Dec 23 , 2023

The business landscape in Addis Abeba is on the verge of transformation as the City Administration takes bold steps to outsource various functions in the public services in trade, revenue, transport, health and education bureaus. This strategic move has not gone unnoticed by the Addis Abeba Chamber of Commerce & Sectoral Association (AACCSA) which has formed a five-person sub-committee to explore potential areas for engagement in this privatisation effort.

Chaired by Seyoum Chane, responsible for Policy Research & Advocacy, the members Yohannes W. Gebriel, director of the Arbitration Institute, Tsegaye Haile, human resource administration, Bemnet Tesfaye, IT manager and Genet Zenebe, manager of Membership Development & Relations, delve into potential areas of engagement, signalling a pivotal moment for the business community. Their mission is clear — to identify strategic entry points for the Chamber as the city administration opens doors for private sector participation.

The 76-year-old institution with a membership of 17,000 takes a proactive stance underscoring its commitment to not only adapting to but also shaping the changing business landscape.

The primary focus lies on the city's Trade Bureau, a vital entity in the business ecosystem. Trade licensing takes precedence as the initial target, with plans to evaluate other potential avenues of engagement. Recognising the challenges posed by bureaucratic hurdles, outdated technology, service inefficiency, and poor quality of services, the Chamber aims to leverage technology to streamline processes and enhance services.

According to the Chairman, exploring technology tools and equipment aligns with feedback received from the business community.

"Our first aim is to bring trade licensing and renewal into our purview," Seyoum emphasised, highlighting their dedication to addressing critical issues that have long hindered the smooth operation.

Seyoum articulated their approach as a parallel self-evaluation that will occur concurrently with the city administration's decisions on which sectors to involve the private sector in.

"We're preparing ourselves," he told Fortune.

Inefficient services and outdated technology have been persistent challenges for businesses operating in Addis Abeba. Yohannes echoed the sentiments of untangling the bureaucratic web. He stated: "We aim to promote business and investment after all."

Binyam Mikru, head of the Trade Bureau and a cabinet member, recently revealed to tier-one taxpayers that the outsourcing process of critical functions was nearing realisation during a discussion at the Haile Grand Hotel around the Lamberet area. This shift towards Public-Private Partnerships (PPP) reflects a global trend where cities are increasingly leveraging the expertise and efficiency of the private sector to enhance service delivery.

Sewnet Ayele, communications director of the Trade Bureau, revealed the phased approach to outsourcing services. He disclosed process will involve consecutive bids for interested stakeholders, allowing the city administration to systematically offload services. This strategy is seen as a prudent way to navigate the complexities of outsourcing while ensuring a smooth transition and maintaining service quality.

"We are opening bit by bit," Sewnet told Fortune, emphasising that outsourcing would not only unburden officials but also enhance services for the approximately 470,000 licensed businesses in the capital.

The Trade Bureau's outsourcing plans extend beyond trade licensing. Sewnet disclosed that management of the four agricultural market centres at the entrances of the city would follow in the line, trailed by postal service management, digitisation of weight scales, and the operations of cooperative agencies supplying basic commodities.

The ripple effect of these changes is expected to usher in a new era of efficiency and innovation in the city's administrative and business operations.

Million Kibret, Managing Partner of BDO Consulting, has been a prominent voice advocating for the outsourcing of services from the public sector. He welcomed the city administration's initiative. Million underscored the inherent efficiency of the private sector and expressed the view that authorities should have embraced outsourcing long ago. "The private sector is inherently more efficient," he affirmed.

The Chamber hinted at its plans to engage in PPP arrangements offered by the city administration during its 17th general assembly at the Inter-Luxury Hotel last week. Under the leadership of Mesenbet Shenkute, a 12.5pc increase in revenue from the previous year was reported, reaching 81 million Br while its total assets declined by 13 million Br to 140.4 billion Br.

Despite challenges, the Chamber has undertaken policy advocacies, studies, and panel discussions, establishing the Institute of Directors and a business incubation centre. President Mesenbet acknowledged the difficulties faced by the business community but emphasised that certain issues were beyond their control.

Mesenbet reflected on the year's successes in hosting several policy advocacies, studies, and panel discussions, which were capped by the establishment of the Institute of Directors and the soaring heights of the business incubation centre. However, the festivities were marred by members of the Chamber who expressed the difficulty of the current business environment entrenched in corruption, curtailed by foreign currency shortages and backbreaking taxes.

The recent controversy over the management of the Addis Abeba Exhibition Center, leading to the cessation of the contract, was addressed, with revealing plans for joint investment with the City administration after extensive deliberations.

Vice President Fasika Sisay urged members to actively participate in the Chamber's affairs, attend meetings, and invest in the project to revamp the exhibition centre.

"Investment from members is crucial for the work," he appealed.

PUBLISHED ON Dec 23,2023 [ VOL 24 , NO 1234]

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