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Ministry to Confer With Mining Companies
The Ministry of Mines is to confer with mining companies engaged in the exploration and production of minerals on the overall performance of the mining sector.
Senior officials of the ministry and executives of mining companies will meet at the Ghion Hotel on Tuesday and deliberate on the performance of the mining sector. A senior official at the ministry told The Reporter that the ministry is ready to discuss the bottlenecks that mining companies are facing.
The mining sector is becoming the major foreign currency earner next to coffee, Ethiopia’s number one export item. Ethiopia annually earns more than 600 million dollars from the export of minerals and gold takes the lion’s share. Tantalum and gemstones are among the list of exportable minerals. Artisanal miners are contributing a significant share to the mineral export. The country will soon become a major potash exporter.
In related news, the Minister of Mines Sinknesh Ejigu, on Wednesday has been appointed as new Ethiopian Ambassador. Sinkenesh, a chemist by profession, served the ministry for more than 20 years. She served the ministry as state minister for the past ten years. Tolossa Shagi Moti, the state minister of Mines, is expected to replace Sinkenesh as minister. It is not yet known who will fill Tolosa’s position.
However, sources close to the ministry told The Reporter that Dr. Tarekegn Tadesse, president of the Addis Ababa Science and Technology University would be appointed state minister. The Reporter was unable to confirm Dr. Tarekegn’s appointment.
http://allafrica.com/stories/201312230292.html
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Airport Enterprise to Invest U.S. $250 Million in Bole Airport Expansion
The Ethiopian Airports Enterprise is going to undertake a major expansion project at the Addis Ababa Bole International Airport passengers’ terminal at a cost of 250 million dollars.
The newly-appointed CEO of the Ethiopian Airports Enterprise, Tewodros Dawit, told The Reporter that in line with the Ethiopian Airlines Vision 2025 development strategy the enterprise is undertaking various airport development projects. The Addis Ababa Bole International Airport Passengers’ expansion project is one of them.
According to Tewodros, the expansion project includes the construction of a new passenger terminal as an extensions of the existing Terminal 1 (domestic and regional terminal) and terminal 2 (international terminal) with all related equipment and the construction of a new VIP passengers’ terminal.
The new terminal will house boarding areas, lounges, recreation centers, shopping malls, offices and other facilities. New boarding gates, boarding bridges, and a new parking area are parts of the expansion project. The new parking area will serve passengers and staff members. The other major component of the expansion project is the VIP terminal. The first of its type in Ethiopia, the VIP terminal, will be used by leaders, senior government officials, diplomats and other dignitaries. The VIP terminal will have various saloons, lounges, conference rooms, recreation centers, duty-free shops, an IT center and exclusive parking lot.
According to Tewodros, a 250-million-dollar loan has been secured from the government of China. An agreement was signed by the Ethiopian Ministry of Finance and Economic Development and the Chinese government. The Chinese construction firm, China Communications Construction Company (CCCC), will be the contractor for the expansion project. CCCC is a renowned construction company which is building the Adama-Addis Ababa expressway. CCCC is the parent company of the CRBC, another Chinese construction firm that built the Addis Ababa ring road project and a number of other roads in Addis Ababa.
CCCC brokered the loan deal with the Chinese Export-Import (EXIM) Bank. The loan negotiation took a year-and-a-half. An agreement will be signed by the Ethiopian Airports Enterprise and the Chinese EXIM Bank.
The design work of the expansion project is being undertaken by a Singapore company, CPG. According to Tewodros the final design of the expansion work will be completed after two months. Work on the project is expected to commence next March. The expansion work is expected to be finalized within three years.
The Addis Ababa Bole International Airport has two terminals. Terminal 1 is used to accommodate domestic and regional passengers while Terminal 2 is used for long-haul flights. Terminal 2, commonly known as the “new terminal”, was inaugurated ten years ago. It was anticipated to accommodate 5 million passengers a year but today it is handling 6 million passengers. Terminal 1, commonly called the “old terminal”, accommodates 500,000 passengers a year.
Ten years ago only 900,000 passengers used the Addis Ababa Bole International Airport every year. In the past ten years the passenger traffic has been growing by 25 percent each year and reached 6.5 million, surpassing the maximum limit of the airport capacity, 5 million. The Ethiopian Airports Enterprise renovated the domestic terminal (later named Terminal 1) and started to accommodate passengers enroute to regional destinations there. This helped to mitigate the congestion at the international terminal (Terminal 2).
When the planned expansion work is finalized, the Addis Ababa Bole International Airport will handle up to 25 million passengers a year. “We expect the passenger traffic to reach 22 million by 2025,” Tewodros said.
“Addis Ababa is a gateway to Africa. We are close to Europe, the Middle East and the Far East. So we want to link Africa to these regions,” Tewodros said. “Ethiopian Airlines is the leading airline in Africa and it is playing a big role in connecting Africa with the rest of the world and we want to have airports that can accommodate the growing demand.
Tewodros said the enterprise will soon put up a tender to hire a consultant that would supervise the construction work. The consultant will also undertake a study on the new airport planned to be built out of Addis Ababa.
Three locations have been identified for the construction of the new international airport (mega-hub). These locations are found near Mojo, Teji, and Dukem towns. The Ethiopian airport Enterprise is undertaking a study on the site location. An aviation expert told The Reporter that the Ethiopian Airports Enterprise wants to build the airport in a lowland area where jetliners use less fuel during takeoff. “Less fuel means the aircraft can take more load,” the expert said. “Modjo is ideal for the planned new mega-hub because of the low altitude. However, the remoteness of the site from the capital and the absence of convenient public transport is an issue to be addressed,” the expert added.
Dukem and Teji are close to Addis Ababa but their altitude is similar to that of Addis Ababa. In addition Teji does not have the required infrastructure. The enterprise has asked the International Civil Aviation Organization (ICAO) for technical assistance on the site selection. The consultant that the enterprise will hire for the Addis Ababa Bole International Airport expansion project will also undertake the study on the mega hub project. The consultant would undertake feasibility, technical, and financial studies as well as produce an airport master plan. The consultant will be tasked to study the integration of the Addis Ababa Bole International Airport with the mega hub.
http://allafrica.com/stories/201312230301.html?viewall=1
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IATA Calls Ethiopian Air Cargo Market the Fourth Fastest Growing in the World
The International Air Transport Association (IATA) last week announced that Ethiopia’s air cargo market is the fourth fastest growing in the world.
IATA’s Airline Industry Forecast 2013-2017 released at the IATA annual Cargo Media Day held on December 11 in Geneva, Switzerland, shows that Vietnam is expected to be the fastest growing country for air freight volumes over the forecasting horizon with a compound annual growth rate (CAGR) of 6.6 per annum, followed by Bangladesh (5.7 percent CAGR), Brazil (5.5 percent CAGR), Ethiopia (5.3 CAGR) and Peru (5.2 percent CAGR).
Africa is forecast to be the fastest growing region over the forecast period with a growth rate of 4.0 percent CAGR. According to IATA, the fastest growing freight route for Africa is the inter-Africa market (5.3 percent).
Not far behind Africa are the Middle East and Latin America, both with a CAGR of 3.8 percent and the Asia-Pacific at 3.5 percent per annum, followed by Europe and North America at 2.4 and 2.7 CAGR respectively. The report indicates that the five largest international freight markets will be the United States, China, Germany, Hong Kong and the United Arab Emirates. Desmond Vertannes, global head of cargo with IATA, told The Reporter that the growing investment coming from Asia to Africa is boosting the air freight business in Africa. “China’s increasing Trade and investment in Africa is a big contributing factor. African exporters are finding new markets. The big contributor is the perishable cargo industry. The perishable industry, the flower, fish industry and the manufacturing industry contribute to the growth of the air cargo in Africa,” Vertannes said.
According to Vertannes, Ethiopia is doing an exemplary work in expanding cargo transport sector. Ethiopian Airlines is acquiring new cargo fleet and building new cargo terminal. He went on to say that expanding the handling facility to greater capacity will help the country’s economic growth. “Lots of African countries can do the same thing. They are enhancing the handling capacity for the air cargo. I congratulate Ethiopian Airlines for pursuing working with their customs authority on e-freight agenda. They have been very good in adopting the e-freight business. We want to encourage other African countries to follow suit. We know that it is happening in Kenya and South Africa. But more countries should join the club.”
Ethiopian Airlines CEO Tewolde Gebremaraim told The Reporter that Ethiopain is the largest cargo operator in Africa and among the top fifty in the world. Tewolde said Ethiopian currently operates a fleet of 6 dedicated freighters to 24 destinations around the world and carries annually around 200,000 tons of cargo. Over the last years, Ethiopian has seen a huge upsurge in our cargo operations thanks largely to the growth of Ethiopia’s exports.
“In 2005-06, our cargo revenue was just 610 million birr. In 2012-’13, it was close to 6 billion birr, a tenfold increase. Ethiopia exports mainly perishable products such as flowers, vegetables and meat, which are carried by air and in bulk by Ethiopian Cargo.”
Tewolde said although the cargo business is very difficult in the current context of slow global economic growth, persistently high fuel price and imbalanced directional flows, the economic growth of Africa in general and Ethiopia in particular as well as our competitive advantages give us great confidence about the future prospects. Africa-Europe and Europe-Africa cargo business is expected to grow by between 5-6 percent per annum over the next years. Owing to the growing economic and trade ties between Africa and Asia, robust air cargo growth is also forecast between the two regions.
“Our cargo business has strong competitive advantages such as recognized brand in Africa, strategic location, low unit cost advantages, economies of scale with strong hub and spoke network, deployment of latest technology, growing exportable products in north-bound direction, and synergetic advantages with cross utilization of resources with our other businesses,” Tewolde said.
He continued, “We are now into the fourth year of our Vision 2025 Ethiopian Cargo strategic roadmap and are meeting all our targets. In line with our Vision 2025 Ethiopian Cargo strategic roadmap, we have recently established our cargo business as a full-fledged profit center of the Ethiopian Airlines Group with the aim of fully tapping into the fast growing air freight business between Africa and the rest of the world.” The airline has also started to implement multiple cargo hub strategy with its partner airline in West Africa, ASKY, by deploying a B737-400 freighter, which, through its West African hub, in Lome, Togo, is collecting outbound cargo from West and Central Africa and feeding Ethiopian global cargo network. Similarly, the airline is distributing in-bound cargo to the entire West and Central Africa region through this partnership. The airline intends to replicate this model in other regions of Africa. The airline’s Vision 2025 Ethiopian Cargo strategy is based on 4 pillars. The first is the fleet. The national flag carrier continues to expand its cargo fleet with 4 additional Boeing B777F on order, two of which will be phased-in in October and November 2014, while the remaining two will arrive in September and October 2015. By 2025, the airline plans to operate close to 20 dedicated freighters to 37 destinations across five continents.
The second is infrastructure. Currently, the airline has a cargo terminal with over 300,000 tons annual capacity. The airline recently completed a state-of-the art cold storage facility with a 65,000 tons annual capacity and is in the process of building, in two phases, a new cargo terminal with a 1.2 million tons annual capacity, which will be one of the biggest in the world.
Tewolde added, “The third pillar of our strategy is human resource development. We are investing heavily in our Aviation Academy so that it is able to produce sufficient technical and leadership personnel for our growing cargo business. Over the last three years, we have invested around 55 million dollars into the expansion of our academy, which now has 1,000 trainees intake capacity.”
Tewolde said his airline is improving its systems, processes and procedures, with the aim of providing the most efficient cargo service to its customers. “We have started to implement e-AWB since 2012 and are finalizing preparations to implement e-freight with the expected ratification by Ethiopia of the 1999 Montreal Convention and are working to achieve cargo 2000 (C2k) certification by 2015.” This would enable the airline to process airway bills fully online. IATA says Ethiopian is taking the lead in Africa by introducing the e-freight business. The national flag carrier plans to carry 820,000 tons annually and to generate 2 billion dollars from the cargo business by 2025.
http://allafrica.com/stories/201312230289.html?viewall=1
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International Carriage Convention Presented for House Ratification
The Convention for the Unification of Certain Rules for International Carriage by Air was presented to the House of Peoples’ Representatives (HPR) for ratification in a bid to help Ethiopian Airlines meet the precondition of other signatory nations that the carrier services.
The Convention was established in Montreal on May 29, 1999, coming into force in 2003 as it replaced the “Warsaw Convention”.
The attached document presented to the House along with the convention explains, “The country has frequently been requested to ratify the convention, and Ethiopian Airlines was challenged to endorse the agreement and translate it into practical implementation as a precondition for its journey to countries who have already agreed to the terms of the convention.
“For Ethiopia, the ratification of the agreement will elevate our country’s aviation development to a better level,” the document read. “Furthermore, it enables the safety of passengers, passengers’ belongings and cargo.”
According to the document, the convention was presented to the House upon request by Ethiopian Airlines, who is the responsible body to which the law applies.
The agreement states that compensation claims should be made within two years, and the convention also forces countries to either accept or reject the whole document with no reservation.
According to the proposed draft law presented for the House’s ratification, the Ministry of Transport is empowered to undertake all acts necessary for the implementation of the convention, in collaboration with “the concerned” government organs.
The convention applies to the international carriage of persons, baggage or cargo performed by aircraft for reward. Similarly, it applies equality to gratuitous carriage performed by an air transport undertaking.
The convention recognizes the importance of ensuring the protection of the consumers’ interests, and the need for equitable compensation based on the principles of restitution.
It was also said that the convention reaffirms the desirability of an orderly development of international air transport operations, and the smooth flow of passengers, baggage and cargo in accordance with the principles and objectives of the convention on International Civil Aviation.
http://allafrica.com/stories/201312230302.html
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Mofed to Introduce Credit Rating Process
The Ethiopian government is pushing to adopt a credit rating system in the country to assist foreign companies, the Ministry of Finance and Economic Development (MoFED) has disclosed.
Asked by BNP Paribus – a French bank which co-financed the Ashegoda wind farm in Ethiopia – about the issuance of sovereign insurance and bonds here, Sufian Ahmed, the minister for MoFED, said that plans are well under way to have Ethiopia rated for financial and credit worthiness by international agencies. Though he did not mention the agencies currently undertaking the foreign credit rating process, Sufian said that they have chosen a French company Lazard Limited bank and asset management to initiate proceedings and tender bids. Fitch, S & P, Moody’s and Trading Economics are the most renowned rating agencies, used by many countries.
Sovereign credit rating is the rating of a sovereign national government, and it indicates the level of risk when investing in any given country. The credit rating takes political risk into account, and is used by anyone looking to invest abroad
Total Ethiopia and BNP Paribus were some of the companies that accompanied the minister at the signing of loan agreements, held at MoFED. Total Ethiopia requested that MoFED consider the fuel profit margins, which are critically low in Ethiopia. Alstom, another French company that has been building and renovating high voltage electric stations and turbines, requested the resolution of the tax issues the company has experienced since 2011. Nicole Bricq, the French foreign trade minister, urged the Ethiopian government to be a “loyal and fair competition” agent. The minister was forced to call for fair play following the reference by the Ethiopian Chamber of Commerce and Sectoral Association (ECCSA) to the poor trade and investment relationship between the two countries, despite the longstanding political and economic ties.
Mulu Solomon, president of the ECCSA, commended China and Turkey for investing more in Ethiopia, while mentioning that France has acted poorly in this regard. Nicole agreed that the business and economic ties of the two countries have not been to the level of her expectations. “We know that we are not alone. The competition is loyal and fair, but we are not afraid of the Chinese or Turkish,” she said.
On Thursday, Bricq signed two concessional loans of 70 million Euros. According to the agreement, 50 million Euros is destined to finance the implementation of a power transmission network which borders the Bishoftu, Dukem, Modjo and Ginchi towns of the Oromia Regional State. The remaining 20 million Euros will help the solid waste management of the capital, Addis Ababa. The existing landfill, Koshe, will be relocated to Sendafa-Buke town, some 38km northeast of the capital.
Bricq arrived in Ethiopia on Thursday for a two day official visit, leading some 25 French companies keen to invest in the country. She met with higher government officials, attended a business-to-business meeting held at the Sheraton Addis on Thursday, and visited the Ashegoda wind farm power project, constructed through the concessional loan of 210 million Euros by France.
http://allafrica.com/stories/201312230299.html
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Ethiopia Earns U.S.$24.4 Million From AGOA Benefit
Ethiopia earned nearly 24.4 million dollars relying on the US government’s African Growth and Opportunity Act (AGOA).
The revenue was obtained during nine months period from January to September 2013, data obtained from the Ministry of Trade (MoT) reveals. Exports from Ethiopia through AGOA are mainly apparel and leather sectors.
With newly added export items such as root crops, factory-produced malt and various types of flours, the country’s revenue is showing a rise.
According to the Ministry, the country’s export to the US has been growing by about 80pc over the last 12 years since the introduction of AGOA.
AGOA, which was first signed into law by former US president Bill Clinton in 2000, offers incentives for eligible countries in Sub-Saharan Africa to export their goods to the US markets duty-free. Currently, there are 39 AGOA-eligible African countries.
http://allafrica.com/stories/201312231605.html
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Ayalew Heads to Turkey, and Sinqenesh to Brazil
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Sinkenesh Ejigu, Minister of Mines
Ayalew Gobeze, president of the Amhara Regional State
They were relieved of their respective office to be appointed as ambassadors to Turkey and Brazil, respectively.
Ayalew Gobeze, president of the Amhara Regional State, and Sinkenesh Ejigu, minister of Mines, have been appointed as ambassadors to Turkey and Brazil, respectively. This comes after the Amhara National Democratic Movement (ANDM) held its congress in Bahir Dar, the seat of the Amhara Regional State where the party is governing.
It has not been clear what prompted this change. But senior leaders in the party say it is part of the succession plan the party has been carrying out in recent years.
“The party’s leadership wants them to serve in other assignments which it deems are crucial,” said a senior leader of ANDM, dispelling rumors that the two officials were reassigned due to poor performance or a result of an interparty squabble.
Both Ayalew and Sinkenesh have served in their respective positions for close to eight years.
Ayalew, a humble personality well liked by many in the Amhara region, has been serving the regional state as president since 2008, where he began his debut as a senior official of the regional cabinet in 2005, under Addisu Legesse. He has also been a member of the House of Federation, since 2005. However, his ascendance in the ruling party began in 2006, when he was first elected as an executive committee member of the ANDM, during the sixth congress of the party.
A teacher when EPRDF insurgents advanced toward Addis Abeba in the early 1990s, Ayalew represents a generation of EPRDFites that have joined the party after the fall of the military government, in May 1991. He is the peer of Demeke Mekonnen, now chairman of the ANDM and deputy prime minister, and Gegu Andargachew, his deputy. The latter began his ascendancy in 2005, after he was appointed to be member the Budget Subsidy & Revenues Affairs Standing Committee of the House of Federation.
Chaired by Ayalew, the 10-member committee had comprised politicians such as Shiferaw Shigute, now minister of Education, Redwan Hussien, now director general of Government Communications Affairs Office, Abadula Gemeda, speaker of Parliament, and Abay Woldu, president of the Tigray Regional State.
Gedu has been appointed as president of the Amhara Regional State, although the assembly of the regional administration’s council has yet to endorse his new role. He became an executive committee member of the ANDM in the same year as Ayalew, although both have been members of the party’s central committee since 1999.
Ayalew is soon to travel to Ankara,Turkey, to serve as Ethiopia’s ambassador, filling the vacant position there, following the departure of Mulatu Teshome (PhD), now president of the Republic. President Mulatu is credited for enhancing, substantially, not only the bilateral trade between the two countries, but also attracting foreign direct investment from Turkey’s investors, particularly in the textile industry. Close to 115 Turkish companies have invested 1.2 billion dollars in Ethiopia since 2003, while its contractors have managed 21 projects with a total projected cost of 2.4 billion dollars.
During Mulatu’s tour of duty, Turkey became the ninth largest trading partner for Ethiopia, with a bilateral trade volume of a little less than half a billion dollars, in 2012. Largely exporting iron and steel to Ethiopia but also industrial machineries, the trade balance remains in favour of Turkey, with a trade surplus of nearly 350 million dollars.Ethiopia exported in the same year to Turkey close to 47 million dollars worth of primary agricultural goods such as oilseeds, fruits, cereals and industrial outputs including textile, yarn, fabrics and apparels.
Another emerging economy where Ethiopian officials are keen to establish stronger ties is Brazil, a country of nearly 200 million people with an economy that has 2.2 trillion dollars in gross domestic product (GDP). It is the sixth largest economy in the world.
Prime Minister Hailemariam has appointed Sinkenesh, a minister of Mines up until last week, to serve as Ethiopia’s first ambassador to Brazil.
Both countries opened embassies in their respective capitals in recent years, although they have a history of brief relationship back in the late 1960s. It was during Emperor Hailesellasie’s visit to the country to visit how its leaders changed the capital from Rio de Janeiro to Brasilia that he had suffered a failed military coup back home. The Emperor was keen to move Ethiopia’s capital from Addis Abeba to Bahir Dar.
The two countries did not see it fit to continue such high level diplomatic representation, thus closed them soon after Ethiopia closed its Embassy in the same year it had opened its Embassy in 1968, and Brazilin 1970. It took another 45 years before Brazil took the initiative to reopen its Embassy in Addis Abeba. The same ambassador is also accredited to the Africa Union (AU).Ethiopia reciprocated this move in reopening its embassy in 2011. The late Prime Minister Meles Zenawi was the second leader of Ethiopia to visit Rio de Janeiro in 2011, and President, Dilma V. Rousseff visited Ethiopia this year, the first for Brazil’s leaders.
Sinkenesh is the second senior government official who is also an executive committee member of the ANDM to leave office on Thursday, December 18, 2013. She leaves behind a ministry where she has been serving since 2001. She was first a state minister for Mines under Mohammed Dirir, now Ethiopia’s ambassador to Egypt, and a minister since 2010. Her ministerial position is filled by her deputy, Tollosa Shiga, sources disclosed to Fortune.
http://addisfortune.net/articles/ayalew-heads-toturkey-and-sinqenesh-tobrazil/
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Court jails corrupt individuals
The Federal High Court said it has given up to ten years rigorous sentence and 20,000 birr fine last Tuesday to four individuals accused of corruption.
Accordingly, the court gave a six years and a half rigorous prison term and 3,000 birr fine to each of two of the individuals namely Aysheshem Gebre and Aklileberhan Ababu.
The individuals, who were tax auditors at a branch office of one of the Ethiopian Revenue and Customs Authority, were caught red-handed receiving bribe from the manager of a certain organization, while they were assigned for auditing works.
The Court said Daniel Tesfa Eyesus is also given a similar prison term and is fined 10,000 birr. Daniel, who was staff of the Ethiopian Airlines accused of embezzling 379,962 birr.
Similarly, Zebiba Eshete is given 10 years rigorous prison term and fined 20,000 birr. Zebiba, who was a coordinator of Orbis Project at the eye surgery section of the Hawassa University, was accused of embezzlement of 567,224 birr worth pharmaceuticals.
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Germany grants additional funds for humanitarian assistance, resilience building in Ethiopia
According to the press release the German Embassy sent to The Ethiopian Herald, the German Federal Ministry for Economic Cooperation and Development has allocated an additional amount of 19.52 mln. euros (501,664,000 birr) to the Government of Ethiopia. The funds will be allocated to a Protracted Relief and Recovery Operation of the World Food Programme (WFP) via KfW Development Bank responding to humanitarian requirements of Ethiopia and enhancing resilience to food insecurity.
Earlier in the year, the German Foreign Office had already supported WFP’s PRRO 200365 (Food Assistance for Somali, Ertrean and Sudanese Refugees) with 750.000 euros. UNHCR received 1,1 mln. Euros for the project “Health and WASH Assistance to Refugees in Ethiopia” and 400.000 euros for the project “Protection and Assistance to Somali Refugees” in Jijiga. Additionally, the German Foreign Office has funded NGO projects in the refugees camps and in Afar with 1.4 mln. euros in 2013.
In total, in 2013 the German Government has supported humanitarian and resilience building projects in Ethiopia with 23,17 mln. euros (595,469,000 birr).
These funds are additional to the commitments made for official bilateral development cooperation with over 40 million euro per year, the active engagement for development of Non-Govnermental Organizations funded by Germany as well as German contributions to various multilateral institutions, notably the European Union (with over 20 per cent of EU development cooperation being funded by the German Government), the United Nations as well as the World Bank and African Development Bank.
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Related articles
- 20 December 2013 News Briefs (allanapotashblog.org)
- 18 December 2013 News Round Up
