February 4, 2016

5:45 pm

Investments: When Ethiopian giants dance

Construction and brewing

Source: THE AFRICA REPORT

By Jacey Fortin

Ethiopia’s in the driving seat, as investors from East and West seize on opportunities in sectors ranging from construction to brewing. Though they are global competitors, China, the US and Europe can complement each other here, say the ingenious functionaries in the state investment commission.

Though her farm is small and the rains have been disappointing, farmer Meseret Daba is looking forward to a profitable harvest this year. The 36-year-old mother of five, who lives near the southern town of Assela, says her income has doubled since she devoted most of her land to barley two years ago. “My life has changed,” she said. “My family is comfortable now, and I’m sending my kids to school.”

” The Chinese should be here. The Indians should be here. The Americans should be here. The Germans should be here. 

All around Meseret’s farm, international loans and foreign companies have been fuelling development. The nearby Wonji-Shoa sugar factory, operated by the state-owned SugarCorporation, was recently expanded with loans from India’s Ex-Im bank. The Chinese company Sinohydro has upgraded the road connecting Assela with the major city of Adama.

But it is a Western corporation that has affected Meseret’s life the most. She began growing barley because Diageo plc, a London-based alcoholic beverages company, initiated a programme in 2012 to source the cereal from Ethiopian small holders. Meseret and about 6,000 other farmers are receiving seeds, fertiliser and other inputs, the costs of which are deducted when they sell their harvests to local cooperatives, with Diageo’s Meta Abo beer brewery as the ultimate buyer.

Over the past few years, Western beer companies including Diageo, Heineken and Castel Group have been building or acquiring breweries in Ethiopia. Nevertheless, China, India and Turkey remain Ethiopia’s biggest foreign direct investors by far. China is Ethiopia’s biggest trading partner and has more foreign direct investment projects than any other country.

Chinese companies are also completing infrastructure projects, funded by loans from Chinese banks. These projects have brought tens of thousands of Chinese workers to the country–and added $4bn in the past five years alone to Ethiopia’s $19bn in external cumulative debt.

When it comes to Ethiopia’s economic relationship withChina, these loans “get all the hype,” says state finance minister Abraham Tekeste. “But we also have a good relationship in terms of trade and direct investment. And we would like to see more Chinese investment, particularly in exports and manufacturing.”

Western Interest

Despite China’s dominance in Ethiopia, various sectors have been attracting Western attention of late. Arecent burst of private-equity investments from Europe has targeted industries including horticulture, wine and energy. These investors may lack Chinese companies’ knack for completing infrastructural projects at low cost, but they boast expertise in certain consumer-oriented sectors, and are keen to exploit Ethiopia’s growing market potential.

Aklilu Woldemariam, promotion and research director at the Ethiopian Investment Commission, noted that the continent showing the most new interest is not Asia, but Europe. The United States, on the other hand, is “definitely” lagging behind. Considering Ethiopia’s good relationship with the US– a major aid donor and defence partner – Aklilu hopes the world’s largest economy could one day break into the top-10 list of Ethiopia’s foreign direct investors.

The US government has been working to promote investment in Africa through its Power Africa initiative, which uses US technical assistance to facilitate energy investments. In Ethiopia, Power Africa has linked up with Reykjavik Geothermal, a US-Icelandic company, to accelerate development of a geothermal energy site near the southern village of Corbetti.

The project has faced delays, but during Obama’s visit to Addis Ababa earlier this year Reykjavik signed a power-purchasing agreement with Ethiopia’s state-owned electricity company. US private investors are also testing the waters.

“As a matter of good investment philosophy, if you’re in Africa you have to be seriously considering Ethiopia,” said Elias Schulze, the managing partner and co-founder of The Africa Group, a US
advisory and venture capitalist firm. He adds that although Western firms might be put off by Ethiopia’s lack of dynamism –the private sector is still developing, and inhibited by protectionist policies – the country’s political stability, economic growth and huge population should be key selling points for investors.

Schulze is also a non-executive board member of a family business, Schulze Global Investments, which has been a pioneer of US private equity in frontier markets. The Ethiopian companies in the firm’s portfolio are diverse, covering sectors like coffee, medical supplies, food processing and cement.

The Ethiopian government seems responsive to growing Western interest, said Schulze. “There’s obviously a sense of patience you need to have. But the government does reform the investment code and the commercial code with decent regularity, so that’s very helpful.”

New name, new action

Atop Aklilu’s office building, which sits at one of the busiest intersections in Addis Ababa, a sign spells out ‘Ethiopian Investment Agency’ in bold red letters. The label is outdated. About a year ago the agency, which used to be under the Ministry of Industry, began reporting straight to Prime Minister Hailemariam Desalegn and was renamed the Ethiopian Investment Commission.

The move reflected a growing realisation that Ethiopia needed a more proactive approach to attracting foreign investors. The building is a hive of activity. It is meant to be a one-stop shop to help investors navigate a system where federalised land policies, unreliable utilities and opaque bureaucracies might otherwise become a deterrent.

But not every sector is equal: manufacturing and agriculture are priorities, while other industries, like banking and trade, are not open to foreigners except through Ethiopian intermediaries.

“Our promotion strategy is in line with government policy,” said Aklilu. Developing countries happen to specialise in the sectors Ethiopia prioritises, he added as an explanation for why Western firms have a smaller footprint.

” economic relationships can’t simply be about building countries’ infrastructure with foreign labour 

This point of view is confirmed by Yang Yang, an assistant business manager at the Ethiopian construction branch of the China Civil Engineering Construction Corporation (CCECC), one of two Chinese companies that is laying down the Addis Ababa-Djibouti railway.

“Turkey, India and Chinaare still developing countries, so we are focusing more on infrastructure,”Yang says. “America has advanced technologies. But developing countries are focusing on what they are good at. When we build, we have seen that the returns are very good, so it’s a win-win situation.”

Battling for Business?

In Ethiopia, as in Africa as a whole, Eastern and Western investors are often seen as competitors in a zero-sum game. Though the government is careful to say that all investors are welcome, the close political relationship between China and Ethiopia – both de-facto one party states that have pursued a heavily state-driven development model – has helped to cement China’s role as a primary economic partner.

Speaking at the African Union during his visit to Addis Ababa in July, Obama made subtle jabs at China when he said that “economic relationships can’t simply be about building countries’ infrastructure with foreign labour.” He added that African leaders might find it easier to work with countries that don’t speak out against human rights abuses.

Western countries are home to advocacy groups like Human Rights Watch and Amnesty International, which criticise Ethiopia for pushing large-scale development projects at the expense of civil liberties.

But when it comes to business, Aklilu argues that all countries have roles to play. Those roles are often complementary, as when European beer companies use Chinese built roads to transport supplies. Or when farmers like Meseret participate in initiatives like Diageo’s barley sourcing, while her community reaps the benefits of the railways and energy transmission lines being laid down by Chinese companies.

“There can be a sense that it’s us or them, but we can really have a balance,” said Schulze. “The Chinese should be here. The Indians should be here. The Americans should be here. The Germans should be here. And they can all be here for another decade or so without fighting in a really competitive sense for market share, which is a very unique opportunity.”•

Archive

Full of natural wonders and ancient culture, this vast country is also home to booming cities and a youthful population. Explore it with our guide on where to go, what to see and where to stay

Read more

The state-owned Ethiopian Airlines, Africa’s largest carrier by number of passengers, according to FlightGlobal…

Read more

Ethiopia Overtakes, Ghana loses No. 1 sub-Sahara spot as IMF revises 2018 economic growth forecasts…

Read more

Chicago has become one of the newest dots on Ethiopian Airlines’ global flight map…

Read more

The project is Beijing’s big experiment in outsourcing, and a $10 billion shot in the arm for the African nation—if there isn’t a civil war first…

Read more

Source The Washington Post By Paul Schemm ADDIS ABABA, Ethiopia — The Marvel Comics movie “Black Panther” has wowed audiences across the United States and around the world, including Africans who have cheered on the African superheroes and their fictional Kingdom of Wakanda. There is a little something for everyone in Wakanda for Africans. The… View Article

Read more

Rambunctious, manic, beguiling, exciting — it’s hard to accurately describe Addis Ababa…

Read more

an effort by Ethiopia to turn itself into an exporter of electricity to the region, channeling at least $4 billion into geothermal projects across the nation…

Read more

The old man’s face was beautiful, although it was etched with deep furrows — no doubt the result of having lived through droughts, famines and 17 years of a brutal and paranoid communist government that has slaughtered half a million of his countrymen…

Read more

Apart from Saudi-Ethiopian billionaire Mohammed Al-Amoudi, Samuel Tafesse is arguably the most popular businessman of Ethiopian origin.

Read more

The World Bank again declared that the Ethiopian economy would be Africa’s most expansive in 2017…

Read more

As Ethiopia strives to become the manufacturing hub of Africa, more and more Chinese companies are showing an interest in investing in the east African country …

Read more

As global demand for teff, Ethiopia’s gluten-free indigenous staple crop grows, officials and businesses are looking to tap the global market…

Read more

The BBC World Service has launched three websites for Ethiopia and neighbouring Eritrea as part of its biggest expansion since the 1940s.

Read more

It is an important security step since if Internet Service Providers (ISPs) do not have this new key, the Internet will not work for them or their customers, according to Mr. Dandjinou

Read more

I have always questioned God’s existence, but in the northern Ethiopian town of Lalibela, I was presented with fairly substantial evidence.

Read more

Turkish construction giant Yapı Merkezi hopes a $3 billion modern railway-line project it is building in Ethiopia and Tanzania …

Read more

The e- visa is processed and issued online on a single Web page where applicants apply, pay and secure their entry visa online.

Read more

Ethiopian Airlines was betting Airbus SE’s new A350 widebody would help it lure lucrative business-class passengers away from the likes of Emirates. . .

Read more

Government reforms are designed to encourage farmers to produce more high-quality beans…

Read more

Pizza Hut is set to open three outlets in Ethiopia this year, becoming one of the first international restaurant chains to enter Africa’s second-most populous country.

Read more

Ethiopia, the second-most populous Sub-Saharan African country with a GDP size of $61.54 billion (Rank: 73), is projected to grow annually at 8.7%

Read more

Germany fosters change in Ethiopian textil industry…

Read more

Norfund has made a USD 7.4 million investment in Verde Beef Processing PLC, an Ethiopian beef producer. Verde Beef Processing PLC produces premium beef and aims to become the largest cattle processing operation in Eastern Africa with a target output of more than 130,000 carcasses per year. The capital provided by Norfund will help the… View Article

Read more

The Danakil Depression, including the Dallol volcanic area is one of the most remote, inhospitable and poorly studied areas in the world.

Read more

The Embassy participated in the inauguration of the Ethiopian Airlines flight to Oslo on Friday 24 March 2017. Read the speech made by the ambassador below.

Read more

Lenders are lining up to set up businesses in Ethiopia, one of Africa’s fastest-growing and most under-banked economies…

Read more

ADDIS ABABA, Feb. 19 (Xinhua) — The airport of the Ethiopian capital Addis Ababa is training Chinese-speaking staff upon arrivals of more Chinese travellers…

Read more

The Caesarea-based firm is teaming up with partner TodayTomorrow Ventures Inc. in a $400,000 deal to construct a wastewater treatment facility at the EPRI 1 condominium complex in Addis Ababa.

Read more

Ethiopian Entrepreneurs who were educated overseas are returning home

Read more

Bethlehem Alemu’s shoes have been sold worldwide by Amazon (AMZN, Tech30), Urban Outfitters (URBN) and Whole Foods (WFM)…

Read more

January 19, 2017

10:27 am

Ethiopian to Open Seven New Destinations

Ethiopian envisages to reach 120 international destinations worldwide by the year 2025…

Read more

Ethiopia on Saturday officially opened the Gibe 3 hydroelectric dam, which is among the biggest in Africa…

Read more

Ethiopia has welcomed hundreds of new taxis…

Read more

A $3.4 billion Chinese-built railway linking the Ethiopian capital Addis Ababa and the port city of Djibouti…

Read more

Ethiopia seems awake to look in to its tourism potential. Along with the development of various tourist infrastructural facilities, the country is endeavoring to market the resource for economic development…

Read more

Gibe III Hydroelectric Project, Ethiopia […] is expected to be in full operation by August, 2016. ..

Read more

Ethiopia seems to be attracting the attention of economists interested in Africa, and for good reason…

Read more

Ethiopian has been voted as the Best Cargo Airline of the Year …

Read more

Ethiopia, Africa’s second most populous nation, has transformed into one of the world’s fastest-growing economies…

Read more

Source: CNN Native to Ethiopia, the Ge’ez is more than just an ancient, nearly forgotten language. It’s Ethiopia’s link to its distant past.  

Read more

Addis Ababa February 10/2016 The government of Sweden is interested to further strengthen all rounded cooperation with Ethiopia, according to the country’s Ambassador to Ethiopia…

Read more

February 4, 2016

5:45 pm

Investments: When Ethiopian giants dance

Ethiopia’s in the driving seat, as investors from East and West seize on opportunities in sectors ranging from construction to brewing…

Read more

A previously unknown population of at least 100 lions has been discovered by a wildlife charity in a remote park in north-western Ethiopia…

Read more

January 12, 2016

10:18 am

An insider’s guide to shopping in Addis

With the headquarters of the African Union located in Ethiopia’s capital city, as well as an award-winning airline…

Read more

Ethiopian Tourism expects the growth to double by 2016

Read more

There are now 2,700 millionaires in Ethiopia, reflecting an increase of 108% between 2007 and 2013 — the fastest growth rate in Africa…

Read more

Ethiopian airlines operated an All-Women Functioned Flight today on the Addis Ababa – Bangkok route…

Read more

Maersk Oil has agreed to buy half of Africa Oil Corporation’s shares in three onshore exploration licenses in Kenya and a further two in Ethiopia…

Read more

Addis Ababa gets first sub-Saharan Africa metro system…

Read more

Minimal corruption, efficient bureaucracy, and cheap production costs are driving China’s investment in Ethiopia…

Read more

– If there was ever a country that embodied the optimism of the “Africa rising” narrative, it would be Ethiopia. The economy of Africa’s second-most populated country has for the past decade grown at an average of 10.8% every year …

Read more

October 15, 2015

5:08 pm

Made in… Ethiopia? Yes, Ethiopia

— So we got used to “Made in Japan,” “Made in China,” “Made in Hong Kong” and most recently “Made in Vietnam.” There’s going to be a new kid in town, but he’s not Asian. Prepare yourselves for “Made in Ethiopia.”…

Read more

September 25, 2015

1:19 pm

Arsenal breaks new ground in Ethiopia

Arsenal Football Club has become the first Premier League side to secure a regional partnership in Ethiopia after announcing Dashen Brewery as its Official Beer Partner…

Read more

Tekle Negash’s days of riding a battered minibus to work in Ethiopia’s capital are over. Boarding Addis Ababa’s $475-million, Chinese-built and funded Light Rail, he can slash his one-hour commute by two-thirds and still save money…

Read more

Ethiopia is head and shoulders above the rest of Africa in meeting the Millennium Development Goals (MDG)…

Read more

Ethiopia’s Addis Ababa has the most expensive hotel room prices in Africa, according to research based on the price comparisons of select major African cities…

Read more

EEthiopia won the first gold medal at the IAAF Beijing World Athletics Championship in the female 1,500 mt race with world record holder Athlete Genzebe Dibaba in Beijing, yesterday…

Read more

Ethiopia’s government will boost spending by 20 percent in the budget year that begins next month to expand infrastructure in one of Africa’s fastest-growing economies,State Finance Minister Abraham Tekeste said…

Read more