Available, But Non-Drivable

The growing economy of Ethiopia has been complemented with a ripening car sales business. But, as in any other sector in Ethiopia, selling cars is also full of challenges. One latest challenge related to temporary plates, however, is slowing putting the brakes on what was once a hopeful sector. The understanding about the rationale and benefit of the new approach of providing temporary plates vary between authorities and importers, reports FASIKA TADESSE, FORTUNE STAFF WRITER.

Receptive yet unyielding

The administration of Prime Minister Hailemariam Desalegn is to review a policy of the central bank, which domestic investors in the manufacturing sector argue discriminate them against their foreign counterparts…


Khat, the stimulant leaf, has become a premier export commodity for Ethiopian with annual earnings exceeding 250 million dollars. Close to two million farming households establish their livelihood on the crop. Although the crop has such an important economic benefit, the government has no policy to support its production. The latest ban by foreign governments, considering the crop as a drug, is worsening the case for exporters, traders and farmers relying on the crop, reports ABDI TSEGAYE, FORTUNE STAFF WRITER.

Face the Business

Ethiopian Prime Minister Hailemariam Desalegn faced a barrage of considered questioning at the public private consultative forum, held at Millennium Hall on Africa Avenue, last week. Despite a confident and somewhat proficient display, during which he took on all questions himself, many in the private sector still felt he was dismissive if not deluded over many of their concerns. The issue of accessing finance was revealed as the second most prominent problem facing businesspeople, according to a survey commissioned by the Ethiopia Chamber of Commerce & Sectoral Association (ECCSA), with some heard mockingly calling the national bank the Development Bank of Turkey. Yet, the considered and well researched approach of Solomon Afeworq, chairman of the national chamber, illustrated progress in the representation of the private sector, during a positive response from Hailemariam, reports FASIKA TADESSE, FORTUNE STAFF WRITER.

Going Gets Tough

The ongoing road and rail construction in Addis Abeba is causing chaos, with the seasonal rains adding to the problem. Both people travelling by foot and vehicles are struggling to pass areas where rain has left huge puddles and construction causes severe obstacles. The Addis Abeba City Roads Authority (AACRA) is, however, optimistic, claiming that the majority of road construction projects are 80pc complete, reports FASIKA TADESSE FORTUNE STAFF WRITER.

A Less Wining Nation

A new drink is highlighting the undersupply of locally produced wine in the country. ‘Ande be Ande’ is a mixture of wine, beer and Sprite, or some other soft drink, and is increasingly popular throughout the bars of Addis Abeba. Just four establishments are currently working in the sector in Ethiopia, and issues such as old machinery and unreliable energy supply are causing the production to fall far short of its potential, reports FASIKA TADESSE, FORTUNE STAFF WRITER.

Bold Budget

The budget for the coming fiscal year has been announced at a record level. This is despite falling short of the GTP’s proposed level. Optimism reigns, with a projected economic growth of 11.4pc – far higher than the 7.4pc level calculated by the IMF and the AfDB. Both parties agree, however, with the minimal inflationary risk. The high anticipated agricultural yields also contribute to the positive projections. The budget has now been passed onto Parliament for deliberation, and will be approved before July 7, 2014, reports ABDI TSEGAYE, FORTUNE STAFF WRITER.

Consultation Forum Addresses Business Sector Hurdles

The issue of poor access to finance was top of the agenda when the Ethiopian Public Private Consultation Forum (EPPCF) presented their study, last week. There were nine major challenges listed, along with recommendations as to how the sector could shift to improve performance. The governor of the National Bank of Ethiopia (NBE), presidents of Banks, experts, manufacturers and representatives of the business sector were all present to discuss the proposals. Although all parties were able to agree on certain aspects of the study, there was room for disagreement in some areas also, reports FASIKA TADESSE, FORTUNE STAFF WRITER.

Two Wheeling in a Tidy Profit

Motorcycles are becoming increasingly common as a transportation method in Ethiopia, with the highest number in Addis Abeba and the south. They are useful both for gridlocked urban areas and hard to reach rural locations. This demand is ensuring that numerous two-wheeler entrepreneurs are able to pick up a pretty profit. All may change soon, however, with the authorities suggesting that they want to limit the increase of such vehicles on the roads in favour of other transport systems, such as the light railway, reports MIKIAS MERHATSIDK, FORTUNE STAFF WRITER.

A Giant on the Sailing

A variety of issues is leading to a backlog of shipping containers at the Modjo Dry Port. Although some blame the inefficiency of the processing services, others suggest that low costs lead businesses to take advantage of the space as storage. Currently, businesses are given plenty of leeway before being punished for failing to collect their goods. This is set to change, however, with new tough confiscation rules soon to be introduced, reports MIKIAS MERHATSIDK, FORTUNE STAFF WRITER..

A Bridge Too Far

The construction of Addis Abeba’s Light Rail Transit system is progressing well, with 60pc of the project completed. There are, however, still a number of concerns regarding how the design will accommodate people and cars hoping to cross the lines. Some complain that the current approach is impacting on both business and day-to-day life in the city, with reports of inconvenience and injury. When fully operational, the rail system will provide transport for an incredible 60,000 people an hour, reports FASIKA TADESSE, FORTUNE STAFF WRITER.

A Master of Plans

Urban planners from Addis Abeba and the Oromia Regional State have been working on an integrated master plan for over two years. The result is to be the first implemented city plan to consider towns at the outskirts of the city. Despite the optimism surrounding the impact the master plan could have, there has been some criticism over the lack of inclusiveness in the process. This led to protests in the Oromia region, resulting in a number of fatalities. The implementation must be conducted in collaboration if the master plan is to be successful, reports MIKIAS MERHATSIDK, FORTUNE STAFF WRITER.

Cementing the Future

The construction of a half-billion dollar cement factory by Africa’s richest man – the Nigerian, Alhaji Aliko Dangote – is ongoing in the West Shoa Zone of the Oromia region. The sector, seen as a priority in the Growth & Transformation Plan, has performed well over the past few years, but some fear that it is becoming saturated. Dangote Cement, the Nigerian company, feel that enhanced development in Ethiopia and the potential of neighbouring markets are enough to make the outlook a positive one, reports MIKIAS MERHATSIDK, FORTUNE STAFF WRITER.

Uncertainly Optimistic

With Prime Minister Hailemariam Desalegn reporting that Ethiopia’s GDP grew by a little less than double digits during the last fiscal year, lofty targets remain. This year the growth target has been set at 11pc, although there is some disagreement with international financial institutions as to how this is determined. The stability of inflation is a hugely positive aspect of the report, but poor export performance and low foreign currency reserves continue to threaten the economy. The Prime Minister remained stern in the face of all opposition in Parliament, reports BINYAM ALEMAYEHU, FORTUNE STAFF WRITER.


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