Ethiopia’s economy, like most other economies, has taken a hit from the COVID-19 pandemic. When the rest of the world’s troubles eased over time, Ethiopia had to fight its own war– literally. In October 2020, a war broke out between federal and allied forces and the Tigray Liberation Front (TPLF). The war took a heavy toll on the economy as well as on humanity, claiming more than 600,000 lives. Ethiopia’s attempt to restructure the mounting debt, and access another round of support remained unthinkable, owing primarily to the civil war. Following an agreement between the warring sides in November, 2022, a few doors appear to be opening. The government has been knocking on all those slightly open doors, wasting no time to save the last breath in the dying pulse of the economy. Whether these efforts will come in time or bring about the needed relief remains to be seen and felt, though, writes EBR’s Addisu Deresse.

In 2021, Prime Minister Abiy Ahmed’s (Ph.D.) administration requested the restructuring of the more than USD 26 billion of debt under the Group of 20’s Common Framework. The process was stalled due to the war that broke out between the federal government and TPLF in October 2020.

Following the agreement signed by the two warring sides in Pretoria in November 2022, debt restructuring seems to be back on the table. Further support for the country’s Homegrown Economic Reform (HGER) also seems to be on the horizon. “An International Monetary Fund loan for Ethiopia is “definitely back on the table,” according to S&P Global Ratings, a key step to restart the Horn of Africa nation’s delayed debt-restructuring plans,” Bloomberg reported in March 2023.

PM Abiy and his officials have not wasted a single minute since the signing of the deal. The PM himself and his high officials have been flying around the world, pleading with international institutions and governments to come to the aid of a severely impacted economy.

On February 6, 2023, PM Abiy flew to Rome, Italy, to sign the Ethiopian Italian Cooperation Framework 2023-2025 agreement. In the agreement that was signed with the Italian President of the Council of Ministers, Giorgia Meloni, PM Abiy secured 140 million euros (100 million in soft loans and 40 million in grants).

“The Cooperation Framework Agreement has two main pillars of action: economic development and job creation, and access to basic services. Particular importance is devoted to vocational training that will foster job creation and access to basic services, in particular health, education, water, and the environment,” reads the statement released by the Italian Embassy in Addis Ababa.

The Italian Deputy Prime Minister Antonio Tajani and the Ethiopian Minister of Finance Ahmed Shide also signed two additional agreements for new programs: “WASH, resilience, and energy in Ethiopia’s lowlands,” worth 31.5 million euros, and “Minimizing investment risk in the Ethiopian coffee sector and providing institutional support to the Ethiopian Coffee Authority (ECTA),” worth 10.5 million euros.

According to the statement, the total sum of the agreements signed in Rome is 182 million euros, bringing the total value of the Italy-funded development projects in Ethiopia to 200 million euros.

PM Abiy flew to Paris on February 7 and met his “friend,” Emmanuel Macron. He was received at the Elysée Palace by the president on Tuesday, and PM Abiy was hoping to capitalize on the momentum created by the peace agreement. However, no significant announcement was made following the visit. “We very much welcome investments by French companies in Ethiopia,” Abiy said briefly on Twitter after his visit to Paris.

After returning from France empty-handed, PM Abiy sent a high-level Ethiopian delegation, led by Ahmed Shide, Minister of Finance, that arrived in Beijing, China, on February 20, 2023.

The delegation, which included Mamo Mihretu, governor of the National Bank of Ethiopia (NBE), Lelise Nami, commissioner of the Ethiopian Investment Commission (EIC), Eyob Tekalegn (PhD), state minister of finance, and other senior government officials, met with Chinese financial institutions and investment firms in addition to holding strategic meetings with important government ministries. The delegation also attended events hosted by the Ethiopian Embassy in China, such as the Joint Economic and Trade Commission and an Ethio-Chinese investment forum.

The delegation’s visit to China was also not followed by any significant announcement.

“The Chinese government, financial institutions, and investors have had in-depth and fruitful discussions with the delegation,” Wu Peng, Director-General at the Department of African Affairs, briefly tweeted following the visit by the Ethiopian delegation.

The visit to Addis Ababa of Mr. Alvaro Piris, an economist at the International Monetary Fund (IMF), and his team from March 27 to April 7, 2023, was the next major event in PM Abiy’s administration’s effort to save the dying economy. Alvaro and his team visited Addis Ababa to discuss the authorities’ request for IMF support for their reform program.

“The IMF team welcomes the authorities’ Homegrown Economic Reform Agenda (HGER II), an ambitious reform program that aims to address key macroeconomic vulnerabilities and unleash Ethiopia’s considerable economic potential,” read the statement released by Alvaro at the end of their visit. “We made progress in discussing the scope for IMF support for this reform program.”

The objective of HGER II, which was put in place after PM Abiy took office, is to preserve economic growth by promoting an environment for business that stimulates more private investment and structural transformation. It has three key elements at the macro-financial, structural, and sectoral levels.

Before HGER, the Ethiopian government, headed by the Ethiopian People’s Revolutionary Democratic Front (EPRDF), had been enacting what were known as the Growth and Transformation Plans (GTP) I and II, which were intended to stimulate national economic growth. Both GTP I and II had received criticism for being overly ambitious because they struggled to meet their objectives, especially in the areas of manufacturing and exports.

The HGER of Abiy’s incumbent, the Prosperity Party, has also been under fire for not being “home grown” and being overly ambitious. The incumbent also dared to succeed with the reform at a time when the country was embroiled in disputes and a full-scale war in the north.

The backing required from the west and its institutions of the reform, as well as the conditions linked to that support, have made it more difficult for it to achieve its goals.

Now that the war against TPLF seems to have eased, the administration is seeing light at the end of the tunnel.

An Ethiopian delegation led by Ahmed and Mamo attended the World Bank and IMF’s spring meetings, which began in Washington in the second week of April, 2023. This time, Ahmed and Mamo were joined by Sileshi Bekele (Eng.) to hold sideline discussions with the officials of the World Bank, the IMF, and the International Finance Corporation (IFC).

According to reports in the international media shortly after the talks began in Washington, Ethiopia is in talks with the IMF to borrow at least USD 2 billion as part of a reform program. According to the source, the IMF is currently evaluating whether the country’s debt is sustainable in light of a request for a program that would be about equal to the size of its holdings with the multilateral lender—or 500 Pct.

According to two people familiar with the negotiations, the IMF predicted in its initial debt study that Ethiopia would have a financing deficit of at least USD 6 billion through 2026. Even if the country is successful in securing the amount under consideration, it will still face a financing gap of almost USD 4 billion during that time frame.

“The scope of the support for Ethiopia is not yet set in stone, both parties are still working on the debt sustainability analysis,” the global media reported, quoting an anonymous source.

Mamo tweeted during the discussions, “Excellent discussion on sideline of WB/IMF spring meetings with Governor Erik Thedeen of Central Bank of Sweden and Governor Andrew Bailey of Bank of England on capacity building support and recent lessons on global financial and monetary stability.”

“Discussed Ethiopia’s economic challenges and prospects, including how the IMF can support the ambitious reform plans in their HGER,” Kristalina Georgieva, managing director of the IMF, said after meeting Ahmed and Mamo. “The IMF stands by Africa.”

However, the agreement with TPLF may not ensure a rescue from the international financial institutions. According to reports, the IMF, as it always has, is strongly recommending, among other things, the unification of the parallel markets for exchange rates. The official rate for a single USD now stands at a little more than ETB 54, while the rate exceeds ETB 100 in the black market. By unifying, the Ethiopian government should double the official rates.

In January, 2023, Eyob strongly denied any consideration by the government to devalue the birr any further. “There is a widespread rumor that devaluation is in the making,” Eyob tweeted on January 19. “This is just a rumor. Completely unfounded. A sensible macro reform is always on our agenda, but there should not be any concern about mere devaluation.”

“Devaluation is frequently used by the government as a means of boosting exports,” says Dr. Atlaw Alemu, a lecturer at Addis Ababa University. “But that hasn’t been a long-term answer, despite the fact that it could appear like one at the moment. Flotation of the birr in the absence of sufficient foreign exchange would be disastrous as it would result in an increase in the cost of imported goods.”

According to consultation with the Republic of Ethiopia and its requests for a three-year Arrangement Under the Extended Credit Facility and an Arrangement Under the Extended Fund Facility, a paper published by the IMF in 2029, the public investment-driven growth model has reached its limits. Macroeconomic and structural reforms outlined by the authorities are anticipated to result in greater growth, investment, and exports over the medium term, as well as a decrease in public debt and external vulnerabilities. The outlook is more vulnerable to negative risks.

“Prior to the upcoming elections, domestic resistance to reforms could make investors more hesitant and hinder growth and investment,” the paper reads. “Rising protectionism, poorer than anticipated global growth, and shocks connected to climate change are all examples of external risks.” According to the National Bank of Ethiopia’s annual report for fiscal year 2020-2021, Ethiopia’s external debt stood at USD 29.5 billion in July 2021.

Ethiopia’s total (internal and external) debt as of March 31, 2022, according to a statistical bulletin released by the Ethiopian Ministry of Finance in May 2022, was USD 56.5 billion. Out of that, USD 28.5 billion are owed to foreign creditors. The remaining USD 28 billion (internal debt) were owed to domestic creditors. As a result, 50.4Pct of Ethiopia’s total debt is external debt, while 49.6Pct is domestic debt.

Ethiopia obtains the majority of its borrowing from multilateral financial institutions. Ethiopia had a total of USD 29.5 billion in external debt as of the 2020–21 fiscal year, with USD 19.5 billion owed to multilateral lenders, 6.7 billion owed to bilateral creditors, and the remaining 3.3 billion owed to commercial lenders.

As of March 31, 2022, Ethiopia owed multilateral creditors like the International Development Association (a subsidiary of the World Bank), the African Development Fund (a subsidiary of the African Development Bank), the International Monetary Fund (IMF), and the International Fund for Agricultural Development (a UN agency) a total of USD 28.5 billion, or USD 14.9 billion, or 52Pct of its total external debt.

Loans from multilateral development institutions such as the World Bank, IMF, and African Development Bank are generally affordable and available. Additionally, because of their poor creditworthiness and the danger of default, poorer countries frequently seek loans from these development banks.

Ethiopia’s creditworthiness has occasionally been declining. This indicates that foreign lenders are not fully confident to offer loans to Ethiopia. Ethiopia’s creditworthiness was downgraded to “junk” status by Standard & Poor’s (S&P), a leading worldwide credit rating agency, in the previous year. Additionally, Moody’s Investors Service cut Ethiopia’s credit rating from B2 to Caa1, indicating a larger risk of debt default on Ethiopia’s part.

Ethiopia’s external debt has been continuously rising since 2007. According to the World Bank, the nation’s external debt stock was USD 2.59 billion in 2007. Since then, it has significantly grown, reaching USD 30.36 billion in 2020.

Ethiopia’s external debt declined considerably in 2006, reaching its lowest level in since 1982. In 1982, it was USD 3.28 billion, while in 2006, it was USD 2.22 billion. From USD 6.18 billion the year before and USD 10.36 billion in 1998, Ethiopia’s external debt decreased to USD 2.22 billion in 2006.

Ethiopia benfited from both the Heavily Indebted Poor Countries (HIPC) and the Multilateral Debt Reduction Initiative (MDRI), two debt reduction programs aimed at developing nations. The debt relief to poor and indebted countries was started by the well-known multilateral financial institutions, the World Bank and the IMF, along with the governments of developed countries, particularly the G8 countries.

The IMF and World Bank created the HIPC Initiative in 1996 to aid developing nations that were struggling under heavy debt loads. The G8 nations approved the MDRI proposal in June 2005.

11th Year • May 2023 • No. 117 EBR

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Federal authorities’ dismantling of regional paramilitaries has created an opportunity for al-Shabaab to strengthen its presence in Somali region.

The leaders of Kenya, Ethiopia, Somalia, and Djibouti held a regional summit in Mogadishu last February where they agreed to launch a joint campaign against the al-Shabaab militant group operating in Somalia, describing it as a threat to regional stability.

The Somali Armed Forces, with the backing of the international allies and African Union Mission in Somalia (ATMIS), have also intensified their fighting against al-Shabaab, with the goal to pursue and remove any threat it poses to regional stability.

The joint operation is set to begin soon in Somalia’s South West State and Jubaland, two territories bordering Ethiopia. Ethiopian troops, which invaded Somalia from 2006 to 2009 and have been heavily involved in combating al-Shabaab ever since, are expected to play a crucial role in the efforts to liberate these two states from the Salafi-jihadist group.

On 6 June, al-Shabaab responded by sending two suicide bombers to attack a contingent of Ethiopian troops stationed in Dolow, a town in Somalia along the border with Ethiopia, which resulted in renewed fighting between the two groups.

While military tacticians in the region meticulously orchestrate a strategy to defeat al-Shabaab within Somalia, Ethiopia is deploying a strategy that limits the capabilities of local regional forces that understand jihadist tactics and have been a critical tool in protecting the country’s eastern and southern borders.

Mounting Resistance

Following the announcement of the joint operation, al-Shabaab leaders reportedly convened a consultation meeting attended by more than a hundred delegates from different areas in an undisclosed location in Somalia and devised a plan to counter the impending coordinated attack on their strongholds.

A communiqué issued at the end of the al-Shabaab leadership meeting stated that the Mujahideen (those engaged in jihad) and the Somali people must work together to repel the second phase of the “crusader campaign” led by Ethiopian invaders with their lives and wealth, just as they did in thwarting the previous campaign of the “apostate tribal militia.”

These actions have allegedly caused al-Shabaab to step up its presence in Ethiopia.

A source close to the action indicates that al-Shabaab leaders believe the greatest threat will come from Ethiopia, so they have prepared a plan to counter the Ethiopian forces in particular and, more broadly, the Black Lion operation, for which they devised a two-pronged strategy.

The militant group’s first strategy is to start a guerilla war within Ethiopia, specifically in parts of Somali and Oromia regions.

According to the source, 600 to 1,000 al-Shabab fighters have infiltrated Ethiopia during recent weeks, where some are already working as casual laborers in areas between Afcade/Hargeele, Shabele, and Weeb rivers to El Kare of Somali region and Bale mountains in Oromia.

Moreover, al-Shabaab’s recent attacks on Ethiopian military bases are believed to have planted hundreds of al-Shabaab members in southeast Ethiopia’s Bale mountains with the intention of carrying out future attacks within the country.

Al-Shabaab fighters in Ethiopia had reportedly stockpiled enough food, ammunition, and other supplies that can last for three months.

The second strategy is to establish an active front in the Bakool and Gedo regions of Somalia, where they intend to bog down Ethiopian forces in the event of an attack.

It should be recalled that Ethiopian forces repelled an al-Shabaab incursion in July 2022 after the group targeted some border towns in Somali region. An estimated 500 to 800 fighters marched 150 kilometers inside Ethiopia before being repulsed by regional special forces.

The incident demonstrated the group’s determination and capability to expand its operations beyond Somalia’s borders.

Locals Recruited

Ethiopia had long been seen to be an impenetrable environment for terrorist activities due to its superior intelligence compared to Kenya which suffered several devastating attacks at the hands of al-Shabaab.

However, in the last three years the country has experienced an increase in the number of Ethiopians radicalized and recruited into Islamic organizations such as al-Shabaab and the Islamic State.

Although terrorist acts have been rare in Ethiopia, there has been a significant surge in jihadist groups’ interest in extending their operations following the war in Tigray from 2020 to 2022.

Al-Shabaab and other Jihadist groups see an opportunity to recruit more fighters within Ethiopia in the coming years, owing to the vast number of unemployed and idle youths living in villages and rural areas of the country.

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Jihadist militants target youth who are disgruntled with the system and marginalized  communities with grievances who are motivated to change their condition, even if it means resorting to violence.

Recently, extremist militant groups have increased their online propaganda by using languages that are commonly used in the region such as Somali, Swahili, Amharic, Oromo, and Arabic.

In July 2022, a Jihadist group released a 25-minute video titled “Upon the Path of the Conquerors,” which was broadcast in Amharic and subtitled in Arabic. The video was shot in good quality and depicts the military operations, training, and daily life of the Islamic State’s Somalia members, with a focus on Ethiopian fighters.

This video demonstrates how Jihadist organizations are interested in reaching out to attract Amharic-speaking Ethiopians, Somalis, and Eritreans to join Jihadist groups and how they are capable of raising funds outside of their traditional areas.

Despite relentless attacks from al-Shabaab, Islamic State militants have maintained a presence in Somalia since a small group of al-Shabaab members defected and pledged allegiance to the Islamic State in October 2015.

While al-Shabaab’s strength is waning due to ongoing regional counterinsurgency operations in Somalia, other terrorist organizations may take over the region if not handled appropriately. As a result, the current operation should target both al-Shabaab and its adversaries.

Resurfacing Tensions

In the past few weeks, the Ethiopian government has been deploying a large number of its military forces to the border areas between Ethiopia and Somalia in preparation for the war against al-Shabab insurgents.

However, these forces have limited knowledge of the area and how the terrorist group operates and, to make matters worse, clashes and mistrust with locals living in the region have been reported from the start.

Moreover, the Ethiopian military is already thinly dispersed and may be ineffective in remote and arid locations such as Somalia. The long-standing distrust between the Ethiopian military and the Somali people may play into the hands of al-Shabaab.

Unfortunately, the newly deployed military in Somali region has started killing and tormenting unarmed citizens in Kebridehar, Godey, Shaykosh, Ayshaca, Gursum, Guradamole, and Tuli-Guuleed.

In one notable incident, the Ethiopian military allegedly killed two civilian and injured ten others on 30 April in Kebridehar, after low-ranking officers got into an argument with local youths. More recently, Ethiopian army members were accused of indiscriminately firing on civilians in Kebridehar on 20 June, killing four people and injuring three others.

These incidents show a lack of coordination and distrust between the Ethiopian military and the local Somali population, and bring back painful memories of crimes committed by the Ethiopian army against Somalis during the EPRDF’s rule.

The Ethiopian army’s relationship with the Somali people has never been good and even the smallest reckless move can cause insecurity throughout the region. As a result, al-Shabaab can use these sentiments to gain momentum by recruiting and operating easily among the local population.

Somalis in Ethiopia believe that the relative serenity, peace, and stability enjoyed by the Somali region over the last five years is vanishing, and that events are spiraling back to the dark days of yesteryear.

Security Vacuum

Ethiopia’s federal government announced its desire to dissolve and incorporate all regional special forces into the national army, federal or regional police, or both, a move that was interpreted as an attempt to curtail local regional autonomy.

On 15 April, the military’s Chief of Staff, Berhanu Jula, declared the process of integration finalized and the regional special forces defunct. As a result, the era of regional special forces came to an end without much difficulty.

Abiy’s recent move to disband regional paramilitaries known as ‘Liyu’ (‘special’) police – which have been responsible for many atrocities since being formed in 2007 – has caused border patrol units to leave their bases prematurely, creating a security vacuum.

It’s understandable that Abiy’s goal is to restore the central government’s monopoly on violence and to mitigate emerging powerful regional forces that could pose a threat to his rule, as happened in Tigray and Amhara regions.

This approach, however, must be applied on a case-by-case basis.

Weakening or dissolving Somali region’s Liyu police now does not serve the purpose of stopping al-Shabaab militants from expanding their presence into the neighboring countries.

Somali Liyu police, despite their many excesses, have been an effective tool for protecting the security of Ethiopia’s eastern and southern border areas. Hence, dissolving or disarming the Somali Liyu police might weaken security at a time when al-Shabaab is building up in border areas.

A two-tiered security approach composed of a strong national army and federal police alongside robust and well-armed regional forces is preferable to the one Abiy envisions. A hasty and chaotic process of demobilization and disarmament will only exacerbate Ethiopia’s security difficulties.

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Main Image: al-Shabaab hostages rescued in Kismayu; 30 May 2014; AMISOM Public Information.

This is the author’s viewpoint. However, Ethiopia Insight will correct clear factual errors.

Published under Creative Commons Attribution-NonCommercial 4.0 International licence. You may not use the material for commercial purposes.

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Halting of humanitarian assistance that began in Tigray has now spread to the rest of Ethiopia, imperiling livelihoods in one of the world’s most vulnerable countries.

International food assistance to Tigray has been suspended for more than two months pending an investigation into reports of theft and diversion, which is expected to be completed this month.

The World Food Programme (WFP) and U.S. Agency for International Development (USAID) have yet to release any concrete findings and the probe does not appear to be finished, but the verdict has already been passed on those in need.

Tigrayans will continue to starve, and food aid will now also be cut for all 20 million people in Ethiopia who are known to be in urgent need of food assistance.

The impact of the aid stoppage in Tigray will be devastating for the 5.4 million people known to be in desperate need and threatens to destabilize the fragile system that kept people alive in the region through two years of siege warfare before a peace deal was signed last November.

If the suspension of food aid continues and expands, a tragedy similar to the humanitarian meltdown in Tigray could soon engulf the entire nation of more than one hundred million people, many of whom live in areas that are affected by the worst drought in decades.

To the extent that any temporary suspension of aid is justified, it must be done in a transparent manner and exempt those most at risk, two necessary conditions that have thus far been absent.

Breaking the Silence

In separate announcements on 8 and 9 June, USAID and WFP confirmed pervasive rumors that food aid was being suspended across Ethiopia. Both agencies have been piloting a food stoppage in Tigray for the past two months and the predictable result has been an increase in starvation-related death.

WFP and USAID will only confirm that the distribution of food aid in Ethiopia is not currently possible because diversion has been observed to some degree in at least seven of the country’s nine regions. An internal by foreign donors indicated USAID believes federal and regional governments and security forces are responsible for some of the theft.

In the absence of their findings, Tigray’s authorities released their own investigation which accused 186 individuals. The study claimed 50 percent of the diversions were from federal structures, 33 percent by Eritrean forces, and 17 percent by Tigray’s officials, and also laid blame on humanitarian organizations.

Frustration with the lack of transparency and current practices of USAID in Ethiopia were expressed with unusual candor by Senator Jim Risch, a ranking member of the Senate Foreign Relations Committee, who issued a statement last week that read in part:

“U.S. agencies have been busy highlighting their self-proclaimed progress at getting food to those in need and ending a war that has destroyed millions of innocent lives. Yet, we now know that leaders at the top of these organizations in Washington, New York, and Rome were aware that implementers on the ground could not guarantee the aid was getting into the right hands […] The lack of oversight and guardrails of U.S. humanitarian assistance should not stand.”

If USAID and WFP are exploring alternate means of providing large-scale food assistance in Tigray, they aren’t talking about it. Currently, there are small-scale activities happening in Tigray, but it’s unknown if WFP and USAID are directly involved.

Both agencies have remained tightlipped about the humanitarian meltdown in Ethiopia and everything that is currently known about the suspension started with leaks to the media that were only later confirmed through official statements.

On 19 June, WFP announced that it hopes to resume some food aid distribution in Ethiopia next month after it has secured better control over how the beneficiaries are selected by increasing its own role and that of its partners while reducing the authority of local and regional government officials.

Phased Shutdown

The suspension of food aid in Ethiopia has proceeded in three stages.

The first stage occurred between 30 March to 14 April and affected only Tigray. Stage two began around 19 April, again in Tigray, after a period of limited distribution to a small number of internally displaced persons (IDPs) in Mekelle. Stage three began on 9 June when the food aid suspension was implemented nationwide. As of writing, the last two stages are still underway.

The first stage of the aid suspension is described in the following email dated 22 April. According to a WFP representative, the causes of the suspension were “issues of beneficiary verification and the sale of humanitarian food destined for Tigray and other regions in the market.”

However, the suspension itself was not temporary, it was only temporarily lifted. According to the multi-agency Food Security Cluster, around 12,600 IDPs in Mekelle received rations in the week ending on 19 April and nothing after that.

The suspension that started on 30 March was only formally announced on 2 May, when it was again described as “temporary”. By the second week of June, not only was the suspension in Tigray still in place, but it was also expanded to include the entire country.

There is never a good time to suspend food assistance in an area where hunger is nearly ubiquitous and the surviving population has recently endured two years of siege warfare with genocidal undertones.

However, following the surge of aid which began in late February, the first two weeks of April offered a brief window of opportunity to suspend distribution for all but the most vulnerable without completely destabilizing access to the basic staples of survival.

As shown in the following chart, with the exception of the Western Zone and Mekelle, the number of six-week rations distributed over the previous two months represented at least 95 percent of the caseload in every zone of Tigray when the suspension began on 30 March.

As noted in the above email, the first stage of the aid suspension was to last two weeks. This was a painful exercise but would have reflected ‘good practice’ on the important condition that the suspension was not applied to individuals and households who did not receive rations over the past two months.

This should have made Mekelle almost entirely exempt from the aid suspension. Newly displaced households should have also been exempt.

Uneven Distribution

After the resumption of fighting on 24 August 2022, hundreds of thousands of displaced Tigrayans converged on Mekelle to be safe from military occupation and close to primary depots of humanitarian aid.

Some are living with family, others in communal spaces with no running water or electricity. Those more fortunate are in better equipped IDP camps built by the International Organization for Migration (IOM) and partners after the first invasion of Tigray in 2020. Some were receiving food aid, others were not.

When the suspension began on 30 March, only around 126,000 people in Mekelle had received a six-week food ration in the past eight weeks and 120,000 of these received their ration during the week ending on 29 March.

Mekelle is also an area of Tigray where the total people in need almost certainly exceeds the WFP target. As shown in the two images below, the target for Mekelle in the last completed round was unchanged from the one set prior to the most recent mass displacement event that brought hundreds of thousands of displaced civilians to Tigray.

The true number of people in urgent need of food assistance in Mekelle is unknown, but it’s certainly higher than it was before the resumption of fighting in Tigray.

Mekelle is not the only place in Tigray where starving people were missed by the last food distribution round. The last official figures from IOM showed that the town of Sheraro in the Northwestern Zone was host to nearly as many IDPs as Mekelle. More recent, unofficial figures shared with the author by an aid worker in Shire put the current population of IDPs in Sheraro at 140,000.

If there was significant theft of food aid in Sheraro, the WFP should have immediately sought alternate means of getting food to the people there. In areas like Enda Baguna, an estimated 37,000 people arrived recently and had not received any food.

This also may have been the case in several areas of the Eastern Zone documented in a UN High Commissioner for Refugees (UNHCR) report that was only available between 3 to 8 March, after which it was inexplicably removed from the website.

Worsening Conditions

Under the conditions outlined above, a temporary suspension of food distribution by the WFP and USAID would not likely have resulted in preventable death.

Due to the uneven distribution of aid during the surge prior to 30 March, however, the number of rations distributed in the Northwestern Zone in the previous six weeks still exceeded the total caseload for this zone, but levels plunged dangerously across the rest of Tigray.

Still, with the exception of Mekelle and the Western Zone, the number of food rations distributed in every other zone of Tigray over the previous two months was close to or exceeding the total caseload. Even if food distribution was only able to resume on a limited basis that was below the minimum need in Tigray, international humanitarian groups should have restarted aid, particularly in Mekelle.

While aid provision did resume around 19 April and a small amount of aid was distributed thereafter in Mekelle, this was only for a matter of days and aid was then halted once again. It wasn’t until the day after the Associated Press reported on 1 May that food distribution in Tigray had stopped that the WFP and USAID confirmed the suspension publicly.

Starvation-related deaths were the predictable outcome of the new iteration of the suspension. Note in the chart below from 3 May the severe drop in the percentage of people who received the food aid they so urgently needed in the prior six weeks compared to the prior two months.

Since then, the people of Tigray have found themselves in a tragically familiar position. It was logistically possible to deliver food to most of those who were known to be in urgent need of outside food assistance, but manmade obstacles had been constructed to deprive even the most vulnerable from accessing aid. Every IDP hosting site in Tigray and every host community was completely cut off from the food they needed to survive.

According to Northwestern Zone Interim Administrator Teklay Gebremedhin, more than one hundred starvation-related deaths have already been reported at IDP hosting sites in that zone in the past three months, but the figure is likely much higher. The very young are particularly vulnerable, as evidenced by recent reports of a 28 percent increase in starvation related deaths in children under five in Tigray.

Broadened Suspension

After the complete meltdown of the humanitarian response in Tigray, USAID and the WFP announced on 8-9 June, respectively, that not only would the suspension of food assistance continue in Tigray, but it would also be expanded to the entire country.

The implications of this latest version of the aid suspension are immeasurable for the tens of millions of Ethiopians who need outside food assistance to survive the historic drought that has gripped the Horn.

As shown in the chart below, the overwhelming majority of people in Tigray who are known to need food assistance did not receive anything during the three months prior to 7 June.

If the suspension of food distribution in Tigray continues until next month, the 12,653 IDPs who received food in Mekelle during those few days in April when the suspension was lifted will be the only people in the region who have received food assistance in the past three months. The following week, the number will be zero.

Siege Revived

The causes of Tigray’s famine conditions reflect a deliberate wartime strategy, as documented most recently in a comprehensive report by Yale Law School’s prestigious Allard K. Lowenstein International Human Rights Clinic.

The Yale study complemented the work of the International Commission on Human Rights Experts on Ethiopia (ICHREE), which found in September 2022 that the Ethiopian government, the Eritrean military, and allied militia and regional forces laid siege to Tigray’s civilian population during the two-year war.

While the ICHREE investigation covered a full spectrum of human rights abuses in Tigray, Amhara, and Afar, the Yale study focused solely on the siege. Specifically, the Lowenstein team found that:

“Ethiopian federal government and allied forces have extensively looted food, water, and health-care systems in Tigray, imposed a siege that has decimated civilian life in Tigray, and denied the passage of humanitarian relief to civilians in need in Tigray.”

During this time, the federal government tried to strangle Tigray by blocking food from reaching starving families, but it never truly succeeded. Dozens of aid workers lost their lives, considerable resources were spent, and endless rounds of negotiations and broken promises brought aid levels up to a trickle.

The Lowenstein Clinic’s analysis ended before the reports of food diversion broke in March and the suspension of food aid began. Currently, the siege of Tigray described in its determination is confined to areas along the borders with Eritrea and the Amhara region.

The rest of Tigray has subsequently been cut off by the WFP and USAID, as the Ethiopian government’s “law enforcement” campaign designed to defeat the rebels by starving all of Tigray has been replaced by the suspension of food aid by the very agencies who are entrusted to deliver humanitarian aid.

The cruel reality is that, despite its efforts, the Ethiopian government never managed to suspend food assistance so completely as we have witnessed since late March.

Responsibility Abdicated

It’s important to note that the combined WFP/Ethiopia Joint Emergency Operation Program (JEOP) caseload of 5.3 million people does not cover everyone who is starving in Tigray.

It has become obvious by now that the UN-IOM cannot account for a significant number of IDPs and the WFP and JEOP have both been unable to reach many of them with food aid, even those in large population centers like Shire, Adigrat, and Mekelle.

Additionally, as mentioned previously, there are still large areas of Tigray, like the Western Zone and districts along the northern border, that remain occupied by Eritrean and Amhara forces. Both have made illegal and unconstitutional claims over Tigray’s territory and, according to plentiful evidence, have committed – and continue to commit – ethnic cleansing and blocked humanitarian aid from reaching innocent Tigrayan families who couldn’t flee these areas.

This is happening in clear view of:

1. The AU monitoring team, which is tasked by the Pretoria Agreement to monitor humanitarian access in Tigray.
2. The UN Office for the Coordination of Humanitarian Affairs, which has a standing obligation to oversee international aid in Tigray and everywhere else they operate.
3. Multilateral human rights bodies like the UN Human Rights Council, the UN Mandated ICHREE, the International Criminal Court, as well as unilateral agencies like the U.S. State Department’s Bureau of Human Rights, Democracy, and Labor.
4. The Ethiopian federal government and the Tigray interim government, which are responsible for the human rights of every single person inside its borders.
5. And, the UN Security Council, the U.S. government, the European Parliament, the UK Parliament, and other donors, which each have specific mandates that call them to action to stop weaponized starvation and to prevent the misuse of their humanitarian funding.

Each of the overseers of aid listed above are designed to operate independently of one another and have the human rights and humanitarian condition of Tigrayan civilians at the core of their charters, constitutions, and legal frameworks.

The failure of the humanitarian response in Tigray reveals the profound weakness of the international system. The lack of transparency from the USAID and WFP has caused a crisis of confidence that is being felt from the IDP camps of Tigray to the halls of the U.S. Capitol.

For the past three years, starvation and civilian deaths in Tigray have been normalized and accepted across a broad spectrum of influential actors. This continued indifference could result in further devastation for long-suffering Ethiopians.

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Main Image: Sharing a meal; Tigray, 1 April 2014; Rod Waddington.

This is the author’s viewpoint. However, Ethiopia Insight will correct clear factual errors.

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Addis Abeba – The International Committee of the Red Cross (ICRC) said critical infrastructures including health facilities and water systems have been seriously affected in the Oromia region due mainly to the ongoing violence.

The Committee said on 22 June, nearly all 42 existing health posts have been looted or damaged in Begi, a district of 100,000 inhabitants in the West Wollega zone in conflict ravaged Western Oromia. Patients with life-threatening medical conditions cannot receive urgent care because health facilities are no longer functioning in the district according to the press release.

“We have a shortage of emergency drugs. No operating room sets. We do not have beds. And now there is also a shortage of water supply due to the damage to the water reservoir. The community pharmacy was also destroyed, and all the drugs and materials were taken,” Dr Alemayehu Kiri, Guduru Primary Hospital`s medical director, said.

The walls of the hospital, which serve more than five districts, were riddled with bullets, and its water tank was damaged. Beds, equipment, surgical sets, medicines, and ambulances were looted, ICRC further sad.

Following an increased influx of people who fled their homes to the area, the number of patients has risen drastically making it extremely difficult for staff to provide healthcare services to the population, it stated.

Despite the extension of operations to the western part of the Oromia region and to Guji, the capacity of the ICRC and the ERCS is overstretched in their efforts to provide protection and assistance to populations most affected by the violence in areas where few if any other humanitarian organizations operate in Western Oromia.

“We have had to make difficult choices, targeting places with little presence of other humanitarian actors,” said Julian Jaccard, the ICRC head of sub-delegation in Nekemte. “People in these areas have suffered immensely and for a long time.”

In May, the UN Office for Coordination of Humanitarian Affairs (OCHA) said the humanitarian situation in East and West Wollega zones of the Oromia regional state has shown to worsen due to continued insecurity from conflict since 2020. Even though there is improved access, about 859,000 displaced people are in need of protection and other multi-sectoral support, OCHA said in its latest situation report on Ethiopia.

The ICRC said since January 2023, it has assisted 62,800 people with food, household supplies, shelter, and cash in the Oromia region. Furthermore it regularly supported 12 health facilities with medical supplies and equipment, helped 32,500 people restore or maintain family links, facilitated access to clean water for 187,000 people, including those in detention places. AS

Technology is transforming the digital economy, and digital financial services (DFS) are vital facilitators. DFS is expanding access to and use of financial services, emphasizing affordability and improving access to credit through a new digital lending system. As a result, new environments have been established to meet more demanding clients, with neo-banking being the new paradigm threatening brick-and-mortar banking.

Financial service digital technology innovators are driving growth, and the market is changing rapidly. DFSs are a critical enabler of a digital economy in which access to finance is essential. FinTechs, in alliance with commercial banks and microfinance institutions, are increasing access to and usage of financial services while emphasizing affordability. They are also setting new trends by fostering access to credit through a new digital lending scheme.

Ethiopia has 1.3 million registered vehicles, of which 84 Pct are used in the transport business. The ride-hailing industry provides an estimated 90,000 rides daily, using mobile technologies. Petroleum products are imported for USD 3 billion, increasing the demand for gasoline by 14 Pct on average per year. In this article, EBR’s Bamlak Fekadu assesses the landscape of the growing digitalization of the Ethiopian economy with an emphasis on digital payment systems.

On April 1, government officials and ministers from the Ministry of Transport (MoT) and the Ministry of Trade and Regional Integration (MoTRI), gathered at the National Oil Company’s pump station around Sarbet in Lafto District to launch a pilot initiative to fully digitize the fuel retail industry’s transactions.

The program was officially launched by the Minister of the MoTRI Gebremeskel Chala, Alemu Sime (Ph.D.) Minister of Transport and Logistics, and Ethio Telecom’s CEO Firehiwot Tamiru.

The initiative aims to reduce corruption and increase transparency in the fuel retail industry by eliminating cash transactions. Customers will be able to pay for fuel using mobile money, credit or debit cards, or other digital payment methods.

The Fuel and Energy Regulatory Authority, a government regulatory body with full jurisdiction in

the region, has issued an important announcement requiring cashless transactions at the Capital and nearby pump stations starting April 24. This announcement comes one week after the pilot initiative started.

The authority emphasized the need for all gas stations and fuel businesses in the capital to make the necessary preparations for the introduction of digital payment for fuel transactions.

Additionally, all pump stations nationwide must abide by the regulation beginning in July 2023. The government’s effort to modernize the fuel industry will not only improve the country’s fuel retail sector but also support the development of other industries. The government is committed to investing in technology and innovation to drive economic growth and development. By promoting digital financial services, Ethiopia can increase financial inclusion and improve access to financial services for its citizens.

At the official launch ceremony, Alemu Sime said that the initiative was motivated by the need to create a well-organized framework that is integrated with a gasoline allocation and registration system at all of the stations in the nation, allowing the government to control the fuel market, which is rumored to be smuggling fuel into the black market. According to him, this is due to the government’s sizable investment in fuel purchases and subsidies, which lowers the country’s retail price in comparison to neighboring nations. ⁠⁠⁠⁠⁠⁠⁠

In this regard, the Ethiopian Petroleum and Energy Authority is also acquiring a new system to digitally regulate the petroleum market. Once it is fully automated, industry actors such as stations, fuel trucks, and depots will be able to share real-time data with the Authority.

“Electronic payments will modernize the marketing system and control the fuel subsidy to prevent economic pressure,” Alemu said.

According to Frehiwot Tamiru, CEO of Ethio Telecom, the transaction will be made conveniently through the QR code generated by the telecom’s digital payment system Telebirr, which has been upgraded to a super app last month. Frehiwot sees the launch of a digital payment system as having great value. The connectivity coverage of the 5G network reached 99.1Pct, ensuring the infrastructure’s reliability to support the payment system.

“The platform will reduce the risks involved with cash transactions while also improving transparency and accountability,” Frehiwot said. “It is hoped that it will boost financial inclusion in the nation, lower operational costs, and increase efficiency.”

Although several digital payment options have emerged, the retail of gasoline has traditionally been associated with cash-based transactions, which enable theft and fraud. Despite the announcement of the government, the electronic payment modalities dedicated to the fuel retail industry are just two.

As of mid-last year, around a quarter of a million public transport vehicles covered by the fuel subsidy programs had been settling their payments through Telebirr. In the past nine months, more than ETB 30 billion worth of fuel transactions have been made through Telebirr.

Nedaj is an alternative payment platform designed for fuel payments, developed by EagleLion Systems Technology and provided to the Commercial Bank of Ethiopia (CBE) last year. Nedaj is a digital fleet management and fuel purchasing solution that allows the 28 commercial banks to integrate, which adds convenience for both the banks and customers. The Nedaj application features bill generation, GPS, and direct payment from a personal account. So far, the platform has registered over 900 fuel stations nationwide and started operating transactions.

With the introduction of the national digital payment strategy, Ethiopia has started its journey to the fourth industrial revolution. The strategy focuses on the development of a reliable, inclusive, and interoperable infrastructure, building a consistent regulatory oversight framework, and creating an enabling environment for innovation.

The national digital payment system has prioritized achieving efficient ATM and POS interoperability, boosting digital retail payment systems, strengthening consumer protection and cybersecurity, and digitizing government and state-owned enterprise payment modalities In response to the amendment of the ten-year-old payment system proclamation, the National Bank of Ethiopia recently updated the Payment Instrument Issuer (PII) Directive, which has been governing the mobile money industry for the past two years. The revised directive has not yet been tested in practice, but additional modifications might be required to ensure the success of mobile money services in Ethiopia. The government of Ethiopia has also implemented policies to support the growth of the digital economy, including tax incentives for tech startups and investments in infrastructure.

Over the past ten years, a variety of digital-only banks have emerged, converting traditional brick-and-mortar and physical banking to digital. Neobanks, also known as challenger banks, offer modern banking options that are optimized for smartphones and the digital age. Fintech solutions are accelerating the financial industry by introducing premium conveniences for accessing daily banking operations via a computer or mobile device and enabling cashless transactions at a wide range of retailers.

Bank of Abyssinia (BOA), one of the pioneer private commercial banks committed to offering digital services, recently launched a fully packaged neo-banking platform dubbed “Apollo” which allows customers to create their own accounts remotely via smartphones. Apollo features a virtual card, instant settlement, deals, and discounts of up to 15 Pct.

Such interfaces are created with the goal of increasing financial inclusion and assisting banks in cutting costs by minimizing queues, and paperwork while reducing the total number of bank branches and associated costs. The bank also introduced “Banking on Wheels,” an innovative concept that involves the use of mobile bank branches that can move from one location to another, typically providing banking services to groups that would not have access to traditional branches.

Abyssinia’s mobile banking app, BOA Mobile, was upgraded on February 17, 2023. The new version aims to enhance the user interface (UI/UX), simplify activation, and offer biometric verification. Many users, however, preferred the older version of the application and considered the new version to be more troublesome than the previous one. The bank’s app has received over 100,000 downloads from Play Store. Also, the bank transitioned its core system to the latest Temenos T-24, a widely used digital core banking solution.

A preliminary report presented to business reporters by Precise Consult, a private consulting company in Ethiopia, shows that lending by the banks is limited to the rich and state-owned companies. According to recent reports, only about six million of the country’s 110 million residents have access to credit from banks and MFIs, which have the lowest performance rates at 5.45Pct. There are approximately 350,000 commercial bank borrowers, of which most are concentrated in Addis Ababa, making up 0.318 Pct of the total nation’s population.

An industry insider suggests that the reported number of borrowers may not accurately reflect the true number due to business people’s tendency to borrow from multiple banks. This trend of borrowing from multiple banks may lead to a higher number of borrowers than reported, suggesting that the rate may be lower than 0.318 percent.

“Due to the trend, there is a potential need for better coordination and information sharing databases among banks,” an industry insider says. “This concentration of borrowers in Addis Ababa emphasizes the urgency for greater availability of financial services in rural areas.”

This indicates a significant gap in financial inclusion and highlights the need for innovative solutions to expand access to credit for the majority of Ethiopians who are currently excluded from formal financial services.

The adoption of digital lending services by Fintechs has helped the DFS sector grow. Currently, banks and system developers are among the major players setting milestones on DFSs, alongside Fintechs like Telebirr, Chapa, Kacha, and Kifiya. ⁠⁠⁠⁠⁠⁠⁠

The growth of DFSs was described as impressive in Cepheus Capital’s publication on the digital economy of Ethiopia. Digital channels are used by commercial banks to process approximately 500,000 customer transactions per day, totaling about ETB 260 billion, or about 8% of the global gross domestic product (GDP).

As of 2020, Cepheus estimated that Ethiopia’s primary group of digital economy companies would generate net revenues of ETB 5 billion, or 10% of the country’s GDP, from the digital economy market, which had a gross transaction value of ETB 350 billion.

Dashen Bank, a pioneer in the private banking sector, has introduced a short-term consumer financing platform through a buy now, pay later scheme dubbed DubeAle, which is among the emerging digital lending platforms developed by EagleLion system technology. The bank is providing the service at all of its branches across the country. Within two months of its launch, DubeAle has received over 20,000 Play Store downloads, and thousands of merchants have signed up. The platform offers a spending cap that permits users to buy large quantities of goods worth up to ETB 700,000. Additionally, subscribers have the option of splitting the cost of their purchases into three to six and a half installments.

According to Bersufikad Getachew, CEO of the EagleLion system technology, Dube (loosely translated to credit) has been a practice in Ethiopian society for centuries, through which merchants provide loans in the form of goods. Thus, the development is an upgrade and integration of this traditional credit system with financial institutions.

“DubeAle was created with the intention of relieving society’s stress caused by the stressful effects of skyrocketing inflation and the sharply declining purchasing power of money, which has caused society to regress,” Bersufikad said.

The number of banks and microfinance institutions located in Ethiopia has increased significantly in the past ten years, but only 10 Pct of households have access to formal credit, and only 1% of people living in rural areas have bank accounts. A consumer financing service known as “buy now, pay later” that connects customers with retailers and the financial industry had a global market size of USD 90.69 billion in 2021 and was expected to grow to USD 3.98 trillion by 2027.

Digital lending, which is characterized by its remotely managed, automated, and fast loan evaluation and disbursement capabilities, has grown significantly in the Ethiopian financial services industry. To cut expenses, loan collection is also automated. However, the availability and effectiveness of supporting frameworks like credit scoring systems and trustworthy forms of identification are essential to the efficient operation of digital lending.

Ethio Telecom is a pioneer in digital lending, with two million users accessing airtime credit every month. In two years, Telebirr has attracted 30 million users, 101 thousand agents, and 28 thousand merchants, connected with 19 commercial banks, and generated USD 1.95 million in foreign remittance. The recently launched Telebirr Mela (microcredit) has disbursed ETB 2.1 billion to 1.4 million users and enabled ETB 1.7 billion in deposits in Telebirr Sanduq. Michu is Ethiopia’s first uncollateralized digital lending product, powered by Kifiya Financial Technology’s Qena, and was able to recoup the 130 million it loaned.

Michu, the uncollateralized digital lending product of the Cooperative Bank of Oromia (COOP), has disbursed over 200 million birr in loan facilities since its launch in May 2022. The loans are intended to meet the operating cash needs of roadside vendors and micro businesses that are underserved by traditional collateral-based lending.

Kacha’s Mobile Money Platform, in collaboration with banks, microfinance institutions, and Saving and Credit Cooperative Organisations (SACCOs), will provide cashless transactions through 30,000 agents in Ethiopia. Services include opening mobile accounts, cashing in and out, fund transfers, bill payments, unsecured microcredits, direct payments, bill payments, airtime top-ups, card payments, international remittances, micro-savings, and micro-insurance.

Chapa, whose name translates to “money” in Ethiopian youth slang, is one of the tenacious and anticipated Fintechs which also pioneered digital lending.

Ethiopia’s digital economy has been hindered by poor financial institution interoperability, cash-based online transactions, a dearth of functional digital payment gateways, and a small selection of FinTech products. Chapa is driven to find solutions to these issues.

Chapa created and launched Eyezon, a fundraising initiative that raised more than USD 6 million for internally displaced Ethiopians and conflict-affected health institutions. This generated 23 Pct of Ethiopia’s foreign exchange inflows in 2021-22. In addition, it raised USD 300,000 for the Great Ethiopian Renaissance Dam (GERD) in collaboration with Ethiopian Electric Power (EEP), Flutter Wave, and Zemen Bank.

Chapa was created in 2020 when the National Bank of Ethiopia (NBE) opened the Fintech field for digital companies. The business acquired its Payment Gateway license from the NBE in May 2022 and has already begun enrolling merchants. It is not without competition, however, as it is the third payment gateway company to receive a license following ArifPay and SunPay.

Chapa formed a partnership with Mila-Quebec Artificial Intelligence Institute, the world’s largest deep learning institute, enabling it to further research within the AI and machine learning world to allow financial inclusion for SMEs and businesses.

The country’s DFS industry and Fintechs are drawing global corporations, organizations, and venture capitalists to invest in these new enterprises, including the UN Capital Development Fund, Mastercard, and others. Only a small sum of money—roughly USD 40 million—has been invested in the digital economy by equity investors, with another USD 20 million coming from donations. Ethiopia’s proportion of global flows has been minimal, and the average quantity of money has been quite small.

According to a report published by Disrupt Africa, African Fintechs received one billion dollars in funding in 2021. 80 Pct of the funding went only to four countries only: Nigeria, South Africa, Egypt, and Kenya.

Ethiopia’s telecom and mobile coverage have significantly increased due to fee reductions for fixed broadband and internet services. By 2025, Ethiopia’s digital economy could account for up to 39 Pct of the nation’s total GDP. Ethio Telecom’s network reached 70 million subscribers by the end of December 2022, with an increase of 9.2 million new customers since the beginning of July 2022.

Cepheus Capital classifies Ethiopia’s digital economy landscape into four segments: finance, ride-hailing, e-classifieds, and media. With these being the are the most successful, they are followed by e-commerce and delivery services. E-government services are among the most successful digital disruptors, followed by B2C business models. Current service offerings are marked by high geographical concentration, narrow technology types, and limited forex generation.

Ethiopians rely heavily on cash transactions despite the recently introduced cash-holding restrictions. The recent currency change has brought over 30 billion birr into the banking system. But by the second quarter of 2021/22, currency circulating outside the banking system reached ETB 158 billion.

“Nowadays, commercial banks are facing severe liquidity issues, limiting customers’ withdrawal,” said an industry insider. “This scenario shows the importance of DFS.”

The Cepheus forecast shows that the size of digitally transacted economic activity will show a nine-fold increase by 2025, reaching just above an ETB trillion or 39Pct of the GDP. The largest revenue pools would likely remain within digital finance and telecom services, followed by marketplace platforms, transportation, and digital media. Several companies in the digital finance, ride-hailing, and digital media space could see ETB 1 billion valuations in a few years’ time.

11th Year • May 2023 • No. 117 EBR

By Abdi Biyenssa   @ABiyenssa

Addis Abeba – A new research titled “Double Burden”, conducted under the Werdwet Research Fellowship of the Center for Advancement of Rights and Democracy (CARD) reveals that inclusive education has been hampered by political instability in the Oromia region.

The research which was authored by Hiywot Samuel over the past one year, and released on Friday last week covered how political instability in Oromia post 2018 affected inclusive education in five towns; Shashemene from West Arsi zone, Nekemte from East Wollega zone), Haramaya from East Hararghe zone), Bedele from Buno Bedele zone, and Ambo from West Shewa Zone.

According to the research, political instability has frequently hampered the implementation of inclusive education which is still in its infancy in Ethiopia, despite laws that recognize it, and “no steps are taken to fulfill this entitlement”.

Students with disabilities attend general education with pupils who are not disabled, without their unique requirements being satisfied, the research stated, adding that these pupils are enrolled in classes and school buildings that are unavailable to them physically and the schools do not use alternative teaching methods, nor do they have accessible teaching and learning materials.

Provision of commodities like assistive technology and other reasonable accommodations required for students with disabilities is affected by the substantial inflation caused as a result of the political unrest in the region, the research said. 

The research also points out that due to the political unrest and worries about unintended consequences, NGOs and other non-profit organizations that aid Students with Disabilities in schools by providing assistive gadgets and making schools physically accessible in other regions of the nation were unable to come and do the same in the research areas. 

The researcher Hiywot pointed out during the launch of the research that in Nekemte and Bedele, no single nongovernmental organization (NGO) is working on the subject of people with disabilities in general and disability-inclusive education in particular because of the political unrest. 

Even more challenging is putting inclusive education for people with impairments into practice. During her research, Hiywot who is visually impaired herself noted the difficulty of implementing inclusive education in Shashemene town due to lack of resources and other issues, and that the political unpredictability made matters worse.

Also, the research findings stated that during strikes, or rallies, schools may occasionally be shuttered for a week or two, and the majority of disabled students do not return to school when the doors reopen because, in the first place, their families do not send them back, and the students themselves do not want to return because they are afraid that the protests may resume and get them into trouble.

Her research findings also assert lack of budget for inclusive education, and noted that even the meager budget that had been set aside was used to finance the conflicts.  AS

Addis Abeba – Ethiopian Navy has graduated its members trained in various professional fields, including in Navigation, Engineering, Electricity, Communication and Armament Department for two years, state media reported.

Having been reorganized after 31 years, the Ethiopian Navy said its members who graduated today have been trained by foreign and domestic instructors in various fields.

In February last year, Ethiopian navy officials briefed a vising Russian navy delegation that works were underway to reorganize the navy unit with trained manpower based on other countries’ navy unit and Ethiopia’s previously existing experience, as well as the national mandate given to it, which has been approved and put into operation by the Defense Forces. An agreement was also reached with the Russian Federation Navy to work together in various fields of training.

A month later, Rear Admiral Kindu Gezu said that Ethiopia was building a navy capable of countering internal and external attacks. The Commander-in-Chief said this during a tour he conducted to the Navy Basic Training School located in Bishoftu, Oromia state, on 24 March where he discussed with the students. He told the trainees that in order for Ethiopia to benefit from its navy, they must effectively complete their training being offered both at home and different countries abroad

Today’s graduation ceremony was attended by the Chief of Staff of the Ethiopian National Defense Forces (ENDF), Field Marshal Berhanu Jula, the Chief of the Ethiopian Naval Force, Rear Admiral Kandu Gezu, and other senior government officials.

Ethiopia is a landlocked country in the Horn of Africa that shares borders with Eritrea, Somalia, Kenya, South Sudan, and Sudan. AS

A number of official reports indicates that Genetically Modified Organisms (GMOs) are not essential for feeding the world, but if they were to lead to increased productivity, did not harm the environment and did not negatively impact biodiversity and human health. The fact is that GMO technology would still be owned and controlled by certain very powerful interests. Several scholars strongly argued that, in their hands, this technology is first and foremost an instrument of corporate power, a tool to ensure profit.
Professor Michael Hudson, a well known American Professor in International Economic Relations argued that, American foreign policy has almost always been based on agricultural exports, not on industrial exports as people might think. It’s by agriculture and control of the food supply that American diplomacy has been able to control most of the Third World. Professor Michael Hudson further noted that the Project for a New American Century and the Wolfowitz Doctrine show that United States foreign policy is about power, control and ensuring global supremacy at any cost, and part of the plan for attaining world domination rests on the United States controlling agriculture and hijacking food sovereignty and nations’ food security.
In his book ‘Seeds of Destruction’, William Engdahl traces how the oil-rich Rockefeller family translated its massive wealth into political clout and set out to capture agriculture in the United States and then globally via the ‘green revolution’. GMOs represent more of the same due to the patenting and the increasing monopolisation of seeds by a handful of mainly United States companies, such as Monsanto, DuPont and Bayer.
Findings of a report by researchers at Cambridge University in the UK indicated that in India, Monsanto has sucked millions from agriculture in recent years via royalties, and farmers have been compelled to spend beyond their means to purchase seeds and chemical inputs. The report also indicated that a combination of debt, economic liberalization and a shift to GMO cash crops such as cotton, has caused hundreds of thousands of farmers to experience economic distress, while corporations have extracted huge profits. BBC reported by quoting an official figures as of 2013 that over 270,000 farmers in India have committed suicide since the mid to late nineties.
Agriculture is the bedrock of many societies, yet it is being recast for the benefit of rich agritech, retail and food processing concerns. Official report released by GRAIN recently stated that small farms are under immense pressure and food security is being undermined, not least because the small farm produces most of the world’s food. Whether through land grabs and takeovers, the production of non-food cash crops for export, greater chemical inputs or seed patenting and the eradication of seed sharing among farmers, profits are guaranteed for agritech corporations and institutional land investors.
Vandana Shiva, a noted Indian social activist argued that the dominant notions that underpin economic ‘growth’, modern agriculture and ‘development’ are based on a series of assumption that betray a mindset steeped in arrogance and contempt: the planet should be cast in an urban-centic, ethnocentric model whereby the rural is to be looked down on, nature must be dominated, farmers are a problem to be removed from the land and traditional ways are backward and in need of remedy.
She stated that Western corporations are to implement the remedy by determining policies at the World Trade Organization, IMF and World Bank with help from compliant politicians and officials, in order to depopulate rural areas and drive folk to live in cities to then strive for a totally unsustainable, undeliverable, environment-destroying, conflict-driving, consumerist version of the American Dream.
According to Vandana Shiva, it is interesting and disturbing to note that ‘developing’ nations account for more than 80% of world population, but consume only about a third of the world’s energy. United States citizens constitute 5% of the world’s population, but consume 24% of the world’s energy. On average, one American consumes as much energy as two Japanese, six Mexicans, 13 Chinese, 31 Indians, 128 Bangladeshis, 307 Tanzanians and 370 Ethiopians.
Professor Arundhati Roy of Indonesia stated that despite the environmental and social devastation caused, the outcome is regarded as successful just because business interests that benefit from this point to a growth in GDP. Chopping down an entire forest that people had made a living sustainably from for centuries and selling the timber, selling more poisons to spray on soil or selling pharmaceuticals to address the health impacts of the petrochemical food production model would indeed increase GDP. It’s all good for business. And what is good for business is good for everyone else, or so the lie goes.
Food policy analyst Devinder Sharma adamantly argued that the ‘green revolution’ and now GMOs are ultimately not concerned with feeding the world, securing well-rounded nutritious diets or ensuring health and environmental safety. Biotechnological innovations have always had a role to play in improving agriculture, but the post-1945 model of agriculture has been driven by powerful corporations like Monsanto, which are firmly linked to Pentagon and Wall Street interests. Motivated by self-interest but wrapped up in trendy PR about ‘feeding the world’ or imposing austerity to ensure prosperity, the publicly stated intentions of the United States state-corporate cabal should never be taken at face value.
Devinder Sharma further noted that, in India, Monsanto and Walmart had a major role in drawing up the Knowledge Initiative on Agriculture. Monsanto now funds research in public institutions and its presence and influence compromises what should in fact be independent decision and policy making bodies. According to Devinder Sharma, Monsanto is a driving force behind what could eventually lead to the restructuring and subjugation of India by the United States. The IMF and Monsanto are also working to ensure Ukraine’s subservience to United States geopolitical aims via the capture of land and agriculture.
William Engdahl in the above mentioned book stated that only the completely naive would believe that rich institutional investors in land and big agribusiness and its backers in the United States State Department have humanity’s interests at heart. At the very least, their collective aim is profit. Beyond that and to facilitate it, the need to secure United States global hegemony is paramount.
According to William Engdahl, the science surrounding GMOs is becoming increasingly politicized and bogged down in detailed arguments about whose methodologies, results, conclusions and science show what and why. The bigger picture however is often in danger of being overlooked. GMO is not just about ‘science’. As an issue, GMO and the chemical-industrial model is linked to ultimately a geopolitical one driven by power and profit.

Addis Abeba – Farmers in Kola Tembien in Central Tigray, one of the major battle grounds during the two years destructive war between Ethiopian government and the Tigrayan forces are unable to get back to their livelihood, farming, even seven months after the war was ended through negotiated settlement, as a result of landmines and explosives buried in the area during the war.

According to the UN’s Mine Action Service (UNMAS), totals of 726 square kilometers of land in Ethiopia remain contaminated of landmines and explosive remnants of war (ERW) from several internal and international armed conflicts occurred throughout the country’s history.

The recent war in the country’s North has added new explosives contamination that poses an immediate threat to life and livelihoods, the UNMAS said in 2022.

“Over 280 casualties have been reported in Northern Ethiopia since the beginning of the conflict, although not all cases have been verified – but it is believed that many other accidents go unreported. Initial analysis shows that children make an alarming majority of casualties (57%),” it stated.

A latest report issued months ago by the Tigray Humanitarian Action Unit and non-governmental Rehabilitation and Development Organization (RaDO) on the status of landmines and ERWs in Tigray, said hundreds of people died and hundred others injured following incidents of explosion of ERWs.

The report which was obtained and reviewed by Addis Standard notes that plenty of landmines and explosive remnants of war, light and heavy weapons remain in areas where active military engagements took place and, are putting lives of people at a great risk.

90% of the total incidents have occurred in remote rural areas and 45% of the explosive stricken areas are farmlands, the report added.

In Kola Tambien, three individuals have lost their limbs and several animals have died following multiple such incidents in a local village in the district, according to Gezahegn Ambiza, the village chief.

“Eights households are completely unable to farm for the third consecutive years, while others’ farming activities are partially limited due to the explosives. We reported to the regional agriculture bureau but, didn’t get response as of yet” said Gezahegn.

Gebremedhin Gebrehiwot, 30, a farmer, owns hectares of farm land which he used to plant wheat, barley and other cereals before the war. Despite the return of peace to the once battle ridden area since November last year, he is unable to return to farming given the fact that the area hasn’t been cleared of explosive remnants.

“I cannot resume farming, unless the explosives are removed from my farm land by professionals. This has made me and my family suffer from socio-economic problems. I am now working as a daily laborer to ensure the survival of my four children because I have no other option, and it is psychologically traumatizing. Besides, I have fears it may explode one day and kill my children,” Gebremedhin said.

“The rainy season has already started, and farmers should have been on their farm lands by now, we need a timely solution before the season ends,” Gezahegn noted.

Even though there is no comprehensive survey, farmers in other parts of Tigray are enduring same problems. Atakilti Arefe, economic adviser and agriculture coordinator at the Eastern Zone in Tigray told Addis Standard that, countless hectares of farmland remain uncultivated in the zone, explosives threats being one of the reasons.

According to Atakilti, farmlands remain dry in districts of the Eastern Zone such as Irob, Bulemekeda, and Gantashum are among other districts, whereas in other areas, farmers need agricultural inputs including oxen, seeds and fertilizers etc. because most of their properties were looted and destroyed during the war.

This has exacerbated the already dire food crisis, and there is high demand for food aid, amidst suspended food aid distribution, Atakilti added.

In September 2022, UNMAS said it seeks $2.5 million to scale up its humanitarian mine action intervention in Northern Ethiopia and provide the necessary technical assistance and capacity development intervention for the Ethiopia Mine Action Office. AS

Wim Vanhelleputte. Photo: Uganda Securities Exchange/Archive

Addis Abeba – Safaricom Telecommunications Ethiopia PLC (STEP) gets a new Chief Executive Officer to replace its outgoing CEO, Anwar Soussa, who will depart the company effective 31st July 2023.

The telecommunication company announced that Wim Vanhelleputte will be the new CEO effective 1st September 2023.

“Wim brings extensive leadership experience and deep industry knowledge, having worked in the telecommunications industry across multiple markets in sub-Saharan Africa for over 25 years,” Safarcom PLC said.

He joins Safaricom Ethiopia from MTN Group, where he was the Operations Executive – Markets since August 2022 and was responsible for the performance and governance of four operating companies in West and Central Africa, the announcement added. Prior to that he was the CEO of MTN Uganda, a role he held from 2016.

“Wim brings extensive leadership experience and deep industry knowledge, having worked in the telecommunications industry across multiple markets in sub-Saharan Africa for over 25 years,” Safaricom PLC said.

According to Ugandan media, during his tenure that MTN Uganda the company “recorded tremendous growth, with the subscriber numbers surging from merely 8.5million to 16million. It also doubled the network towers to 3000 sites countrywide to boost service delivery to the customers. Similarly, revenue grew by 75% during the same period under review.”

Other portfolios he held include, CEO of MTN Cote d’Ivoire and Cluster CEO for Airtel DRC and Congo.

The Belgian national began his career as an Associate Engineer at Westinghouse Energy Systems Europe in Czech Republic, before joining Siemens Atea as a Project Engineer in Zimbabwe, then as a Residential Project Manager in Gabon, according to Safaricom PLC. “As Wim joins us, we have planned for a seamless transition to ensure that we maintain our momentum so far in delivering our vision to transform lives through a digital future for all Ethiopians.”

Wim will join Safaricom Ethiopia in the backdrop of a major announcement by the World Bank Group’s International Finance Corporation (IFC) and Multilateral Investment Guarantee Agency (MIGA) earlier this of plans for a $157.4 million equity investment in Global Partnership for Ethiopia BV (GPE) and a $100 million A-loan to its wholly owned subsidiary, Safaricom Telecommunications Ethiopia Private Limited Company (Safaricom Ethiopia).

The decision came less than a months after the National Bank of Ethiopia (NBE) issued a mobile money service license on 11 May to Safaricom M-Pesa Mobile Financial Service Plc, making it the first foreign investor in the industry to get licensed. AS

Ethiopians have had a difficult time in recent years. In a nation where the news is full of war, conflict, displacement, and economic challenges, just making it through the day might be the wisest choice. People do that, especially in the capital, Addis Ababa. Going to theaters, movies, and other festivals might temporarily relieve stress. A new addition to the list is the growing trend of standup shows. Even though it has not yet reached its full potential, standup comedy is indeed helping urbanites ease their economic pain. In this article, EBR’s Hemen Asmare shares insights she gathered talking to a young man who started a center in hopes of supporting the growth of standup comedy, and the role it may have in society.   

Standup comedy was primarily presented as a prelude to other public gatherings, like music concerts and public conferences. Aside from what one might catch on TV, a short comedy in between weekend programs, pure stand-up comedy shows may not have been found so easily just a couple of years ago.

“I think Meskerem Bekele, the one who released his standup comedies from the US, came very close to pure standup comedy,” says Adayehegn Asfaw, the founder of Saq Center. “Following that, Eshetu Melese and others have dared to bring pure comedy packages before the public, who have recently shown interest in paying for such shows.”

Asayehegn founded a comedy center about two years ago in Kality, Akaki Kality District. He envisioned the center hosting a series of standup comedy shows to support the growth of the art of standup comedy. The center houses more than 100 viewers during shows.

According to Asayehegn, standup comedy shows elicit two types of reactions from the public. The first reaction is from an audience that is already acquainted with standup comedy shows in the US and other parts of the world. This audience understands the fabric of the shows and so is really entertained. The other segment is the ones that have not been introduced to such shows and show mixed reactions.

“My first show was called Article 39,” Asayehegn told EBR. “We are not yet available on social media, but we will start promoting our works soon.”

According to Asayegn, diverse audiences have diverse demands; some may want comedy, while others may prefer narrative entertainment, and some may prefer physical humor or impressions.

“In Ethiopia, you can tell that people are interested in hearing more of that same thing when a topic that made people sad is brought up in a humorous way,” Asayehegn says. “Also, the youth want to hear more love stories.”

Asayehegn’s work is also being challenged by public opinion. Some people argue that in a nation where the news is full of misery, it may not be the right time to put an effort into expanding the work of comedy. Even if one tries, it may not be successful.

However, that is not how Asayehegn views it. Rainy days are actually the right time for art to play its role. Art imparts wisdom on how to get through those difficult times, and carries people on its wings, helping them cross over.

Another issue is the lack of financial support for the shows and the genre as a whole. Big corporations and businesses that happily finance movies and music albums are less enthusiastic about supporting this form of art. Asayehegn hopes that this will gradually change.

Another challenge is artistic freedom. Asayehegn and his colleagues are jealous of how far comedy has progressed in the US. Whether it is in politics or social issues, comedy knows no limit.

“That is not the case in our country,” Asyehegn explains. “There are very few you can talk about.”

Freedom is a key ingredient of art. For one thing, one has to feel free to even begin to imagine and appreciate an artwork be it a painting, a script for a film, or a standup. But, it doesn’t end there. After the artist has put out the work, the audience has to feel the freedom to entertain the topics that were imagined in Freedom, according to Asayehegn.

“It doesn’t end there,” Asayehegn explains. “Comedians criticize the public as well, so, the public must appreciate it as a piece of art, that requires freedom of thought.”

For Yonas Lemma, a 30-year-old middle-aged businessman, nothing matches a moment of laughter at one of these shows.

“It takes your stress away, even for a moment,” Yonas told EBR. “I really have fun at these events.” On one of his busy and stressful days, a standup show or a piece of poetry does the magic for Yonas, who has become addicted to shows by comedian Eshetu both online and in person.

Studies show that standup comedy has different health benefits. Comedy is a great stress reliever since it helps you feel relaxed. It makes you chuckle and helps you forget about your worries. Comedy has been proven in several studies to be a scientific and healthy technique for releasing unpleasant emotions. Rather than releasing your pent-up tension and fury through negative habits, you may choose to turn to humor to relieve your dissatisfaction and stress.

It reduces blood pressure. A night of laughter at a comedy club provides more than just relief it also has the remarkable ability to increase your heart rate and breathing rate. The body’s heart and respiration rates gradually drop, resulting in reduced blood pressure towards the end of the show.

Surprisingly, a researcher discovered that viewing a hilarious movie reduced blood pressure for a full 24 hours afterward. Other research found that not only can amusing shows increase artery dilation, but that viewing melancholy programs really harms our blood vessels.

It helps relieve pain, Stand-up comedy, in addition to being a stress reliever, may also aid with long-term pain treatment. Laughing can stimulate your body to manufacture natural painkillers and can also help ease muscle discomfort by disrupting the distress cycle. 

11th Year • May 2023 • No. 117 EBR

Boston Partners, the parent company of Kuriftu Resort & Spa, was founded by Tadiwos G. Belete, who currently serves as its CEO. Tadiwos was born in 1957, in the southeastern Ethiopian State of Oromia. At the age of 16, Tadiwos moved to Sudan in search of stability, security, and a better life for himself and his eight younger siblings. This was six years after the coup that resulted in the establishment of the Derg communist government, which caused severe economic and social upheaval in the country. Tadiwos has endured a great deal of adversity throughout his life, particularly during his time in Sudan, including health issues that nearly claimed his life. He often thinks back to his first job, scaring birds away on a small, privately owned farm. In 1983, he flew to the United States of America and was granted refugee asylum.

Tadiwos’s journey in the U.S. started with enrolling in a hairdressing school and working nights as a parking lot attendant. He also tried his hand in the restaurant business, promoting Ethiopian artists. He then decided to pursue his education and attended Roxbury Community College, attaining an associate degree in accounting, and Suffolk University in Boston, with a specialization in the same field. At the same time, he opened a salon on Newbury Street with seven other business owners.

Tadiwos spent 19 years working as a hairstylist in Boston, where he gained expertise and firsthand knowledge of what actually works and what doesn’t, as well as how to really run a successful business. In order to bring the Western spa experience and beauty culture to Ethiopia, Tadiwos, a happily married father of three who led a prosperous life in the US, bought a plot of land along Africa Avenue and started building the eight-story Boston Partners building in Addis Ababa. He established a salon, which he dubbed Boston Day Spa, after the renowned city of Boston, which had acted as a stepping stone to his great accomplishments.

Since the debut of Boston Day Spa, Tadiwos has expanded and opened the now well-renowned Kuriftu Resort in Bishoftu Town, in the State of Oromia, and Bahir Dar, in the State of Amhara. He also launched the Kuriftu resort in Awash. And notably, the Kuriftu Water Park is the first of its kind in Ethiopia. Tadiwos also proudly promises further mega projects in the State of Afar and the town of Arba Minch. The pan-African businessman is also building The African Village, due in September, which aims to serve as a melting pot for African culture and the hospitality industry,  offering visitors a unique experience. In this interview with EBR’s Addisu Deresse, Tadiwos talks passionately about the need to tap into Africa’s potential and boost local tourism, among other matters.

My research shows you are a husband with three children. Tell us about them.

I have three children. The oldest, Yonaiel, graduated from Boston University when he was 30 years old. When we returned to Ethiopia, he was 8 or 9 years old. He started working from the bottom up, from carrying luggage to working in construction. Now he is the operations manager of our company. He is also studying operations management. He studied at a good school. My second daughter is Mahlet. She studied hospitality and tourism management in New York. She worked at a hotel in America for four and a half years. She rose through the ranks and was eventually a manager, after which she returned to her country. She is now starting her second year as head of sales. The youngest’s name is Abbner, and he graduated from Pace University with a bachelor’s degree in finance. He is now working for a finance company in America. After gaining some experience, I think he will come back to work on our projects.

If you had to hand over your role to one of your children, which one would it be?

They are all very ambitious. They serve the organization with great effort in their respective departments. So our work is not the result of one person’s work, but that of a group. An organization should not rely solely on the family, it needs enough staff. We have thousands of employees, and we believe that the company treats everyone as its child, who works effectively at both the team and management levels. I think that any of the children can replace me at the desired time.

What does a man with so many resorts enjoy? What do you enjoy the most when you are not working?

We used to work 20 or 18 hours a day. Now that I have come to Ethiopia, I work almost 16 to 17 hours a day. My children are also growing, and the company is in its 20th year. We have a very strong management team and mature employees who have been with us since our inception. Apart from bringing new business ideas, the management team controls the operations. Other than that, my personal hobbies are doing sports with friends and swimming 3 or 4 days a week. I’m not a person who reads a lot of books.

What is the one principle you cannot live without as a businessman?

Both passion and discipline are essential traits. I think they are the most important keys to saving yourself from burning out. You won’t change anything if you devote your whole life to what you don’t love.

How do you describe the role that Boston has played in your entrepreneurial life?

I think that my life changed during my exile in Sudan, where I decided to change my life, thinking that I had no one. That created a drive in me that has been vital through the years. Boston is a comfortable country. I can’t say that it has inspired me to create a business because it is a country where the government is fighting for you even if you don’t have a job. My efforts while I was in Sudan, struggling to get myself out, and developing business ideas, have contributed a lot. It has been 20 years since we returned to Ethiopia. Since 2002, the organization has been growing and becoming more successful every year, contributing many ideas to the Ethiopian ecosystem. I think that the organization was the result of many experiences, not just one. My experiences in Boston, Sudan, and here in Ethiopia have contributed their fair share to get us where we are today.

Marc Cuban, an American billionaire, argues one needs an accounting background to become successful in business. Even if one can hire, the founder needs to understand what his accountants do. How much help has your accounting background been?

My accounting education should not be overstated; it was just two years of training. The college I went to in America is a school where refugees and disadvantaged people go. So I do not believe that my understanding is the result of education. I don’t focus on the financial aspect of what I do. I never go around cashiers. I have never counted the money. I have never even signed a check. So, my accounting background has not helped at all. As I told you before, I think it’s the result of bringing out what’s in you and working day and night with passion. I have never thought about money. I don’t want to. I have never done feasibility studies. I discuss and debate business ideas with my team, and we do what is approved after those debates. That is how we operate.

I think it was in 2014 when you opened Kuriftu Resort in the middle of the Red Sea. Tell us about the two projects you have outside of Ethiopia.

By the way, the Djibouti project has been suspended. The foreign currency exchange problem in our country did not allow us to run the project as planned. I sold it to my partner. Now we are focusing more on our local projects.  But because Ethiopian tourism always wants blue water, white sand, and seafood, we are doing promotions with our partners there. We are working in collaboration with businesses in the region to boost local tourism.

Tell us about the African Village project you are working on.

The African Village Initiative is a first-of-its-kind effort for both Ethiopia and us. We are quite enthusiastic about the initiative. We plan to launch within the following six months,  in September. We constructed 54 villas after the rain stopped. Each of the 54 villas has its own upstairs. Each African country receives a villa. We will make each country feel at home in each villa. The furnishings and decor are all done in such a way that the entire building represents their country, their books, their flags, and their feelings. Because Ethiopia is Africa’s political capital, we believe it is our job to promote intracontinental tourism. We intend to provide each African ambassador with one month of time. They are welcome to bring their own chefs. The business community will collaborate with embassies on a variety of initiatives. We shall seek to expand continental tourism by enlisting the active participation of all countries. This is a billion-person continent. African countries can greatly benefit from increasing the flow of tourism among themselves.

What is pan-Africanism to you as a businessman?

Pan-Africanism, to me, is creating a movement that highlights Ethiopia on the African continent. A business that was created, born, and raised in Ethiopia should spread throughout Africa, bringing our food, flag, and language with it. This is true not only for tourism but also for manufacturing and other investments. We should not only visit other African countries; they should also visit us. Having many investment shows means that they come here and we go there. Consider this: in the past, all of the country’s wealthy citizens traveled to other parts of the world to invest. It means turning that around and finding a way to benefit Africa. It means helping our unemployed brothers and sisters. Its purpose is to encourage youth who are hungry to earn and live. So we have a lot of ground to cover. Governments in every African country should support and promote indigenous businesses. They are beneficial! They create job opportunities for workers, improve technology, and share their knowledge.

How do you hear about the African Continental Free Trade Area (AfCTA) or the news about Ethiopia softening its borders with Kenya to allow trade?

It is a huge development. African countries need a softer border between them. You can visit all of Europe and return with one visa. We don’t have that here. There is no paradise like Africa. People from Africa go to Dubai for vacation. People still don’t consider it a vacation unless it is in Dubai. People don’t think it’s an investment unless they cross the ocean. So we must come up with an idea that will change that.

Some of your projects are new. What is the process by which you develop those business ideas?

As you know, Boston Day Spa was launched when there was no spa in Ethiopia. Now there are several. We offer a premier service. As you know, we were the first to introduce a Water Park. What we have done at Entoto includes a children’s recreation area. Everything we do is new. What we are doing now in the African Village Initiative is something no one has dared to do before. Our unique selling point is our ability to develop new services and products. It is always our wish to develop Ethiopia with these unique ideas. I think we are very lucky. New ideas are written down and presented during meetings here in this very office. Before we begin the groundwork, we vigorously debate and strengthen the idea. There will be product ideas that get rejected, of course. There are three or four unique upcoming projects that you can see in the near future. These new projects will also show Ethiopia something new and help change the country’s image.

The hospitality sector was one of the worst hit by the pandemic. How did you survive it?

It is better to say that God covered us. We were out of business for almost two years. We have thousands of employees, and even during that time, we did not fire a single employee. We have been paying full salaries. It was a very tough time, but luckily, as a company, we don’t have a lot of debt. I believe God helped us. To tell you the truth, it was a difficult time. But now, thank God, things are improving. It had been 3-4 years since we had seen an international tourist. But you know the best part of it is that promoting local tourism can be the basis of a country’s development, and we have learned a great lesson from the locals. I would also like to thank our guests for helping us get to this point.

Even worse, hospitality in Ethiopia was challenged by security issues. What was the implication for your business?

We don’t work for money! That’s why we said we work with passion and discipline. We were working during the various riots and the pandemic in Ethiopia. We were working through all the challenges. We always work, and we will continue to work. We don’t get involved in anything that gets in the way of our work. Business is our priority, and the pandemic made us focus on domestic tourism. If you have the ability to bring new ideas to local tourism, you can do it even in difficult situations.

It is fair to say that new business ideas should be backed by robust marketing. What is your strategy for marketing these tourism products?

We usually go for a marketing strategy that is a natural fit for the product. About 4 million Ethiopians live in different countries. We try to identify what they want and categorize them by age. What do the children want? What do middle-aged people want? What do the elderly want? When they come to the water park, they will find 2-3 business sections. Parents come with their children, and grandparents entertain their children with them. The work we’ve done at Entoto has captured the interest of all those groups of people. What we did at Awash is beyond the standards of any country. Therefore, it is designed to satisfy local consumers as well. When our brothers and sisters who come from abroad bring their children, we will combine business ideas and marketing strategies that can be used to tell a unique story about Ethiopia.

How do you evaluate the government’s support for and view of the sector and its potential?

I think that the view towards tourism and the support of the government has changed more than I ever thought it would. There has never been a time when the government paid attention and made tourism the first of the three pillars of its new economic reform. New projects are being developed everywhere under the prime minister’s initiatives. So, I see the possibility of our tourism development continuing for many years to come. Every business owner is doing their work better than they used to. So I think the tourism sector seems to be running on its own now. The future is also very promising. I can say, without a doubt, that Ethiopia will find its ideal position in tourism in the next four to five years.

Historical and religious attractions have been the main products of tourism for so long. What is your experience with product diversification?

Our experience with product diversification is improving, but we have a long way to go. As you said, our historical sites have been the main tourism products we’ve had for a long time. When we introduced Kuriftu, it became a tourist site in and of itself. People come to Kuriftu to have fun at the site, making it a tourism product in and of itself. The number of tourists that visit Bishoftu is unmatched, making it the first tourist destination in Ethiopia. You can also consider the Water Park, the Awash Project, or the one in Afar, which are all diverse tourism products.

We can’t have business as usual. We can’t just keep opening hotels near historic attractions. We need to develop new ideas and new products if we are going to tap the full potential of Ethiopia and Africa at large.

For as long as you have been in business, the industry has been characterized by a severe lack of trained professionals. What is your philosophy on human resource management?

Yes, the industry has been characterized by a lack of trained professionals. Since we started 20 years ago, our company’s core belief has been to train our staff. We don’t poach staff from any other hotel. We are strict with our training program. There are a dozen employees here who have gone through years of training and promoted themselves from the position of a guard to leading major departments. We are so proud of that. Of course, many of the people we trained have left us for other hotels, which we don’t complain much about. We are also proud of the fact that about 83 Pct of our employees are women.

What factors do you consider when you prepare to develop a new product?

A number of factors go into our decisions when we develop new products. We always try to consider places outside of Addis Ababa. The second issue has to do with landscaping, the view, and the greenery, and all those factors go into our decision of where we can do what. This doesn’t mean we go out and look for the perfect place to set up a business. Sometimes the location is good, but you don’t have the landscape. So, you have to create the landscape or the view yourself. We take care about what we try before we do it. That is why people talk about Kuriftu, whether it is in Djibouti, Eritrea, or Sudan.

What is your view of the future for both the industry and the country at large?

I think the future will be great. I think Ethiopian tourism will be better than ever. I believe that Ethiopia will be a country that is promoted and sold worldwide. Therefore, I think the future will be bright for Ethiopian tourism. If I tell you in numbers, I think Ethiopia will rank from 1 to 3 in the next 5 years. Most of the properties we have produced belong to Ethiopians, other countries are not like that. The things that we are building, even for a small profit now, show that we are prepared and waiting for the promising times to come.”

The practice of local revenue collection for cities and towns in Ethiopia is limited. Most towns and cities depend on state and federal governments support to finance development projects, leaving them with no power to collect their own revenues. The practice has left development impaired while leaving essential services to the mercy of aid. With what seems to be a plan to change that, the Addis Ababa City Administration has embarked on a new property tax. As much as this new scheme is essential as a source of local revenue, the amount of tax would be unbearable for city dwellers, writes EBR’s Addisu Deresse.   

Samson Desta [Not Real Name] is a 42 years old banker who lives at a residence he and his siblings inherited from their parents. Their parents’ residence, located in the Akaki Kality District of the capital, rests on 500 square meters of land.

Samson, who is married and a father of two, also has siblings who are married and live in the same compound. That property has been more of a blessing for the big family, given the skyrocketing price of rent the capital has been witnessing over the years.

“I cannot even begin to imagine what life would have been like with my two children in a rental house,” Samson feels thankful for the property his parents left to the family.

For decades, the property has not only saved the family from rental costs but also served as a source of revenue for Samson and his siblings, who led a decent life by sending their children to private schools.

Samson and his siblings collect ETB 40,000 monthly by renting houses in their compound. After spending a portion of it on recurrent expenditures such as power, tap water, and wifi, the balance goes to supporting their respective children and their education. For so long, the family only had to pay a little over ETB 2,000 a year in rental income tax.

This amount may only hold briefly as the Addis Ababa City Administration Revenues Bureau has introduced a new property tax directive. The new directive sent down to district offices on May 13, 2023, would incur a significant amount for property owners in the city.

The new directive separates properties into those used for business and housing. Each subcategory has its grade, and each category has its subcategories.

Properties constructed of mud and wood are taught in the first subcategory, condominium houses are in the second, and brick villas and flats are classified in the third subcategory.

A property in the first grade of a residential category pays ETB 214 per square meter. In contrast, condominium houses, villas, and apartments in the same grade pay ETB 247 and ETB 361, respectively. For properties owned by businesses, the exact grade in the first category pays ETB 444, a business condo pays ETB 493, and a villa or apartment made of brick owned by a business pays ETB 632 per sq. meter.

The tax value for all properties stands at 4.5 Pct. The total annual tax for a property can be calculated by multiplying the size of the property by the value per square meter by 12 months and then by the tax value.

Samson’s family’s property rests on about 217 square meters. Based on this calculation, the annual tax for the property of Samson’s family will jump to more than ETB 25,000 per year. A number Samson thinks is impossible to bear.

“I am hoping there is some mistake I made while calculating the tax,” Samson says. “Otherwise, it is absolutely impossible to even imagine being able to afford it.”

This is the second shocking news Samson received in the same week last month. The private school he sends his children to gathered parents, where the school announced a proposal to increase school fees by 100Pct. Samson and his family this difficult to understand what is really going on in the country.

Samson’s fear is not only for himself and his family. He understands how this will reciprocate to the people who live in his rental houses.

“By the end of the day, it won’t be much of a problem for me,” Samson explains. “I will double the rental prices and let the people shoulder the burden. That’s what we call fueling inflation, isn’t it?”

“For this year, to ease the burden, taxpayers are required to pay only 50 Pct of the calculated amount,” reads the letter sent to districts. “Those who have already paid this year’s tax are also exempt from the new tax bracket.”

Urban financing experts contend that property taxes are essential for developing cities and towns, notwithstanding how alarming it may be to city residents.

Such was the argument when interest groups in urban financing convened at The Urban Centre to listen to a panel discussion on local revenues for Ethiopian towns and cities in the late afternoon of October 20, 2022.

“You can also consider property taxes,” said Abebe Zeleul, senior national advisor at UN-Habitat, in an interview with EBR. “Property tax was, by the way, introduced in Ethiopia during the imperial era.

Unfortunately, it didn’t go well enough to boost local revenues. Local governments must identify properties and include the majority of them in their tax brackets.”

According to Haile Gebreyohannes, a senior urban revenue and finance specialist, cities finance themselves in various ways. Cities finance themselves through subsidies, own-source revenue, community contributions, external assistance, and domestic loans.

“All of these sources of financing for our cities are either low in amount or insignificant,” Haile said. “Some others are not reliable, while others are very difficult to mobilize.”

Actual Own Source Revenues (OSR) for Ethiopian cities include income from land lease (non-recurrent), trade and professional tax, transfer of title deeds (non-recurrent), and many other low-yield items.

According to Haile, state revenues account for less than 30Pct of the OSR of Ethiopian cities, while leasing income accounts for the highest. When annual expenditures account for less than 20Pct of the total budget, recurrent budgets account for greater than 75Pct.

“The implication is obvious: fiscal deficit,” Haile argues. Urban financing has been a problem for a long time. This problem is exacerbated by various things, such as the high land cost, the requirement for infrastructure upgrades, and the difficulties in luring private investment. But in recent years, a number of cutting-edge finance techniques have also been created to address these issues.

Tax increment financing (TIF) is one example. With this instrument, towns can make expenditures in public infrastructure and other upgrades within a specific area and then use a percentage of the gain in local property prices to cover those costs. This may be a practical approach to paying for urgently needed upgrades without burdening taxpayers.

Community development financial institutions (CDFIs) are yet another case in point. These specialized lenders give money to enterprises and initiatives in disadvantaged areas. CDFIs can help close gaps in the stock lending market and offer crucial finance for initiatives that might only proceed with them.

There are numerous instances of creative urban finance methods in use all around the world. Even the most challenging urban development projects might be financed with enough innovation and inventiveness.

According to Abebe, generating local money has proven to be distant from these best practices. In Ethiopia, there is no fiscal decentralization and no empowerment of the cities. Urban local governments’ OSR is minimal and needs a solid legal foundation. Due to a lack of data and data management systems, their potential has yet to be discovered. The accepted concepts could be more precise, and the rate and bases are limited. Additionally, cities rely more on capital than long-term revenue streams like land rents.

In sub-Saharan Africa, several systems are the collection of property taxes is made up of several diverse systems, some located at the national level and some at the local level, according to a working paper written by Rose Wanjiru, Anne Wanyagathi Maina, Eldah Onsomu, and Graeme Stewart-Wilson and published in 2019. There is now universal acceptance that property tax systems in sub-Saharan Africa do not result in the intended cycles of public investment and local government empowerment because of the frequent center-local disputes. Therefore, the efficient application of property taxation depends on institutional trust and cooperation across organizations.

The article discusses recent events in Kenya, including the passage of a new constitution in 2010 that drastically reduced the power held by the national government and gave it to county governments instead. The new constitution gave 47 new county governments authority and responsibility previously held by the central government. Kiambu, Laikipia, and Machakos were the three counties where the study was conducted.

Although fiscal transfers from the federal government are the primary source of funding for county governments, property taxes make up the majority of their sources of income. The county government has the authority to set its own tax rates, property rates, and tax bases.

This affords a unique chance to look at some of the prospects and issues facing property taxes in sub-Saharan Africa.

“It is not whether the government must collect a property tax,” Samson argues. “There is not a sane person who argues against that. However, imagine a 20-fold increment in property tax, added to a 100Pct increment in school fees and a 100Pct increment in the price of eggs and teff. That is insane!”

11th Year • June 2023 • No. 118 EBR

In 2017, Donald Trump rode his “anti-globalist, America First” campaign message all the way to the United States presidency. In essence, Trump declared anything and anybody who was not blatantly an American nationalist a “globalist.” A number of political analysts adamantly stressed that the key reason why Donald Trump and his message mavens deployed the term in that manner was to shield the candidate against predictable charges that it was preposterous for a billionaire, and one truly given to the gilded lifestyle, to get to the White House by pretending to save the common folk.
Manfred Steger in his book titled “Rethinking Globalism” stated that at its most basic level, globalism is very simply a philosophy dedicated to bringing people closer together all over the world. It is fundamentally about learning from each other’s successes or failures and promoting cooperation as well as prosperity. Self-styled “anti-globalists” have tended to flatten the definition conveniently into something more specific – in the sense of defining it as whatever it is that they oppose in the world.
On the left, anti-globalism has focused on trade deals and the abuses of hypercapitalism by a wealthy few individuals and multinational corporations. On the right, especially in the United States, anti-globalists run the gamut from Americanists, who would prefer a world led and dominated by the United States, to libertarians or small-government conservatives. They all like to misconstrue globalism as a movement for a “world government.”
Manfred Steger noted that there are also far-right critics who view globalism through the lens of conspiracy theories that purport to identify shadowy cabals pulling the strings of world events. These conspiracy theories, over the centuries, have at various points been anti-Catholic, anti-Masonic, anti-Semitic or all of the above. It is difficult to tell where exactly on the conservative-to-far-right spectrum President Trump himself places his anti-globalism. To be sure, his anti-globalism bears little resemblance to the left’s anti-globalism, not least because his administration is filled with the plutocrats they abhor. He also very much seeks to project the U.S. hegemony they abhor as well. But again, none of these anti-globalist definitions of “globalism” truly capture the spirit of the philosophy at its root.
It is true that international cooperation doesn’t equal world government. The pursuit of international cooperation and the attempt to shape an equitable form of global governance do not equal world government. There are problems to solve that are bigger than any one sovereign state. And as regards global governance, one can have a de facto version of it, traditionally called imperialism, or a more enlightened, better balanced one. That is the one the democratic world is struggling to establish today.
Quinn Slobodian in his book titled “Globalists: The End of Empire and the Birth of Neoliberalism” stated that any constructive vision of globalism, which we have always embraced, simply means finding ways to bridge the cultural and political, even civilizational, divides between governments on areas of common need or concern. To bridge those gaps, this inclusive kind of globalism dispenses with the belief that any one area of the world is by nature superior to the others and that it has all the right answers. It also militates against the Trumpian notion that nothing positive can be gleaned from other cultures or governing styles.
Quinn Slobodian noted that in the 20th century, this kind of globalism saw a shift toward flexible supra-national forms of cooperation and alliances. Extending that arc of cooperation goes well beyond the oft maligned EU. The 21st century is seeing a plentiful rise of city and other sub-national governments as global actors.
John Ralston Saul in his book titled “The Collapse of Globalism: And the Reinvention of the World” stated that in contrasts to the zero-sum worldview of the “Trumpists”, there is no upward or downward transfer of power in globalism. There are simply ever more actors at the table to work with and learn from each other. And there are many more stages to act on. According to him, our globalism is also, contrary to the narrowly defined leftist version of the critique, far from the multinational hyper-capitalism of today and the heinous colonialism of the preceding era.

By Melaku Kinfegabriel – Ethiopia is known for its rich biodiversity and diverse range of animal species. The country has a long history of exporting live animals, including both domesticated and wild animals.

Live animal exports from Ethiopia play a significant role in the country’s economy, contributing to foreign exchange earnings and providing employment opportunities. Ethiopia has been one of the largest exporters of live animals in Africa. The country has a vast livestock population, estimated to be around 60 million cattle, 30 million sheep, 30 million goats, and 1.2 million camels. This abundance of livestock resources provides Ethiopia with a competitive advantage in the global market for live animal exports.

Live Animal Export Regulations in Ethiopia
The export of live animals from Ethiopia is regulated by the Ethiopian Ministry of Agriculture. The ministry has established guidelines and procedures to ensure the welfare of animals during transportation and to prevent the spread of diseases. These regulations are in line with international standards set by organizations such as the World Organization for Animal Health (OIE) and the Convention on International Trade in Endangered Species of Wild Fauna and Flora (CITES).

Types of Live Animals Exported
Ethiopia exports a wide variety of live animals, including cattle, sheep, goats, camels, horses, poultry, and bees. Cattle are one of the most commonly exported animals, with breeds such as Boran, Arsi, and Horro being popular choices. Sheep and goats are also exported in large numbers, with breeds like Afar and Somali being favored for their adaptability to harsh environments.

In addition to domesticated animals, Ethiopia also exports certain species of wildlife. These include various types of antelopes, zebras, ostriches, crocodiles, and birds. However, it is important to note that the export of wildlife is strictly regulated to ensure conservation efforts are not compromised.

Export Process
The process of exporting live animals from Ethiopia involves several steps. First, exporters need to obtain permits from the Ministry of Agriculture. These permits specify the type and number of animals being exported and ensure compliance with all relevant regulations.

Once the necessary permits are obtained, the animals undergo health checks to ensure they are free from diseases. This is done by veterinary professionals who examine the animals and issue health certificates. The health certificates are required for the animals to be eligible for export.

Transportation of live animals is carried out by air or by road, depending on the destination. Air transportation is commonly used for long-distance exports, while road transportation is preferred for neighboring countries. During transportation, measures are taken to ensure the welfare of the animals, including providing adequate space, ventilation, and access to food and water.

Destination Markets
Ethiopia exports live animals to various countries around the world. The Middle East, particularly Saudi Arabia, Yemen, and the United Arab Emirates, is a major market for Ethiopian livestock. These countries have a high demand for meat and rely on imports to meet their domestic needs.

Other destination markets for Ethiopian live animals include Sudan, Djibouti, Somalia, and Kenya. These neighboring countries have a close geographical proximity to Ethiopia and share cultural and economic ties that facilitate trade.

Benefits and Challenges
The export of live animals from Ethiopia brings several benefits to the country’s economy. It generates foreign exchange earnings, contributes to rural livelihoods, and promotes economic growth. Additionally, it helps improve the quality of livestock in Ethiopia through exposure to international markets and competition.

However, there are also challenges associated with live animal exports. Ensuring the welfare of animals during transportation is a key concern. Long-distance journeys can be stressful for animals, and proper care must be taken to minimize their suffering. Additionally, there is a risk of disease transmission during transportation, which can have negative impacts on both animal and human health.

Export Revenue
Ethiopia has experienced fluctuations over the years due to various factors such as changes in global demand, market conditions, and domestic policies. However, it is important to note that accurate and up-to-date data on Ethiopia’s live animal export revenue is not readily available.

Based on historical trends and estimates from various sources, it can be inferred that Ethiopia’s export revenue from live animals has been substantial. For instance, in 2018/2019 fiscal year, Ethiopia earned approximately $360 million from live animal exports. This figure demonstrates the significant contribution of the sector to the country’s overall export earnings.

The Ethiopian government has recognized the importance of the livestock sector and has implemented policies to promote and support its growth. Initiatives such as improving animal health services, enhancing market access through infrastructure development, and strengthening the capacity of livestock producers have been undertaken to boost the export potential of live animals.

Meat Production and Export Revenue
The total volume of meat production in the country reached 1.9 million metric tons in 2019/2020, according to the Central Statistical Agency of Ethiopia. Cattle are the primary source of meat production in Ethiopia, accounting for a significant portion of the total volume.

The poultry sector has been growing rapidly in recent years, driven by increased urbanization and changing dietary preferences. Poultry meat production has seen substantial growth, with Ethiopia producing around 70 thousand metric tons of poultry meat annually.

Meat Export Revenue
The export income from meat products has shown positive growth over the years. According to data from the Ethiopian Meat and Dairy Industry Development Institute (EMDIDI), Ethiopia earned approximately $93 million from meat exports in the fiscal year 2019/2020. This represents a significant increase compared to previous years, highlighting the growing demand for Ethiopian meat in international markets.

The Drivers of Meat Production and Export of Ethiopia
Several factors contribute to the growth of meat production and export in Ethiopia. These include:

1. Abundant Livestock Resources: Ethiopia has vast grazing lands and favorable climatic conditions, which support the rearing of livestock. The availability of natural resources plays a crucial role in sustaining the livestock population and meeting the demand for meat production.

2. Government Support: The Ethiopian government has implemented various policies and initiatives to promote the livestock sector, including providing financial support, improving animal health services, and investing in infrastructure development. These efforts aim to enhance productivity, quality, and market access for meat products.

3. Increasing Demand: Both domestic and international demand for meat products has been on the rise. In Ethiopia, population growth, urbanization, and changing dietary patterns have led to increased meat consumption. Internationally, there is a growing demand for high-quality meat products, particularly in Middle Eastern countries where Ethiopian meat is highly regarded.

4. Quality Assurance: To meet international standards and ensure food safety, Ethiopia has been working on improving the quality of its meat products. The government has established regulatory bodies such as EMDIDI to oversee quality control measures and provide certification for export-oriented meat processing facilities.

Market Entry Requirements
To enter Ethiopia’s meat production and export market, there are several requirements that need to be fulfilled. These requirements encompass various aspects such as legal regulations, infrastructure, quality standards, and market access. It is important to note that the specific requirements may vary depending on the type of meat product and the destination country for exports. Here is a comprehensive overview of the key requirements:

1. Legal and Regulatory Requirements:
– Business Registration: To engage in meat production and export activities in Ethiopia, it is necessary to register a business entity with the appropriate government authorities. This typically involves obtaining a trade license and registering with the Ethiopian Investment Commission (EIC) or relevant regional investment bureaus.

– Compliance with Food Safety Standards: Meat producers and exporters must adhere to food safety regulations set by the Ethiopian Food and Drug Authority (EFDA). This includes obtaining necessary permits, ensuring proper handling, storage, and transportation of meat products, and implementing hygiene practices throughout the production process.

– Veterinary Certification: Exporters must comply with veterinary certification requirements to ensure that the meat products meet international health standards. This involves obtaining veterinary health certificates from the Ministry of Agriculture or other authorized bodies.

– Export Licensing: Prior to exporting meat products, exporters need to obtain an export license from the Ministry of Trade and Industry or relevant regional trade bureaus. The license ensures compliance with export regulations and allows for market access.

2. Infrastructure and Production Requirements
– Slaughterhouses and Processing Facilities: Establishing or partnering with existing slaughterhouses and processing facilities that meet international standards is crucial for meat production and export. These facilities should have adequate infrastructure, equipment, and trained personnel to handle slaughtering, processing, packaging, and storage operations.

– Cold Chain Facilities: Maintaining an uninterrupted cold chain is essential for preserving the quality and safety of meat products during transportation. Exporters need to invest in refrigerated trucks, cold storage facilities, and other temperature-controlled logistics infrastructure to ensure the products remain fresh and meet market requirements.

– Traceability Systems: Implementing traceability systems enables the tracking and monitoring of meat products throughout the supply chain. This includes recording information about the origin, production methods, veterinary treatments, and transportation details. Traceability systems enhance transparency, quality control, and compliance with international standards.

3. Quality Standards and Certifications
– Halal Certification: Ethiopia has a significant Muslim population, and obtaining halal certification is crucial for exporting meat products to Muslim-majority countries or markets with high demand for halal products. Certification can be obtained from recognized Islamic organizations or certifying bodies.

– Quality Assurance Systems: Implementing quality assurance systems such as Hazard Analysis Critical Control Point (HACCP) or ISO 22000 is essential to ensure food safety and meet international quality standards. These systems help identify and control potential hazards throughout the production process.

– Product Labeling and Packaging: Meat products intended for export must comply with labeling requirements of the destination country. This includes providing accurate information about ingredients, nutritional values, allergens, and proper packaging that ensures product integrity during transportation.

In general, Ethiopia’s meat production volume has been steadily increasing over the years, driven by abundant livestock resources and government support. The country’s export income from meat exports has also shown positive growth, contributing to its overall economic development. With increasing demand both domestically and internationally, Ethiopia’s meat industry is poised for further expansion in the coming years.

In conclusion, Ethiopia’s export revenue from live animal and meat exports has been a vital source of income for the country. The sector has provided employment opportunities, improved livelihoods, and contributed to foreign exchange earnings. In terms of live animals, while accurate data on export revenue is limited, it is evident that Ethiopia’s livestock resources and strategic geographical location have positioned it as a key player in the global meat and live animal tradelive animal trade.

This article is part of the Analytical Reporting to Improve the Federation (ARIF) project.

For some in a divided political community, ethno-federalism is the source of all ills. For others, it’s the remedy to them.

At the root of the Ethiopian federation’s brutal polarization is a divisive founding document.

A parliament controlled by the Ethiopian Peoples’ Revolutionary Democratic Front (EPRDF) adopted Ethiopia’s constitution in 1995, four years after the coalition seized power in Addis Ababa as rebels.

The constitution formulated a federation and, alongside a set of individual rights, it enshrined group rights as it split Ethiopia into nine regions based on ethno-linguistic settlement patterns and two chartered cities.

Although many back then regarded a relatively liberal constitution as a step forward compared to its predecessors, it is by no means free of defects, and has long sparked fierce debate.

The two aspects that cleave opinion most are the creation of administrative units along ethno-linguistic lines and the introduction of self-determination rights—even the right to secede—for what were called Ethiopia’s “nations, nationalities and peoples.”

Proponents refer to this system as multinational federalism and argue it was designed to hold Ethiopia together by granting autonomy to its diverse peoples. They depict it as an imperfect yet necessary effort to rectify Ethiopia’s historical legacy of violent and assimilationist state formation, and unjust relations among ethnicities.

Critics label it “ethnic federalism” and argue that the promotion of group rights has been at the expense of Ethiopian unity. Rather than coming together, they say, long-co-existing communities such as the Tigray, Amhara, Oromo, Gurage, Somali, Sidama, Wolayta, and many others, have grown apart, and that distance has in turn bred violence.

Partly because of the instability and these ideological divisions, ever since Prime Minister Abiy Ahmed took power in 2018 promising sweeping reforms, the issue of constitutional change has lurked in the background.

While those who decry the ethno-federation saw his premiership as an opportunity to do away with the system, others, including protesters in Oromia who helped put Abiy in office, and Tigrayans, who have waged three revolts since 1943 against the central government, cling dearly to their self-rule rights.

Until now, the premier and his allies have done little to resolve this tension, and instead this fundamental political schism has only become wider—and more violent.

In Oromia, insurgents driven nominally by complaints about denied autonomy have been fighting the federal authorities since 2019. A constitutional dispute over the postponed national elections saw Tigray’s leaders hold a regional election in September 2020 in defiance of federal authorities, an ill-fated decision that precipitated a devastating civil war.

The main fault line in these conflicts, and Ethiopian politics and society more broadly, are diverging visions of Ethiopia as either a multinational federal or centralized state, federal or otherwise. These viewpoints polarize so-called ethno-nationalists and pan-Ethiopianists.

Among Tigray’s current leaders are some of the architects and main proponents of the federal system from the Tigray People’s Liberation Front (TPLF).

Many Oromos, particularly Oromo nationalists, also support the existing federal system but often argue it has never been effectively implemented.

Typically, its most vociferous opponents are Ethiopian and Amhara nationalists, some of whom depict it as “ethnic apartheid” that, in its design, was meant to counteract Amharas’ historical supremacy and so has undermined Ethiopian unity.

They blame the federal structure for a litany of ethnically targeted massacres since 2018, and also attribute these atrocities to the EPRDF’s record of allegedly exacerbating factionalism to facilitate a divide and rule scheme.

Given these polarized views, action on constitutional reform may prove just as destabilizing as inaction, as there is no easy way to bridge Ethiopia’s ideological divides.

In a speech last year, Abiy attempted to chart a middle ground by claiming his administration is “integrationist”, as opposed to the assimilationist or separatist governments of the past.

All the while, representatives of the ruling Prosperity Party warn against compromising national unity in pursuit of ethnic identitarian goals, and call for multinational unity to be strengthened. Yet there is no indication how that might be realized, and indeed such sentiments can be seen as contradictory.

Reform Mandate

Throughout Ethiopia’s history, every regime change has resulted in a new constitution. A revision occurred only once, when the 1931 constitution underwent changes in 1955.

This era is no different. There have been no formal amendments and only a few ‘informal’ ones, meaning unconstitutional practices that have taken root.

Hence, constitutional law is largely unpracticed and specific potential changes rarely discussed.

This may be about to change.

Since 2018, in several parliamentary sessions, Abiy has raised the need to reconcile opposing views on constitutional matters. However, such affairs took a backseat during the war in and around Tigray, with conflict also afflicting Oromia.

In late 2021, Ethiopia established a National Dialogue Commission in order to hold public discussions on fundamental issues. Abiy told parliament that if political actors fail to reach a consensus regarding the constitution, the matter would be decided by the public in a referendum.

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Eleven commissioners were selected and announced in February 2022. However, opposition parties almost unanimously argued the proposed national dialogue was compromised by the Prosperity Party’s control over it. Nonetheless, the process which stalled during the Tigray war has been resumed, and constitutional issues are expected to be on the agenda.

Although some factions within the Prosperity Party openly support ethnic-based federalism, there is less certainty about the Prime Minister’s vision. Because of the sensitivity of the issue, supporters of the constitution are concerned the ruling party may be disguising its true intentions.

Abiy’s political philosophy, ‘Medemer’ (synergy), envisages a more united Ethiopia and considers ethnic radicalism to be amongst the nation’s primary problems, an approach that ethno-nationalist factions associate with Ethiopia’s assimilationist past.

A range of opinions exist regarding constitutional amendment. While some rigidly support the existing framework, most believe it can do with some improvements, and others call for the adoption of a new constitution altogether.

A survey conducted by Afrobarometer in 2020 suggested the public largely supports change on some level, and these findings were repeated more recently in a research conducted by a government think tank.

What’s less clear is what changes need to be made and through which mechanisms. Given the depth of division, reaching consensus is no small order.

Contentious Clauses

Many aspects of the constitution have been sources of disagreement among politicians and the public since its inception. Certainly the most controversial is the type of federalism.

Getachew Assefa, a constitutional law scholar at Addis Ababa University, cited ethnic-based politics, including the organization of regions based on ethno-linguistic settlement patterns and the right to secession, as the primary source of division.

Even the preamble, which empowers the country’s “nations, nationalities, and peoples” is debated over.

More divides exist around the fact that the power of constitutional interpretation is vested in the House of Federation (HoF), a political entity as opposed to a quasi-judicial organ.

Prime Minister Abiy has been cagey about which amendments he would like to make but has openly sought to introduce private land ownership. Proponents of multinational federalism also identify land administration as in need of reform, but for different reasons.

Under the constitution, land is owned by the central state and the people. The Oromo Liberation Front (OLF) and Ogaden National Liberation Front (ONLF) are among the political factions that believe this violates regional self-determination by preventing regional governments from owning land.

Article 47(3), which outlines the process of acquiring regional statehood, is another clause cited as being in need of reform, while Bate Urgessa, a senior political officer of the OLF, raised the lack of clarity regarding the special interest of Oromia in the capital as a further shortcoming of the constitution.

The federal government’s role, including taxation power, the recognition of individual and minority rights, and more recently the issue of ethnic and religious rights, are other contentious aspects.

According to Bate, genuine democracy may have exposed more shortcomings in the constitution. “It hasn’t truly been tested under the non-competitive, single party rule,” he said.

Ethnic Federalism

Proponents say ethnic federalism was intended to bring equality among Ethiopia’s diverse people and thereby ensure harmonious coexistence.

Federal arrangements along ethno-linguistic lines have proven to be relatively successful in nations such as Switzerland, Belgium, and India. However, critics point out that hasn’t been the case in Ethiopia as ethnically motivated violence keeps rising.

They say the system of “ethnic” federalism itself is the underlying factor behind the polarization and believe the constitution must be overhauled to attain peace and unity. Alternatively, backers of “multinational” federalism point to the improper application of the constitution and lack of democracy as the source of intercommunal conflict.

As Zerihun Gebregziabher, leader of Ethiopian National Unity party, explained to Ethiopia Insight, although federalism is necessary because a unitary form of government won’t fit such a diverse nation, the current system is polarizing.

“When ethnic groups are granted total autonomy over respective areas, they inevitably aim to solely benefit their ethnicity, which in turn is hindering citizens’ right to pursue livelihoods and reside in a place of their choice within their country,” he said.

Zerihun’s party and others want a new constitution with a federal structure where states are formed on the basis of non-ethnic attributes, such as geographic distinctions.

Yeshiwas Admassu, an attorney who helped draft the constitution, wants the same. “Federalism is advantageous in many regards, but centering it on ethnicity is driving the Ethiopian people apart, who are intertwined and have coexisted for long despite their differences,” he told Ethiopia Insight.

Conversely, Haileyesus Taye, director of the Center for Constitution and Federalism Training at the HoF, regards multinational federalism as the only viable system of government for Ethiopia.

“The reality is there are groups with distinct historical, cultural, and linguistic identities who desire to exercise self-rule and who also have common national interests. The two can only be managed under a multinational federation,” Haileyesus said.

​​Merera Gudina, leader of the Oromo Federalist Congress (OFC), claims the conflicts are because federalism as designed hasn’t been implemented. “Self-determination right was welcomed by many who longed for ethnic equality, but they were left equally disappointed as its antagonists when they realized it isn’t going beyond strengthening the center’s power grip,” he said.

Meanwhile, OLF’s Bate argues that geographic federalism would be detrimental to the rights of minorities as larger ethnicities would likely dominate state power.

The contention around ethnic federalism extends to the reference of so-called nations, nationalities, and peoples, which the constitution assigns sovereign power to, a concept seen as inclusive by some and divisive by others.

Yeshiwas Assefa, former chairman of Ezema, a party that aims to establish citizenship-based politics, believes many provisions need to be the focus of an inclusive amendment process, including the preamble.

However, ethno-federalists regard the preamble as illustrative of Ethiopia’s pluralism, and believe it reflects the fact that Ethiopia is a multinational state.

Abdirahman Mahdi, leader of the ONLF, claimed, “there is no single people called Ethiopians.” In his view, “the people are composed of nations and nationalities that came together and formed the Ethiopian state.”

Secession Right

The right to secession is among the most criticized aspects of the constitution. Article 39 stipulates that every nation, nationality, and people in Ethiopia has the unconditional right to self-determination, including secession.

Historically, Ethiopia has witnessed numerous secessionist movements, including Eritrea’s independence movement that ended in 1993 with its secession, and also radical separatist ethno-nationalist movements in Tigray, Oromia, Somali, and elsewhere.

Though the Prosperity Party appears to support ethnic federalism, it has not clarified its position regarding secession.

However, there’s reason to believe the secession right will be first on the chopping block in any Prosperity Party-led constitutional reform as Abiy has highlighted its disadvantages.

Additionally, his ‘Medemer’ philosophy asserts that diversity should in no way result in division, let alone separation.

If a referendum was held, the secession clause could be abolished. Haileyesus is among those who see no advantage to it. “Federalism ought to be a lasting union. For unsatisfied members to resort to seceding goes against the core idea of such union. As long as there is democracy, problems can be resolved in a discussion” he told Ethiopia Insight.

The question of whether Oromia should secede from Ethiopia or transform it from within has been a central debate among Oromo nationalists. Some view the right to secede as an integral part of autonomy and self-determination. Merera said that his party, the OFC, is neither for nor against the secession clause, as a meaningful degree of self-determination can exist without it.

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Bate said the OLF considers the clause necessary because secession can then take place in a peaceful manner. “Secession can still happen without the existence of a legal framework in place; establishing a legislative procedure will at least help to make it happen in a less volatile manner,” he told Ethiopia Insight.

From the ONLF’s perspective, the right to secede is the only thing keeping the Somali people at the table as greater constraints would add to the already considerable separatist tendencies in the Ogaden, which is part of Somali region.

The constituencies most opposed to secession include Ethiopianists of all backgrounds and Amhara nationalists, who typically oppose ethno-nationalism but nonetheless use such rhetoric to claim territories throughout Ethiopia rather than seceding from it.

Meanwhile, the TPLF’s relationship with secession is complex, as there were always factions within it that sought independence during its struggle against the Derg from 1976 to 1991. But its elites opted instead to control the center for nearly three decades and widespread secessionist sentiments only reemerged in response to the recent war and the atrocities committed during that 2020-2022 conflict.

With this spectrum of attitudes, reaching consensus on this contentious issue will be no easy task.

     Reform Process

Constitutional reform is critical for any nation as it has the potential to cause fundamental changes to the government system and can elicit violent contestation.

Thus, steps towards it must be taken up with care, inclusive deliberation, and consideration of all factors. The process is not one that should be rushed and, most critically, the amendments must be based on a broad consensus.

The adoption of Ethiopia’s current constitution was marked by a lack of inclusive deliberation and any substantial consensus among major political actors or the general population. That resulted in a constitution that failed to reconcile the varying viewpoints. This experience ought to serve as a lesson for any upcoming amendments.

The CCI amicus curie hearings

Moreover, supporters of the federal system emphasize that democratizing the existing system should precede any resort to constitutional amendment. Additionally, they point out, the fact that a single party rules almost throughout the country would make any amendment non-inclusive and be regarded as the Prosperity Party’s change.

“Effecting a major constitutional amendment at this stage will be like opening Pandora’s Box,” said OFC’s Merera, referring to the likelihood of violent backlash to any non-inclusive attempt to water down ethnic self-rule rights.

Similarly, OLF’s Bate raised the necessity of truly participatory politics. “A democratic election will simplify the issue. Parties will put forth their objectives, whether it’s implementing the constitution as is, improving it, or adopting a new constitution. Then the option favored by the majority will prevail,” he told Ethiopia Insight.

Additionally, Bate argues that consulting political parties in a national dialogue won’t be sufficiently inclusive because there is no telling what level of representation unelected parties carry. “Collecting a few thousand signatures and establishing a political party doesn’t necessarily make one a representative of the people,” he said.

ONLF’s Abdirahman shares a similar view. He believes amendment at this stage is destined to be a manifestation of the Prosperity Party’s will. Thus, major changes to the constitution under current circumstances can cause grave harm to the nation.

On the other hand, critics of “ethnic” federalism argue there is no reason to delay the initiation of a constitutional reform process.

Yeshiwas Admassu believes it should be initiated right away and through dialogue any challenges along the way can be tackled to reach a consensus.

Bekalu Atnafu, spokesman for Balderas for Genuine Democracy, an opposition party stridently opposed to the status quo, stated that if a genuine effort towards consensus is made by the center as well as member states, and if the national good is prioritized, successful constitutional reform can occur.

At the moment, the upcoming national dialogue is expected to resuscitate Ethiopians’ attention on the issue of the contentious constitution and perhaps kickstart revisions.

Nonetheless, major questions remain around what amendment procedures would be followed—as well as what degree of consensus can realistically be obtained from a divided political community.

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Main photo: Ginbot 7’s return rally in Addis Ababa, 9 September 2018, Charlie Rosser.

Published under Creative Commons Attribution-NonCommercial 4.0 International licence. You may not use the material for commercial purposes.

Execution, Literacy Challenging Transformation

Ethiopia’s economy has been affected mainly by peace and security challenges. Shortage of forex, dwindling industrial outputs, and inflation, among other challenges, have stood on the economy’s throat, leaving it gasping for air. Amidst these dark moments in the economy, Prime Minister Abiy Ahmed’s (PhD) administration has shown a solid commitment to one thing: digital transformation. Last month, the Ministry of Transport and Logistics implemented a digital payment system at fuel retail, banning cash payments throughout Addis Ababa. Since the announcement, operational gas stations have been chaotic. Despite the multi-facet advantages of digital payment, enough preparations to work on the digital literacy of the public are necessary for a seamless transition into the modern way of payment. Moreover, the details of the execution of the digital transformation need to be well thought out, writes EBR’s Bamlak Fekadu.

As thousands of people travel from all over the country for holiday vacations and family visits to the capital, Addis Ababa regularly experiences long lines at transport terminals and pump stations in the days after the holidays. This situation often leads to traffic congestion and fuel shortages, causing inconvenience and frustration for locals and visitors.

On April 24th, Monday morning, the weather was foggy and rainy, and the streets of Addis were congested with traffic, unusual considering all the exacerbating factors bearing in mind the holidays. Even with these reasons, the traffic jam was different this time, with long lines of vehicles following vehicles in most fuel and gas stations. Because too many cars lined up to get fuel, many drivers were spotted with their engines turned off, while some ran out of gas.

The directive initiated by the Fuel and Energy Regulatory Authority, a government regulatory body with the jurisdiction, was issued to transform the fuel retail industry’s transactions to a fully digitised and cashless system and was put into effect after three weeks. Over 43 thousand transactions were made via the new digital system in the first two days.

However, Addis Ababa, which is home to 60Pct of the vehicles in the country, was given only an 18-day notice before the strict implementation of cashless transactions at gas stations for all vehicles and was responsible for consuming 65Pct of the roughly 12.42 million litres of fuel the nation uses daily.

The new system aims to increase transparency and reduce corruption in the fuel retail industry. However, it has caused inconvenience to some customers who have to use the new cashless payment methods.

According to EBR’s observation in some of the pump stations, ride-hailing service providers with frustration on their faces, families with angry faces, and irritated minibus taxi chauffeurs because of the short-noticed payment system implementation.

Despite the benevolent strategy, it ultimately becomes tyrannical and exasperating for either the client or the fuel stations due to infrastructural limitations for accessing digital financial services and the gap in digital literacy.

Addisu Bazezew, 41, a husband and father of two children who works as a senior driver at a private firm, had been in one of the National Oil Company (NOC)’s 200 gas stations around Bambis on Jomo Kenyatta Street in Addis Ababa for more than three hours.

While his phone was constantly ringing from his employers, it was easy to see the frustration on his face. He did not know how much longer he could withstand the pressure. He attempted to explain his situation, but his boss did not seem convinced.

“The new payment system is not convenient. It is frustrating and inconsiderate of employed drivers. The system is time-consuming,” he told EBR.

In Ethiopia, drivers make little money; and in many cases, employers do not use fuel coupons. Because of this, they have to pay out-of-pocket for fuel without having any pre-funds deposited in their accounts before launching the digital payment initiative.

“I do not even have enough savings in my account; besides, the system has limitations with few payment modalities,” he said. As a result, he had to register on Telebirr and search for Telebirr agents nearby to make deposits for later payments.

Addisu needed clarification on the sudden change in payment methods, which required digital cash.

“I had to sit and wait for hours until the vehicles in the front line were confirmed to have paid,” he told EBR.

The trading system is new, and combined with shoddy network infrastructure and inadequate preparations, which caused delays in SMS confirmation of payment and limited digital literacy, these issues have led to frustration among users and negatively impacted the adoption of the trading system.

However, authorities claim that they put all 153 pump stations in the capital to start implementing the mandatory fuel transactions through digital payment platforms after months of tests, referring to beneficiaries of the fuel subsidy. More than 200 thousand beneficiaries have received subsidised fuel via digital payments since July 2022.

Melkamu Abera, whose last name is changed for this article, works at one of Total Energy’s 143 service stations in Lemikura District, around Ayat in Addis Ababa. He witnessed the new directive as suffocating for both retailers and consumers.

“The directive was introduced in an absurdly short period, which manifests a failure of government and payment service providers planning,” Melkamu shares his view.

The three services the government urged people to use most frequently were the Telebirr mobile wallet, CBEbirr, and the Nedaj application from the Commercial Bank of Ethiopia.

“Unlike in the past, we now require customers to pay first before we begin filling the vehicle,” Melkamu explained.

Melkamu cited payment option limitations and delays in SMS purchase confirmations as significant reasons for the unsatisfactory situation. Due to the delays, he has had incidents in the past few days where customers drove off without paying while he tried to render faster service.

Even with the brief declaration made by the authorities, the electronic transaction methods designated for the fuel-vending sector are limited to up to three platforms.

Currently, there are eight payment system operators in the country, where 31 commercial banks operate. However, the competition is between the two state-owned firms – Commercial Bank of Ethiopia (CBE) and Ethio Telecom.

CBE’s digital mobile banking services, including the CBE Birr App, have 7.9 million active members, the Nedaj App dedicated platform with over 50,000 downloads from the Play Store, and Ethio Telecom’s Telebirr mobile money system boasts 31 million users.

“Customers waited up to eight hours as a result,” he told EBR.

Testimonies from retail stations and consumers go contrary to the swearing of EthioTelecom’s CEO, Frehiwot Tamiru, assuring the infrastructure’s reliability and the connectivity coverage of the 2G network, which surfaced to 99.1 Pct.

In order to give the government control over the fuel market, the project, according to Transport and Logistics Minister Alemu Sime (PhD), was designed to create a well-organised framework that integrates with a gasoline allocation and registration system at every station in the country.

However, for fear of the unknown, consumers are engaged in panic buying, resulting in long lines and shortages at some gas stations, causing inconvenience for the public and driving others to seek alternatives in the black market.

Ethiopia has nearly 1.3 million vehicles, of which more than half are in the transport business. There are over 630,000 vehicles in Addis Ababa registered to operate for different purposes, of which the ride-hailing industry provides an estimated 90,000 rides daily utilising mobile technologies.

Ethiopia spends nearly USD 3 billion per year on fuel imports, with diesel being the most consumed with 3 million metric tons, followed by 700,000 metric tons of benzene, 600,000 metric tons of jet fuel, and 70,000 metric tons of industrial diesel, equivalent to 8 million litres of diesel and 2.5 million litres of benzene daily imports.

Over 700,000 vehicles in the city, including ride-hailing companies, taxis, commuters using tricycles, and delivery companies, were left on their knees in a frustrating situation due to the city’s fuel shortage, which had been escalating a few days after the initiative’s launch.

Alemayehu Bedada wins his bread serving transportation with his trikes motor, usually referred to as “Bajaj”, after an Indian multinational automotive manufacturing company that first introduced the three-wheel motors in Ethiopia, at Bole District around CMC Altad. He was tired of waiting in line for more than two hours, so he purchased benzene from the black market for as much as ETB180 per litre.

The Ethiopian Petroleum and Energy Authority strongly argues that there is no shortage; instead, it signals preparations for illicit acts.

On the other hand, drivers of state-owned buses like those operated by Anbessa Bus and Sheger City Bus began to voice their frustration over a lack of fuel. They claimed their daily fuel consumption had decreased from 200 litres to 50 litres.

Customers have reported problems such as slow transaction times and confirmation challenges. In contrast, retailers such as Mekonen Tiruneh station attendant at Oil Libya, with over 200 stations, claim a low digital literacy rate contributes to delays in the refuelling process. This development has sparked reactions and discussions among customers, officials, and experts.

“Some drivers have a propensity to forget their usernames and passwords. They frequently struggle with using one-time passwords (OTP) to confirm their purchases, which is another frequent occurrence,” Mekonen told EBR.

Customers have reported problems such as slow transaction times, challenges with confirming purchases, and a low digital literacy rate contributing to delays in the refuelling process. This development has sparked several reactions and discussions among customers, officials, and experts.

“The process is very exasperating, especially for drivers, since Unstructured Supplementary Service Data (USSD) takes around 15-20 minutes to get a confirmation message that they made their payments,” Mekonen said, adding that the system would have been better for both the customer and retailer if the network was not a problem.

USSD is revolutionising how people make payments, allowing users without a smartphone or internet connection to use banking, insurance, fund transfers, checking bank account balances, generating bank statements, purchasing insurance, and lending.

USSD has successfully unlocked financial inclusion opportunities for the unbanked and underserved in Africa, with an estimated 6.7 billion transactions worth USD 65.7 billion in 2020. The impact is significantly higher than the 5.7 billion transactions worth USD 21.4 billion in 2017.

According to the Global Competitiveness Report of 2019 by the World Economic Forum, Ethiopia has ranked 137th in ICT adoption and 100th in digital skills among 141 countries, behind Gabon, Zambia, Mauritius, Mali, Lesotho, Botswana, and Uganda. The situation shows that more interventions are needed to advance the call for digital literacy campaigns.

According to Solomon Kassa, a Tech- expert, and a TV personality, the Digital Financial System in Ethiopia, with figures drawn from the International Telecommunication Union (ITU), Ethio Telecom, the United Nations, the World Bank, GSMA Intelligence, and KEPIOS, underserved 65.2Pct of the adult national population in the financial services sector, leaving over 40 million people utterly unbanked in 2022.

The use case for advanced digital financial services was depicted in the report by Solomon as having even fewer users overall. The percentage of people who use online banking has remained at 0.4Pct over the past year, compared to 11.9Pct, 0.03Pct, and 0.6Pct who made digital payments, bought items online, or paid bills online during the same periods.

Given the use case penetration despite the lack of adequate infrastructure, Mignot Tariku, a freelance programmer who has worked on software and application developments, including enterprise resource planning ERP, is sceptical about the timeliness of digital transformation in the fuel vending industry. He argues that online banking still needs to be widely used. However, as technology and internet access continue to advance in the nation, there may be room for growth and increased usage.

In light of the definition of an electronic payment or digital transaction involving two parties and one or more e-payment modalities, such as ACH, cards, bank transfers, digital wallets, mobile payments, and others, she contends that the project’s implementation could be improved.

“However, the motive of the initiative appears to favour the state-owned enterprises”, she argues, adding that technology is about simplifying life, but what we are witnessing is limited in scope.”

“The government should have considered card payments via POS and other alternatives,” Mignot told EBR.

Currently, Telebirr, Nedaj, CBE Birr, and Coopay-Ebirr are the digital payment options drivers can use to pay for fuel. FinTech startups have also appealed to have their system among the digital payment options.

According to corporate business lawyer Daniel Fekadu, the government’s decision does not restrict buying or selling gas with the birr. However, it only changes the mode of payment to digital instead of cash.

Digital payment means the transaction is fully registered, which is critical to combat illegal practices. The government’s push for more digital payment is a good option as the economy currently has a cash shortage. However, Daniel criticised the government for not involving all financial institutions in this payment transformation. The digital payment systems have become a battlefield for the state-owned Ethio-telecom and the Commercial Bank of Ethiopia, leaving the more than 30 private banks off the show.

Despite the complaints, the state remains committed to going cashless and states that the situation will improve as more drivers become accustomed to it. A nationwide system rollout is expected to be implemented on July 8th, 2023.

11th Year • June 2023 • No. 118 EBR

The private sector’s ability to prosper is imperative to job creation and investments necessary for human security. Armed conflict and post-conflict situations constitute severe constraints on economic life and present a hostile environment to business and investments. Economic analysts, however, seriously argued that the positive connections between the role and needs of the private sector and peaceful development are however still less explored.
Considering the multiple risks and associated high costs of violence, a peaceful development and improved socio-economic conditions typically converge with the self-interest of businesses with a long-term objective. The private sector, international and local, has the ability to contribute in at least two rather different ways: by conducting its core business and by actively promoting certain elements of peace-building.
Taking years of practical experience from private sector development in complex environments as point of departure, Sofia Svingby, a private sector development specialist at Stockholm University argue that through conscious engagement and active dialogue promotion business can and does take on an important role for both economic development and peace-building in fragile contexts.
While potentially highly profitable, fragile or complex environments present a multitude of challenges for an international company. According to Sofia Svingby, this risk-opportunity balance must be carefully managed to cater for long-term success. Weak formal institutions, opaque power structures, commercial and political interdependencies and ethnic tension are some examples of particular challenges of the fragile context any business company needs to navigate.
The private sector’s main contribution to developing economies and societies stems from its core activity of its ability to offer products and services meeting local demand, and the related effects on job creation and economic growth. Brian Ganson, Associate Professor at the Business School of Stellenbosch University stated that in their interaction with suppliers, consumers, employees and governments and institutions, companies may transfer know-how, promote peaceful tools of conflict management and good governance through their core business conduct. Herein lie both the inherent challenge and opportunity. According to him a company’s ability to steer towards sustainably successful business models rather than short-sighted and exploitative practices is pivotal.
Brian Ganson, however, argued that in order to be successful, companies can not go about doing ‘business as usual’. In complex or fragile environments, operations and products need to contribute to a virtuous rather than vicious circle of economic and societal development. If implementing conflict sensitive approaches in strategies and operations, companies can facilitate economic development while also contributing to establishing essential conditions for peace-building.
Brian Ganson further noted that a context-sensitive governance model, including means of ensuring local compliance with the corporate code of conduct, is required, but key to implementing such approaches is leadership. Leaders’ ability to navigate complex environments which is harvesting opportunity and managing risk determines if a business can successfully provide benefit to stakeholders, employees and society. In order to do this, leaders need to incorporate an attitude of attentiveness to any aspects in the local context that may influence the company’s operations. According to Sofia Svingby, the key attribute of such an attitude is inquisitiveness, continuously striving to understand the environment in which the company operates.
Joanna Buckley, development economists at Oxford Policy Management Consultancy on her part argued that this approach helps business leaders anticipate and manage the way the company influences the local context, positively or negatively. Moreover, and equally important, it supports the management’s grasp on how the local context, for instance its conflict dynamics, affects the company and its ability to meet the financial, reputational, legal, and other requirements placed on international firms.
Joanna Buckley explained that in addition to conducting business sustainably and responsibly, private sector actors such as individual companies, multinational or local, as well as organised business, may offer channels and methods for trust-building outside the traditional arenas. This potential can be manifested by a well-functioning labour market dialogue or improved interaction between private sector and policymakers. The ability of individual employers or that of business organisations to contribute to conflict resolution, either at the workplace level or in society at large, may be decisive in establishing a dialogue-centred rather than conflict-oriented interaction.
The fact that companies often have an acute awareness of the challenges facing citizens in local communities is sometimes overlooked. Organised business on local and national level, meanwhile, can have an important role to play in holding governments and public institutions accountable. The achievements of the 2015 Nobel Peace Prize laureates, the Tunisian Quartet, clearly demonstrate how business and labour market parties, when engaged in broad cooperation, were able to provide an alternative, peaceful political process at a time when the country was on the brink of civil war.
Jonas Borglin, a known Swedish private sector and industrial analyst argued that business should be viewed and view itself as a stakeholder in sustainable development, even though a company’s status as a commercial entity may render it difficult to engage in far-reaching development work as such. The interests, capacity and mandate of companies and business associations need to be acknowledged if business actors’ potential in building resilient, prosperous societies is to be efficiently utilised.
According to Jonas Borglin, sustainable, responsible business practices and values are not complementary features of long-term successful business, but a pre-requisite. As such, the core business and the way it is conducted is the major contribution of a company not only as a source of financing, innovation, job creation and growth, but through its impact on stability and governance issues, including anti-corruption, peace and security and the rule of law.

(Photo: BGI Ethiopia/Facebook)

Addis Abeba – BGI Ethiopia, one of the leading brewery companies in Ethiopia, has recently achieved a significant milestone in its growth strategy. It finalized an agreement to sell its headquarters building and relocate its plant to its recently acquired facility, Meta, which is located in Sebeta town. Last February, after acquiring Meta, BGI Ethiopia launched an expansion of the brewery with an investment of over half a billion birr. This investment aims to reequip, renovate, and expand the brewery.

According to a press statement released by the company, this recent move represents a pivotal moment for BGI as it aims to fast-track its aggressive growth ambitions. The decision to relocate the plant aligns with BGI Ethiopia’s long-term vision of doubling its business within the next five years. Through this strategic move, BGI aims to secure the necessary resources to drive sustainable growth and unlock new opportunities.

Hervé Milhade, the CEO of BGI Ethiopia, emphasized that this decision stems from the company’s unwavering commitment to innovation and meeting the evolving needs of its clients and stakeholders. Milhade stated, “We believe that this strategic decision will position BGI Ethiopia for accelerated growth by addressing current capacity constraints and aiming to double the business by 2027.” He further mentioned that the proceeds from this transaction will be directed towards expanding the current capacity at the Meta plant and acquiring a new greenfield site. AS