The 9th International Network for Bamboo and Rattan (INBAR) Council Meeting opened on Tuesday(November 4) in Addis Ababa.

State Minister of Agriculture, Sileshi Getahun, told the meeting that Ethiopia was showing leadership in Africa’s green development by its innovative national policies and in the harnessing of technical expertise. It was also providing support for the private sector with the aim of improving rural livelihoods, restoring degraded landscape, fighting climate change and boosting green industries.

The State Minister said bamboo was one of the most important prospects for fast-growing, strategic intervention for afforestation and reforestation in mountainous and degraded areas. It could become a source of wealth, creating jobs in both rural and urban areas, with particular relevance to small and micro enterprises as well as medium scale industries. It would help Ethiopia achieve its vision to become a middle income country by 2025.

[MinistryofForeignAffairs]

A symposium on the theme of “Doing Business in Ethiopia” was held in Johannesburg, South Africa on Thursday last week (October 30). Organized by Mail and Guardian in collaboration with the Ethiopian Embassy, the South African Department of Trade and Industry, NOMPAK, KPMG, Standard Bank and the Chamber of Commerce of Johannesburg the forum expanded on the investment opportunities available in Ethiopia for South African Investors.

State Minister of Industry, Tadese Haile, gave a key note speech to brief participants on the progress Ethiopia has registered over the last decade and the enormous progress made in the areas of infrastructure, health and education.

Ms Lerato Xlewoa Mlumbi-Perer, from South Africa’s Department of Trade and Industry noted that Ethiopia was one of the countries with favorable investment opportunities for South African Companies. She said the country’s “strategic location, better accessibility for skilled resources, huge market potential and favorable investment opportunities” made Ethiopia one of the best investment destinations for South African investors. She also suggested that both countries should synergize their developmental strategies in order to provide closer economic ties.

Other speakers at the symposium stressed the need for strong economic ties among African countries in order to encourage development for a better Africa. The event was attended by representatives of more than 30 companies as wells as a number of media organizations.

[MinistryofForeignAffairs]

Alle, a wholesale enterprise established to provide goods at a competitive prices to retailers, plans to supply consumer goods worth 354 million birr this Ethiopian budget year.

The enterprise is set to supply the food items through its stores opened at Megenagna, Kaliti and Merkato areas, Enterprise General Manager, Nuredin Mohammed, told WIC.

Inaugurated by Prime Minister Hailemariam Desalegn four months ago, the enterprise has so far supplied food and other fast moving consumer goods worth 42 million birr to retailers, he said.

Currently, the enterprise is supplying goods with lower prices (5 -15 percent discount) from the current market prices, Nuredin noted.

The enterprise has 280 million birr worth goods in its store, he said.

According to Nuredin, the enterprise has a plan to open 36 stores in 27 towns over the coming three years.

Hawassa, Sheshemene, Dessie, Bahir Dar, Mekelle, Dire Dawa and Adama are the towns chosen for this budget year, he noted.

[WaltaInformationCenter]

On Thursday November 6, 2014 the Ethiopian Coffee Exporters Association (ECEA) held its third international conference, amidst dissatisfaction at the performance of Ethiopian coffee exports. In attendance were major players of the global coffee market, including Starbucks and Mondeleze International.

ECEA Chairman of the Board, Hussein Agraw, reported the event was a success, with only 35 international participants expected, but in fact 50 attended. This success reflects the growing popularity of the conference and increased demand for Ethiopian coffee, claims Hussein.

Mulatu Teshome (PhD), the president of the federal democratic republic of Ethiopia graced the conference with his presence. Also in attendance were Kebede Chane, minister at the Ministry of Trade (MoT), Roberio Oliviera Silva, director of the international coffee organization (ICO) and Peter Vrooman, deputy chief of the mission at the US embassy.

Focusing on traceability and quality, the conference discussed challenges and opportunities for Ethiopian coffee. A big opportunity for Ethiopian gains is the expected losses to the Brazilian market due to drought.

Ethiopia stands fifth in world coffee production, trailing far behind late comers to the global market such as Vietnam. Ethiopia exported 6.6 million bags of coffee (396,000tns, at 60kg per bag), delivering only a 4.5pc share of the global market. Brazil is the world’s largest coffee producer, with 49.2 million bags and a 33.85pc market share. Vietnam, Indonesia and Colombia follow Brazil, with 27.5 million bags, 11.7 million bags and 11 million bags, and market shares of 18.94pc, 8.04pc and 7.58pc, respectively.

The amount exported by Ethiopia in the 2013-2014 fiscal year was 190,837tns. This was lower than the amount exported at the beginning of the Growth & Transformation Plan (GTP) in the fiscal year 2010-2011 (196,118tns). Exports in 2013-2014 and 2010-2011 were valued at 719 million dollars and 841.7 million dollars respectively.

Africa’s share in global coffee exports have continued to decrease, said Roberio Oliviera Silva. Africa’s share in the 1990 world market was 20pc of the total world’s coffee. This has fallen to 11-12pc.

“Over the past two years, the world’s total coffee production stood at 145 million bags. The expectation is that this would rise to 175 million bags by 2020,” says Silva. “Therefore, because of the recent fall in Brazilian coffee, there will be shortages in coffee production.”

“The sector’s performance has remained far from satisfactory, with highly volatile international coffee prices, inconsistency in our quality and supply to the global market, and logistics,” said Mulatu, in his opening remarks to the conference, “therefore, our supply to the global market could not exceed the 200,000 metric tons level, despite the steady increase in coffee production.”

With 190 exporters, 280 importing companies, 85 green coffee processing industries and warehouses, and 47 destination countries worldwide, Ethiopian coffee has an opportunity to flourish in the world market, says Assefa Mulugeta, director general at the export promotion directorate at MoT.

“Opportunities for the Ethiopian coffee market are the well established brand, the positive image of the country as the birthplace of coffee, strong local coffee culture, varieties of coffee suitable for roasting industries, and potential for volume and quality expansion due to adequate land and inexpensive labor,” said Assefa.

Promoting Ethiopian coffee is one of the recommendations to help raise coffee export revenues. Assefa also suggested “branding and promotion, by strengthening business diplomacy capacity” needs to be adopted.

Working to achieve this, the conference has brought many big players in the coffee market to Ethiopia. As a consequence of the event, Ethiopian coffee is to be featured in a number of upcoming international conferences and expos.

Ethiopian delegates have been invited to participate in the coffee themed Cluster at the Expo Milano 2015. Ethiopia will also host the world’s 116th World Coffee Council in 2016.

Furthermore, Ethiopia is to feature as a portrait country at the Specialty Coffee Association of American (SCAA) event in 2015. The country will also host the African Fine Coffee Association 2016 Exposition. Presenters at the 2016 conference hope to use it as a platform to promote Ethiopian coffee.

“The opportunity for Ethiopian coffee is to engender acceptance of the brand in the international market and for people to have positive impressions of it,” says Arthur Karutekua, director of green traceability at Starbucks.

One way to build that quality is establishing traceability, which the Ethiopian Commodities Exchange (ECX) is preparing to implement by June 2015. Picked coffee is the first commodity to pass through this system. Traceability begins by tagging coffee bags after processing at the point of washing, or hulling, stations to the buyer’s (exporter’s) warehouse. These “buyers scan each tagged bag as they process the coffee according to contract specification.” The traceability report then becomes available to roasters in the international market via digital passports.

During the conference the ECX demonstrated a prototype website for accessing traceability reports. Buyers will need a scanner and computer to scan the tags, says Solomen Edosa, an advisor to the ECX board. The system displays the supplier details, the customer details, and product information, including the place of production, processing stations, weight, terms of washed and unwashed coffee and the grade.

The system, which took two years to develop, will be rolled out in the coming coffee season. The ECX coffee traceability initiative was funded with 1.5 million dollars from the US Feed the Future program, under the USAID Ethiopia, with a contribution of 900,000 dollars from Dutch foundation IDH and coffee processing and trading firms Nestlé and Mondeleze.

The conference also hosted discussions to improve the quality of coffee, both at the plantation and processing points. The litter from shade trees will provide natural fertiliser for coffee trees, as well as averting some tree diseases, such as rust, says conference presenter Yilma Yemanebrehan, a chief advisor to MIDROC Ethiopia. Shade trees also regulate temperature, claims Yilma. The optimum annual average temperature for coffee is 18 degrees to 22 degrees; the marginal temperature is between 22 degrees and 23 degrees, with temperatures above 23 degrees and below 18 degrees, being unsuitable for plantations.

Wet washed coffee was also stated as one means of increasing the quality of coffee.

“The quality of coffee is increased by washing (processing red berries in wet mills immediately after harvesting) which better preserves the intrinsic bean quality, yields more homogenous product and fewer defective beans,” says Bart Minten, senior research fellow, International Food Policy Research Institute (IFPRI).

The conference addressed the major questions of coffee production, such as marketing and export. This year’s hope for the revenue from coffee export still hangs on the decline in Brazil’s production.

The conference saw discussion of Ethiopian market issues, with key players sharing their experiences and thoughts on enhancing the traceability and sustainability of Ethiopian coffee.

“We have to bargain in the marketplace and reverse the prevailing price trend, because our coffee is the best quality. The conference has paved the way for this. Previously we went to buyers’ to exhibit our coffee. Now we bring stakeholders to us to show our goods,” said Hussein.

[AddisFortune]

Dalol Oil SC, which is one of the four Ethiopian owned oil companies, announced that it will begin supplying alternative energy products for the manufacturing sector. The company that began operating in the beginning of 2012 has stated its intention to begin importing coal and petroleum coke (pet coke) in the current budget year.

Currently, National Oil Ethiopia (NOC) is the only supplier of these two products, and now Dalol will be the second.

According to Serkalem G.Kirstos, CEO of Dalol Oil, the company began importing bitumen/asphalt last fiscal year in addition to the usual lubricant and petroleum (fuel) import.

During its second year of operation the oil firm registered significant profit even though it is usual to take a loss for five years in that industry.

The CEO said that the new energy supplies that the company introduced in the past budget year has played a major role in the company’s success.

In the past budget year the company has supplied bitumen for the Ethiopian Road Construction Corporation (ERCC), Addis Ababa City Roads Authority (AACRA) and Tidhar Group, an Israeli company that constructs roads in Addis Ababa and some other parts of the country.

The product of coal and pet coke is an alternative energy source for the manufacturing sector, like cement factories, which require a significant amount of energy for their production.

The annual report that the oil company released at the general assembly indicated that Dalol supplied 7,500 barrels (1,463 metric tons) of bitumen for its clients.

In the past budget year the company distributed 37.4 million liters of petroleum, which is an increase of 210 percent growth compared with the 2012/13 budget year.

The company that imports the lubricant from Saudi Arabia’s Petromin, a sister company of Saudi Aramco, a Saudi Arabian national petroleum and natural gas company based in Dhahran, Saudi Arabia, has also shown significant growth in terms of the supply compared with the preceding year.

The total volume of lubricant that the company supplied in the past budget year was 206.7 metric tons, which is 750 percent higher than the 2012/13 achievement.

As of the end of the past fiscal year the non-current assets of the company reached 22.1 million birr and the current assets are set at 198.2 million birr.

According to the annual report, the oil company has undertaken 700 million birr in sales. Despite financial constraints the company has been very successful.

The external audit report stated that the company has registered about 10.5 million birr in profits before tax. The net profit after tax for the year was 8.5 million birr, which accounted for a loss during its first year of operation.

The CEO told Capital that even though the company registered good performance for the stated year, financial constraint has been a challenge for the company’s growth. He said that the company should expand its capital to go through on big capacity projects. To accomplish this, the company has decided to expand its capital.

The annual report indicated that the company has plans to put 22.5 million birr worth of subscribed but unpaid shares for interested buyers.

It stated that it has begun negotiations with interested companies and individuals to sell the stated amount of shares.

The total paid up capital reached 41.7 million birr, while the subscribed shares are 64.1 million birr.

At the general assembly held at Global Hotel, the board of directors chaired by Dereje Walelegn proposed that the expansion of the company’s capital to 400 million birr aiming to boost the company’s operation, which is highly capital inducement.

Currently, ten oil station are operating under Dalol, and out of this two are company owned dealer operated (CODO), which are owned by Dalol and operated by investors, while the other eight stations are controlled under a dealer owned dealer (DODO) arrangement or fully owned by investors.

Serkalem expects this will expand to 15 stations and four CODO stations this year including one in Addis Ababa.

Serkalem was the general manager of Continental Petroleum and the Managing Partner of Habitable Business Solutions which works on the environment. He was also commercial manager of NOC. His contribution in introducing alternative sources of energy like Petroleum Coke in Ethiopia, for the first time when he was at NOC, is considered to be a huge success. He is the second CEO of Dalol since it began operating.

[Capital]

Fitch Ratings has affirmed Ethiopia’s Long-term foreign and local currency Issuer Default Ratings (IDRs) at ‘B’. The Outlooks on the Long-term IDRs are Stable. The Country Ceiling and the Short-term foreign currency IDR are both affirmed at ‘B’.

KEY RATING DRIVERS: Ethiopia’s ‘B’ IDRs reflect the following key rating drivers:- -Ethiopia is vulnerable to shocks even compared with ‘B’ rated peers despite strong improvements in its World Bank governance indicators and development indicators over the past decade. This is balanced by strong economic performance and improved public and external debt ratios since debt relief under HIPC in 2005-2007.

Macroeconomic performance is broadly in line with rated peers. The public sector-led development strategy implemented over the past decade, focusing on heavy investments in infrastructure, has sustained strong real GDP growth, which reached an estimated 10.3% in the fiscal year to 7 July 2014 (FY14), above most regional peers, although it may be overestimated according to previous reports by the IMF.

Inflation, which has historically been high and volatile, has slowed to single digits since October 2013, due to a combination of moderate international food prices and reduced central bank financing of the budget deficit. However, Fitch believes inflation remains vulnerable to food price variations.

Public finances compare favorably with ‘B’ rated peers, but are exposed to rising contingent liabilities. General government debt has broadly been stable over the past four years, at 26% of GDP in FY14, well below peers (47.1%). Debt structure is also favorable. As the government relies heavily on concessional lending from multilateral creditors, maturities are long while interest payments, at 2.1% of budget revenues, are extremely low. The foreign-currency share of public debt, at 60.5% at end-FY14, is in line with peers. This moderate level of debt has been made possible by the containment of general government deficit below 4% of GDP over the past decade (2.6% in FY14), due to spending restraint, and outsourcing of part of its investments to state-owned enterprises (SoEs).

As a result SoEs’, debt has risen significantly in recent years, and accounted for an estimated 22% of GDP in FY14 (FY10: 12.1%). Even though the authorities expect this debt to be repaid from SoEs’ commercial receipts, Fitch believes this is a rising contingent liability for the government.

Additionally, this rise in debt has been financed by recourse to domestic credit, concentrating bank exposure to SoEs, and increasingly from external sources, sometimes with less favorable financing conditions, which could increase external debt and interest service over the coming years.

Authorities’ strategy of transitioning towards export-led growth has had limited results so far: the current account deficit widened to 8.6% of GDP in FY14 from 5.9% in FY13, as declining commodity prices have penalized exports of coffee and gold, which together with oil seeds, still accounted for 56% of goods exports in FY14, while imports of capital goods have continued to grow.

As a result net external debt, at 100% of current account receipts, is on the rise and coverage of current account payments by international reserves has remained weak, at only 1.8 months at end-FY14. Prospects for export diversification are positive, however, over the medium term, helped by a slightly improving environment for foreign direct investments (FDI) and potential electricity exports.

KEY ASSUMPTIONS

The ratings are reliant on a number of assumptions: -Fitch assumes that there will be no major change in the political regime and development model of the country in the coming years. -Fitch assumes that world GDP will grow by 3% in 2015 and 3.1% in 2016, from 2.6% in 2014, therefore sustaining demand for Ethiopian exports of goods and services. -Fitch assumes that the international community’s support for Ethiopia will continue in the coming years.

[Reuters]

When Scottish explorer James Bruce published a five-volume work in 1790 about his search in Ethiopia for the source of the Nile, European readers dismissed his account of ancient churches and castles – surely no such thing existed in the heart of Africa.

Fast forward to 2014 and Solomon Tadesse sometimes feels he faces similar preconceptions as he seeks to attract tourists three decades after images of famine and communist purges filled TV screens and shaped the world’s view for a generation.

Yet Solomon’s Ethiopian Tourism Organization is making headway in the battle to change attitudes. Visitor numbers have risen 12 percent a year in the past decade to reach 600 000 in 2014. His target next year is one million.

“That aspect has definitely diminished the old clichés, the old paradigm, the old mentality of Ethiopia being a country of famine and war. Rather now (it is) with potential for economic growth,” said Solomon, chief executive of the organization, a joint initiative between the state and private enterprise.

In the capital Addis Ababa, the transformation from the starvation years and the Red Terror purges of the 1970s and 1980s is plain to see. Construction is booming and a metro opens next year, cutting through the sprawling city – the only such network in sub-Saharan Africa.

Ethiopia’s goal is to lift tourist revenues to $3 billion (about R33 billion) next year from $2 billion last year and, if it achieves that, it will start challenging the dominance of regional rivals on Africa’s eastern seaboard, such as Kenya and Tanzania. But instead of beach holidays and safaris, land-locked Ethiopia is promoting its imperial past – the below ground-level 13th-century churches of Lalibela, hewn from solid rock, and the hill castles of Gondar – as well as its mountainous and majestic topography.

And, while Kenya’s tourism industry has been hard hit by a series of attacks by Islamist militants over the past year, Ethiopia, which offers little room for political dissent and keeps a tight rein on security, has largely avoided such events.

“What Ethiopia offers to tourists, different from Kenya and Tanzania, is history and culture,” Tony Hickey, an Irish tour operator who first came in 1973, said.

He reels off names of the rich and famous for whom he has arranged Ethiopia tours, such as US film director Oliver Stone and designers Calvin Klein and Donna Karan, visits which he believes are the result of changing perceptions of Ethiopia.

But challenges remain if Ethiopia is to fulfil its tourism goals. Just three major international chains run hotels in Addis Ababa and operators complain that bureaucracy hinders plans for new hotels and trained service workers are in short supply.

“Hotel rooms, both in terms of quantity and quality, I think this is the single largest critical problem to boosting tourism numbers in Ethiopia,” said Tewolde Gebremariam, chief executive of Ethiopian Airlines.

“If we are able to convince these people to come to Ethiopia, visit for a couple of days and then continue with their journey, that would mean a lot,” said Gebremariam.

But, for now, more transit visitors would add to the hotel room squeeze. The airline already needs 300 rooms a day just to meet demand for passengers with long connecting flights. “There aren’t the hospitality training institutes you get in Kenya,” tour operator Hickey said.

“Hotel developers are not asked to provide human resource development plans when given the green light to build.”

The Sheraton, Radisson Blu and Hilton are the only major brands in Addis Ababa. More international chains are building hotels, but the number of high-end rooms will still only be about 1900 by 2017 from about 900 now, in a nation of 90 million people.

Capacity constraints are evident when delegations turn up for summits at the 54-nation AU, which has its headquarters in the Ethiopian capital. High-end rooms are booked weeks in advance and lower-end hotels jack up prices.

Despite the need to expand, investors grumble that their plans to build are often hobbled. They complain of regulations that hinder speedy leasing of land and slow customs approval to import equipment.

In response to complaints, the Tourism Transformation Council, chaired by the prime minister, was set up to improve links between the government and private business in the former communist country where the state still dominates the economy.

“The contribution of tourism and the hospitality industry to the economic development of my country is vital,” Prime Minister Hailemariam Desalegn told a conference for hotel operators in September.

“When you look at Ethiopia and the economy and the development, it is being done in the right way,” he said. “This is giving us a lot of confidence in the market.”

[IOL]

More than 100 Chinese companies participated in an expo dubbed 2014 (Africa) China Commodities, Technology & Services Expo displaying Chinese products in Ethiopia’s capital Addis Ababa.

The Expo was organized by the Chinese Ministry of Commerce with a view of enhancing business cooperation between China, Ethiopia, and other African nations.

Speaking at the opening of the Expo, Xie Xiaoyan, Chinese Ambassador to Ethiopia, said the Expo helped further promote the exchanges and cooperation between the business communities from China, Ethiopia, and other African nations.

Xie stated that China and Ethiopia have been strengthening their overall cooperation and friendship.

He said the two countries have been enjoying strong economy and trade bilateral cooperation.

“Our countries have made many fruitful achievements through cooperation in politics, economy, trade, culture, education science and technology etcetera. Ethiopia is China’s important strategic partner in Africa,” said the ambassador.

Xie recalled that Chinese Premier Li Keqiang made visits to African countries including Ethiopia in May this year and that the Premier proposed six areas to actively promote cooperation between China and Africa.

The Premier proposed to actively promote cooperation in six areas including, industry, finance, poverty reduction, environmental protection, cultural exchanges and peace and security, said the ambassador.

The ambassador said the 2014 (Africa) China Commodities, Technology & Services Expo would contribute share to further strengthen the cooperation and relations between businesses in China and Africa.

Tadesse Haile, Ethiopian State Minister of Industry, noted that Ethiopia and China are enjoying excellent bilateral relations.

The two countries share many interlinked and similar ideas towards accelerated and sustainable economic development, said the State Minister.

He stated that Ethiopia is in the last year of the implementation period of the five-year growth and transformation plan (GTP) and heading to the second GTP whereby the country lays strong foundation to transform its economy to achieve the middle- income economy status by the year 2025 through accelerated and sustainable economic development.

The State Minister noted that his country draws lesson from China, which the official called on to further strengthen cooperation in infrastructure and industrial development towards competitive and sustainable economic development.

As Ethiopia makes endeavor to transform its economy, Tadesse said “emphasis will be given to the development of various infrastructures, infrastructural activities such as roads, railway, telecom, power and human resource development.”

Tadesse also noted that the Expo would be a platform for business and cooperation between China and Africa.

“The rapid development of China has provided unprecedented opportunity for Ethiopia and Africa; and we need to capitalize on this,” he said.

With the opening of the 2014 (Africa) China Commodities, Technology & Services Expo, “more Chinese enterprises are expected to be attracted to Africa with technologies and investments,” he said.

Stating that his company is engaged in construction of power transmission lines here in Ethiopia, Xiong Feng, General Manager of the Engineering Department of State Grid Corporation of China, said the Expo provides the opportunity to promote their quality business to customers.

Jia Chen, CEO of ZTE Ethiopia, said his company is participating in such Expo for the second time when ZTE has started to expand its business scope.

Recalling that ZTE has been in Ethiopia for telecom expansion projects, Jia said ZTE is now focusing on smart city solution, which the Chinese telecom company promotes to visitors at the 2014 (Africa) China Commodities, Technology & Services Expo.

“Today, our participation we would like to show to customers about our smart city solution; smart education; and smart everything; the solution, especially to show the functionality; for the future a kind of smart city; smart traffic control to the customers,” said Jia.

[GlobalTimesChina]

The Ethiopian Pulses, Oil-seeds and Spices Processors-Exporters Association (EPOSPEA) said it is aggressively working to expand and create new market linkages for pulses, oil-seeds and spices. This was disclosed at 4th international conference organized for industry leaders from around the world here yesterday.

In his opening remarks, President Dr. Mulatu Teshome said that Ethiopia is endowed with untapped and immense investment opportunities in the areas of agriculture with favourable climate which is suitable for the production of varieties of pulses, oil-seeds and spices.

According to the recent export performance data for the year 2013/14 fiscal year, the pulses, oil-seeds and spices sub-sector contributed 920 million USD to the Ethiopia’s export earnings with a share of over 28 per cent. This natural gift is compounded with considerable quantity and quality products that meets the standards of international market expectations, the president added.

With regards to the GTP sector goal, Dr. Mulatu said that the government has fully committed itself to take all measures that deemed necessary for attaining the target laid down in its first GTP which has targeted to increase the land coverage of the crops cultivated by these three sub-sectors.

Based on such coverage expansion plan, it has envisaged increasing the volume of the products and also has targeted to increase the exportable value of the sub-sector. In view of this, the government has put in place various sector-specific legal and policy as well as strategic frameworks. Among the different measures of the government, creating an enabling environment favourable for fostering the private sector engagements in the production, processing and exporting of the products of the sub-sector, he added.

Dr. Mulatu also called for investors to make use of the huge opportunities in the sub-sector like the available vast fertile cultivable land and the abundant and easily trainable and relatively cheaper labour force.

Association President Haile Berhe said that the conference was aimed at creating a platform for international buyers and national exporters to strengthen, expand existing and new market linkages and outlets so as to make the sector contribute to the overall development perspectives of the country. As the conference is an annual international event, it is very decisive for oil-seeds, pulses and spice exporters.

Trade State Minister Yacob Yala on his part part said that the objective of organizing the conference is to boost the sector and make stakeholders beneficial from the value chain economy. The government has designed viable development policies and strategies and the effective implementation of these policies and strategies in an integrated and comprehensive manner has made the country one of the fastest growing economies in the world. Ethiopia has adopted a series reform programmes to speed up its integration in the world economy.

Yacob added that the government has recognized the private sector as an engine of economic growth of the country and highly committed to enhance the sector development and private-public partnerships through providing effective industry associations and creating a forum for consultation between the private sector and the government.

Country Mission Director to the United States Agency for International Development (USAID) Dennis Weller said: “With more than four million Ethiopian smallholder farmers relying on the production of sesame and chickpea for their livelihood, developing these value chains is an important part of our programme. By increasing yields and exports, we are improving livelihoods of smallholder farmers and their families across Ethiopia.”

The pulses, oil seeds and spices sector is one of the largest components of Ethiopia’s agricultural sector and immensely contributes to the country’s economic growth, second to that of coffee. Ethiopia produces more than 400,000 metric tons of chickpea annually and is the six largest chickpea producer in the world.

[The Ethiopian Herald]

A multinational mining company engaged in gold exploration projects in western part of Ethiopia, Ascom Mining Ethiopia PLC, is holding talks with the Ethiopian Ministry of Mines to secure a large-scale gold mining license.

Ascom Mining has been prospecting for gold in the Benishnagul Gumuz Regional State, Assosa Zone, Sherkole Wereda, Shungu and Nazali localities since 2009. The company has discovered a large amount of primary gold in the license area which covers 268.17 sq.km of land. The gold deposit is found in a mountain commonly called Dish mountain.

Last March, experts of Ascom made a presentation to officials of the Ethiopian Ministry of Mines about the gold discovery. Reliable sources told The Reporter that officials of the ministry were happy with the presentation. Sources said the company conducted feasibility study.

A senior official at the Ministry of Mines told The Reporter that executives of Ascom and the ministry are holding talks on the gold mining license. The official said the ministry will grant the company a large-scale gold mining license once the negotiations are finalized.

The official said Ascom has made the largest gold discovery in the history of gold exploration in Ethiopia. “Once the company acquired the license it will develop the mine with in a year,” the official said. The gold deposit is estimated at more than 100 tons.

Ascom Mining Ethiopia PLC got its gold and base metals exploration license through transfer from previous license holder Ariab Gold Mining PLC (Sudanese and Ethiopian JV Company) on November 20, 2008.

The license was previously granted to Ariab Gold Mining PLC on May 7, 2007. Ascom Mining Ethiopia PLC constitutes of ASCOM PRECIOUS METALS BVI owning 96 percent of the share and Ariab Gold Mining PLC owning the remaining 4 percent.

According to the Ministry of Mines, in accordance with the mining law, in addition to the initial first three years the license has been renewed four times relinquishing 25 percent from the retained license area at each renewal. The ministry said the company is currently in its 7th year exploration period working in 268.17 sq.km area.

So far MIDROC Gold is the only company engaged in large-scale gold mining activity. In 2012, the ministry granted Ezana Mining PLC large-scale gold mining. Ascom will be the third company to secure large scale gold mining license.

A British company, Nyota Minerals, was about to secure its large-scale gold mining license to mine the Tulu Kapi gold mine in west Wollega. However, the company recently farmed out its concession to another UK company, KEFI Minerals. KEFI Minerals will soon apply for large scale gold mining license.

[TheReporterEthiopia]

The Senior Communication Expert with the Ethiopian Horticulture Development Agency Mekonnen Hailu said last Sunday that Ethiopia was intending to expand the revenue from the export of horticulture products to 371 million USD for this 2014-15 fiscal year. Some 245 million USD was obtained from horticulture export last year, MoFA reported.

He said that efforts were underway “to export high-quality products during the reporting period as part of the overall activities to increase the nation’s revenue.” He added that “utilization of modern technology, in particular chemical-free pest control mechanism, is being applied to make the products free of chemicals because chemical-free products have great market demand.”

He said the Government was considering the importance of bolstering the import of horticulture varieties with a view to improve the quality and quantity of products, noting that “The country has already earned 56 million USD from export of over 130 million cut flowers and more than 41,000 tons of vegetables, fruits and herbs during the first quarter of the current budget year.” “Around 44 million USD of this is secured from cut flower export while the balance was earned from vegetables, fruits and herbs.

Mekonnen noted that eighty per cent of the country’s horticultural products were exported, mainly to European countries, including the Netherlands, Germany, Belgium, Italy, Norway and France. Japan, the United States, Saudi Arabia, and the United Arab Emirates are other key importers of the nation’s products.

According to the Ministry of Foreign Affairs, over 120 foreign and domestic companies are currently engaged in horticulture development efforts in Ethiopia. This comes as a result of the Government’s incentives, including duty-free importation of green house energy machinery, the provision of up to seven years tax holiday, and support and priority given to infrastructure development for investment sites, in order to attract FDI and trade inflows in the sector.

[TheEthiopianHerald]

Africa’s gross domestic product may expand by 50 percent to $3.7 trillion by 2019, boosted by an emerging middle class and increased household demand, according to Deloitte.

“Rising consumer demand, aligned with annual growth of around 8 percent is likely to add around $1.1 trillion to African GDP by 2019, with Ethiopia, Uganda and Mozambique among the fastest expanding markets,” the auditing company said in an e-mailed report today.

Sub-Saharan Africa is forecast to grow 5 percent this year, driven by infrastructure investment, a buoyant services sector and strong agriculture production, the International Monetary Fund said last month. Middle-class households in 11 leading economies in the region are set expand to about 40 million by 2030, with the biggest growth seen in Nigeria, the continent’s largest economy, according to a report by Standard Bank Group Ltd.

While growth in demand for consumer products, including luxury items and smartphones offered opportunities, different regulations in individual markets were hurdles to set up businesses and companies need long-term strategies for investment in Africa, Deloitte said.

“Where there are challenges, there are also opportunities to innovate,” it said. “Given the potential for growth the continent offers, the business opportunities in Africa could outweigh the risks.”

Mobile-phone penetration is set to rise to 97 percent by 2017 from 72 percent, with about 334 million smartphone subscribers, the company said.

[Bloomberg]

The price of sesame dropped to USD 500 from 1,200 per ton in one month. Following the turn of events, exporters have been hesitant to supply, preferring to wait for the price to improve.

However, for industry players like Philippos Philippas, president of the UK-based Huyton Inc. Group, exporters are trending unhealthy. If they persist to do so, he told The Reporter that they will face loss in waiting and speculating for the price to rise up.

Philippas, who attended the 4th international conference organized by the Ethiopian Pulses, Oilseeds and Spices Producers and Exporters Association (EPOSPEA), said that Ethiopian exporters should be cautious not to replicate the same mistakes of the Sudanese – the third largest producers in the world. It is to be recalled that last year the Sudanese ended up exporting about 285,000 tons of sesame, which was way lower than what they originally planned.

“The global consumption is about 1.4 million metric tons and the availability is going to be about 1.7 million tons. Hence, there will be a surplus and that surplus will pressure the prices. The point I want to emphasize is that last year the sellers pushed the prices up. As a result, consumption was reduced worldwide. I don’t want the buyers to do the same now”, Philippas warned.

Following the delayed rain and drought in China, which stands the 40 percent buying nation of Ethiopia’s sesame, some exporters are not worried by the current low market price. In September, sesame was sold at USD 2,200 per ton. However, in October the price went down to USD 1,700. Philippas estimated that the latter price will remain to be the market price of Ethiopia for the year. However, Haile Berhe, president of EPOSPEA, differs in opinion. The prices are known to be fluctuating for years and exporters will behave accordingly, he argues.

The orchestra of the sesame market seems to get louder when China said that it will ship close to 850,000 tons for the year. That again annoys Philippas who strongly criticized the Chinese side for not providing the realistic volumes they will buy. For Philippas, the best China will buy is set at a maximum of 650,000 tons. The Sudanese production for this year also was questioned.

It intends to bring some 600,000 tons of sesame this year. Yet, half of the total produce is destined for local consumption in Sudan.

Ethiopia this year expects to harvest 350,000 tons of sesame. Previously, the government was bullish to produce and export 500,000 tons. Realizing the unrealistic plan, the target was reset to 350,000 or less. The concluded budget year production stood at 270,000 tons. According to Assefa Mulugeta, director general of the export promotion directorate general, this year harvest will be challenged due to the heavy rainfall and windy weather condition witnessed affecting the major producing regions in northern Ethiopia.

Huyton Inc. Group was associated in supplying coal to the Ethiopian Petroleum Enterprise (EPE) since 2011. The contract was terminated after the government had bought 800,000 tons of coal form Huyton in three years. However, the group sticks on supplying in wheat and barley for the beer industry. Huyton mostly is known for being one of the major buyers of sesame, shipping out some 40,000 tons a year.

[WaltaInformationCenter]

The United States Agency for International Development (USAID) grant $350,000 to a milk processing plant, Berwako Milk Processing PLC, in Jijiga Town of Ethiopia which is expected to benefit 3,000 pastoral households from reliable access to the milk market.

Mission Director Dennis Weller announced a $350,000 grant to a milk processing plant, Berwako Milk Processing PLC, in Jijiga Town to improve the milk market for pastoralist communities and enhance the competitiveness of the livestock industry in Ethiopia’s pastoralist areas.

Berwako Milk Processing PLC was recently built to process cow and camel milk into different dairy products. USAID’s support to Berwako will enable more than 3,000 pastoral and agro pastoral households in Duhusha, Fafan, Bombas, Babile, Awbare and Kebribayah to have access to a more reliable and regular market for their milk. Better access to markets will in turn stimulate more production of milk, improving livestock productivity in the area. The company is planning to export products to Djibouti and Somaliland.

USAID’s Pastoralist Areas Resilience Improvement and Market Expansion (PRIME) is working with businesses that can really make a difference for pastoralist areas of the country. “Our goal is to transform these areas and the lives of the people through improved nutrition, more jobs, and better income for milk producers. It’s very much in line with the government’s Growth and Transformation Plan (GTP),” says Weller in Jijiga to announce the grant and visit the site.

The grant to Berwako Milk Processing PLC is part of the competitive Innovative Investment Fund implemented by USAID’s PRIME, which provides matching financial support to agribusinesses in selected value chains that are likely to generate increased incomes in pastoral and agro-pastoral communities. “USAID PRIME helped me make my dreams come true,” says Amir Muktar, the owner of the plant.

USAID PRIME’s support to Berwako is focused on building the capacity for purchasing raw camel and cow milk from over 3,000 pastoral and agro pastoral households and process more than 15,000 liters of milk every day. USAID PRIME is providing technical assistance to all actors in the supply chain including local production cooperatives and women’s groups, milk consolidators and traders, processors and their network so that they can achieve operational efficiency and meet quality standards.

USAID PRIME is a five-year project (2012-2017) with funding from the U.S. Feed the Future Initiative designed to increase household incomes and enhance resilience to climate changes through market linkages in Ethiopia’s dryland areas of Afar, Somali and Oromia regions.

[NewBusinessEthiopia]

A large industry zone is to be set up in Hawasa town with the view of contributing to making Ethiopia a leading African nation in light manufacturing in the next ten years.

To achieve this goal, the government is working to make urban areas centers of industries, with active projects in Dire Dawa, Kombolcha, Addis Ababa and Hawasa.

Addis Ababa’s Lemi industrialized zone is almost completed and space is being allocated to foreign manufacturers.

State Minister of Industry Mebrhatu Meles told fanabc.com that preliminary studies have been finalized to set up a large industrial zone in the rapidly growing Hawasa. The establishment of the industry zone in Hawasa will facilitate the export of value added agricultural products in the locality. Furthermore, it will enhance Hawasa’s service and tourism sectors of the economy.

[FBC]

Ethiopian Pharmaceutical Fund and Supply Agency (EPFSA) said it is implementing a support framework that encourages local pharmaceutical producers and attracts foreign companies to invest in the sector.

The agency held yesterday a half-day consultative forum with local pharmaceutical producers and suppliers.

EPFSA Director-General, Meskelie Lera, said on the occasion that the main aim of the meeting is to evaluate the performance of producers and suppliers and identifying the challenges they encountered so far.

The support framework is meant to encourage local investors and create encouraging environment for foreign investors to move into the sector so as to meet the targets set in the GTP by increasing the quantity and quality of medicine produced in the country.

The support framework includes restricted bids for only local producers and subsidy of 25 percent when they compete with foreign suppliers, he stated.

In addition, they are given 30 percent pre-payment for the bid they win and a loan arrangement would be made with Ethiopian Development Bank to cover the remaining 70 percent.

Ethiopia is set to cover 50 percent of its imported pharmaceutical products by local producers during the GTP period, it was indicated.

Meskelie added that the forum is therefore crucial to identify the challenges in the budget year and increase the less than 20 to 25 percent performance.

The Diector-General told the participants that 17 warehouses are being built to solve the problem of storage.

The finalization of the warehouses would increase the medicine storage capacity of the country to 580,000 cubic meters from the current 46,000. This will significantly increase the country’s storage capacity.

[ENA]

The 4th Ethiopia CEOs Forum was held yesterday, November 19 at the Sheraton Addis to a full attendance of businessmen and women and representatives of embassies, donor and governmental agencies.

The focus of this 4th round of the forum was the booming Fast Moving Consumer Goods (FMCG) sector in Ethiopia and the wider region and the potential opportunity it creates for business and economic development.

One of the panelists at the forum was Mr. Dario Minutella, Manager at A.T. Kearney, a global management firm consulting “Alle Bejimla”, the first state-of-the-art modern Fast Moving Consumer Goods wholesale enterprise in Ethiopia. While he elaborated on the paths taken and the challenges faced while setting up the turnkey project, he still believes that there’s a big opportunity and further more opportunities to be captured in the coming year.

Mr. Nuredin Mohammed, the General Manager of “Alle Bejimla”, another panelist, explained the current retail market situation and how “Alle” is helping solve the bottlenecks to the growing market. He stressed that in order for the FMCG market to grow, the taxation system, store networks and logistics will have to be modernized.

The third panelist, Mr. Adam Abate, Managing Partner of Apposit Technologies, a firm that builds software that powers high impact businesses in Africa, briefed the participants in the importance of utilizing information technology for the development and implementation of modern day businesses. He emphasized on the importance of mobility and democratization of technology for the FMCG sector in Ethiopia.

With the exclusive networking opportunity the Ethiopia CEOs Forum presented, participants were given the chance to engage with various business leaders and government and donor agency representatives.

The Ethiopia CEOs Forum is a quarterly event that is organized by Precise Consult International, with the aim of bringing together leading CEOs, government officials, donors and international agencies on issues related to doing business in Ethiopia.

Please find thoughts on the Ethiopian economy by Henok Assefa, Managing Partner, Precise Consult International: http://preciseinsights.blogspot.com/

Number of Turkish companies visiting Ethiopia because of their desire in investing in the country has been increasing, Ethiopian Ambassador to Turkey Ayalew Gobeze announced.

In an exclusive interview with ENA, the Ambassador said 120 Turkish companies visited Ethiopia last year. Of these investors some have already got licenses and others are planning their projects.

The number is expected to increase this year. Some 10 Turkish investors, who are interested to invest in Ethiopia, have visited the country in the month of September, he added.

These companies have shown interest to engage in textiles and leather industries and cotton cultivation, he said.

Noting the share of Turkish investment in Ethiopia is large, Ayalew said, number of companies that are desirous to invest in Ethiopia is also increasing.

A total of 350 projects owned by Turkish companies are licensed so far, of which 90 are already operational.

In addition to textiles, leather and agro processing, Turkish companies are also engaged in the construction sector.

The bilateral relations between Ethiopia and Turkey have been growing over the past years, according to Aykut Kubaroglu East African Affairs Deputy Director at Turkish Foreign Ministry.

Turkey has created strong investment tie with Ethiopia, which is one of the fast growing economies in the world, he added.

The favorable investment atmosphere, fast economic growth and peace and stability of the country are helping Ethiopia to attract more Turkish investment, the Director said.

[ENA]

Ethiopia plans to sell its first dollar bond as Africa’s fastest-growing economy exploits record demand for the continent’s debt.

Ethiopia picked Deutsche Bank AG and JPMorgan Chase & Co. for fixed-income investor meetings in Europe and the U.S. beginning November 26, according to a person familiar with the matter, who asked not to be identified as the information is private. The proceeds of the sale will be used to fund electricity, railway and sugar-industry projects, Finance Minister Sufian Ahmed said Oct. 8.

The Horn of Africa nation is joining issuers, including Ghana, Kenya, Senegal and Ivory Coast, who sold what Standard Bank Group Ltd. says is a record $15 billion of Eurobonds this year. Government and corporate issuers are seeking to benefit from investor appetite for higher returns before the Federal Reserve raises interest rates as soon as next year.

“There is an incentive to issue before U.S. rates start to gradually edge up from next year,” Samir Gadio, head of African strategy at Standard Chartered Plc in London, said today by e-mail. “The market seems to expect that Ethiopia will price among the highest-yielding African sovereigns.”

African government and corporate Eurobonds sales this year beat 2013’s record $14 billion, Standard Bank said on Nov. 13. Sovereigns accounted for about 71 percent of issuance, according to the Johannesburg-based lender.

African Returns

Emerging-market assets have benefited from record-low interest rates in developed nations that pushed investors to seek out higher returns elsewhere. The end of quantitative easing by the Fed and the prospect of its first interest-rate increase since 2006 is drawing some of that money back to the U.S.

Almost 30 years after pictures of Ethiopian children with distended stomachs were used to raise money by Bob Geldof and Live Aid, the country is growing faster than any other African economy, at an average of 10.9 percent over the past decade, International Monetary Fund data shows.

Credit Rating

Ethiopia was assigned its first credit ratings in May. Moody’s Investors Service rates it a non-investment grade B1 with a stable outlook, while Standard & Poor’s gave the East African country a B rating. The country is Africa’s biggest coffee producer and the continent’s second-most populous nation after Nigeria.

Ethiopia’s planned issue could be assisted by technical factors, such as scarcity, as the Eurobond will be the only tradable asset for international investors wanting access to the African nation, Standard Chartered’s Gadio said.

Ethiopia is building the continent’s biggest hydropower plant on the Blue Nile River, known as the Grand Ethiopian Renaissance Dam, that will probably increase electricity supply five-fold by 2020. It may need to invest about $50 billion in infrastructure over the next five years, of which $10 billion to $15 billion may come from foreign investors, the finance minister said last month.

[Bloomberg]

Some companies that are attending the Powering Africa Ethiopia Meeting have shown interest in investing in renewable energy in Ethiopia.

Heads of the Chinese company Goldwind International Holdings and South Africa’s Group Five Structured Ingenuity told ENA on the sidelines of Powering Africa Ethiopia Meeting that Ethiopia has abundant wind resource in addition to hydropower.

Goldwind International Holdings Business Development Manager for Africa Market, Liang Xuan, told ENA that the company has delivered 51 megawatt of wind turbine for Adama One Project which has been commissioned two years ago. He added that profitability of the renewable energy sector is immense and the company has interest to engage in the sector.

Goldwind International Holdings is building a wind farm that would generate 400 megawatt in collaboration with Terra Global Energy Developers, a US company, around Debrebirhan, according to Xuan.

“We have been enjoying working in Ethiopia in terms of legal investment framework and political environment. Things and projects have been moving smoothly and we are confident to continue our project across Ethiopia,” he said.

South Africa’s Group Five Structured Ingenuity Director Richard Adams on his part said it is promising to see what the government of Ethiopia has done in a few years in the energy sector.

Ethiopia is a good place to investment, he said, adding that his company has planned to engage in the energy sector in the country. Development Bank of South Africa International Finance Unit Manager, Zodwa Lekubu, stated that the bank finances investors who want to engage in building renewable energy infrastructure.

She added that Ethiopia is a big market for renewable energy and the bank is keen to finance investors in this sector.

“We are looking at a number of opportunities. Ethiopia is one of the new markets that we are looking at. One of the projects that we are looking at is the wind plan project which is going to develop in the country and we are looking for to invest in the project and we going to be a successful,” the manager pointed out.

[ENA]