Price War Leads to Bankruptcy


As the number of insurance companies rises in the country and the competition between them heats up, pricing insurance products and services seems to be taken lightly with no scientific approach consideration. Price wars, which seem to have engulfed the Ethiopian insurance sector at the moment, will eventually lead firms to bankruptcy, ASSEGED G. MEDHIN argues.


Is an Ethiopian Deposit Insurance Scheme Premature?

With the possibility of introducing a deposit insurance scheme (DIS) in Ethiopia currently being discussed, Abdulmena Mohammed Hamza, an accounts manager at Portobello Group, based in London, discusses its suitability in light of the nation’s current financial climate. Such a scheme is commonplace across numerous countries globally, but is more often associated with highly liberalised financial industries – which is not the case currently in Ethiopia. Questions are also raised over how effective it would be and whether its establishment would lead to a moral hazed among both banks and their consumers.


New Era of Displacement is Rising

As the number of refugees reaches record numbers unseen since the second world war, environmental and climate-induced migration is proving a major challenge driving people away from their homes. Currently, environmental distress causes one person to be displaced every second of every day. While the number of displacement of people due to climate change increases, Seble Samuel, writes there are many legal gaps in the provision of protection for the mobility of peoples forcibly displaced by environmental hazards.


The Globalisation Disconnect

Globalisation is being challenged like never before – firstly by Brexit and currently by the rise of Donald Trump in the US. One major cause of such opposition, according to Stephen S. Roach, a faculty member at Yale University and former Chairman of Morgan Stanley Asia, is the antiqued understanding and approach to what is a rapidly shifting, and extremely complex, reality. One major oversight in what the author calls Globalisation 2.0 – the second key phase of the movement – is the failure to understand and account for worker backlash. Concrete solutions are desperately required to prevent its complete collapse.


Credible Companies Can End Customs’ Quality Quandary

The decision to exclusively utilise the Government-owned conformity assessment service provider (Ethiopian Conformity Assessment Enterprise (ECAE) for mandatory standards inspections at Ethiopia’s ports is illogical, according to an expert whose name is withheld upon request. Not only does this unnecessarily extend the processing time, but it too has a number of gaps, which have led to the acceptance of third-party certification on certain goods. Internationally credible third-party service providers should be used to improve both the speed and coverage of checks.


How Slow Will China Go?

China’s many years of double-digit GDP growth are clearly now a thing of the past; this is simply a natural slowdown that always exists when a low-income country catches up with the stronger global economies. Indeed, Japan and South Korea are two previous examples of such a trend. It’s not all doom and gloom for the Chinese, however, according to Lee Jong-Wha, Professor of Economics and Director of the Asiatic Research Institute at Korea University. With the right approach, the Asian powerhouse could still seamlessly progress from middle- to high-income status.


Can Banking Competition Boost Somaliland’s Financial Inclusion?

Though several banks have obtained licenses from the Somaliland Central Bank, the financial services sector in the country is dominated by the remittance business. Not all the banks provide other banking and investment services, other than basic banking services, which are desperately needed in the country. Mohammed Dahir Ahmed explores if competition between banks can promote the infant financial sector in Somaliland.


Somaliland: Mobile Banking Regulatory Gaps Must be Addressed

With the rise in the number of subscribers in mobile banking services and an increase in the number of mobile banking platforms providing financial services, the responsibility to protect the financial security and privacy of subscribers in Somaliland lies on the authorities. However, despite the large size of the population who makes use of the technology and the sheer size of the transaction that is taking place on mobile banking platforms, Mohammed Dahir Ahmed, a banking and finance expert, highlights the gaps in regulatory mechanisms and bodies.


Restoring the Economy’s Ability to Deliver Prosperity

Globalisation, and all its interconnecting economical and political provisions, has come under severe pressure of late. Britain’s decision to exit the EU, alongside an escalating immigration crisis, has led to the emergence of several flaws in the globalisation model. Such flaws have catalysed increased disenfranchisement from the globalisation movement, which has ultimately led to increased nationalism in opposition to cross-border cooperation. There are, however, still many positives to grasp on to, according to Mukhisa Kituyi, the Secretary General of the United Nations Conference on Trade and Development, who urges that the 14th UN Conference on Trade and Development (UNCTAD 14) in Nairobi in July will be critical for renewing positivity and taking the 2030 Sustainable Development Agenda forward.


The Mobile Imperative for Africa

The potential role of mobile technology across Africa is huge. Despite a huge increase in subscriber numbers since the turn of the Millennium, however, the process of digitalisation is still somewhat pedestrian. This is with the exception of a few lauded examples, such as MPesa, in Kenya, and Konga, in Nigeria. Despite being championed by African leaders continent-wide, more needs to be done to encourage and facilitate growth in this diverse and fascinating sector.


Brexit’s Blow To Globalisation

Britain’s exit from the EU, or Brexit as it has come to be known, has sent shockwaves around global financial markets. In the immediate aftermath, the pound plummeted and instability reigned in financial indexes the world over. More than this, however, the surprise decision of just less than 52% of Britain to exit the EU may well put the breaks on the process of globalisation. This article is provided to Fortune by Project Syndicate.


Brexit: Who Would Take the Hit?

The historic referendum to quit the European Union (EU) by the majority of the British public has sent shock waves across the world and sparked financial market tremors. From New York to London and Hong Kong, stock markets tumbled sharply, fearing the potential risks in all unknowns, writes Eyob Tesfaye (PhD), a macroeconomist.


Adding Value to Future of Art in Africa

As Ethiopia begins to exploit linkages between historic relationships with art and culture and the current climate of opportunities in tourism, Desta Meghoo J.D., cultural consultant, manager and curator, questions what the future holds for Africans who want to play an active role in the “commodification” of culture, to Africa’s benefit?


Functional Orientation Hinders Logistics Integration

Achieving functional excellence in management and integration of logistics is crucial to Ethiopia’s transformation to industry-led development that is sustainable, argues Yohannes Abebe (yohannesabebe10@yahoo.com), procurement specialist in this commentary.


Nitty-Gritty Affairs of Tabled Tax Bill

The Tax Bill in the legislative grail has 237 articles comprising no less than 37,000 words. Temesgen Worku (t.w.bezabih@vu.nl), a PhD candidate at Vrije University in Amsterdam and senior lecturer of Accounting and Finance at the Addis Abeba University, has diced and sliced them to debunk their complexity and the impact they may impose on a lone virtual businessman in Addis Abeba running a dating website.


Can a Basic Income Help Poor Countries?

The old idea of recasting the welfare state by instituting an unconditional universal basic income has lately been capturing imaginations across the political spectrum, writes Pranab Bardhan, a professor of the Graduate School at the University of California, Berkeley, in this article provided to Fortune by Project Syndicate.


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