Sugar Factory.

Eng.Wondimu said the projects were designed to meet the local demand for sugar thereby enabling the country to earn foreign currency from export through realizing the GTP. They are also aimed at enabling the public in the area benefit from irrigation development, he added.

The State Minister also stressed the need to further strengthen ongoing efforts to overcome capacity limitations related to designing and construction works in the country.

Water Works Design and Control Deputy Manager Kassahun Lulseged also said that the project includes construction of water distribution centers, reservoirs and troughs as well as laying of water pipelines mainly in 14 villages in Aysaita, Dubti, Mille and DetBahri. So far, work in six villages has been finalized, he added.
The construction of social service facilities, residential units, alleys and flood prevention schemes, among others, is nearing completion. Seven institutions, which include primary schools, health facilities, flour mills and training centres will be constructed in the villages, he said.

Standing Committee Vice Chairperson Dr. Gemeda Dinegde on his part said executives of the project have undertaken activities to fill gaps identified in the implementation of the project last year. Hence, implementation of the project is picking up.

Gaps in undertaking integrated activities in collaboration with stakeholders and failure to address social problems as well as provide the necessary information on the project to the public, among others, were identified as weaknesses in project implementation.

Dr. Gemeda also pledged increased support both by the committee and the government for the success of the project thereby achieving the development plans of the country, Dr. Gemeda said. Afar is located 558-kms away from Addis Ababa.

http://www.waltainfo.com/index.php/explore/11680-tendaho-dam-irrigation-project-implementation-progressing-well

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Manufacturing sector recorded higher earnings

Ethiopia’s manufacturing sector has registered an encouraging improvement over the past five months of the current fiscal year. The sector, which has an important place in the Growth and Transformation Plan (GTP), has earned more than 165 USD over the period exporting manufactured products. That earning represents a significant increase of 22% from the same period of the previous year, showing positive changes in quality and quantity of good from the manufacturing sub-sectors of textiles and garments, leather industry, agro processing, chemicals industry and pharmaceuticals.

The government of Ethiopia has an extensive plan to increase the country’s export earnings and create jobs through an expansion of the manufacturing base. To achieve that goal and to maintain the successes so far gained, the Ministry of Industry has partnered itself with technical and vocational training institutes to ensure the quality of skill sets and the number of trainees needed meet the demand of the manufacturing sector. The Ethiopian government is also keen on creating a conducive investment climate for investors.

http://www.mfa.gov.et/news/more.php?newsid=2832

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Ethiopian Commodity Exchange to go online

The Ethiopian Commodity Exchange (ECX) is making preparation to introduce online trading and establish Remote Trading centers in multiple locations across the country. The ECX is continuing on its work of easing the process of commodity transaction and facilitating an improved access to information for market players.

This undertaking is expected to bring an enhanced efficiency and increased liquidity as it would allow participation in the commodity transaction process without the need to be physically present at the trading floors of the ECX. The Investment Climate Facility for Africa (ICF) is forwarding USD 2.2 towards the total cost of USD3.8, the balance of which will be covered by the Ethiopian government.

During a visit of the ICF’s Board of Trustees to the headquarters of the ECX, the CEO, Ato Anteneh Assefa said “with the implementation of the Online Trading System, the ECX will become more accessible to its stakeholders, especially the millions of small holder farmers.” The ICF’s Board Co-Chair also said “we are happy to be involved in this project. It is symbolic of what is happening all over Africa, in terms of opening up the trues market to those concerned – the millions of farmers.”

The Online Trading System will certainly help the ECX to improve its services and expand its reach. Since its establishment, the ECX has been hailed as an institutionalized market place that has transformed the commodity market of Ethiopia by providing an unprecedented market and information access to Ethiopian farmers and traders.

http://www.mfa.gov.et/news/more.php?newsid=2826

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Sustainable land management project receives 2 billion Br financing

The Ethiopian government has received nearly two billion birr to implement the second phase of a project designed to decrease land degradation and improve its productivity.
The Ministry of Finance and Economic Development (MoFED) signed the agreement of approximately 1.95 billion birr with the World Bank (WB) on Tuesday December 10 for the Sustainable Land Management (SLM) Project.
USD 50 million of this amount comes from the WB via a loan agreement while the government of Norway contributed USD 40 million in grants. USD 13 million of this was financed by the Global Environment Facility.
Sufian Ahmed, Minister of Finance and Economic Development, signed the agreement with Guang Zhe Chen, Country Director for the WB.
Chen, believes that Ethiopia is a leader in the African region, when it comes to tackling the adverse impact of climate change. He pointed to Ethiopia’s climate resilience and green economic strategy and said this project will enhance that  strategy by raising the productivity of land resources and promoting climate smart agriculture by introducing and expanding sustainable land and water management practices.
The project is due to directly or indirectly benefit close to 1.7 million people in six regional states namely Amhara, Tigray, Oromia, SNNP, Gambela, and Benishangul Gumuz.
Sufian said that this phase will attempt to reduce land degradation and improve its quality in selected watersheds and targeted regions by using the methods and technology tested in the first phase.
The Minister said the project is in line with the second pillar of the Growth and Transformation Plan, which focuses on maintaining agricultural growth through expanding watershed supervision and implementing effective water management and water moisture retaining strategies.
This phase two SLM project, which will be implemented in 135 watersheds or weredas, throughout the country, has four components.
According to the Minister the SLM will focus on improving and adopting new technology and methods for smallholder farmers and communities around watersheds to manage their land in a more sustainable manner.
They then plan to work with government agencies and other people that have a stake in managing land and water resources to learn how to do so more effectively. The program also will work to help small farmers become more financially secure so that they will become motivated to adopt sustainable land and water management practices.
The Minister said the project will support the Ministry of Agriculture (MoA) to make sure resources are delivered and that results and progress of the project are documented.
The cost of land degradation in Ethiopia is estimated to be between two and three percent of agricultural Gross Domestic Product (GDP), according to the World Bank.

http://www.capitalethiopia.com/index.php?option=com_content&view=article&id=3813:sustainable-land-management-project-receives-2-bln-br-financing&catid=35:capital&Itemid=27

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Leather Industry Takes Panning From Government

Various developments in the operating processes have been targeted as ways to improve the sector’s efficiency

Tadesse Haile, right, state minister of Industry and Wondu Legesse, pondered over ways of enabling Ethiopian tanneries better prevent significant environmental impact from enhancement of production.

Expressing his disappointment with the export performance by the leather industry in November, Tadesse Haile, center, pointed out that the government was not in a position to listen to any excuses.

The Government has expressed disappointment with leather and leather product exporters, after the country’s foreign exchange earnings fell short of expectations and previous performances.

Export revenue in the first quarter of the 2013/14 fiscal year amounted to 628 million dollars. This is just 71.4pc of the government’s plan for the period and 10pc lower than the same period a year ago.

According to the Ministry of Trade’s (MoT) report, the target for the first quarter was 880.1 million dollars, but a decrease in the volume of major export items like coffee and gold has contributed to the decline.

It was against this background that Tadesse Haile, state minister for Industry, disapproved of what he called the ‘disastrous’ performance in the export of leather and leather products.

“I have been to the factories of many of you and we have been trying to address your problems,” Tadesse recalled while making his opening speech, on Thursday, December 12, 2013, at the National Workshop on Technological Options for Better Environmental Sustainability of the Ethiopian Tanning Industry at the Ghion Hotel located at Ras Desta Damtew Street. “The result has, nevertheless, been very disappointing.”

Leather and leather products earned 32.1 million dollars in the first quarter of the current fiscal year. Although the amount has increased by 7.3 million dollars compared to the figure for the same period in the previous year, it still falls short of meeting the target.

“Your companies and your contribution are part and parcel of the overall economy,” Tadesse told tanners. “So you cannot afford to slow down or decrease your volume of export.”

Tanners and experts in the industry gathered on that day to deliberate on ways of attaining better environmental sustainability. It is a high time for the leather industry to opt for proven technologies to primarily meet the Environmental Protection Authority (EPA) norms and to gain greater sustainability.

“I appeal to all the Ethiopian tanners to take full advantage of this workshop to attain better environmental sustainability,” he added.

Ethiopia has started implementing effluent treatment plants in individual tanneries. It has the advantage of big tanneries, which mostly process about at least 10 tonnes a day, generating about 400 cubic metres in a day. Currently, Ethiopia has about 30 tanneries.

The leather industry uses large amounts of water and chemicals and risks animal and plant health unless due attention is given to waste disposal systems, director general of the Leather Industry Development Institute (LIDI), Wondu Legesse, said. “Hence, it is necessary to avail waste disposal systems along with factories installations.”

Although expected to comply with requirements by the Environmental Protection Authority (EPA) norms and to gain greater sustainability, Ethiopian tannery industries, for their part, face some difficulties in doing so.

“Raw materials have increased in price three to four fold,” says Abdissa Adugna, representing the Ethiopian Leather Industry Association (ELIA). “This has created huge problems for tanners in developing capital for their environmental systems.”

Currently, most of the tanneries have primary treatment plants in place, whereas few have primary and secondary treatment systems. A few do not have treatment plants at all. But, even in those with treatment plants, the operation system is questionable, mainly due to the lack of technically trained operators, operational and maintenance issues of electro-mechanical equipment and the availability of chemicals.

Options, such as high exhaustion tanning methods, recycling and reuse methodologies and the minimisation of tanned solid wastes, among others, were presented at the workshop by experts from the Central Leather Research Institute (CSIR) of India.

http://addisfortune.net/articles/leather-industry-takes-panning-from-government/

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Cooperative Bank Of Oromia Shows Remarkable Increase in Profits

The bank’s aggressive expansion efforts have been the catalyst behind its rapidly improving performance

Source: Cooperative Bank of Oromia Annual Report, 2012/13.

The Cooperative Bank of Oromia (CBO) has shown a considerable expansion in its assets, registering 6.54 Billion Br – an increase of 82pc during the year that ended on June 30, 2013.

All asset items have gone up. Cash and bank balances have gone up by 180pc, to 3.02 billion Br. This increase is due to the aggressive expansion in branch networks. In the year under review alone, the Bank  pushed the number of its branches up by 25. Among new outlaying branches opened outside of the Oromia Regional State are Metema – a border town in North Gonder Zone of the Amhara Regional State, near to Sudan, 897 kms from Addis Abeba – and Hawassa, the capital of the Southern Regional State, 273kms from Addis Abeba.

The Bank’s aggressive expansion also involved human capital, pushing the total number of its employees up to 1,427 – an increment of 24.5pc compared to last year.

The aggressive expansion also forced the Bank to incur considerable costs. The annual audited report for the year 2012/13 indicates that there was a huge increase in expenses. The total expenses incurred by the CBO went up by 66.6pc to 273.6 million Br. Detailed studies indicate that, except interest expenses, all other costs went up considerably. Employees’ salaries and benefits increased by 107.4pc to 87.82 million Br; general administration expenses increased by 46.5pc to 85.2 Br million and interest expenses increased by 15.8pc to 68.6 million Br.

The CBO’s profit after tax showed a remarkable increase, reaching 189.6 million Br. The profit after tax figure has been constantly on the up over the past few years. Both interest and non-interest incomes have gone up. Interest earned on loans and other investments was up by 39.3pc to 239.7 million Br, while non-interest income items showed a staggering growth of 128pc to 300.9 million Br.

“The Bank relied on resource optimisation to get more profit,” Wondimageghehu Negera, president of the Bank, told Fortune. “We have also cautiously worked on some adaptive strategies and increasing our competitive edge.”

The growth in non-interest income is due to the expansion in local services, as well as an increase in foreign exchange dealings, he said.

Established in 2004 with an authorised capital of 300 million Br, the CBO started operations in March 2005 with a paid-up share capital of 112 million Br.

“I see a robust performance,” Zewde Zeleke (PhD), one of the founding shareholders of the Bank, told Fortune. “I look forward to an even more spectacular performance in market outreach and technology initiatives.”

Cash and bank balances represent 46.27pc of the total assets of the bank, which indicates that the CBO is in a highly liquid position.

“This does not mean that it is not with its downsides,” cautions Abdulmena Mohammed Hamza, an accounts manager for the Portobello Group Ltd – a London-based holding company with subsidiaries in property investment and development. “Such levels of liquidity is unusual in the current economic condition.”

Last year’s figures indicate that the industry cash and bank balances to total assets ratio was 31.5pc and the CBO ratio was 29.6pc.

Provision for doubtful loans and other receivables increased by 717.6pc to 31.9 million Br.

“This shows that a sizeable amount of loans went sour,” says Abdulmena. “The management of the bank needs to thoroughly investigate the cause of such a huge leap and design appropriate mechanisms to reduce it to an acceptable level.”

The reason for the increment in this account, according to Wondimagegnehu, is because most loan repayments are not regular. This forces the figure to go up a little bit.

“It will soon be reduced,” he told Fortune.

The CBO managed to increase its paid-up capital by 152.1 million Br, to 442.34 million Br.

At this pace, the CBO will comfortably reach the capital of 500 million Br set by the NBE, before the deadline of 2016.

When the Central Bank issued a directive to raise the minimum paid-up capital required to establish a new bank from 75 million Br to 500 million Br, in September 2010, the CBO was one of the nine private commercial banks, whose capital was below half a billion Birr.

The CBO officials are also confident that they can meet the NBE’s requirement of accumulating 500 million Br of capital by 2016.

The current level of capital and reserves of the bank enabled it to have a Capital Adequacy Ratio (CAR) of 29pc. This is far higher than the legal minimum of eight percent.

http://addisfortune.net/articles/cooperative-bank-of-oromia-shows-remarkable-increase-in-profits/

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 EIA Proposing Amendment to the Investment Law

The Ethiopian Investment Agency (EIA) is proposing amendment to the Investment law, Fortune reported.

The proposed amendment, which has now reached the Council of Ministers (CoM), has been in the making for the past six months, according to Fortune.

“The main reason to amend the regulation is to prolong the period that investors can import capital goods (machinery) duty free,” said Getahun Negash, the Agency’s public relations and communication director told Fortune.

Under the current law, investors enjoy duty and tax exemptions on capital goods imported for the establishment of the businesses only until they acquire a commercial license. After the commencement of operation, investors will then be considered as an existing business and are thus not entitled to the incentives, according to Getahun.

The Agency is helping investors seeking to import machinery after acquiring a trade license “through its board decision, by issuing a special letter,” Getahun told Fortune. The incentive framework only embraces investors in the manufacturing and agricultural sectors, excluding services.

The proposed amendment now seeks to extend the period of time duty free privileges enjoyed by investors.

http://www.2merkato.com/news/alerts/2756-ethiopia-eia-proposing-amendment-to-the-investment-law

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Related articles

• (UPDATED) 17 December 2013 News Briefs
• (UPDATED) 14 December 2013 News Wrap
• 13 December 2013 News Round Up
• 11 December 2013 Development News Briefs

VENTURES AFRICA – Managing Director of DHL Express Sub-Saharan Africa, Charles Brewer, has said that agribusiness has witnessed “significant” growth in Africa across the full value chain from production down to retail following increasing demand from the growing middle class.

“The retail sector is booming in Africa, as is the rapid growth of populations and the African middle class. As a result of this expansion, there is a greater availability of and demand for good quality agricultural produce and processed food products than ever before,” he says.

According to a World Bank report, Africa’s farmers and agribusinesses could create a trillion-dollar food market by 2030 – a three-fold increase from the current size of the market which is estimated to be worth $313 billion.

“This expected growth highlights the growing market and many opportunities for South African agribusiness and related value chain role players to expand into Africa,” says Brewer.

According to Hennie van der Merwe, CEO of the Agribusiness Development Corporation (ADC), based in South Africa, given the increased spending power, demand for goods and untapped land resources of the continent, “Africa is currently experiencing a revival in terms of its focus on agribusiness, not only to increase food self-sufficiency, but also to create jobs and economic activity, specifically in rural areas.”

However, he explains that while Africa is well-endowed with resources, it often lacks much of the necessary expertise to unlock the commercial potential of its agriculture resources, whereas South Africa is well regarded for its expertise in commercial farming and agribusiness.

Van der Merwe posits that major technology transfer and capacity building would be necessary to mitigate the problem adding that opportunity lies for local businesses and farmers in this regard to expand beyond their borders and offer expertise in neighbouring countries.

“Partnerships with a local business or association in the specific country are necessary as business owners need to be provided with assistance, guidance and sometimes protection when in the area. It is also essential/indispensable to ensure that all the building blocks for working value chains are in place to ensure and support successful operation. A local partnership will also assist with analysing the market carefully to evaluate what the real market needs, requirements and opportunities are,” Van der Merwe concludes.

Sourced here:  http://www.ventures-africa.com/2013/12/agribusiness-set-to-boom-across-africa-dhl-md/

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