Taxi Drivers Brace for Fresh Costs as Speed Control Rule Nears

Posted on November 23, 2025November 27, 2025 by Web Master

A proposed regulation mandating the installation of GPS-enabled speed-limiting devices on all vehicles has triggered widespread concern across the commercial transport sector, as drivers and association leaders brace for what they see as an expensive and technically opaque imposition.

The draft directive, initiated by the Ethiopian Road Safety & Insurance Fund Service (ERSIFS), forms part of a broader campaign to tackle soaring traffic fatalities. Authorities argue that with speeding accounting for the lion’s share of road accidents, the regulation is a necessary step. But the prospect of mandatory compliance has left many drivers anxious over affordability, unclear technical standards, and enforcement risks.

The draft directive is part of a renewed push to combat the deadly effects of speeding, identified by authorities as the leading cause of more than half of traffic accidents in low and middle-income countries and the main factor in the carnage on local roads. If enacted, the new rule will apply to virtually every vehicle operating in the country, exempting only emergency vehicles, diplomatic cars, heavy machinery, and cars assigned to senior government officials.

Under the proposed regulation, speed controllers should be able to prevent vehicles from exceeding prescribed speed limits and transmit operational data to a centralised monitoring platform. Only certified companies will be allowed to import, install, and service the equipment, while vehicles lacking a functioning speed limiter will be denied the annual technical inspection certificate needed to remain on roads.

Implementation is set to roll out in phases, beginning with commercial transport services such as taxis and minibuses. Drivers and vehicle owners will bear the responsibility for installing, maintaining, and repairing the devices, which should be synchronised with GPS and sealed to prevent tampering. Police will have the power to inspect the devices during routine checks, and may temporarily seize a driver’s competence certificate if the equipment is found to be faulty or improperly installed.

The draft regulation spells out a strict penalty regime. Vehicle owners who permit operation without a speed controller face fines of up to 3,000 Br. Failure to repair a defective unit could result in a 2,000 Br. fine. Drivers may be fined 1,000 Br for driving without a device, operating with a malfunctioning or unsealed unit, or failing to present the installation certificate. Installer companies, meanwhile, could receive escalating penalties ranging from written notice to three-month license suspensions and, ultimately, license revocation for repeated noncompliance.

According to Yonas Belete, director of road traffic safety at the ERSIFS, the regulation is still a draft but is considered a necessary upgrade to existing measures.

“Accidents in our city are too frequent, and most occur because drivers exceed the speed limit,” Yonas said. “The current rules need software upgrades and more rigorous implementation.

ERSIFS is working with Ethio telecom to develop a speed control device service. While the device itself may be imported, the software will be developed locally to provide real-time traffic management data.

“This is part of our broader strategy to prevent car accidents,” Yonas told Fortune.

Earlier efforts included setting the speed limit at 50Km/h and collaborating with police to enforce compliance.

Yonas disclosed that a thorough consultation process was conducted to develop the draft, involving authorities from all 14 regions across the country, including Addis Abeba and Dire Dawa, as well as a major conference held five months ago to gather input before submitting the draft to the Ministry of Transport & Logistics.

“We’ve done our part and are waiting for the Ministry to move the draft toward implementation, which could happen any day now,” he said.

The rollout will initially target commercial vehicles such as Code 1 and Code 3 taxis, which have been implicated in many of the most serious accidents, especially those involving more than a dozen passengers. The specific type of speed-limiting device will be selected once Ethio telecom completes the digital infrastructure to support the system. Anyone seeking to import and market the device will need to meet technical capacity and quality standards and secure authorisation from the Ministry before entering the market. Once the regulation is officially adopted, all vehicles will be required to install the device on schedule.

While government officials capitalise on the safety benefits, the draft directive has sparked widespread concern among taxi operators, who fear an added financial burden. Many drivers, already struggling to cope with high fuel costs, maintenance, and spare parts costs, are worried that the new requirement will push them over the edge.

According to Getu Tesfaye, president of the Selam Taxi Association, which represents 400 members, the group had little information about the draft or the speed controllers themselves.

“Speed is a major problem among drivers, and this is a good solution for reducing accidents,” Getu said. “But we do not know the device or the costs involved. Taxi drivers are already struggling to change tyres and maintain vehicles. Adding new costs is very difficult.”

Getu would like transport officials to consider providing financial support or loans to his members.

Tekestebrhan Semre, a Code 1 taxi owner and driver with more than six years of experience, voiced similar concerns. He earns an average of 3,000 Br daily income, but after fuel, oil, and other expenses, he takes home less than 500 Br.

“Adding the cost of a new speed control device is more than I can handle,” he told Fortune.

Mola Genetu, a father of two, who has been driving a taxi for over a decade, was also worried about the financial pressure the device would create.

“We don’t deny that speeding causes accidents,” he said. “But adding costs without clear guidance is not a solution. There have been too many regulatory changes recently.”

Roughly 4,200 Code 1 taxis and about 1,000 Code 3 commercial transport taxis are operating in Addis Abeba. The roads remain perilous. In 2023/24, 401 deaths were recorded, with pedestrians accounting for 86pc of all fatalities. In the following year, fatalities increased to 448, where 83pc were fatal. Megenagna areas were identified as one of the city’s most dangerous traffic hotspots, recording 13 fatalities in the past year alone.

“The accidents are real and concerning,” said Dereje Beyene, president of the Tsehay Taxi Association, which has more than 410 members.

But he echoed the worries about financial strain and regulatory overload.

“Adding multiple regulations on top of existing burdens doesn’t fix the problem,” he said. “We’ve no objection to a new rule in principle, but the enforcement needs oversight to prevent corruption and ensure fairness.”

Proponents of the directive argue that enforcement, monitoring, and strict penalties will encourage compliance and, over time, reduce accidents attributed to speeding.

For Berhanu Kuma, who heads the road safety concept directorate at the Addis Abeba Traffic Management Agency, the life-saving purpose of the draft regulation is indispensable.

“Our main job is to enforce traffic rules, and more than half of the accidents in our city are speed-related,” Berhanu said. “This regulation can ease our work if implemented consistently.”

Transport officials insist a phased schedule will allow vehicle owners time to install the speed controllers, while locally developed software will handle performance monitoring and support broader traffic management efforts.

Beyond the taxi associations and regulators, experts in automotive and public health say that while speed control devices can reduce accidents, their effectiveness will depend on technical compatibility and sound implementation. Abiy Alene, a mechanical designer and lecturer at Addis Ababa University with over a decade of experience teaching automotive and transport-related courses, as well as more than 14 years of driving, agrees that speed is a major factor in many of the city’s traffic accidents.

“Speed definitely contributes to the accidents we see in the city,” he told Fortune. “Introducing a solution is not a bad idea. However, these devices also have downsides for both fuel-powered and electric vehicles.”

Abiy warned that the devices need to be adaptable to the actual road conditions. If they lock a car to a fixed speed limit at all times, they can damage engines, especially when the vehicle needs extra power to climb steep roads or descend safely.

Roads in Addis Ababa are not levelled, and in some areas drivers may need to exceed 50 km/h to climb hills or maintain safe control going downhill.

“We’ve already seen problems in some pickup vehicles that had speed-limit locks,” said Abiy. “The device should be able to sense road conditions, and for that to happen efficiently, roadside equipment also needs to be upgraded so the speed-control system can collect accurate information.”

Teferi Abegaz (PhD), an assistant professor of public health at Addis Abeba University who completed his studies on traffic accidents 15 years ago, concurred. Technological solutions targeting speed are necessary.

“Road safety is governed under global health frameworks, and addressing speed is a key component,” he said. “But implementation will be challenging. This type of technology needs strong software support, and GPS-based systems can make enforcement easier.”

Teferi cautioned, however, that the biggest obstacle will be vehicle compatibility. He observed that most Code 1 and Code 3 commercial vehicles are not computerised to handle advanced monitoring systems.

Soaring Cooking Oil Prices Squeeze Households, Expose Market Fault Lines

Posted on November 23, 2025November 26, 2025 by Web Master

In a troubling divergence from official inflation data, the cost of everyday essentials is climbing with unnerving speed, reshaping household habits and revealing deep inefficiencies in the import-dependent supply chains.

Nowhere is this more visible than in the spiralling price of cooking oil, an indispensable kitchen staple whose sudden surge is reverberating from the open-air markets to restaurant kitchens and low-income homes.

The divergence between official statistics and the lived experience has been drawing increasing attention, particularly as international organisations weigh in with their own analyses. The International Monetary Fund (IMF) recently confirmed what most families already know. The cost of goods and services in Ethiopia has jumped by an average of 13pc. Yet, the Central Statistics Agency (CSA) offers a different reading, reporting food inflation at 10.2pc this month.

On the ground, however, the difference is all but invisible. Prices continue to surge, stretching household budgets to their breaking point.

The disparity is evident in the capital’s busiest markets. In neighbourhoods such as Ayer Tena, Mercato, and Lancha, a walk through the stalls reveals how much prices have jumped in a matter of days. Cooking oil, a staple in local kitchens, has become an example of this crisis.

The preferred Omar brand, widely known for its quality, jumped 18pc in a week, rising from 1,700 Br to as much as 2,000 Br, depending on the shop. Orkide oil followed closely, rising 12pc to 1,850 Br, while Sunflower, another popular choice, spiked 17pc to 1,750 Br. Even more striking is the Viking brand of palm oil, which soared from 1,100 Br to 1,500 Br, a jump of 36pc in seven days.

For many in Addis Abeba, and across the country, these increases are forcing tough choices.

Tesema Bedaso, 28, has felt the pinch more than most. Working as a day labourer at a construction site near Bole Arabsa and living alone in Tulu Dimtu, he is financially stretched. He rents a single-room condominium for 8,000 Br a month, leaving little for food and other necessities. Not long ago, he could buy five litres of edible oil for 1,500 Br at his neighbourhood shop. But when he returned recently to restock, the oil was gone. With prices rising everywhere, he has been forced to change the way he diets.

“Now I boil potatoes and eat them with salad,” he said. “Almost every food needs oil to cook.”

Despite the challenges, Tesema is determined to find a way. He now plans to buy smaller amounts of oil, a litre or two, if he can find any at a reasonable price.

His story is far from unique. Fikirte Tilahun, a mother of three and a housewife, found herself in a similar bind when she set out to buy cooking oil. Initially hoping to purchase a five-litre bottle, Fikirte was taken aback by the new prices. She immediately scaled back her plans. She now buys only a litre or three at a time, the five-litre option no longer within reach.

“The cost of living has increased badly,” she said. “Life has become very tough.”

For shopkeepers, the situation is equally troubling. According to Habib Ahmed, who runs a small shop in Ayer Tena, he had little choice but to raise prices this week after seeing wholesale costs spike during a recent trip to Mercato. Almost every item on his shopping list was more expensive than before. Cooking oil, in particular, was subject to wild fluctuations.

“I feel ashamed when customers ask me the price,” Habib said.

Some customers accuse him of being greedy, but most eventually return after finding the same high prices elsewhere. The strain on supply is also growing. Habib saw how traders in Mercato were limiting sales to two packs of cooking oil per shop owner, if they were willing to sell at all.

“Even getting that amount has become difficult,” he said.

Officials, aware of the growing complaints, are stepping up efforts to monitor and stabilise the market. According to Ashenafi Berhanu, communications director at the Addis Abeba Trade Bureau, his office has begun inspecting markets to check for hoarding or excessive pricing. These are concerns raised by shop owners like Habib, who say the latest surge in prices has no explanation. Ashenafi also stated that there is no shortage of imported goods or disruption in the import system. He blamed speculation and hoarding for much of the current rise in the cost of living.

But traders and distributors in Mercato reject this, insisting the problem lies further up the supply chain. According to Hamdan Mohamed, a longtime distributor, the real issue starts with importers.

“If there is hoarding, it’s from the side of the importer, not from the distributors,” he said.

Hamdan claims that when importers supply sufficient product, Mercato traders have the capacity and the willingness to buy and distribute edible oil at only a small profit margin. He recalled a recent sharp price increase that began when importers raised their rates, sometimes citing factory shortages as the cause. The result, he said, is higher wholesale costs and fewer products to sell.

“The increase is because the supply is low and the import price is higher than usual,” he told Fortune. “It isn’t because we want to make unfair profit.”

Hamdan pointed to another issue where importers often issue invoices for a much lower amount than the actual sale price, a practice meant to reduce their tax burden. Distributors, meanwhile, are required to issue invoices for every sale they make at the actual cost.

“When the goods arrive, the invoice the importer gives us is much lower than what we actually paid,” Hamdan said. “This is pushing us toward loss.”

Distributors, needing the products, accept the deal but are left unable to issue the correct invoice when they sell the goods on.

The consequences are costly. Some distributors end up selling without issuing receipts. When revenue bureau inspectors visit, they treat the omission as a violation and threaten hefty fines, up to 100,000 Br.

Hamdan believes the only solution is for importers to issue valid invoices, allowing distributors to do the same and avoid these problems. The combination of low supply, high import prices, and invoice-related headaches, he said, is fueling the current crisis.

Zemzem Sermolo, another trader in Mercato, agreed that the trouble begins with rising import prices. The surge has forced her to stop selling liquid cooking oil and instead switch to palm oil.

“Whenever importers increase their rates, prices rise here,” she said.

She noted that liquid cooking oil has become so expensive that many customers now buy palm oil as a substitute.

The shift is affecting the restaurant business as well. Tigist Birhane, owner of the Beteseb Restaurant near Mercato, once cooked with high-quality oil for her customers. But with supplies tight and prices volatile, she switched to a cheaper, more reliable oil. The oil she once used now costs 2,000 Br for five litres, while the unpurified “Viking” brand sells for 1,500 Br and lasts much longer. For Tigist, who caters mainly to construction workers and bank employees, the change was not a choice but a necessity.

“The good oil is too expensive,” she told Fortune. “If I used it, I simply couldn’t make a profit.”

There are still efforts to provide relief. The Ethiopian Trading & Business Corporation, established to help stabilise prices, offers five-litre sunflower oil at 1,550 Br. According to Bestelot Yilma, an advisor at the Corporation, by importing directly and distributing through its own shops in major cities, the company can avoid the worst of the price spikes.

“Since we’re bulk buyers, we stock the products in advance,” she said. “Currently, we’re issuing the oil from our stock. There is no price increase in what we offer.”

The Trade Bureau maintains that its main job is to prevent hoarding and the sale of goods at inflated prices, not to set prices for traders. Ashenafi urged consumers to buy cooking oil at fair prices from Sunday markets and district consumer cooperatives throughout the city. He recommended that shoppers look to these outlets whenever possible.

Some experts argue that the current crisis goes beyond supply hiccups and market speculation. Getachew Alemu (PhD), an economist known for his commentary on macroeconomic issues, argued that the fundamental problem is reliance on imports for goods such as cooking oil. This exposes consumers to global price swings, customs tariffs, and logistical changes that can quickly push up costs.

“Even if the statistics indicate a decline, the situation on the ground feels very different,” he said.

Getachew attributed other factors to the price push, including unpredictable government policies, the tax authority’s outdated tax system, speculation, and tax changes to fuel. According to him, regulatory moves such as the closure of domestic oil factories for safety reasons have added to the instability.

“These sudden and unpredictable decisions distort the market,” he said.

Fuel taxes have also affected prices, sometimes prompting traders to hoard products in anticipation of future price hikes. This, combined with already high demand, has made the market even more volatile. Getachew called on the government to review its policies, revise the tax system, and manage the macroeconomy more prudently if it wants to keep prices in check.

Agency Turns to Shareholder Farming in Bid to Reshape Rural Economy

Posted on November 23, 2025November 26, 2025 by Web Master

A federal agriculture agency sets an ambitious plan to transform the agricultural sector, creating private agricultural business companies across cluster farming areas.

Developed by the Agricultural Transformation Institution (ATI), the plan seeks to reshape how farmers grow, market, and benefit from their crops, offering a glimmer of hope to millions who have long relied on traditional, subsistence farming. Part of the Agricultural Commercialisation Clusters (ACC2) project, it carries a clear mandate to end the dominance of intermediaries in agricultural markets and introduce a commercial model that links farmers directly to buyers, markets, and sources of agricultural inputs.

The first phase of the ACC, launched six years ago by former President Sahlework Zewde, marked a turning point in the sector’s strategy. Backed by a 128 million dollar funding package, most of it secured from international partners such as Denmark, with additional support from the African Development Bank (AfDB) and the European Union (EU), the ACC2 plan is expected to impact as many as 6.5 million of the 18 million farmers in the coming years, according to government projections.

According to the Agency’s officials, the federal government will cover the lion’s share of each company’s costs, but farmers should put up at least 10pc of the initial capital. These shares, contributed primarily in land and sometimes in cash, will make participating farmers shareholders, entitled to dividends proportional to their contributions. To buy in, each farmer would provide at least a quarter hectare of land at the national level. At national level one household has 0.8hc on average. The cluster is expected to run from 15hct to as much as 200hct.

The target is to fold about 15,000 of the 99,120 existing production clusters into 50 new Farmers’ Production & Agri Business Companies (FPABC) that will serve as the commercial backbone in as many districts.

Senior ATI officials see the new companies as more than market hubs. They will operate across the full value chain, from supplying inputs to aggregating produce, offering collateralised financing to their members, and, crucially, acquiring licenses to import and export.

“Every farmer should buy shares,” said Dagnachew Lule (PhD), ATI’s senior director for the clusters. “This is a win-win for jointly financed companies.”

The hope is to allow farmers to sell their products directly through these companies, without the costly intermediation of dealers that have long sapped incomes and created instability.

For years, farmers have struggled to add value to their products, held back by fragmented supply chains, poor infrastructure, and limited market access. Cluster farming, which began on 600,000hct, now covers 12 million hectares. However, Dagnachew believes, much remains to be done.

“We’re at 2.43 million hectares, but at the regional and ministerial levels, there’s more progress,” he said. “Persistent shortages of seeds, fertiliser, and mechanisation are still a drag on productivity.”

According to Dagnachew, while production in many regions is high, marketing remains elusive for many farmers due to poor roads and non-existent markets.

“If you want to improve agriculture, it needs financing,” he told Fortune. “Otherwise, there is no benefit.”

Private companies are expected to fill these gaps, serving as the focal point for the aggregation, processing, and marketing of key commodities such as maise, white grains, barley, mango, avocado, and honey, each company limited to the commodities produced within its cluster area. Once operational, the companies will be authorised to handle input procurement, agro-processing and exports. They will also be allowed to participate in the import of fertilisers.

“But much will depend on whether they are permitted to take part in the import sector,” Dagnachew said. “We need to reduce the gap observed in the market that we currently have.”

The rollout is tied to broader efforts to commercialise agriculture and make it a driver of economic growth and food security. A total of 115 million dollars in finishing funds is projected to be needed to complete the project over five years. The emphasis is beyond production and on integrating farmers into national and international markets, with each FPABC designed as a one-stop shop for the cluster farmers it serves.

The ACC2 program is expected to provide particular relief to roughly 300,000 internally displaced people, especially those in the Somali Regional State, who are expected to be among the first to benefit.

Gebru Tafesse, a veteran from Gurage Zone’s Abesheke District, grows mainly maise but has branched out into fruits and vegetables in recent years. He faces the same obstacles that have dogged generations of Ethiopian farmers. Most of his land, about 80pc, is planted with maise, with the rest devoted to avocado, mango, and sugarcane. Once the maise is harvested, he plants onions. In a good year, he brings in 700Qtls to 800Qtls of maise. Oftentimes, less, depending on the weather.

But for Gebru and his neighbours, market volatility is the defining challenge.

“We produce well despite the challenges, but the market is the engine,” he said. “Sometimes we’re forced to sell our produce at a very low price.”

Despite opening a shop in his kebele to sell fruit, he has rarely turned a profit. Even when he manages to sell as much as 50,000 Br worth of produce, he sometimes ends up dumping out unsold goods. In a good year, he can fill four freight trucks, each with 200Qtls of onions, for the market in Addis Abeba. But last year, market swings and poor roads cost him more than 100,000 Br.

Gebru is hopeful that the new companies will shield farmers from such losses, but he remains cautious.

“It’ll help, but what about the infrastructure?” he said. “My neighbours and I are willing to cooperate, but if the solution doesn’t address the real problems, our losses will continue.”

Since 2023, Gebru has watched the prices of nearly everything rise, even as farmers’ incomes declined. Fertiliser prices, late deliveries, and the absence of improved seeds remain a major bottleneck.

“Farmers need fair prices, not price increases on everything,” he told Fortune.

He warned that if the costs of seeds, fertiliser, and chemicals keep climbing, farmers’ livelihoods could be severely threatened.

Officials in the Central Ethiopia Regional State see the same problems and the same potential. According to Usman Surur, head of the regional agriculture bureau, commercialising agriculture is critical for improving farmers’ incomes and fixing the market-linkage gaps that persist across Ethiopia. He pointed to the first phase of the program, which he saw brought real, if incomplete, change.

“Success never comes without problems,” he said, predicting that the next phase will bring new opportunities and fresh challenges.

According to Usman, clustering has made post-harvest handling easier and reduced waste. In the Gurage Zone alone, more than 36,000hct of maise are planted in clusters, yielding an average of 83Qtls a hectare. In Kebena, a district within the zone, 8,000hct of maise are clustered, and another area boasts 2,000hct of wheat. For Usman, such a scale enables farmers to form their own companies, transforming the agriculture sector.

“Agriculture isn’t only ploughing and seeding, but it should also be productive,” Usman said. “In the past, farmers had no opportunity to grow by selling their products adequately. This system helps solve that problem.”

Usman believes that by giving farmers ownership stakes in the new companies, the initiative will create more sustainable market links and improve farmers’ ability to access domestic and export markets, as well as vital agricultural inputs. The first phase saw 2,800 farmers come together to establish eight milk-processing units. The next phase will introduce farmers to new technologies, from maise processors to potato chip plants and other commodity-specific ventures.

“There are real changes in our region, along with challenges,” Usman said. “Clustering has made post-harvest handling easier and reduced waste.”

He cited limited awareness among farmers, persistent financial constraints, and weak infrastructure (roads, telecom, and electricity) as critical constraints. Logistics, cold-chain storage, and transportation remain major concerns. Despite a record harvest of 115 million quintals last year, he hopes to realise an increase of up to five times that figure in the future by irrigation farming.

For Addisu Arega, the minister of Agriculture, the project is about more than boosting yields. He believes the initiative is a necessary shift from subsistence and fragmented farming to a coordinated and value-chain model capable of underpinning the country’s food security and economic future.

Experts agree that the new model represents progress, but warn that the transition will be anything but simple. Yemengist Tesfahun, who leads Agricultural Business & Value Chain Management at Gondar University and has spent over a decade working with farmers and cooperatives, characterised agricultural commercialisation as “complex and requiring strong organisation.” Farming, she argued, remains primarily focused on short-term consumption rather than the business of agriculture.

For Yemengist, the main challenge lies not only in resource constraints but also in deep-rooted infrastructure gaps and poor market linkages.

“Farmers have no experience of surplus production from feeding themselves to markets,” she said. “It requires practical work, not theory.”

Without clustering, she warned, “some products meant for export fall apart before they even reach the market,” making the cluster-farming approach all the more vital. For her, the biggest bottlenecks are land fragmentation, which makes mechanisation difficult and drives up costs. Agricultural extension services are not enough, and unresolved land policy questions still loom large.

“Development agents alone aren’t enough,” Yemengist told Fortune. “We need people at the grassroots level with practical expertise to guide farmers.”

In her view, clustering holds out the best hope for consolidating small plots and moving farmers toward profitable modern practices.

“There is more land covered with grass than with grain,” she said, arguing that the approach could move farmers away from outdated traditions and into wider markets.

She believes farmer-owned companies will be key to building stronger value chains and raising capacity, but infrastructure remains the most critical concern. Yemengist cautioned that the government’s bold ambitions must be matched by serious, sustained investment in roads, storage, and market access. Across the country, she obserevd, fruit and vegetables often go to waste for lack of transport and reliable buyers.

Minister Melaku to Suspend Raw Leather Exports Amid Industry Crisis

Posted on November 23, 2025November 26, 2025 by Web Master

The federal government is preparing to impose a ban on the export of raw leather, a decisive intervention by Industry Minister Melaku Alebel sought to revive a domestic tanning industry in freefall.

The proposed ban, currently under drafting, marks a dramatic shift from earlier restrictive tax policies and signals the Minister’s frustration with years of policy failure in leveraging the country’s vast livestock endowment for industrial development. Melaku revealed that his Ministry is drafting new regulations to suspend the export of raw leather, blaming its exports for starving tanneries of the resources they need.

“We’re drafting a regulation to stop raw leather export,” Melaku told federal legislators, pressing the urgency of his decision.

The authorities are considering suspending the export of raw leather as the federal government seeks to revive a battered industry and curb a mounting shortage of raw materials for domestic tanneries.

Over the past decade, Ethiopia’s vast livestock population has failed to deliver the anticipated economic returns, as quality issues, leakage, and weak policy enforcement have dogged the sector. The country is believed to host tens of millions of cattle, sheep, and goats, making it one of Africa’s leading livestock sources. In 2021, the off-take rate yielded an annual production of about 41 million pieces of hides and skins.

However, the numbers conceal a growing malaise. Despite the theoretical abundance, only 22 million pieces, roughly half of the annual production, reached tanneries. These account for an estimated 138 million square feet of material available for processing. The rest, according to industry experts, was lost to contraband, spoilage, or subpar collection and handling practices. The Leather & Leather Product Industry Research & Development Centre reported in 2023 that the country loses more than 240 million square feet of leather each year, at a cost estimated at one billion Birr.

Export earnings have reflected the downward spiral. In the 2020/21 fiscal year, the leather sector generated 40 million dollars, down sharply from 133 million dollars five years earlier, a 70pc plunge. In the decade beginning in 2012, earnings from tanneries collapsed by 84pc, while export volume shrank by 62pc.

Officials have attempted to prop up foreign currency inflows by imposing minimum export prices and hefty taxes on raw hide exports. Raw leather exporters are compelled to pay a 150pc tax and are required to sell their products at no less than seven dollars a piece. Minister Melaku is determined to go further and prohibit the trade altogether.

The squeeze on supply is felt sharply on the ground. Dagnachew Abebe, secretary general of the Ethiopian Leather Industry Association, represents a sector in distress. He pointed to a shrinking number of manufacturers, a severe shortage of raw materials, and a rapid decline in quality.

“Due to a shortage of raw leather, many tanneries have shut down,” he said. “The Association doesn’t support the export of raw skin.”

There were around 35 companies a few years back, but now they have shrunk to seven. According to Dagnachew, the quality of hides and skins from the Addis Abeba Abattoirs Enterprise remains up to standard and is used for safety shoes and military footwear.

“The quality is declining day by day,” he said.

He attributed much of the decline to the shifting of oversight from the Ministry of Agriculture to the Ministry of Trade & Regional Integration, with agricultural extension programs for animal treatment discontinued in the process. Around 80pc of the low-grade leather comes from the way animals were treated before slaughter, and the remaining from the industrial processing.

“The sector’s woes cannot be fixed at the factory gate,” Dagnachew told Fortune.

Contraband and the legal export of raw hides continue to siphon off quality materials from the domestic market.

Efforts to train workers through the TVET program have yet to translate into new job opportunities, as the sector languishes without quality input. Ambitious government plans unveiled over the past two years have set targets for the industry to reach 827 million dollars in annual export revenue by 2032. The strategic plan envisions the export of 166.5 million square feet of finished leather worth 208.1 million dollars, along with 45 million pairs of shoes worth 562.5 million dollars, 10.4 million pairs of gloves (20.8 million dollars), and 2.4 million pieces of leather goods and garments (36 million dollars).

Industry players, such as Evano Mesfin, manager of New Wing Addis Shoe Factory Plc, see that the reality on the ground is less promising. The factory has expanded from women’s footwear to other lines, but the same challenges persist. His company has managed a test shipment of safety shoes to Italy.

“The main challenge we’re facing is the quality of hide and skin, which has recently deteriorated in quality,” he said, voicing hope that procurement directly from the Enterprise could improve matters.

The difficulties extend up the supply chain. According to Mesfin Tekelewold, a marketing processor at Addis Abeba Abattoirs Enterprise, the company auctions hides and skins every 10 days, with purchases typically ranging from 20Kg to 25Kg, and sometimes reaching 40Kg. Although the auctions are open to any licensed buyer, attendance is low, rarely exceeding 10 companies.

“Many companies are discouraged, and some of the companies have even changed their line of business,” he said, citing low prices and weak incentives as culprits.

Collectors often do not bother to transport skins to collection centres, as the price is too low to justify the trouble. The collapse of basic collection infrastructure is another obstacle. The Collectors Association, once operated numerous collection sheds, but new corridor development projects have resulted in their demolition.

“There is no shed that collects skins and hides, which is becoming the major challenge,” said Tarekegn Jida, deputy director general of the Leather Development Centre.

He called for the establishment of small posts to collect and transfer hides seamlessly to factories, and urged the use of dry trash trucks during the holiday season, when slaughtering peaks. According to Tarekegn, at current market rates, a seller makes 17.5 dollars from an oxen hide. A research study commissioned by the Centre revealed that pricing should be based on weight, not pieces, as one piece weighs about 11Km, a measure that deters exporters under the current regime.

However, policy solutions remain elusive. The Ministry of Finance has advised the Ministry of Industry not to intervene directly in the market, a position that limits what industry officials can do.

The sector’s setbacks are not new, but veteran industry observers say the underlying issues are deeper than they appear.

Kebede Amda, a leather technician with four decades of experience, believes that the export of raw skins, particularly if destined for food and of lower quality, is not as damaging as portrayed. He contended that the problem lies in the authorities’ failure to support collectors and enforce quality standards at every level adequately.

“The leather is thrown out before we get a chance to collect it,” he said, lamenting the impact of poor waste management and misplaced environmental activism.

Kebede believes that if the sector had succeeded, it would have created jobs and helped reduce unemployment through a long value chain for value addition. He insisted that incentives be granted to collectors, including duty-free import privileges for refrigerated vehicles, to help preserve raw materials for processing.

Minister Melaku delivered a sobering report to Parliament last week, telling federal lawmakers that the sector is challenged by global competition and chronic shortages of raw materials.

“It isn’t as easy as exporting coffee,” he said.

The Industry & Minerals Affairs Standing Committee, chaired by Amarech Bakalo (PhD), pressed the Minister on poor results. The Ministry facilitated 681 million dollars in foreign currency to manufacturers last year, but the return on income was half that amount. The textile sector, given top priority, generated 118 million dollars, deemed “encouraging”, while leather exports yielded only 25 million dollars, all considered “disappointing.”

“What we ask is results,” Amarech pressed Melaku. “Show us the result. If the sector is not gaining, we should stop the incentive and shift our investment to the other sector.”

Melaku defended his Ministry’s efforts, pointing out that manufacturing returns are never immediate and that the sector needs supportive policies to thrive. He identified the lack of input and raw materials as fundamental challenges, adding that the problems extend beyond exports to import substitution. Other lawmakers cited past cotton gluts in Gondar, where overproduction forced farmers to burn their crops, and bemoaned the persistent lack of value addition in the manufacturing sector.

Melaku recalled that cotton exports were permitted at the time, but cost and international prices made them unviable. Only three percent of the three million hectares suitable for cotton cultivation is currently utilised. Tax issues similarly impact food processing, though the recent lifting of withholding taxes has offered some relief. Yet, many companies remain closed, waiting for a change in market and policy conditions.

Ethiopian Airlines Leases New Turboprop Aircraft to Air Congo

Posted on November 23, 2025November 25, 2025 by Web Master

Ethiopian Airlines has leased two new ATR 72-600 turboprops to Air Congo, the Democratic Republic of Congo’s flag carrier, in which it holds a 49pc stake. The aircraft, equipped with the latest engines, are expected to enter service in February 2026, marking the first introduction of this model in the DRC.

The announcement, made at the Dubai Airshow this week, marks the country’s return to Aérospatiale Alenia (ATR) operations after three decades. It follows a July 2024 agreement to establish ATR maintenance capability in the city, a step intended to position Ethiopian’s Maintenance, Repair & Overhaul facilities as a regional hub for the Franco-Italian manufacturer’s fleet.

Group CEO Mesfin Tasew framed the lease as part of a wider effort to offer African carriers cost-effective regional connectivity. Air Congo CEO Mesfin Biru Weldegeorgis pointed to the aircraft’s capacity to reach remote airstrips, an essential feature in the DRC’s demanding geography.

ATR CEO Nathalie Tarnaud Laude welcomed the collaboration, noting the growing uptake of the company’s aircraft across the continent due to their lower operating costs and suitability for emerging markets. The lease underscores Ethiopian Airlines’ expanding role in advancing intra-African air transport and supporting partner airlines under its Vision 2035 strategy.

Ahadu Lifts Profit, Deposits While Capital Gap Persists

Posted on November 23, 2025November 25, 2025 by Web Master

Ahadu Bank has raised its paid-up capital to 1.13 billion Br, up from one billion Br last year, though it remains far short of the five-billion-birr threshold the National Bank of Ethiopia (NBE) has set for merger eligibility next year. Total capital now stands at 1.5 billion Br.

The Bank expanded lending to 2.6 billion Br during the fiscal year, pushing its aggregate loan portfolio to 4.43 billion Br. Management reported firm results across core indicators in a difficult operating climate. Deposits climbed to 7.88 billion Br, a 41pc jump from the previous year. Foreign exchange earnings reached 88.2 million dollars, rising by 10.3pc from the same period. Total income surpassed 2.16 billion Br, buoyed by strong non-interest revenue, particularly from foreign-currency transactions, which soared by 87pc year-on-year.

Total assets crossed 10.1 billion Br, marking 57pc growth. Profit before tax hit 502 million Br, a 351pc surge compared to the 2023/24 fiscal year. The Bank added 390,000 customers during the year, lifting its total client base to more than one million across 102 branches as of 2025.

African CDC Secures Major Pandemic Funding for Health Preparedness

Posted on November 23, 2025November 25, 2025 by Web Master

The Africa Centres for Disease Control & Prevention (CDC) welcomed the Pandemic Fund’s approval of half a billion dollars during its Third Call for Proposals, with Africa set to receive nearly half of the allocation. The decision was announced at the Pandemic Fund Board Meeting in Kigali, Rwanda, held from 17 to 19 November 2025.

The funding is designed to help African Union Member States strengthen core capacities, particularly in high-risk and cross-border areas. It reflects Africa’s growing role in producing technically robust, high-quality proposals for pandemic prevention, preparedness, and response.

Africa CDC noted that preparedness is essential to preventing health crises. The organisation will continue to assist countries in translating these resources into practical capacities on the ground, enhancing community safety and reinforcing health security and sovereignty across the continent. The collaboration between the Pandemic Fund Board and global partners was also commended for advancing pandemic readiness.

Ethiopia is among the countries set to benefit. Authorities continue to monitor the Marburg virus, with four confirmed deaths and eight cases under investigation out of forty-six laboratory tests.

Stablecoins Are Inevitable

Posted on November 23, 2025November 22, 2025 by Web Master

The eurodollar market, comprising dollar-denominated deposits held outside the United States, emerged in the late 1950s to meet global demand for dollar liquidity, while avoiding the regulatory costs associated with dollar-denominated financial intermediation. Initially viewed with suspicion, not least from US authorities, the market was soon integrated into the global monetary system, with the US even providing partial supervision.

It is now indispensable to global finance.

This pattern has recurred throughout financial history. Before the 2008 financial crisis, “shadow banks”, including investment banks, structured investment vehicles, and money-market funds, created money-like liabilities, which the US Federal Reserve did not secure. When confidence collapsed, liquidity evaporated, leading to credit freezes, fire sales, and bankruptcies. To ensure their survival, major financial institutions such as Goldman Sachs and Morgan Stanley transformed themselves into bank holding companies, thereby gaining access to central-bank liquidity and deposit insurance.

While financial innovations often emerge on the system’s periphery, beyond the reach of regulation, if they prove to be systemically important, they end up being integrated into the system’s regulated core. When private entities issue money-like claims at scale, they eventually seek out, or are compelled to obtain, central-bank backing.

Stablecoins, privately issued digital tokens backed by external assets, are likely to follow the same trajectory. What remains unclear is precisely how they will be integrated into the monetary system, by which actors, and under what institutional framework.

The answer will depend mainly on regulation, specifically, whether the US or European approach prevails. To be sure, authorities in both the US and the European Union (EU) have so far pursued a custodial model, treating stablecoin issuers as payment intermediaries, rather than deposit-taking lenders. But that is where the similarities end.

US regulators argue that issuers of systemically important stablecoins should operate as insured depository institutions or be subject to equivalent prudential supervision. These entities do not necessarily need to become banks, but they should face comparable standards, including robust liquidity rules and capital requirements. Circle, which issues the USDC and EURC stablecoins, has publicly supported this approach, advocating stronger oversight and, possibly, narrower banking structures that could eventually grant issuers limited eligibility to hold reserves in Fed accounts.

By contrast, the EU’s Markets in Crypto-Assets (MiCA) regulation establishes a two-track system. Non-bank issuers can operate as Electronic Money Institutions (EMIs), which must hold sufficient reserves to provide full (1:1) backing for issued stablecoins, guarantee par-value redemption to token holders, and segregate client assets. EMIs may not lend or perform maturity transformation, that is, they cannot create credit.

Credit institutions (banks) may issue stablecoins directly under their existing banking licenses, subject to the same prudential standards as their other liabilities. For example, Société Générale’s (SGS) subsidiary Forge issues EUR CoinVertible under a full banking license. Banco Santander and BBVA are also exploring tokenised deposit pilots, in which customer deposits are represented on permissioned blockchains but remain on the bank’s balance sheet.

Simply put, European banks can issue tokenised deposits or euro-denominated stablecoins that are fully integrated within their balance sheets and supervised by the same authorities as their traditional activities.

The EU model has the virtue of institutional clarity. By mirroring the two-tiered monetary system, in which central banks supply reserves to banks, which provide money to the public, it preserves the functional hierarchy between public and private money. But this model might inhibit innovation, because incumbents often face technological inertia. Integrating blockchain-based systems into legacy banking infrastructure will be no easy feat.

The US model has its own disadvantages, rooted in the separation of institutions’ lending and deposit functions. If non-bank stablecoin issuers (which do not extend credit) hold reserves in Treasuries or at custodial banks, commercial banks (which do extend credit) could see their access to deposits constrained.

As markets mature, moreover, the line between stablecoins and deposits will blur. If stablecoin issuers and banks are competing for the same pool of retail or institutional funds, regulators will face pressure to subject them to the same rules. But some large stablecoin issuers will push in the opposite direction, seeking greater flexibility to invest reserves, extend credit, or access central-bank accounts directly. Over time, these competing pressures could yield a new hybrid category: digital full-reserve or narrow banks.

Financial history holds another important lesson. When liabilities function as money, there is always a risk of a run. Regulating stablecoin issuers as custodians does not change this, even as it reduces operational risks. For traditional banks, the risk of runs is mitigated by deposit insurance and the central banks’ lender-of-last-resort function. If stablecoins become systemically important, central banks may have no choice but to extend comparable protections, either directly or through regulated intermediaries.

Both the EU’s MiCA Regulation and the United States’ GENIUS Act follow this logic. While differing in institutional design, each seeks to bring systemically stablecoin issuers under prudential and operational oversight equivalent to that applied to banks. Although neither requires large stablecoin issuers to formally convert into banks, the regulatory trajectory favours functional equivalence in prudential oversight.

This suggests that both jurisdictions may bring stablecoins into the financial system’s core through charters, supervision, and central bank connectivity. In a sense, Circle’s model (a non-bank subject to prudential oversight) amounts to a step in this direction.

The rise of digital currencies is often portrayed as synonymous with the fall of traditional money, and the banking system that moved it. But what we are more likely to see in the coming decade is banking’s digital reincarnation, with a retail payment stablecoin circulating on public blockchains (such as Ethereum), fully backed by reserves held at a central bank-linked institution. The architecture will be new, but it will have a proven foundation: the credibility of the central bank.

The ultimate backstop for private money is and will remain public trust, embodied in the central bank’s balance sheet.

Awash Bank Launches New Salary Loan Service

Posted on November 23, 2025November 25, 2025 by Web Master

Awash Bank has launched an Employees’ Salary Loan through its “Tila” application, now integrated with the Telebirr platform, targeting workers in both private and government institutions whose salaries are processed via Telebirr or Awash Bank.

Eligible employees can access loans equivalent to six months of their salary, up to one million birr, repayable over sixteen months. The launch was announced on 20 November at the Ethiopian Science Museum. At the event, the Bank also unveiled device financing for customers seeking to purchase Ethio telecom smart devices.

Ethio telecom Chief Executive Officer Frehiwot Tamiru noted that the new financing service will enhance device affordability and boost smartphone adoption nationwide.

Tila operates as a micro, non-collateral credit and savings platform. It offers services including Tila Micro Saving, Personal Micro Credit, which allows individuals to borrow up to sixteen thousand birr based on their Telebirr transaction history, SME loans ranging from fifty thousand to one hundred fifty thousand birr for periods of one to six months, as well as Cardless ATM and School Pay services. The Bank supports Tila with an annual credit supply exceeding two billion birr.laboratory tests.

Customs Seize Contraband Worth Hundreds of Millions

Posted on November 23, 2025November 25, 2025 by Web Master

The Ethiopian Customs Commission seized contraband worth over 375.6 million Br during a week-long operation from 5 to 12 November 2025. The haul included 350.2 million Br in illegal imports and 25.4 million Br in export contraband, covering textiles, electronics, coffee, grains, vehicle parts, cosmetics, khat, narcotics, pharmaceuticals, minerals, live animals, and foreign currency.

Hawassa led with 70 million Br seized, followed by Moyale with 69 million Br and Awash with 64 million Br. Authorities detained twenty-three suspects and impounded five vehicles. The operation relied on joint inspections, public tips, and aerial surveillance, involving Customs officers, federal and regional police, and local communities.

The Commission warned that smugglers’ tactics are constantly evolving and urged citizens and institutions to remain vigilant and report suspicious activities to protect the national economy from illicit trade.

Bunna Bank Converts Dividend Into Capital After Record Profit Surge

Posted on November 23, 2025November 25, 2025 by Web Master

Bunna Bank, one of the country’s second-generation private banks, reported a pre-tax profit of 2.6 billion Br, a sharp rise from the previous year’s 930 million Br. Net profit reached 1.9 billion Br. At the general assembly held last week at the Addis International Convention Center, shareholders approved a dividend payout of 1.2 billion Br but voted to convert the amount into capital instead.

The decision positions the Bank ahead of the five-billion-birr paid-up capital requirement a year earlier than anticipated. Once the full dividend is converted, paid-up capital will stand at 6.5 billion Br.

Board Chairman Mulugeta Asmare described the outcome as the result of a disciplined working culture and long-term strategy. He said the Bank has not only achieved record earnings but also strengthened its capital base to support future innovation and expansion.

Election Board Allocates Ten Billion Birr for National Elections

Posted on November 23, 2025November 25, 2025 by Web Master

The National Election Board of Ethiopia(NEBE) has allocated 10 billion Br for the national election on 1st June 2026. At a briefing at the Ministry of Finance, Development Partners Group officials received updates on board’s preparations, reaffirming support for Ethiopia’s democratic process.

State Minister Semereta Sewasew noted the role of credible elections in safeguarding rights and stability, noting partners’ financial and technical contributions. NEBE Chairperson Melatwork Hailu outlined reforms to boost transparency, including the country’s first digital voter registration, with polling stations chosen for reliable internet, electricity, and trained staff. NEBE confirmed its software is independently tested for cyber resilience and backed by strict data governance.

Efforts are expected to ensure inclusive participation for women, youth, persons with disabilities, and internally displaced communities. Civil society and international observers will monitor the process.

Author: Web Master