Bob Geldof Gives Ethiopian Wine a Boost


The winery is part-owned by a UK equity firmed chaired by the famous Irish rock star, Bob Geldof (Sir)




Five months after being transferred into private hands, Awash Winery is eyeing an increase in its production, over three years, from seven million litres to 20 million litres. The Winery has also been using the expertise of foreign nationals to improve the taste of its wine branded as Axumite and Gouder. One such expert is Philip Pritchard, a senior advisor, with several years of experience in China, who was persuaded to come to Ethiopia by Bob Geldof, the knighted Irish rock star and activist, who owns a stake in the company.

Awash currently bottles seven million litres of wine annually. It plans to boost production under 12 brands, including the well-known Axumite, Awash and Gouder names.

Gouder is a national brand Geldof first tasted in 1984, when he got back from areas of drought in the north that had taken the world by shock. The 1984-85 Ethiopian famine had prompted many such as Geldof to galvanize the international community for help. He is known to be a force behind a LiveAid concert, a phenomenal event that was the first to get broadcast live across the world for the first time, and as a result raised over 100 million dollars for charity.

“I was back from Korem,” Geldof recalled. “I was tired, exhausted, and in a mess. I was craving for good meal and a drink.”

Geldof was taken to the Castle Castelli Restaurant, Cunningham St, in Piazza area. The wine he had was Gouder. Thirty years later, Geldof was at the same restaurant on Thursday night, January 30, 2014, where he dined with several Ethiopians, including Berhane Deressa, former mayor of Addis Abeba, who Geldof said was the first Ethiopian he had met back in the mid 1980s.

Geldof raised his glass last week to the wellbeing of a people he came to help during the darkest period of their history.

“I had thought I would be coming here perhaps twice; that was it,” he told Fortune. “Here I am, attached to these people forever.”

He was not a causal consumer of Gouder last week though. The private equity firm he chairs, 8Miles, owns Blue Nile, a company which acquired the 70-year old winery based in Addis Abeba and vineyard near the town of Ziway from the Ethiopian Privatization & Public Enterprises Supervising Agency (PPESA).

A great fan of the late Meles Zenawi, but also straight talker to the power that be, Geldof says he decided to get involved in the winery hoping to see the factory expands and improve in order to provide additional employment. The previous owner, the Upper Awash Agro Industry, has 517 employees, 32 whom are permanent.

Geldof sees his engagement in the share company as part of his progression from aid to investment and development.

“I’m tired of talking too much about aid to Africa,” he told Fortune. “We rather need job opportunities, transfer of technology and also transfer of skills.”

The improvement process involves changes in both the process of farming and bottling.

Italian investors first established the vineyard, with a 547hct of farmland, in 1943. The Winery, whose factory is located in the Lideta District of Addis, has a 500hct farm in Merti Jirsu, which was previously owned by the Upper Awash Agro Industry, and a 42hct plot in Zeway, about 163Kms south of Addis Abeba. It was nationalized following the 1974 revolution, and remained under the state’s ownership until it was privatized in 2012, for 458 million Br.

Ethiopia Imported 10,637hl of wine in the 2011/12 fiscal year, at a cost of 27.8 million dollars, according to the Ethiopian Customs & Revenue Authority (ERCA). The volume and value of imported wine showed 10.5pc and 12pc increments, respectively, compared with the previous year. However, according to 2011 figures from Data Monitor, a market analysis website, latent demand for wine in Ethiopia is estimated at 50,687hl.

Geldof walked through the farm in the Awash Melkasa area on Tuesday for the first time since the acquisition. The 63-year-old rock star was impressed with the progress on the farm.

“The good weather and soil helps to increase production,” he said during the two-hour visit.

Currently, 136hct has been used, where over a million seedlings are being transplanted. The application of new technology and an irrigation system, which are conducive to the effectiveness of the farm, are some of the new things Geldof said he was impressed with.

The transfer in technology and skills, he said, expedites development and ends dependency in Ethiopia.

“Our priorities are expanding the farm, since the shareholders will not get a profit for the next four years,” says Mulugeta Tesfakiros, a businessman who operates several companies under Muller Industries, including Muller Real Estate and the Langano Bekele Molla Hotel. His company owns 49pc of Blue Nile. “We hope to benefit from the popularity of Geldof.”

The company has brought eight wine experts from the international wine industry, not only for better handling of the farm and the factory, but also for the transfer of skills to empower the local experts, said Mulugeta.

Geldof told those at the dinner at Castelli, including Dawit Zewdie (PhD), chairman of Africa Humanitarian Action, Elleni Gebremadhin (PhD), former CEO of Ethiopian Commodities Exchange , and Sebhat Nega, a veteran politician in the ruling party, he would like to see Awash takes the taste of its wines to an international standard, thus competing with those imported to the country. The volume and value of imported wine showed 10.5pc and 12pc increase, respectively, compared with the previous year.



By HIWOT SEYOUM
FORTUNE STAFF WRITER

Published on February 02, 2014 [ Vol 14 ,No 718]


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