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Month: November 2020

DEFENCE FORCES CAPTURE, CONTROL MEQELLE

Posted on by Web Master

In a dramatic turn of events on Saturday, units of the Federal Armed Forces entered and captured the city of Meqelle, over three weeks after a military confrontation in Tigray Regional State began. Late evening the same day, senior officials of the federal government, from Prime Minister Abiy Ahmed (PhD) to Deputy Prime Minister Demeke Mekonnen and Army Chief of Staff Birhanu Jula (Gen.), made a series of statements announcing the landmark event in the bitter fight between forces of the Federal and Tigray regional governments.

“I’m pleased to share that we have completed and ceased the military operations in the Tigray region,” said Prime Minister Abiy, using the same social media platform where 26 days ago he announced to the country, and the world, the launching of military operations there.

The federal government has been undertaking military operations against forces of the Regional State’s militia and special forces in Ethiopia after the latter overran the Northern Command of the Defence Forces and took control of a stock of arsenals. There have been massive battles on a number of fronts, where casualties on both sides remain unreported. However, over 40,000 refugees made it to neighbouring Sudan, where reports of human rights atrocities against civilians surfaced. Forces in Tigray Regional State struck Asmera, the capital of Eritrea, twice; as well as Gonder once and Bahir Dar three times.

While the conflict was ongoing, a mass killing of over 600 people in Mai-Kadra, a town in the South-West Zone of Tigray Regional State, was reported. Leaders of both sides blame one another for these atrocities, disclosed by the Ethiopian Human Rights Commission and Amnesty International.

World leaders urged Ethiopia’s leaders to show restraint and caution when conducting the final military assault on the city to safeguard the civilian population estimated at over half a million.

However, aired by state broadcaster Ethiopian Broadcast Corporation (EBC), Chief of Staff Birhanu said no casualties occurred to residents of Meqelle during the operation, and residents remained in their homes when the Defense Forces took over the city.

The Army has also liberated over 7,000 members of the Northern Command that were held hostage by the TPLF [Tigray People’s Liberation Front], according to Berhanu, who said that the Defence Forces are now in complete control of Meqelle. “The people of Tigray should be the most overjoyed at this victory.”

While the Army Chief of Staff said the Defense Forces “fully controlled” the city, Redwan Hussein, spokesperson of the state of emergency secretariat, announced that ”essential parts” of Meqelle, such as the airport and “several locations” have fallen under the control of the Defense Forces.

According to Prime Minister Abiy, the Defense Forces are in control of the Northern Command Camp, the airport, public institutions, and the regional administration office.

Prior to launching the latest military offensive last week, Prime Minister Abiy had issued a 72-hour ultimatum to the regional forces to surrender or face a military offensive in the state’s capital of Meqelle. He set out three goals to the military operation he ordered on November 3, 2020: Disarming the TPLF, bringing its leaders to trial, and installing a provisional administration until elections are held in the Regional State. The forces under his command are at the cusp of achieving the first goal and providing the security condition to move onto the third. It is not clear whether the TPLF leaders have surrendered to fulfill the second goal.

It was difficult to establish — up until press time — what might have transpired during the late evening of Saturday before the advent to Meqelle of Federal Forces. However, it appears that there was no fighting in the city, after a possible withdrawal of TPLF political and military leaders and its forces from the city, according to sources. If such is the case, the capture of Meqelle signals the return of the TPLF to its years of insurgency prior to 1991. Officials from the federal government were not available for comment.

A recent report by the United States Institute for Peace warns that while the fighting of the last few weeks may have significantly degraded the TPLF’s military capacity, it is unlikely that the federal government can entirely subdue the TPLF as a political entity.

”The TPLF’s historic capacity to wage guerrilla warfare from the rural mountains of Tigray may not be definitively eroded by its losses in conventional warfare,” says the report.

There has been a complete communications blackout in the Regional State since the military operations began. Television broadcasts from the Regional State have also ceased transmission as of the end of last week.

Prime Minister Abiy Ahmed (PhD) has also announced that the Defence Forces have completed and ceased the military operations.

What lies ahead is rebuilding the damaged infrastructure in the Regional State, while returning and rehabilitating the tens of thousands of refugees back to their homes will be top priorities, according to the Prime Minister.

“Our focus now will be on rebuilding the region and providing humanitarian assistance while Federal Police apprehend the TPLF clique,” Prime Minister Abiy tweeted on Saturday.

The hot pursuit of suspects has already begun. Early last week, the Office of the Attorney General announced 167 individuals are suspected of alleged crimes linked to the incident in Tigray Regional State and are to face criminal charges including high treason, armed rebellion, outrage against the Constitution, acts of terrorism related to firing rockets and hostile acts against a friendly country, Attorney General Gedion Timothewos (PhD) disclosed last week.

The parliament has also removed the immunity of 39 parliamentarians, including Debretsion Gebremichael (PhD), TPLF chairperson and president of the Regional State.

Ethiopia’s parliament has legislated a bill that declared a six-month state of emergency in the Regional State. The House of Federation also approved the federal government’s intervention in Tigray Regional State and the formation of a provisional administration that will appoint new officials, hold elections, and execute orders from the federal government. The Provisional Administration was set up by the federal government, tasked with the governance of the Regional State replacing all zonal and regional heads. Under its recently appointed Chief Executive, Mulu Nega (PhD), the Provisional Administration has drafted a charter that has listed the roles and responsibilities for the administration, pending final approval.

For Grave Rights Concerns, Truth Should not be Casualty of Conflict

Posted on by Web Master

May-Kadra is the latest in a spat of violence committed against civilians across many parts of Ethiopia over the past two years. Located close by the junction of a border with Sudan and Eritrea, it is a dusty town in the far western part of Tigray Regional State where the massacre of 600 civilians was reported this month. Who actually did such a despicable crime after forces of the Federal Defence and Tigray regional government clashed remains unclear, with claims and counterclaims coming out of each side.

Both sides in the armed conflict continued to preach the righteousness of their cause and rested the responsibility for the conflict on their opponent. They both claim victory in the battlefields while remaining mute over the regrettable casualties their respective forces are bound to suffer. After all, this is an armed conflict in which the full forces of military units are deployed – from infantry to air force and mechanised divisions. However, the total communications blackout in the Tigray region has not helped, making it impossible to ascertain many of the claims. It instead created the perfect environment for the truth to become a casualty, as the old adage goes.

It is almost impractical to fault the parties for this, especially once the conflict has begun, and amenable conditions for a ceasefire are not on the table as far as either side is concerned. Truth is a weapon in itself. How it is framed and utilised is part of the tactics in the contestation, no less potent from the battlefields. Any strategist would ensure that the revelation of truth is not made to interfere with the objectives of the military operation. Truth can affect strict military norms, betray strategies and impact morale.

As Chris Cleave, a British writer and journalist, once put it, “What was war, after all, but morale in helmets and jeeps?”

This relationship to truth in a time of conflict explains partly why both sides only comment on what is going right in their military operation from their respective perspectives. It is also why the Tigray People’s Liberation Front (TPLF), the governing party in the Tigray Regional State, only admitted the loss of control of towns after the trickle of photos, videos and some independent reporting made it to social and mainstream media.

Still, not all is fair in love and war. Even in the instances where armed conflict is justified – and it rarely is – crimes against humanity are acts with accountability before the international community. This is true both from a moral standpoint as well as established international laws on armed conflict. Already, charges of war crimes have been levelled against each side. From disturbing reports by Amnesty International and the Ethiopian Human Rights Commission to gruesome accounts of refugees in Sudan, it has been established that hundreds of civilians were found brutally murdered in May-Kadra. These are acts that could lead to war crimes.

The preliminary report by the Commission under Daniel Bekele is a harrowing account of a violation of the laws of armed conflict: attacks against a civilian population not taking part in hostilities. The perpetrators are alleged to be forces loyal to the TPLF, according to witness accounts gathered by the Commission. The leadership of the TPLF nonetheless has denied responsibility. Media reports based on the accounts of refugees that have fled to Sudan attribute these acts of violence to militias attached to Amhara Regional State. Where the truth lies is impossible to pinpoint without an international investigation.

Armed conflict is ugly; directed against civilians, it is uglier still. Investigating them is critical for any healing or political settlement to take place in the aftermath.

Having incensed the public, who are rightly outraged, it requires a thorough investigation. The Commission’s report in highlighting the details of the atrocity committed is encouraging, and a follow-up investigation by the African Commission on Human & Peoples’ Rights to be carried out, even more so.

Also of importance is the allegation by the federal government of an attack against disarmed members of the Northern Command, at the start of the conflict, by the forces of the TPLF. Prime Minister Abiy Ahmed (PhD) charged that in the town of Shiraro, in the Northwestern part of the region, the TPLF “massacred” unarmed members of the National Defence Forces. If proven, this too would be another violation of the law of armed conflict, which prohibits attacks against combatants that are unarmed or no longer possess the ability to engage in battle. This would qualify in the case of the alleged killing in Shiraro, given that they were found with their hands and legs tied to muffle movement, according to the Prime Minister.

Those who are responsible should be prosecuted to the full extent of the law.

A fact-finding mission composed of members that command a certain level of credibility due to their impartiality and expertise, which are usually international rights institutions, should be deployed and provided with access to verify these claims. The world is calling out both sides to cooperate in allowing access to a team of an international investigation, a call neither side should not frustrate if it believes truth is with their side. The call for “an independent and impartial inquiry commission to investigate” is one of the 15 resolutions motioned on Thursday before the European Parliament.

Denying access to international scrutiny in the guise of a sovereign right would be against international norms and the Constitutive Act of the African Union Article 4 (h) Ethiopia signed.

No less worrying, there have also been charges made against the federal government in its military operation, including indiscriminate bombings that led to the loss of civilian life and the denial of humanitarian access in the region. The latter should not be a point for contention. A region that requires imports of food and fuel to meet demand would be hard-pressed to avoid a humanitarian crisis if left to its devices without transportation lines open.

It is incumbent upon the federal government to provide access for humanitarian aid to pass through, including in areas under the control of forces of the TPLF. It is a message the international community has rightly been consistent in stressing, including the European Union (EU).

“International Humanitarian Law needs to be upheld,” Josep Borrell, high representative of the EU, said after his meeting with Deputy Prime Minister Demeke Mekonnen. “On behalf of the EU, I have called for safe and free movement and protection of civilians, vulnerable groups and IDPs.”

It is just as critical that indiscriminate attacks are avoided. It is indeed against international law of armed conflict to “render certain points, areas or military forces immune from military operations” by utilising the presence of civilian populations if this is indeed what the TPLF leaders are aiming to do. This is a law against human shields, and indeed becomes a worrying prospect as federal troops advance on the most densely populated eastern parts of the Tigray region, such as Meqelle, the seat of the Tigray Regional State administration.

In the same token, the federal government’s response could be indiscriminate if it employs tactics that will make it impossible to discriminate against military targets from a civilian population. The allegation that the TPLF leadership is using civilians in Tigray as human shields, even if true, does not give it free rein to respond in a manner that inflicts heavy casualities on the civilian population. Here, the principle of non-reciprocity comes into play.

Humanitarian law is to be respected under all circumstances, even when it is believed that the other side is acting irresponsibly in its treatment of the lives of the people in the areas it occupies. The obligation to minimise and discriminate falls on the shoulders of the party that takes the shot as well as the opponent that is using human shields.

“Great care will be given to protect innocent civilians from harm,” Prime Minister Abiy Ahmed (PhD) said in a statement announcing the launch of what he said would be the final phase of the military operation. “All precautions will be taken to ensure that heritage sites, places of worship, public facilities, development institutions and residential areas will not be targets.”

History will hold him up to his words in the developments that are yet to come.

For now though, the world is urging both sides to cease active conflict. But the viable response is through dialogue and mediation.

“Political solution and the search for dialogue are the only viable option for the future of Ethiopia,” according to Janez Lenarcic, the EU’s commissioner for Crisis Managment.

Running on Fumes: Ethiopian Tourism in 2020

Posted on by Web Master

It has been over a decade since the auspicious day when Tariku Mulugeta met a French guide in Gonder. He had barely started his career as a tour guide himself at Fasil Ghebbi in the city where he was born and raised. At the time, he spoke only English and Amharic, and a few phrases in French learned through self-help audiobooks. He met her while assisting a group from France that was visiting on a trip.

She knew Amharic and saw that he had an interest in giving tours in French. They ended up spending two hours in a restaurant that afternoon translating and writing down the details of Fasil Ghebbi, made up of a myriad of castles, churches and monasteries dating back to the 16th century. He learned it by heart and started giving tours in French shortly thereafter.

“I wasn’t able to answer questions at first if there were any,” he said. “I knew only what I needed to give that tour.”

About a year following that, he caught the attention of a Frenchman who was there to visit the castles with his family. The man turned out to be the director at the Alliance Française in Addis Abeba, part of a global network of institutions promoting the French language. Curious to know how he spoke the language well and impressed by his grasp of a language that was self-taught, he offered him a scholarship on the spot should Tariku ever decide to come to the capital.

“Looking back, I think that was what helped me decide to stay on this course,” Tariku said. “I left to Addis shortly after, and I enrolled in the class.”

Despite his father’s initial stern disapproval of his career path and the uncertain financial security associated with the job, his colourful career has now proved worthy of every chance he took on it. Just a fresh graduate from university with a degree in tourism management when he started out, Tariku now has over a decade of experience working across the country.

The 37-year-old speaks English, French and German and has been busy working as a freelancer since his move to Addis Abeba. Most of his clients are from German-speaking countries, and his work ethic and language skills have kept him busy despite the unpredictability that comes with being a freelancer.

“I never worried about work since I had clients who would request me at the tour companies,” he said. “I always had work even in the off-seasons.”

But the past year has been unlike any other for Tariku since he started work. The Novel Coronavirus (COVID-19) pandemic has wreaked havoc on the tourism industry, and his last gig was sometime back in March. International tourist numbers, which were nearing a million visitors annually over the past few years, dwindled to nil.

“It was like hell,” he said. “There was no work, I couldn’t go outside of the city, nor could I visit my family.”

There are estimated to be over 2,000 tour guides operating across the nation, according to data from the Ethiopian Tour Guides Professional Association. Nearly 500 of these are licensed at the federal level and operate across the county like Tariku.

But little to no attention has been given to the fate of this part of the sector, according to Henok Tsegaye, the Association’s executive secretary.

“Tour guides are the informal ambassadors that represent the country to people from all corners of the world,” he said. “It’s been upsetting to see how little has been done for them in this difficult time.”

The Association, which was set up six months ago, already has 120 members and has been working toward organising seminars during this time without work. It is also lobbying for support from the government.

“There are many that aren’t able to send their kids to school or pay their rent,” said Henok. “We’re trying to address these needs first.”

In a bid to restart activities and prepare for operation under what is widely considered a “new normal,” the Ministry of Culture & Tourism along with Tourism Ethiopia took a series of steps including crafting a Safe Travel Protocol and a Recovery Strategy. These were followed by stakeholder meetings, disinfection of destination sites and awareness-raising campaigns for those involved in the tourism value chain.

By August, the Ministry was well on its way to obtaining a COVID-19 Safe Travel Stamp from the World Travel & Tourism Council, a move expected to accredit the country in the eyes of international tourists and anticipated eagerly by many players in the industry. But the plan hit a snag when mandatory quarantine continued to be enforced by the Ministry of Health.

The communication between different government entities involved in the process wasn’t coherent, according to Nahome Admassu, president of the 40-member-strong Talak Ethiopian Tour Operators Association.

“They didn’t see eye to eye on some issues, so it became difficult to achieve,” said Nahome. The Association was working on stopover tourism before switching to a recovery strategy once the pandemic took centre stage.

Tour operators under the Asociation who had used the benefit of tax exemption to import cars for their businesses suddenly found themselves at the business end of foreclosures. The Association on its part tried to get grace periods extended, but even those have now lapsed. The attempts to get the use of the cars temporarily changed to other services like rentals and keep the businesses afloat have not yielded any concrete answers yet.

“We’ve been going back and forth from one government office to another with little success,” he said. “There are operators on final warnings for repayment while we have been trying to find solutions.”

Now this month’s eruption of armed conflict in the north is likely to make the already grim situation even worse. The fighting that has engulfed Tigray Regional State has made not only the region but neighbouring areas inaccessible as well. The Regional State is home to tourist attractions like Axum, with ruins dating as far back as the first century, and the rugged Gheralta Mountains, where many rock-hewn churches lie hidden.

Parts of the northern circuit of the country including the Simien Mountain range, the most elevated region in Ethiopia, and the Danakil Depression in Afar Regional State, one of the hottest places on earth, have also been closed off due to their proximity to the conflict.

Tour operators like Simien Tour & Travel, which began to see a trickle of reservations over the past couple of months, have had cancellations because of this.

“Most of our work was in the northern part of the country,” said Alexander Kemal, owner of Simien Tour & Travel. “Since the conflict broke out, whatever new work we planned has been cancelled.”

The months from November to February are high season for the country and the busiest time of the year for Simien. It was in preparation for this that the Ministry and Tourism Ethiopia had set a date for the reopening of the sector in the country. Alex and many others in the industry had been part of the reopening that took place across different destinations, including Lalibela and Bale National Park.

“It seemed promising since the pandemic had completely put us at a standstill,” he said. “But now with the second wave happening across other countries as well, it’s been back to zero.”

Simien is one of the estimated 500-plus tour operators in the country. Other operators have shifted to different revenue streams.

Renting out the travel cars under the company is how Yama Ethiopia Tours is managing to stay afloat. In the past few years, the company was bringing in up to 800,000 dollars a year, according to the owner Tariku W. Aregay. Since March, however, that has no longer been the case. Tariku says that with the current outlook, the company is more focused on preparing for 2022.

“Perhaps with a vaccine available it will be more dependable,” said Tariku. “The level of preparation here doesn’t inspire a lot of confidence, and we don’t want to expose remote communities to the virus by operating at this time.”

Despite difficulties faced by the sector, the steps that were being taken were indeed starting to bear fruit. Local flights were also well on their way to matching the frequency of services provided before pre-pandemic times. Tourists had started arriving to various destinations, according to Sileshi Girma, CEO of Tourism Ethiopia.

“We have visitors at different destinations arriving in the country despite the quarantine requirements,” he said. “The current situation will place another burden on the industry.”

This might leave the country with a negative image that could be difficult to change.

“There is a possibility of reminding tourists that Ethiopia is a place with war or famine and reimagining is the necessary work that lies ahead for us,” he said.

Tourism Ethiopia and the Ministry of Culture & Tourism are planning an aggressive promotion campaign once the nation regains peace, according to Sileshi.

“Part of the plan will include inviting international tour operators, so they know that safety won’t be an issue,” he said.

Though there may need to be work done to reinstate what has been physically damaged throughout this time, the main challenges lie in ascertaining a sense of safety, according to the CEO.

“We don’t know yet if through the conflict any valuable sites have been harmed,” he said. “But the need to work on the perception of the country is present. This will require a lot of public relations work.”

The sector has benefitted immensely from better days and should work toward a change in operation in accordance with the current needs, according to experts in the hospitality sector like Yonas Moges. He believes that attracting customers at this time will require flexibility in operations and a willingness to operate at a minimal profit.

“It seems that the entire sector is awaiting a better day when it should be brainstorming solutions,” he said. “Many have shut their doors while holding onto whatever resources they have. This could well be two years down the road, and restarting those businesses that far into the future will have cost implications that may be even harder to bear.”

Taking the necessary precautions and getting creative to get people through the door with offers like reduced prices is the way to go, he advised.

Thousands across the tourism value chain from tour operators to tour guides like Tariku are left to ponder the future of their industry. Tariku is now working with local tourists on trips not too far out of the city. It may not be as profitable as earlier, but it is still a source of income in an otherwise impossible situation.

“We have a couple of groups online where we organise hiking trips,” he said.

He also plans to start school once it reopens and begin learning Chinese — adding one more language to his portfolio while he waits things out with the rest of the world.

Ethiopia Closes Telecom to Fourth Operator for 10 Years

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The Ethiopian Communications Authority (ECA) has decided not to let a fourth operator enter the telecommunications sector for at least 10 years. The two new joining companies, which are expected to enter the telecommunications industry soon, will receive a 15-year operator license, enabling them to provide combined services for mobile, internet and fixed-line.

The long-awaited request for proposal (RFP), which was launched at the end of last week, guarantees that the two operators will only have to compete against each other and the incumbent Ethio telecom. With the liberalisation plan, the country will follow a ”2+1 approach,” in which two operators along with the state enterprise provide full telecom services.

“During the consultation meetings we had with prospective bidders,” said Brook Taye (PhD), a senior advisor at the Ministry of Finance, “they requested three to five years of a grace period.”

However, the market dynamics study conducted by the Ministry and the Authority revealed that the market could handle three operators for a decade, according to Brook.

“With fair and equitable profit,” said Brook, “the market can absorb three companies for 10 years.”

While granting the companies a grace period, the government expects them to fulfill the stipulated requirements, including covering 98pc of the population with voice call and text message services within five years.

“Failing to comply with the requirement results in a sanction,” said Brook.

Floated on November 27, the bid will stay open for 90 days. To receive the bid documents, the prospective bidders need first to send in a letter stating their intent to take part in the bidding process by December 10, 2020. After depositing 15,000 dollars into a bank account opened at the National Bank of Ethiopia, the bidders will receive the RFP document in a soft copy, and they will be made to sign a non-disclosure agreement subsequently.

The bid document has three parts: detailed information about the country’s market prospects; tender requirements, including what is expected from the operators; and license details, which define the terms in the contract. The RFP also explicitly lays down the targeted quality, population and geographic coverages.

In the document, the Authority has already prepared operator codes, a unique number assigned to telecommunications operators. Ethio telecom will hold the existing mobile network code 09, while the two new operators will receive 07 and 08 mobile network codes. Numbering allocations for fixed lines will also be made to the companies across the country, which is divided into nine telecom regions. The frequency will also be designated for the bidder, such as the range of bandwidth that will be availed for each operator.

For the expression of interest that was launched in May, Global Partnership for Ethiopia, a consortium of Vodafone, Vodacom and Safaricom; Etisalat; Axian; MTN; Orange; Saudi Telecom Company; Telkom SA; Liquid Telecom; and Snail Mobile have shown interest. Kandu Global Telecommunications and Electromecha International Projects, the two non-telecom operators, also expressed their intent to enter the Ethiopian market.

December 25 is set as the deadline for the reception of questions and suggestions from interested bidders on the RFP. Twenty days later, the Ministry and the ECA will give provisional answers to the questions and inquiries raised by the bidders. The final version of the RFP, which will incorporate comments from the bidders, will be launched on January 29 with a final bid submission date of March 5, 2021.

The bid will be opened an hour after [the submission window] is closed, according to Balcha Reba, director-general of the Authority.

“The evaluation committee will wait readily to jump into the evaluation,” Balcha said.

Technically, the evaluation will be conducted by a hybrid bidding model, according to Eyob Tekalign (PhD), state minister for Finance.

“We’ll use selection criteria that combines both qualitative and quantitative measurement,” Eyob told Fortune.

Hybrid, beauty contest, and full auction were the three options proposed to be used to pick the two new telecom operators.

The process of opening the telecom industry to foreign operators has taken almost two years. The time was spent on drafting a communications services proclamation; restructuring the Ethiopian Communications Authority and preparing 16 directives; a regulation; and a framework. The Authority has prepared the RFP and the marketing strategy alongside the International Finance Corporation (IFC), the transaction advisor.

“In the coming 90 days,” said Brook, “we’ll end up having a very competitive process. And hopefully, we’ll receive a very competitive bid that will result in a more dynamic communications services sector in Ethiopia.”

The evaluation team aims to complete the selection process and announce the winners in a period of less than a month from the bid closing date.

The way the bid document outlines the technical and financial requirements is very objective and easy to measure, according to Brook.

“We expected to announce the winners in March,” said Brook.

Gov’t Presses on with Sugar Estates Privatisation

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The government has pushed the privatisation of sugar factories one step forward, kicking off the process of hiring a consultancy firm that will oversee the transaction. All told, the transaction adviser will supervise the privatisation operations of nine sugar estates.

The Public Enterprise Holding & Administration Agency, which handles the privatisation of state-owned companies, launched an expression of interest this week by inviting consultancy firms to apply. Welkayit, Tendaho, Kesem, Omo Kuraz I, II and III, Arjo-Dedesa, and Tana-Belese I and II are the sugar estates slated for privatisation.

The Agency stepped into the privatisation process after the Ministry of Finance completed pre-privatisation tasks that took two years. The Ministry conducted a technical assessment for all of the companies, drafted a sugar policy and proclamation, designed a marketing strategy for the companies, prepared a privatisation strategy and conducted valuation as well as environmental impact assessments.

IBS Consulting Group, a South African firm, recently completed conducting the environmental impact assessment with local experts also involved in the process. Booker Tate Limited, an English consultancy, has completed its work on the asset valuation of the companies.

“Before jumping into the privatisation process,” said Brook Taye (PhD), a senior advisor at the Ministry of Finance, “we needed to complete all the studies and research.”

Assuming the task from the Ministry, the Agency is taking the first step of the process by recruiting a consultant. Interested bidders, which can be a single consultancy, a consortium of firms, or joint venture companies, are expected to file their expressions of interest before December 11, 2020.

The bidders are expected to have at least two experiences in the past five years in developing, assessing and advising on privatisation activities either as an advisor or as an agent, and wide experience in the sugar sector, including legal, regulatory, operational, industry and technical experience, according to the announcement.

The winning firm, which will be selected with a quality and cost-based selection method, will prepare a plan and recommendations for a privatisation transaction, undertake the market research, and carry out detailed analysis of alternative transaction approaches to recommend the one best suited to each company or all companies. It will also engage with assisting the Agency in any activities after bringing a strategic investor on board as is necessary to close the transaction.

The privatisation modalities could be full or partial privatisation, joint venture partnerships with the government, management rehabilitation of the factories and cane field development.

In April 2019, the Ministry of Finance issued a request for information (RFI), and 10 local and international companies responded to the call, expressing interest in participating in the privatisation process of the state-owned sugar factories.

Sugar estates are among the state enterprises that the ruling party decided to privatise back in June 2018. Ethio telecom, railways, industrial parks, hotels, energy and manufacturing plants are other enterprises or infrastructure that the party decided to fully or partially privatise.

So far, the government has hired two transaction advisors for the partial privatisation of Ethio telecom and the liberalisation of the telecom sector. The Ministry contracted Deloitte to advise the partial privatisation of Ethio telecom, while International Finance Corporation (IFC) is serving as the transaction advisor for the ongoing effort to issue two telecom licenses.

Initially, the government intended to privatise 13 sugar factories; however, it dropped the plan for three operational plants: Wonji Shoa, Metehara and Fincha sugar factories, and decided to keep the companies under government ownership. The privatisation plan of Omo Kuraz VI Sugar Factory, which was under construction by the then Metals & Engineering Corporation (MetEC), was also held back since the construction of the plant had not progressed much.

After consuming much of the budget allocated for Omo Kuraz VI Sugar Factory, which was planned to have a capacity of crushing 24,000tn of cane a day, MetEC completed less than 20pc of the construction before its contract was terminated due to poor performance.

Out of the nine estates, the construction of Tendaho, Kesem, Omo Kuraz II and III, and Arjo-Dedesa is complete, while Tana-Belese I and II, Welkayit and Omo Kuraz I are under construction and at different completion stages.

The operational sugar factories in the country produced 3.2 million quintals of sugar last year, registering a 700,000ql increase from the previous year. However, the government imported two million quintals, spending 374.89 dollars a tonne for supply and 62 dollars a tonne for transportation to meet local demand.

Abyssinia Bank Marks Prudent Growth

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Bank of Abyssinia, one of the three most profitable banks in the country, registered moderate growth during the past fiscal year, netting 853.7 million Br in profit. The Bank’s profit recorded 10pc growth, lower than the 48pc rate marked the previous year.

The earnings per share (EPS) of the Bank drooped slightly to 7.2 Br from 7.23 Br a share, which has a par value of 25 Br. The reduction was likely due to the injection of fresh capital. The Bank has increased its paid-up capital by 12pc to 3.2 billion Br.

Meseret Taye, the board chairperson of the 25-year-old Bank, states that the Bank achieved commendable growth despite the challenges.

“Continued security concerns, the persistent forex crunch, and the rising price levels on top of negative effects of the pandemic produced a notable business slowdown,” said Meseret.

The main factor that contributed to increased profit after tax was an improvement in revenues from financial intermediation. Abyssinia’s interest on loan advances and National Bank of Ethiopia (NBE) bills, which phased out recently, soared by 38pc to 4.9 billion Br. Increased lending activities drove this growth. During the year, the firm disbursed loans and advances of 36.8 billion Br, an increase of 57pc.

The growth in loans and advances is awe-inspiring, according to Abdulmenan Mohammed, a financial analyst.

Non-financial intermediation income of Abyssinia showed a mixed performance. Income from service charges and commissions increased by 51pc to 916 million Br. However, income from foreign dealings plummeted to a loss of 175.3 million Br from prior revenues of 81 million Br.

“The culprit for such a massive loss needs a thorough investigation, and rectifying measures should be taken,” Abdulmenan said.

Desalegn Yizengaw, vice president of the Bank in charge of financial management, says that the constant depreciation of the Birr against a basket of major foreign currencies has caused the loss.

“The year saw as high as 15pc depreciation of the Birr,” said Desalegn, “this is higher than the growth rate of the previous years.”

The annual pace of nominal depreciation of the Birr against the basket of major foreign currencies has been gradual and quite stable at about five percent in recent years. However, over the past year, the local currency has been continually devaluing by approximately 0.3pc every week.

A huge expansion followed the increase in revenues with expenses. Interest on savings increased by 20pc to 1.8 billion Br. The increase must have been due to a surge in deposits, which reached 47.6 billion Br, an increase of 48pc, mobilised from its 2.6 million customers. The loan-to-deposit ratio at Abyssinia increased to 77pc from 72.9pc.

The loan-to-deposit ratio of the Bank is incredible, according to the expert, who added that the management should be applauded for it.

“However, the high level of the ratio is somewhat concerning as it can cause liquidity problems as happened at the end of 2019 and early 2020,” he said.

Last year, the National Bank of Ethiopia offered 14.5 billion Br in loans to the cash-strapped commercial banks at a competitive bidding interest rate. The banks have been grappling with a liquidity strain that has not been seen in the economy for over two decades.

“The management should watch the liquidity level,” said the expert.

Liquidity issues are not determined by a single bank, according to Desalegn, who mentions inter-banking transactions through cheque and payment clearances.

“There was an industry-wide liquidity crisis in the country last year,” he said, “and it was reflected at every bank.”

Normally the period from October to February is known for the harvest season where there is a shortage of cash at the banks, according to Desalegn.

Salaries and benefits paid by Abyssinia soared by 86pc to 1.8 billion Br, and general administration costs went up by 30pc to 814 million Br.

The massive surge in salaries and benefits is concerning unless it is related to significant salary adjustments and business expansion, according to Abdulmenan.

Desalegn confirms the expert’s comment.

“We made huge investments in technology, which will have an outcome in the coming three years,” said Desalegn.

Last year, the Bank approved a new restructuring that expanded the management base and offered salary raises and benefit packages, according to Desalegn.

“We pay 20pc to 30pc higher than the industry,” he said.

During the year, the Bank has opened 166 new branches and pushed the total number of branches under its network to 503. Its employee count has also reached 6,700.

The total assets of the Bank expanded significantly, increasing by 45pc to 57 billion Br. Abyssinia’s investment in NBE bonds decreased by seven percent to 7.1 billion Br due to phasing out of the 27pc directive. The bond investment accounts for 12pc of the total assets and 15pc of the total deposits of Abyssinia.

Further reductions of these proportions are expected in the years to come, according to Abdulmenan.

Liquidity ratios indicate that Abyssinia’s liquidity level increased in terms of value but declined in relative terms. Cash and bank balances increased by 42pc to 6.4 billion Br. The ratio of liquid assets to total assets slightly decreased to 11pc from 11.4pc, and the ratio of liquid assets to total deposits also declined to 13pc from 13.9pc.

The Bank should take extra caution against a further reduction in the liquidity level, according to Abdulmenan.

Abyssinia had capital and non-distributable reserves including revaluation reserves of 5.3 billion Br and a capital adequacy ratio (CAR) of 14.3pc. Even though the CAR of the Bank is well above the regulatory minimum, it is far lower than the industry average of 18.5pc in the last fiscal year.

“The management needs to consider increasing its CAR for a precautionary reason,” recommends the expert.

The issue of CAR will be addressed at the end of the current fiscal year, according to Desalegn, who says that the Bank will work on matching the growth rate of the paid-up capital with loans and deposits.

“The subscribed four billion Birr capital will be fully paid this fiscal year,” he said. “The general assembly will discuss and vote on further capital growth.”

Girma Alemu, one of the 2,400 shareholders of the Bank, was blithe about last year’s performance.

Girma joined the Bank a quarter of a century ago as a founder by investing 25,000 Br. Currently, the value of his shares has reached one million Birr after he bought more shares three years ago.

“I only witnessed disagreement and controversy at the Bank during its establishment while picking a name for the Bank,” he said. “After that, I heard no disagreement among shareholders, unlike other companies and financial institutions.”

Girma says that some of the founders opposed the name Abyssinia during its establishment. But Abyssinia, the former name of Ethiopia, was approved by the majority.

“The Bank proved it’s a bank of all,” he remarked. “It’s owned by shareholders from all parts of the country.”

Law Sets Tariff Modes for Off-Grid Electricity

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A new draft directive that outlines guidelines for setting and reviewing mini-grid electricity tariffs is making its way toward legalisation. Drafted by the Ethiopian Electric Authority, the directive is part of the Authority’s latest law for the governance of off-grid electricity generation and distribution systems.

The directive, which sets the tariff for a period of four years, takes into consideration the ability and willingness of consumers to pay the tariff while ensuring that costs incurred by the developer and return on investment are considered.

The retail price for the use of the power generated by off-grid developers will encompass revenues for both generating and distributing the electric power with considerations to price predictions for four years of application time. It will include capital costs of developers, distribution asset costs, depreciation of the systems in use, customer service costs and taxation. It will, however, deduct any costs that have been subsidised by other bodies.

The tariff can be set based on consumption amount or as a flat rate. The developers are tasked with doing a survey and communicating with potential customers to come up with a tariff that will then be approved by the Authority.

The tariffs are set not to exceed national average tariffs for up to one kilowatt-hour of consumption a week in cases where it is subsidised. In the case where there are no subsidies, the retail price may be higher than national average tariffs.

This is a minimum threshold applicable to households that use the electricity just for lighting, according to Bahru Oljira, competency certification & technical regulation director at the Authority.

“This is a business venture, and mini-grid operators take on more costs due to the short-lived nature of their equipment, which raises the prices higher than for users of the national grid,” he said. “The government may step in and subsidise the cost, in which case, it’ll be beneficial to end-users.”

Most beneficiaries of off-grid electricity systems are expected to be in rural areas where the National Grid System has not yet reached, according to Bahru.

The directive also lays the ground for cross-subsidisation, where substantial users of the grid system may subsidise costs for others given the intensity of their use. A good example would be industrial firms that may congest the lines due to heavy consumption.

The tariff, once set, will be in use for a period of four years, unless contested by either the consumers, developers or the regulator. While the review mechanism entails that 10 active or potential customers can petition for a review, the tariff revision request may take up to 60 days. It will include an application for revision, preliminary review and public hearing. It will commence with a tariff recommendation and approval following a post-preliminary review. If displeased with the result of the revision, petitioners will need to re-file a tariff application within the following 30 days.

The directive also outlines the quality of service and technical standards for off-grid electricity producers. Under the former, it limits the unplanned outage frequencies to be less than 96 times a year for hydro and wind, and less than 52 times a year for solar and other mini-grid electricity suppliers. The duration of the interruptions is also set to be less than 10pc of the annual intended service hours. Planned interruptions are not to exceed 12 instances and an outage duration of 5pc of the supply.

“The penalty for developers that overshoot this limit will be set with a regulation,” said Bahru.

Licensees are compelled to generate at least 50pc of consumed energy annually from renewable energy, according to the directive.

Developers like Alphasol Modular Power Energy Plc, which has been working in off-grid electrification in the country for over 10 years, point to some bottlenecks that need to be attended to if the sector is to play an even bigger role.

The stringent parameters of microfinance institutions make it difficult for users to benefit from using off-grid electrification, according to Nebiyu Assefa, deputy CEO of the company.

“Higher production of power entails a higher cost for the community,” he said. “Microfinance institutions need to be more flexible so that end-users access higher energy production. When power levels are low, they only serve as lanterns, and that doesn’t significantly change the lives in the community.”

The company has been providing solar water pumps and solar electrification for schools and homes in rural parts of the country, according to Nebiyu. While solar energy systems are exempt from taxes, accessories that benefit from it are not, like solar water pumps and televisions.

“This is not uniform and discourages the use of solar energy,” he said.

There is currently 44pc electricity coverage with two licensed mini-grid operators, one wind and one solar-based, in the country. The federal government’s National Electrification Programme aims to achieve full electricity coverage in the country by 2030, with nearly 35pc of the power expected to be provided by off-grid operators.

For some experts, this is regarded as a highly ambitious plan.

The scattered nature of settlements in the rural areas of the country and the high prices that come with off-grid electrification make this plan difficult to attain, especially photovoltaic (PV) ones, according to Wondowossen Bogale (PhD), associate professor at the School of Mechanical & Industrial Engineering at Addis Abeba University.

“Laying the cable connections by itself will be challenging in the current settings of inhabitants,” he said. “The cost of the materials is also high, and the personnel who operate it are few.”

Countries that have excelled at off-grid electrification have incentivised and supported engagement from the private sector, he explained.

“Though there are tax incentives for photovoltaic developers here, it requires more encouragement,” he said.

Integrating various methods of off-grid electrification is the way to achieve sustainable electrification for the country, he added.

“Combining solar and wind power generation may bridge the gaps where one won’t work,” he said. “As most rural communities are engaged in agriculture, integrating biogas from agricultural waste will also prove beneficial.”

The cost-effective nature of wind power should also be taken as an advantage and implemented in smaller scales, he advised.

Development Bank Sees Top Level Reshuffle

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The Development Bank of Ethiopia (DBE), the state policy bank, has appointed two vice presidents. Yilma Abebe, the Bank’s internal audit director, was promoted to vice president in charge of small & medium enterprise financing. At the same time, Sefialem Liben, a former employee at the central bank and Bank of Abyssinia (BoA), was appointed vice president of corporate services. Yet the Bank, which has seats for five vice presidents, still has two vacant posts.

Yilma replaced long-serving vice president Teshome Alemayehu, who had seniority in lease financing, running projects financed by the World Bank and the Japan International Cooperation Agency (JICA). Teshome has been appointed as a lease adviser.

Before being appointed vice president, Yilma was removed from his post of internal auditor and was assigned to the loan review department where he stayed for only a few days, according to sources close to the case.

Yilma holds first and second degrees in agricultural economics from Haramaya University and Saint Mary University, respectively. He has worked at the policy bank for over two decades in different posts, including branch manager, senior credit analyst and auditor.

The 52-year-old Sefialem Liben, who has vast experience in the banking industry, graduated from Addis Abeba University in business administration in 1989 and joined the National Bank of Ethiopia (NBE) the same year. He also earned his second degree in Business Administration in 2007 from the same university. Before departing from the central bank, Sefialem’s last post was as a department director. In 2010, he joined Abyssinia as vice president in charge of resources. He departed BoA to engage in senior consultancy services after serving for over six years.

Sefialem replaced Dessalegn Bogale, who was serving as acting vice president for the past few months. Before Dessalegn took the post, Hadush Gebreegziabher, vice president of corporate services, departed from the Bank in March after serving for three and a half years. Prior to being appointed as vice president in 2017, Hadush was the Meqelle Branch District Manager.

The latest appointment is part of a redeployment plan of the new management, according to Natnael Hailu, acting director of strategy, change and communications at DBE, which has been struggling with a high rate of non-performing loans that once even reached 40pc.

The appointment of the two new vice presidents should be endorsed by the board of the Bank first, and then it will be sent to NBE for approval, according to Natnael.

The Bank has had a new president since mid-September of this year. Yohannes Ayalew (PhD), the former vice governor and chief economist of NBE, has assumed the presidency at the Development Bank, replacing Haileyesus Bekele. Over the past four years, the Bank has changed presidents three times.

Getachew Wakie, vice president for project appraisal and portfolio management for the past three and a half years, is now joined by the two new vice presidents. However, the posts of vice president for finance & banking and vice president for customer relationship management have been vacant for over a year and have not yet been filled.

“It’s been challenging to get the right picks for the posts,” said Natnael. “But there will be more appointments in the coming weeks to fill the vacant posts.”

Fighter with the Soul of an Artist, Yemane Kidane Passes

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It did not take much more than to greet Yemane Kidane, aka “Jamaica,” to have an idea of his disposition. Perennially upbeat, a glass half full kind of guy, he consistently replied back to everyone that asked ”How are you?” with a characteristic “Beautiful.”

Beauty, but more importantly, aesthetics, was where he believed some of the best things in life could be found. He loved good food and was a cook that received accolades. He enjoyed music and liked to dance. He was fashionable. His hairline had receded significantly, so he no longer resembled his younger self when he was sporting an afro. But he had grown into his new look with style, often wearing glasses and donning a black beret.

Then there was, of course, his appreciation for a good cigar, a habit he kept into old age before he passed away after battling cancer on November 16, 2020, in Seattle, United States.

“He loved life and lived like there was no tomorrow,” says Selome Tadesse, former head of the Ethiopian Broadcasting Corporation (EBC) and a women’s rights activist. ”You can see it in the food he ate and the clothes he wore.”

Yemane and Selome met in the early 1990s working in government. As far as she is concerned, a person so easy going cannot help but become an artist, as did Yemane, who dabbled in literature with the likes of “Alibegerenet”, a book of collected poems.

”He was artistic; that was where the appreciation for life came from,” says Selome.

It was not normal to find meaning in the small things in life for a man that tried to change the big things, namely, by bringing about a revolution. But it was a testament to his upbeat view of life that his personality almost overshadowed that he was nearly royalty in the political status quo of the past three decades.

By virtue of birth, Yemane’s claim to popularity was as a cousin to Isaias Afeworki. He was born in Asmera, Eritrea, to a wealthy family. His father was a businessman, and his mother owned a hotel. The year he was born, 1950, was a momentous period for the country his older cousin would eventually become president of. A report was submitted to the General Assembly of the United Nations that year on the status of Eritrea, which had fallen from Italian into British hands. Two years letter, it would fall into Ethiopian hands in the form of a federation.

Both Isaias and Yemane would grow up. One would be at the helm of a movement, the Eritrean People’s Liberation Front (EPLF), which would go on to defeat the forces of the Dergue. The other, Yemane, who had interrupted his studies to join his cousin’s movement, would be given a momentous mission that would go on to change his entire life’s trajectory.

In the early days of the establishment of the Tigray People’s Liberation Front (TPLF), the mid-1970s, as its leaders were articulating their objectives, they decide to form a strategic partnership with the older and more experienced EPLF. They required, at the very least, training. The EPLF sent two of its high ranking members to help out.

One was Mehari Haile, aka Mussie. The other was Yemane, who was nicknamed “Jamaica” because of the time he spent in the Caribbean country before joining the struggle. It would prove a significant departure to the life of the latter. Even from their early days, the EPLF and the TPLF, though cognizant of their convergent short-term aims, did have their differences even before they went on to secure state power. Not least of these differences was the issue of self-determination, according to Martin Plaut, a researcher on the Horn region.

During the struggle, Yemane became a strong advocate of the movement and close friends with the leaders of the Front. It was an emotionally robust relationship and would more or less define his legacy in the eyes of the public. His friends in the movement held a strong place in his heart. When his first child was born, he named him Mussie, after his fallen comrade.

When war broke out between Eritrea and Ethiopia in 1998, with the EPLF and the TPLF at the helm, respectively, he remained loyal to the country on the southern side of the Mereb River. When a rapprochement was struck between the two countries two decades after hostilities broke out, he was no less thrilled.

“I am Ethiopian, he is Eritrean,” he said of President Isaias, after the warming of relations.

For him, the issue was personal. His siblings were in Eritrea when the war had broken out. When his brother and sister passed, he could not attend their funerals, because he would not be allowed in.

“I came through struggle until now,” said Yemane, who is survived by two children and a grandchild. “This peace touches me directly … I hope to help with all my strength.”

Bunna Insurance Maintains Profitability, Yet Rate Slides

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Bunna Insurance, one of the youngest insurance firms in the country, has netted 20 million Br in profit during the last fiscal year. The net profit, however, was 25pc lower in comparison to the preceding year.

The firm’s earnings per share (EPS), the net profit divided by the number of shares owned by the firm’s 634 shareholders, also plunged by 11 Br to 16 Br. The reduction in EPS was caused by a drop in profit combined with a massive injection of fresh capital. During the reporting period, the insurance firm boosted its paid-up capital by 29pc to 145.2 million Br.

Despite the decline in profit and EPS, Bunna was able to boost its gross written premium earnings by 22pc to 249.2 million Br, of which the company retained 78pc. Bunna’s retention rate was slightly higher than the industry average of 77pc recorded two years ago.

Zewdu Minas, the board chairperson of the seven-year-old Bunna Insurance, says the firm achieved premium growth despite the high market decline due to Novel Coronavirus (COVID-19) and other challenges.

A surge in claims coupled with rising operating expenses were the main culprits for the reduction in Bunna’s profit. The total claims paid and provided for increased by 45pc to 122 million Br.

The rise in claims considerably undermined the performance of Bunna, resulting in a 19pc reduction in underwriting surplus to 27.9 million Br.

“Over-target paid claims and high reserve for unexpired mega-risk insurance coverage has made a negative impact on the budget year’s underwriting result,” said Zewdu.

The significant increase in claims needs serious attention from management, according to Abdulmenan Mohammed, accounts manager at the London-based Portobello Group and a financial statement analyst with close to two decades of experience.

Motor insurance policy and carriers liability, a policy that covers risks of transported goods and merchandise, were the reasons for the rise in claims, according to Dagnachew Mehari, CEO of Bunna, which recently launched the carriers liability policy.

“After COVID-19 was reported in the country,” said Dagnachew, “the Ethio-Djibouti corridor was busier than usual transporting different imported items.”

Because of the congestion on the corridor and stress on the drivers since Djibouti had a higher number of confirmed COVID-19 cases at the time, there were recurrent accidents, according to Dagnachew.

“These led the firm to spend more to cover the claims for loss or physical damage to the vehicles, death compensation claims, as well as the cargo carried on the trucks,” said Dagnachew.

Direct operating expenses also increased by 13pc to 23.5 million Br, while general administrative costs and salaries and benefits went up by 37pc to 42.3 million Br.

The growth of expenses at Bunna is concerning and the management should closely monitor the expansion of expenditures, according to Abdulmenan.

Dagnachew, who considers employee issues an internal risk, says that last year the company paid a bonus to its employees as an incentive and recruited high-caliber staff with experience, which cost the company more money.

During the past fiscal year, the firm hired 36 new employees, pushing the total number to 171. It also opened three new branches, bringing the overall number to 24 plus two contact offices.

“The firm is nothing without its employees,” said Dagnachew, who added that Bunna has started conducting an employee satisfaction survey this year. The firm’s risk department will conduct the survey regularly, according to the CEO.

Last year, the firm spent nine million Birr in interest on the 169-million-Br bank loan it borrowed to purchase a six-storey building located near the African Union. Procured seven months ago, the building is currently serving as the headquarters of the firm.

Despite a rise in expenses, Bunna did well in investment activities. Interest income increased by 26pc to 20.4 million Br, while dividend income went up by 71pc to 13.7 million Br.

It earned a commission of 16.5 million Br, an increase of eight percent, and paid 14.6 million Br in commissions to agents, an increase of 15pc.

The total assets of Bunna increased significantly. Total assets soared by 51pc to 634 million Br. Out of this, 167.4 million Br and 95 million Br were invested in savings and other investments such as shares, respectively. These investments decreased to 41.4pc of total assets from 56.7pc .

“This is a good investment strategy,” commented Abdulmenan.

Liquidity analysis shows that the liquidity level of Bunna decreased in both value and relative terms. Cash and bank balances decreased by 16pc to 33.3 million Br. The ratio of cash and bank balances to total assets decreased to five percent from nine percent.

Bunna needs to take caution against a further reduction in liquidity, according to Abdulmenan.

The firm is working on maintaining its liquidity status as well as meeting the requirements of the central bank, which stipulates that insurance firms keep 60pc of their assets in cash, according to Dagnachew.

“That’s why we took a bank loan to buy the building,” Dagnachew told Fortune.

The capital and non-distributable reserves of Bunna account for 24.6pc of its total assets. The firm is a well-capitalised insurance company, according to the expert.

“Bunna should use its capital to bring in more returns,” said Abdulmenan.

The financial performance of the firm put it in the 13th position of the industry, which has 18 insurance companies operating with 605 branches across the country. The capital of these firms reached nearly 9.7 billion Br during the reporting period.

Lemma Woldaregay, the founding shareholder of the firm, also says he is satisfied with the outcome.

“Despite the challenges brought by the pandemic,” said Lemma, “the firm performed well.”

Lemma, who is also one of the founders of Bunna International Bank, buying shares for 3,000 Br, also but seven shares at Bunna Insurance when the firm made its second-round share sale before it became operational a few years back.

Lemma, whose number of shares has doubled without new investment, is optimistic about the future performance of the company, saying that Bunna has already overcome the previous year’s challenges.

“Now it’s trying to stand on its own two feet,” said Lemma.

City Commences Well Drilling to Bridge Supply Gap

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Eleven water wells that are expected to supply an additional 33,000 cubic metres of water to the capital are scheduled to start operations this coming January. The projects were awarded to four local and foreign companies.

Initiated by the Addis Abeba City Water & Sewerage Authority, the water well drilling project is included under the second phase of the project for the current fiscal year. The first phase marked the addition of 20,000 cubic metres of water from nine wells to the water grid.

Launched at the beginning of the fiscal year, the entire project has an allocated budget of two billion Birr and a total of 55 wells under its wing. Upon conclusion of the project at the end of the year, the Authority aims to provide a total of 100,000 cubic metres of additional water supply to the city, which has a daily demand of 1.1 million cubic metres.

The projects under the second phase are located in Gulele, Arada and Yeka districts. The wells will have depths ranging from 300m to 500m. CGCOC Group, G6 Trading, Amhara Water Works Construction Enterprise, and Mulugeta Mekonnen Melesse Water Well Drilling were awarded contracts to carry out the drilling.

Mulugeta Mekonnen Melesse Water Well Drilling, which won one lot consisting of three sites in the project, is mobilising the necessary machinery to start the work, according to Fikrealem Ketema, the company’s drilling project manager.

The firm, which had previously carried out water well drilling for bottled water companies like Gift and Daily Water, has been given two months to finalise the first two sites with an additional two months allotted for the remaining site.

“It is enough time for us to finish as the wells we’re drilling are 300m deep,” said Fikrealem. “This is assuming that there are no extraordinary hydrological or formation complications.”

The sites for the wells have already been finalised, and right of way issues with the local communities have been solved, according to Serkalem Getachew, communication affairs support process leader at the Authority.

“Demarcation is a central challenge for water well projects,” she said. “We’ve also encountered theft of electric cables and other necessary equipment.”

In the past month alone, the Authority has reported the theft of miscellaneous items including water pipe maintenance equipment worth 23,000 Br from its storage facilities.

New road projects also tend to cut existing water lines during construction, according to Serkalem.

Currently, the city sources its water from across 200 wells and the Legedadi, Gefersa and Dire water reservoirs. The reservoirs and wells have a combined production capacity of 574,000 cubic metres of water, with the majority sourced from the latter.

The production capacity of wells and reservoirs suffers by 30,000 cubic metres due to power fluctuations, which affect production and distribution, according to Serkalem.

In addition to this, nearly 40pc is wasted along the way for various reasons.

The initiative to dig wells is only a temporary solution to address the city’s needs until bigger projects are set in motion, added Serkalem.

“Water wells aren’t sustainable,” she said. “They’ll eventually run out.”

The long-term plan of the Authority will be to incorporate the second phase of the Legedadi Reservoir, which is expected to generate 86,000 cubic metres of water, according to her.

Though wells are no permanent solution, experts like Andualem Tilahun, a hydraulics engineer with over 13 years of experience, believe that the project undertaken by the Authority is sensible.

“The priority should be the needs of the city’s inhabitants, who should have potable water provided to them by any means,” he said.

The option of using wells to supply the water needs of the city is also a comparatively less costly venture as it requires only an initial investment as groundwater doesn’t have many impurities, according to Andualem.

“There might be some physical impurities as well as mineral concentrations, but that requires minimal work,” he said. “Surface water sources like rivers, on the other hand, require a substantial amount of capital to build and then incur ongoing high costs for the treatment centres.”

Due to impurities emanating from various waste, surface water will require capital for initial structure construction that may entail dams, as well as for the building of treatment centres and the necessary chemicals for the treatment, he explained.

National Convention Bureau Gears Up for Launch

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Ethiopia Convention Bureau, an agency in charge of attracting business and conference tourists to Ethiopia, will hold a national launching event in January with the slogan “Meet in the Land of Origins”. The Bureau along with its Meetings, Incentives, Conventions & Events (MICE) brand was set up less than half a year ago and aims to make Addis Abeba a MICE destination favourite of Africa by 2030.

Aided by consultants hired from the World Bank throughout its preliminary phase, the Bureau, which has designed a three-year strategic plan with a budget of 3.4 million dollars, crafted its national MICE Vision following a feasibility study and situation analysis in the country. The Bureau has completed staffing up, crafting an incentive and meeting planner guide and manual, and web design.

The Bureau, operating with eight staff members including the director, has prioritised six key targets under the strategic plan. Increasing the number of delegates that come for meetings and conventions, the amount of spending per delegate, and the duration of their stay make up the first three components. Incorporating events to take place during off-season periods to ensure year-round income generation and eventually encouraging them to be held in second-tier cities are also key goals of the initiative.  It also aims to spill over opportunities across the service value chain.

The Convention Bureau, anchored within Tourism Ethiopia, will not organise events or conferences on its own. Rather, it will mainly provide advisory services to organisers along with planning and giving on-site support for events. The sales section, its most vital element, is where it will source new business markets and engage in bids to be handed over to the private sector once secured.

There has been a tentative selection of venues for the launch, according to Alemayehu D. Tinsae, the director of the Bureau, which hopes to involve governmental bodies and a multitude of associations in the country in securing international events.

“We can also provide support to them,” said Alemayehu.

Credibility, an issue faced by the private sector, hinders securing international bids and will be solved through the intermediation by the Convention Bureau, according to Alemayehu.

Convention bureaus are helpful for the private sector since they compete internationally as dedicated entities that will pursue bids, according to Yoadan Tilahun, founder & managing director at Flawless Events and president of the Ethiopian Events & Exhibition Organisers Association.

“This was previously done sparingly through various government bureaus,” she said. “The international bids are complex, so when the Bureau manages to secure them, then it will be up to us, the organisers, to deliver.”

International MICE bids are a matter of showcasing a country’s relevance and benefits to a planned event, according to Yoadan.

“The advantage of the Bureau will be that there is a dedicated entity that will follow up and compete on a much larger scale,” said Yoadan.

Recognising that there was previously no official track record regarding international events or conferences taking place in the country, the research section under the Bureau will be tasked with documenting and measuring the sector’s performance.

The idea of a convention bureau at a national level may be new, but the Addis Abeba Convention Bureau was established nearly a year ago. Kumneger Teketel, a hospitality expert who proposed the concept of MICE to the City Administration at the time, states that the challenges for such an institution are dedication and budgetary restrictions.

“The idea came to fruition after pushing for it for over six years,” he said. “A national bureau, however, is a milestone for MICE. This is of utmost importance if we are to promote this section and bridge the gap between public and private industry players.”

South Africa, with two convention bureaus, ranks first among African countries as per the rating of the International Convention & Congress Association (ICCA), which ranked Ethiopia 88th after hosting 13 international meetings in 2019.

Due to the pandemic, meetings have shifted onto online platforms, and pundits in the sector comment that the recovery period of business and conference tourism might take longer.

“We’re witnessing a hybrid form of meetings where some are taking place online, while others are in person,” said Alemayehu. “The pandemic wasn’t taken into consideration when we did our study, and this will definitely have an impact. We’ll have to revise our strategy.”