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Author: Yeabkal

Dispute Deepens at Addis Chamber as Abera Abegaz Challenges Election

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The controversy surrounding the Addis Abeba Chamber of Commerce & Sectoral Associations (AACCSA) has escalated as board member Abera Abegaz demands enforcement of a court ruling that overturned his suspension and reinstated his right to participate in the Chamber’s General Assembly.

Abera’s lawyer, Sintayehu Zeleke, submitted a letter on January 28, 2025, to AACCSA, Mesenbet Shenkute, the Ethiopian Chamber of Commerce & Sectoral Associations (ECCSA), and the Commercial & Investment Bench of the Federal First Instance Court.

The letter seeks a timeline for implementing the court-approved settlement, which includes retracting Abera’s suspension and holding the 18th General Assembly under the Chamber’s established legal framework.

The dispute began when former AACCSA President Mesenbet Shenkute expelled Abera from the board on December 18, 2024, citing disciplinary issues. She also barred him from contesting in the 18th General Assembly election.

Abera challenged the decision in court on December 25, 2024, arguing that his removal was unlawful and that Mesenbet had violated Chamber regulations by dissolving the Credential Committee, which is responsible for vetting board candidates.

Fearing that the election would render his lawsuit moot, Abera requested an injunction to halt the General Assembly. On January 8, 2025, Federal First Instance Court Judge Gerawork Yitbarek granted the injunction, suspending the assembly three days before its scheduled date. The court directed both parties to reach an out-of-court settlement or proceed with legal proceedings.

Abera also challenged the board’s decision to allow non-members to participate in the election, arguing it was a violation of the Chamber’s bylaws.

At the heart of the dispute is a controversial proposal to amend the Chamber’s constitution. Mesenbet Shenkute’s restructuring plan would make membership mandatory for all 480,000 licensed businesses in Addis Abeba, ending the long-standing voluntary system. Abera claims this violates the Chamber’s founding principles and undermines its legitimacy by forcing businesses to join.

Mesenbet defended the plan as essential to strengthening the Chamber’s financial and institutional capacity. She argued that the current voluntary model fails to meet the needs of the city’s private sector.

Abera, however, alleged that his vocal opposition led Mesenbet and the board to dismiss him, sidelining dissent and fast-tracking the bylaw changes.

A major shareholder of A.Y. NOBLE Inspection & Surveillance Service and a board member of Zemen Bank, Abera argues the mandatory membership plan is a power grab designed to consolidate control. He claims his confrontation with Mesenbet at a board meeting over the issue was later used as an excuse for his removal.

On January 14, Abera and the defendants, Mesenbet and the Chamber, agreed to settle. Their agreement required Mesenbet to retract Abera’s suspension, reinstate his candidacy, and conduct the General Assembly in accordance with the 2003 Chambers of Commerce & Sectoral Association Establishment Proclamation and the Chamber’s 2011 regulation.

The next day, the court ratified the settlement, lifted the injunction, and ordered both parties to comply with the terms.

Despite the agreement, AACCSA proceeded with a contentious election the next day, electing a new board.

In a dramatic turnaround, on January 16, 2025, just one day after the injunction was lifted, the Chamber held an election. Businesswoman Zahara Mohammed was elected president, replacing Mesenbet Shenkute. The new board also includes President Zahara Mohammed, Vice President Abebe Gurmesa, Sara Solomon, Addisu Getahun, Zahra Ahmed, Mesfin Gared, Damte Dagnew, Habtamu Hailu, Aychiluhim Kebede, Tesfaye Gebrekidan, and Girumnesh Yimer.

The previous board, before the disputed election, comprised President Mesenbet Shenkute, Vice President Fasikaw Sisay, Kibret Abebe, Asfaw Alemu, Melaku Kebede, Abera Abegaz, Alemayehu Nigatu, Sara Solomon, Abebe Gurmesa, Suleiman Fereja, and Gizachew Tekalign.

On January 28, Abera sent a letter to AACCSA, Mesenbet, ECCSA, and the Commercial & Investment Bench, demanding a timeline for the agreement’s implementation. His requests included holding the 18th General Assembly as agreed and retracting the suspension letter issued by Mesenbet.

Abera’s letter to the Chamber and the court demands clarity on when the agreed terms will be fulfilled, including the proceedings of the 18th General Assembly and the formal retraction of his suspension.

The court ordered the disputing parties to adhere to the agreement and conduct the General Assembly in compliance with the Chamber’s proclamation and bylaws. A source close to the matter explains that these include the reinstatement of the Credentials Committee, which was previously dissolved by Mesenbet, setting the date and venue for the General Assembly, and sending invitations.

The Committee is responsible for vetting candidates for the presidency and board positions to ensure they meet eligibility requirements. The bylaws of the Chamber allows only verified members to participate in the elections and the vote must be conducted via secret ballot.

Mesenbet’s reform plan aimed to restructure the Chamber, including allowing non-members to participate in board elections.

Established in 1947 and restructured in 2003, the Chamber represents 17,000 members.

Central Bank Extends Loan Repayment Period for Tigray Businesses

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Businesses and traders in the Tigray Regional State have been granted a one-year extension on loan repayments totalling 86 billion Br, offering temporary relief after the devastating two-year conflict.

The National Bank of Ethiopia (NBE) initiated this extension after the initial grace period expired on December 16, 2024, prompting commercial banks to take action against borrowers unable to repay accumulated debts.

The conflict severely impacted businesses, with debts quadrupling due to accrued interest.

The Central Bank has issued a new circular to all banks, easing requirements for loan provisions, rescheduling, and handling non-performing loans (NPLs).

This circular, signed by Vice Governor Solomon Desta, aims to support war-affected investors struggling with crippling debt and interest accumulation.

Banks must assess each borrower’s financial status and evaluate asset damage. Loan recovery plans must be developed and submitted by March 31, 2025.

Banks are required to implement more flexible repayment options for businesses impacted by the war.

The decision comes as many businesses in Tigray struggle to resume operations following the war. During the armed conflict, the NBE ordered the closure of 616 bank branches to curb widespread looting and security risks, further exacerbating the region’s economic downturn.

The central bank has temporarily suspended key provisions of its Asset Classification & Loan Provisioning Directive, allowing banks greater flexibility in rescheduling loans for businesses in Tigray.

The new circular issued by the central bank permits financial institutions to extend loan repayment timelines beyond two years, issue new loans without audited financial statements, and provide financing to borrowers with downgraded credit ratings. The circular also temporarily lifts restrictions on loan iterations, enabling additional credit for businesses that have reached their borrowing limit.

Belete Fola, a portfolio manager and principal examiner at the NBE, stated that these measures aim to facilitate economic recovery by easing financial burdens on businesses in the region. Banks are expected to assess borrowers’ financial conditions, develop loan recovery plans, and report their findings by March 31, 2025.

The Directive, introduced in June 2024, was designed to strengthen risk management by enforcing stricter loan classification and provisioning requirements. However, the latest circular temporarily overrides certain restrictions, allowing banks to refinance and reschedule loans for businesses affected by the war. Borrowers who have reached their credit limit may also be eligible for additional loans under special conditions.

As of June 2024, commercial banks have issued nearly 1.5 trillion Br in loans and advances, maintaining a non-performing loans (NPL) ratio of 3.6pc, below the regulatory five percent threshold. Banks are required to ensure that the total sum of their on-balance sheet items, including loans and advances, and off-balance sheet exposures to related parties, does not exceed 25pc of their capital. However, this requirement excludes credit risks associated with lending to investors in the Tigray Regional State.

Belete stated that waiving interest payments remains at the discretion of individual banks, based on their financial assessments and risk portfolios.

Dagmawi Kassahun, vice president of Berhan Bank, stated that the NBE’s new directives provide clear guidelines for banks operating under current economic conditions. He told Fortune that his bank has begun preparations to extend new loan provisions and has formed teams to ensure compliance with the revised regulations. However, he says that carefully analysing the implications of these directives before implementing an action plan is important, particularly concerning potential risks associated with credit exposure to related parties.

Berihu Haftu, president of the Tigray Chamber of Commerce & Sectoral Associations (TCCSA), says that investors in the regional state face severe hurdles in resuming business operations due to the lack of financial support. He revealed that the Chamber has been lobbying for a full loan write-off for investors whose assets were entirely destroyed and a 50pc debt reduction for businesses that suffered partial damage. TCCSA has also called for new loans to be provided to affected businesses.

“Nothing substantial has been done for investors,” Berihu said, expressing frustration. He questioned the rationale behind demanding interest payments when banks were non-operational during the conflict.

Business representatives in the Tigray Regional State have been pushing for a write-off of interest on loans totalling 31 billion Br in recent discussions with central bank officials. Despite their efforts, NBE has denied the request, leaving businesses to rely solely on extended repayment periods.

Berihu argues that businesses in the regional state face constraints due to the NBE’s credit growth cap and the absence of special financial provisions for recovery.

“Investors are still in crisis,” he told Fortune. He says while businesses have been unable to resume operations, commercial banks have started taking punitive actions against struggling borrowers.

Among the hardest hit is Moges Negu Commercial Ranch Plc. Established in 2006, the company suffered millions in damages during the war. General Manager Haleka Moges revealed that a 570 million Br loan taken six months before the conflict has now ballooned to nearly one billion Br due to accumulated interest.

“We requested an interest waiver and an extension of the repayment period,” he said. However, efforts to restart operations have stalled due to financial constraints, and a 3.7 billion Br loan request remains unapproved.

Another investor, whose water bottling company was completely destroyed at the start of the war, saw an 80 million Br loan swell to 110 million Br with interest. The company has struggled to recover, and a request for a new 180 million Br loan for machinery and working capital has been rejected.

“We are struggling to recover,” the investor stated, arguing that merely rescheduling existing loans is not enough.

“We need to rebuild before repaying loans,” he told Fortune.

Investors have voiced frustrations with the Tigray Investment & Export Commission (TIEC) on several occasions. Kassahun Gebregziabher, the Commission’s deputy head, stated they are still pushing for financial relief and duty-free import permits from the Ministry of Finance (MoF) and other government officials.

“Nothing has changed,” he said, noting that over 63 investors who requested duty-free permits to import construction materials are still waiting. He also states that financial pressures are worsened by unpaid demurrage costs at Djibouti ports, where machinery is being held.

The Tigray Genocide Inquiry Commission identified over 34,000 instances of damage across various sectors, including retail, manufacturing, services, agriculture, health, education, public services, and religious and cultural heritage preservation.

Credit exposure provisions have been constantly changing since the banking sector was liberalised, according to Tilahun Girma, a business and investment consultant. He said that banks are reluctant to write off loans and interest, fearing it would prompt other businesses to request similar incentives, raising their risk.

“Banks fear a slippery slope,” he told Fortune. He argues that while credit risks are high, banks must share the burden in such situations. He suggested a more sustainable approach, where government support helps banks manage the financial load while preserving their capital.

“The sustainability of their capital is crucial,” he said. Tilahun recommends measures that balance the needs of banks and businesses in the regional state.

Utility Expands Smart Metre Installation to Curb Power Theft, Improve Service

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The Ethiopian Electric Utility (EEU) is rolling out smart electric metres across Addis Abeba to combat power theft, enhance customer service, and modernise its infrastructure. The project, funded by the World Bank’s Ethiopia Electrification Program (ELEAP), involves installing 25,000 advanced metering infrastructure (AMI) units. It is part of a long-term plan to equip all five million EEU customers with smart electric metres.

The initiative has a total cost of 48 million dollars and 75 million Br. Currently, it is 69pc complete, with an additional 125,000 energy metres planned for installation in the third phase.

The EEU’s unified prepayment project began as a pilot programme in the Balderas area, where 100 condominium units received smart electric metres. It was later expanded to 2,000 houses before a broader rollout. Initially set for completion by December 2024, the deadline has been extended by nine months to adjust the building data system that houses customer information. The first three months of the extension will focus on metre installation, while the remaining six months will be dedicated to evaluation.

“The unified prepayment project will reduce power theft and improve customer service,” said Tesfaye Hirpa, EEU’s distribution automation programme director.

The new smart metres can detect theft and automatically cut off power in response to illegal activity. They pinpoint theft locations using property numbers, GPS, and contract accounts. Tesfaye says this will reduce customer complaints about incorrect billing.

The project includes a new EEU mobile application, enabling customers to check and pay bills online. Payment options will expand to include Telebirr, the Commercial Bank of Ethiopia (CBE), and Awash Bank, helping prevent power disconnections due to late payments.

A parallel project targeting medium- and large-scale industries, also funded by the World Bank, is nearing its delayed completion. The initiative, launched in March 2020 with a budget of 12.5 million dollars and 9.6 million Br, was initially set for completion in 2022 but was extended to August 2024. Its goal was to install 50,000 advanced metering infrastructure (AMI) units. So far, 40,111 enterprises have received smart metres, bringing the project to 96.2pc completion.

The EEU has long struggled with power wastage and theft. Currently, 22pc of the electricity it receives from Ethiopian Electric Power (EEP) is lost, with half of that loss attributed to technical issues. In the first three months of this fiscal year alone, the Utility lost 2.7 million Br to theft.

However, the EEU managed to recover 35 million Br through sudden inspections over the same period. Tesfaye says the new AMI metres will substantially curb electricity theft.

The EEU serves 4.9 million customers and plans to add 600,000 more this year. However, financial strain remains a major hurdle. In its first-quarter performance, the Utility covered only 71pc of its expenses. Its total expenditures reached 16 billion Br, including 5.3 billion Br paid to EEP, 938 million Br for loan repayments, and 466 million Br for reconstruction.

The EEU has introduced gradual tariff increases, set to be fully implemented over the next four years. Some customers have already felt the impact. Mintesinot Lemma, general manager of Mintu Plast Plastic Plc, a plastic raw materials manufacturer, says that while he has not seen a major change from the smart metre installation, the tariff hikes have severely affected his electricity costs. His monthly bill for four companies was around three million Br but has recently risen by nearly 20pc.

Woineshet Moges, owner of Mechu Trading Plc, has seen her electricity bills rise by more than 20pc, putting pressure on her medium enterprise.

“It is more than we expected,” she said.

The rollout of smart metres has reduced customer service workload in some districts, such as Balderas, where the initial pilot took place. Alemayehu Tadesse, a district office manager, stated that customers can now pay remotely, avoiding long queues. He told Fortune that only one complaint had been filed regarding an automatic shutoff after a usage surge.

However, power blackouts remain a major issue. The Utility reports that the country experiences an average of 46 hours of blackouts per week. The EEU is responsible for 88pc of these outages, with the remaining 12pc attributed to the EEP. Outdated infrastructure is a major factor, while power theft contributes to 24pc of shortages. Operational issues and overcurrents account for 22pc and 8pc, respectively. The most frequent cause of outages is earth faults, particularly landslides, which make up 47pc of all incidents.

The World Bank ranks Ethiopia third in Sub-Saharan Africa for energy access deficits, with nearly half the population lacking reliable electricity. While grid expansion has reached 60pc of towns and villages, the urban-rural gap remains huge. In cities, 96pc of households are connected to the grid, with Addis Abeba at 99.9pc. In contrast, only 27pc of rural households have electricity.

The situation is worse in remote areas more than 25km from the grid, where just 5pc of people have power. Even those with access face severe disruptions, 58pc of grid-connected households experience four to 14 power outages per week, with 3pc facing even more frequent blackouts.

Yemaneberhan Kiros, founder and general manager of Yomener Energy Auditing & Engineering Plc, supports the EEU’s crackdown on theft, which he says is a major cause of power shortages. He urges EEU to assess high-load areas, monitor power quality, and prevent surges that damage equipment.

“Energy management has been weak,” he stated. “EEU upgrade infrastructure with the latest technology.”

City Embraces Yoga, Meditation for Wellness

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Rihan Demsew, engaged in the import and export trade in Addis Abeba, sought a solution to her work-related stress and long hours, which led her to join a meditation and yoga centre. Rihan also lives with Rheumatoid Arthritis (RA), which presented her with numerous physical difficulties. Before beginning her training, Rihan struggled with everyday tasks such as bending to wear shoes, completing hand-related tasks, and climbing stairs, and she also experienced sleep issues. She knew that managing her condition involved medication, physical therapy, and lifestyle changes.

After five months of training, including a one-month yoga package for 3,000 Br, two days a week, Rihan noted a gradual improvement in her physical condition. While she acknowledges that RA may not disappear completely, she believes consistent physical therapy, daily activity, and a balanced diet can substantially improve her condition and reduce pain.

Now, she is able to perform tasks that were previously difficult and feels stronger and healthier. “My body feels stronger and is able to recover well when overworked,” she said.

Many individuals are drawn to meditation and yoga centres for various reasons, including improving body structure, adopting healthier habits, addressing health problems, and reducing weight. The industry has kept pace, offering classes for as much as 1,500 Br per session lasting 60 to 90 minutes.

One individual, a student of Heran Yoga who preferred not to be named, has been practicing meditation for two years and yoga for one year, initially joining out of curiosity after hearing about meditation from others. She started with a passion for meditation as she faced issues like mental distraction and loss of focus. This motivated her to also try yoga.

Based on her experience, she observes that more people are engaging in yoga and meditation, with a growing number of training centres in the capital.

“I see numbers increasing at many places,” she said, even though she expected that more people would have caught on to the activity.

The wellness industry has expanded recently with meditation centres springing up seeking to tackle a new angle of improving health. After the COVID-19 pandemic, meditation and yoga became more accepted by the public, according to Rihan.

Meditation is a practice that involves concentrating the mind through mental and physical methods. Meditation is becoming more popular as individuals seek stress relief, mindfulness, and spiritual growth.

Yoga, on the other hand, is a mind and body practice, involving physical postures, breathing techniques, and meditation. It seeks to promote physical and mental well-being through increased flexibility, strength, balance, stress reduction, and mindfulness.

Aremimo, a meditation centre in the capital, was established three years ago by Elias Gebru (PhD) and offers training for individuals, groups, and companies. Elias estimates that there around four similar type meditation centres throughout country.

Companies often seek training to reduce stress and improve the quality of their workforce. Aremimo offers tailored proposals for companies, adjusting training programs and fees based on their capacity to pay. They provide flexible payment systems, with daily, weekly, monthly, and annual packages. Aremimo’s clients include major organizations such as Coca-Cola, DMC Real Estate, Bank of Abyssinia, and Ethiopian Airlines.

“Especially foreign-owned companies are our strong customers, some even signing two-year contracts,” Elias told Fortune

A two-month package for individuals costs 7,000 Br at Aremimo, while organizational training fees depend on the organization’s capacity, quality of work, and number of employees, averaging 1,000 to 2,000 Br per person per day.

The number of meditation and yoga centres is growing. Other centres like Tulsi Wellness Centre are well-known for their training services. Founder Deborah Lundstrom, a wellness coach at the centre with 11 years of experience, says that more organizations and individuals are visiting Tulsi. Group training is particularly growing, charged at 700 Br per hour. The centre also has membership packages.

Deborah hosted a wellness show on a local TV station during the COVID-19 pandemic.

“The show helped viewers understand the effectiveness and benefits of meditation,” she told Fortune.

Another player is Khul Meditation & Yoga Centre, which offers both meditation and yoga training. Meditation trainings are available on daily and monthly packages, while yoga training includes daily, monthly, three-month, and six-month packages.

A one-month yoga package costs 3,000 Br for two days per week and 4,000 Br for three days per week. Three-month packages are 7,500 Br for two-day version and 9,000 Br for the three-day type. They also offer six month packages as well as daily yoga sessions for 600 Br.

Meditation training is priced at 1,400 Br per month with four sessions. Daily meditation sessions costs 500 Br. Rediet Sime, a customer service officer at Khul, stated that on average, the centre has 50 monthly yoga clients and 20 for meditation. The centre also has a team that provides training for the elderly. Khul Meditation Centre was established in 2012.

Heran Tadese, a meditation and yoga trainer, says there are very few certified trainers in Ethiopia, which she estimates to be between 10 and 20. She stated that she paid 3,000 dollars to obtain a wellness certification in Egypt.

In the past two years, her average monthly attendance ranged from 20 to 30 people, but over the past two months, it has dropped to 8 to 10 per class per week. Heran’s fees vary depending on location and type of training, with each 90-minute class costing 600 Br to 1,000 Br per session.

She says that yoga centres in Ethiopia are not officially recognised. “Awareness is very slim about this practice,” she said. According to her, yoga centres often close within months of opening as they lack consistency, and most trainees are members of the diaspora and other high-earning people which is not enough clientele to sustain a business.

Sintayehu Yihune, a sociologist and lecturer at Dilla University, says that Ethiopian society has traditionally been bound by culture and faith, which has limited the use of these practices. When people experience anxiety or depression, they typically go to bars or religious institutions. This makes meditation and yoga less common, limiting it to people familiar with foreign cultures.

Still, he attributes the recent rise of wellness centres to a shift in how health is approached. “Diseases that were once treated through traditional methods are now being addressed with medical and alternative treatments, including meditation and yoga,” he added. This growing trend signals a cultural shift, with more individuals exploring meditation and yoga to address modern mental health problems.

According to him, while these practices may be effective based on their medical or philosophical foundations, they may not be effective according to social norms. Many in the community cannot afford these services due to low income, background beliefs, and religious affiliations.

Banks Flinch, Central Bank Blinks, the Brewed Buck Burns

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Birr (Brewed Buck) has been charting a steady course of depreciation against the Green Buck (U.S. Dollar) over six days beginning January 27, 2025. Although the rates across the banking industry generally convey a shared sense of gradual weakening, subtle divergences have emerged that hint at distinct strategies for coping with mounting pressures in the foreign exchange market.

Some banks appear intent on managing depreciation carefully and staying below the psychologically important mark. Others, seemingly in step with a market-driven position, are more willing to cross this threshold. For most of the week, large private banks such as Dashen, Awash, Abyssinia, and Wegagen appeared united in their resolve to post buying rates under this threshold. Yet, at a few banks, including Tsehay, Goh, Gadaa, and ZamZam, buying rates have comfortably exceeded 125 Br for several consecutive weeks, echoing a more aggressive posture.

The National Bank of Ethiopia (NBE) also stepped over the barrier, a shift from its traditional role in damping volatility. By contrast, the state-owned Commercial Bank of Ethiopia (CBE) maintained lower rates, cementing its capacity to act as a stabilising force when erratic market behaviour could trigger sharper swings.

Dashen Bank’s reluctance to cross 125 Br, missing the mark by a mere 0.04 cents, encapsulates the balancing act many private banks are trying to pull off. There appears to be an acknowledgement that the Birr remains under pressure due to inflationary trends, geopolitical tensions, and persistent trade imbalances pushing the Brewed Buck southward. Banks are wary of moving too quickly, a decision that could exacerbate inflation, hurt consumer confidence, and invite stricter regulatory scrutiny.

According to observers, this collective caution, however subtle, signals that the banking community recognises the fragility of the market and the importance of tempering a freefall.

Not all banks share that viewpoint, though.

Tsehay, Goh, Gadaa, and ZamZam have gone well past 125 Br, leading analysts to speculate that these smaller private players see an advantage in getting ahead of a depreciation predicted to continue in the medium term. A higher buy rate can help attract more foreign currency, particularly from remittances or exports, and position these banks to meet local demand or strategise around short-term currency spikes.

The NBE’s decision to cross the threshold has attracted particular attention. Long perceived as the authority guiding the market from behind the scenes, the Central Bank has typically held rates below the average to restrain sudden price hikes and inflationary ripples. Its new posture implies a more deliberate effort to keep the official market with real demand and supply, though sceptics warn that this approach risks fueling inflation if the Birr’s decline accelerates.

Throughout last week, the selling rate moved in parallel with the buying rate, further confirming Birr’s downward bias. The average buying rate was 124.86 Br, while the selling rate averaged 127.61 Br.

Commercial Bank of Ethiopia (CBE), by virtue of its state-owned status and sheer market heft, has often functioned as a buffer during currency instability. Its conservative pricing has signalled steadiness and held down the more aggressive manoeuvres from smaller banks. In the absence of the CBE’s moderating force, the Breweed Buck might have depreciated more sharply, with banks’ competing tendencies to outbid each other pushing the currency lower at a faster rate.

Broader macroeconomic conditions appear to support the view that the Birr could weaken further in the coming months. Ethiopia’s import-driven economy, coupled with lower foreign exchange earnings from key export sectors, has heightened demand for hard currency. Political uncertainties and the rising cost of living, fuelled by imported fuel prices, pressure external balances. In this environment, banks adopting the more aggressive forex valuation strategy may see their position validated, though they equally risk regulatory pushback if authorities deem the pace of depreciation excessive.

Over the past three quarters of 2023/24, the foreign exchange market’s dynamics offer clues.

Total forex purchases by commercial banks declined from 63.51 million dollars in the third quarter to 54.62 million dollars in the fourth quarter, translating to a 14pc drop. Despite this quarter-on-quarter contraction, overall purchases still stood 16.6pc higher than in the same quarter of the previous fiscal year, demonstrating the underlying demand for foreign currency even during the slowdown. However, aggregate forex sales decreased by 13.9pc compared to the preceding quarter and dipped by 1.2pc against the same period a year earlier, a retrenchment in supply.

The CBE once again looms large. It bought 48.11 million dollars in the fourth quarter, representing a 12.3pc decline from the preceding quarter but still nearly a quarter higher than its year-ago level of 39.19 million dollars. On the sales side, the Bank’s performance jumped 13.8pc quarter on quarter to about 47.84 million dollars, marking a substantial 24.3pc increase compared to a year earlier. This dual dominance in purchases and sales positions the CBE as the single most consequential actor in the forex market, with the potential to dampen or amplify broader market trends based on its pricing strategies.

Beyond the state-owned giant, mid-tier banks exhibited marked fluctuations.

Wegagen Bank’s purchase volume soared to 231.4 million dollars from 61 million a year earlier, a striking 279.2pc surge. Yet during that same period, its sales volume dropped 69.9pc quarter on quarter, displaying the uneven shifts that can occur from one reporting interval to another. Bank of Abyssinia similarly experienced notable declines, with a 58.3pc drop in purchase levels from a year ago and a quarter-on-quarter sales decline of over 50pc.

Among newer market entrants, banks such as ZamZam and Gohe Betoch posted smaller transaction sizes overall. However, they occasionally registered triple-digit percentage changes when measured against a low base, a sign that smaller players can shift quickly to capitalise on shifting short-term liquidity conditions. While the ongoing transition toward a floating exchange rate regime continues to dictate much of this volatility, a trend toward consolidation rather than aggressive expansion is evident. Many banks appear to focus on balancing liquidity requirements and regulatory constraints, leaving only a few positioned for high-risk or high-reward strategies.

Even so, the fundamental demand for foreign currency remains strong, pointing to durable pressures on the Birr. The year-on-year uptick in overall purchases indicates that businesses and individuals are still in need of buying foreign exchange despite week-to-week or quarter-to-quarter fluctuations. Banks that have seized on opportunities arising from short-term supply swings, whether driven by political events, holiday inflows, or policy shifts, have generally witnessed more robust growth, at least in the near term.

Set against this broader economic backdrop, the six-day forex trend spotlights a currency on a seemingly irreversible slide. The question facing policymakers and bank executives is whether to let the Brewed Buck continue its downward drift or to invoke additional measures to steer it toward a new equilibrium. Some industry observers believe it is only a matter of time before all banks accept the 125 Br barrier as the new normal, pushing rates beyond that level and adapting to the associated inflationary effects.

What AI Means for Growth, Jobs

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Some prominent economists argue that the revolution in artificial intelligence (AI), particularly the rapid development of generative AI, will have only moderate effects on productivity growth but unambiguously negative effects on employment, owing to the automation of many tasks and jobs. We disagree on both counts.

When it comes to productivity growth, AI’s impact can operate through two distinct channels: automating tasks in the production of goods and services, and automating tasks in the production of new ideas. When Erik Brynjolfsson and his co-authors recently examined the impact of generative AI on customer-service agents at a US software firm, they found that productivity among workers with access to an AI assistant increased by almost 14pc in the first month of use, then stabilised at a level approximately 25pc higher after three months.

Another study finds similarly strong productivity gains among a diverse group of knowledge workers, with lower-productivity workers experiencing the strongest initial effects, thus reducing inequality within firms.

Moving from the micro to the macro level, in a 2024 paper, we considered two alternatives for estimating the impact of AI on potential growth over the next decade. The first approach exploits the parallel between the AI revolution and past technological revolutions, while the second follows Daron Acemoglu’s task-based framework, which we consider in light of the available data from existing empirical studies.

Based on the first approach, we estimate that the AI revolution should increase aggregate productivity growth by 0.8-1.3 percentage points per year over the next decade. Similarly, using Acemoglu’s task-based formula, but with our own reading of the recent empirical literature, we estimate that AI should increase aggregate productivity growth by between 0.07 and 1.24 percentage points per year, with a median estimate of 0.68. In comparison, Acemoglu projects an increase of only 0.07 percentage points.

Our estimated median should be seen as a lower bound, because it does not account for AI’s potential to automate the production of ideas. On the other hand, our estimates do not account for potential obstacles to growth, notably the lack of competition in various segments of the AI value chain, which are already controlled by the digital revolution’s superstar firms.

What about AI’s implications for overall employment?

In a new study of French firm-level data collected between 2018 and 2020, we show that AI adoption is positively associated with an increase in total firm-level employment and sales. This finding is consistent with most recent studies of the firm-level effects of automation on labour demand, and it supports the view that AI adoption induces productivity gains by helping firms expand the scope of their business.

This productivity effect appears to be stronger than AI’s potential displacement effects (whereby AI takes over tasks associated with certain types of jobs and workers, thus reducing labour demand). We find that the impact of AI on labour demand is positive even for occupations often classified as vulnerable to automation, such as accounting, telemarketing, and secretarial work. While certain uses of AI (such as for digital security) lead to positive employment growth, other uses (administrative processes) tend to have small negative effects.

But, these differences appear to stem from different uses of AI, rather than from inherent characteristics of the affected occupations.

All told, the main risk for workers is that they will be displaced by workers at other firms using AI, rather than by AI directly. Slowing down the pace of AI adoption would likely be self-defeating for domestic employment, because many firms will be competing internationally with AI adopters.

While our interpretation of the data shows that AI could drive growth and employment, realising this potential will require suitable policy reforms. For example, competition policy should ensure that the superstar firms that dominate the upper segments of the value chain do not stifle entry by new innovators. Our study finds that AI adopters are predominantly much larger and more productive than non-adopters, suggesting that those already on top are positioned to be the biggest winners of the AI revolution.

To avoid increased market concentration and entrenched market power, we should encourage AI adoption by smaller firms, which can be achieved through a combination of competition policy and suitable industrial policy that improves access to data and computing power. To enhance the employment potential of AI and minimize its adverse effects on workers, broad-based access to high-quality education, together with training programs and active labour-market policies, will be crucial.

The next technological revolution is already underway. The future of entire countries and economies will depend on their willingness and ability to adapt to it.

 

 

Misconceptions, Hasty Judgments Lead to Costly Mistakes

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I had an errand to run, dropping off some clothes at Sunshine Laundry, my go-to spot for its quality service and convenient hours. The parking attendants guided me to an open space, and I quickly went inside. While handing over the laundry, nature suddenly called. I had been drinking plenty of water and had not realised the urgency until the pressure hit.

With no restroom in sight, I rushed across the street to Flamingo Restaurant, knowing exactly where their restrooms were. Climbing the narrow fire-escape-style staircase was no easy task under such circumstances. When I finally reached the restroom, I found both the men’s and women’s toilets occupied. Minutes of agony passed before the men’s restroom became available, and I dashed in to relieve myself.

Feeling much better, I returned to Sunshine Laundry to pay and schedule my pickup. But another unpleasant surprise awaited me. A car was parked directly behind mine, blocking my exit. I confronted the three parking attendants, who informed me that the owner had gone to Hyatt Regency for a wedding.

I was alarmed and annoyed. It could take two to three hours for someone at a wedding to return. One of the attendants rushed to Hyatt to find the car owner, while another tried to justify the inconvenience, telling me the owner was a famous person, a completely irrelevant detail that only made my frustration worse.

Finally, one of the parking attendants pointed towards Hyatt Regency as the blocking driver appeared. To my surprise, it was a famous Ethiopian movie star, someone I admired. I had even taken a selfie with him at the Hilton Hotel about a year ago. He was now with his wife and two children, carrying a toddler in his arms while she followed with another child.

Seeing him instantly transformed my frustration into joy. I greeted him warmly, kissed the tiny hands of his toddler, and forgot my complaint entirely. Instead, I reminded him of our previous encounter at Hilton, though he only vaguely remembered. Understandable, given the number of fans he meets. As he drove away, we waved goodbye, leaving the parking attendants stunned by my sudden shift from agitation to delight.

I pulled out my phone and showed them the photo from a year ago, both of us smiling, with his arm resting on my shoulder. Still in a good mood, I tipped them generously, despite their failure to prevent my car from being blocked.

Their version of the story was that the actor had gone to Hyatt to pick up his wife and kids, but a drunken pedestrian caused a delay. In the chaos, the attendants had improvised a temporary solution, parking his car behind mine. Seeing me cross to Flamingo, they assumed I was staying for a meal and would not return soon.

I could not help but think, had I escalated the situation in anger, I would have regretted it. Like a mirage in the desert or the illusion of water on a hot asphalt road, reality often differs from the first impression. Empathy and patience help people see the other side of the story before jumping to conclusions.

The world is filled with misunderstandings, suspicion, and conflict, often caused by hasty judgments and unchecked prejudices. In 1969, El Salvador and Honduras went to war for 100 hours over riots sparked by a World Cup qualifying match. Like a wildfire ignited by a single spark, a small misunderstanding can lead to irreversible damage.

This is why I oppose capital punishment, it leaves no room for reversal if new evidence proves the accused innocent. Time and again, people realise their assumptions were wrong, only to take a complete 180-degree turn when they see things from a different perspective.

An Amharic poem by the renowned writer Kebede Michael in his book “Teretina Misale” (Fables and Idioms) tells the story of a little mouse narrating an escapade to her mother. The young mouse describes venturing out of her hole into the open world, encountering two animals.

One was quiet, with fluffy fur, green eyes, and a sleepy, relaxed demeanour. The other was noisy, with a squeaky voice, an ugly beak, and flapping wings that shed feathers. Instinctively, she was drawn to the gentle-looking one but was terrified by the monstrous, loud bird.

After listening patiently, her mother warned her: the gentle one was a cat, their greatest enemy, while the ugly, noisy one was a harmless rooster. The moral of the story is that appearances can be deceiving. Misconceptions, biases, and unfounded worldviews can distort reality and lead to costly mistakes.

Over the weekend, I was in the Bole Medhanialem area when I passed an elegant cafe. Its posh interior, spacious layout, and rich aroma of premium coffee immediately caught my attention. After a long day running errands, I felt it was time for a break.

From its affluent location and luxurious furnishings, I assumed it was a high-end cafe. Expecting a hefty bill, I decided to treat myself.

As I stepped inside, I was drawn to the upstairs seating area. The subtle scent of newly polished wooden furniture and the calm ambiance made me feel at home.

Upstairs, I was greeted by a lavish sitting area with plush sofas upholstered in what looked like suede or canvas. I sank into the comfortable seat, taking in the stunning interior from my vantage point above.

A waiter arrived and took my order for an espresso, mentioning that the cafe is a subsidiary of Robera Coffee, a well-known premium coffee exporter in Addis Abeba. He explained that the brand aims to expand into the cafe business, following in the footsteps of Tomoca, Chaka Coffee, and Hadero.

When my coffee arrived, the first sip was a revelation, a rich, deep flavour rarely found. I sat back, savouring the exceptional taste, enjoying the cosy, quiet ambiance with the entire upstairs to myself.

After lingering for a while, I finally asked for the bill, only to be caught off guard. The waiter informed me that the cafe had not yet set its prices and was serving customers free of charge. He explained that their only focus at this stage was to gather honest customer feedback. Then, he asked if I wanted anything else.

This level of customer service was unheard of. The next day, I returned for another free espresso.

On the third day, my espresso arrived with delicious cookies that melted in my mouth. I relaxed in the leisurely atmosphere, enjoying the moment. Then, the waiter brought the bill, a slight surprise, as I had expected the free service to last longer.

However, the price was reasonable, considering the premium product, location, and service. The cookies were still free, and the waiter treated me to a few extra rounds.

Though the honeymoon period was over, I had become a regular customer. The cafe still had no sign outside, but its exceptional coffee, warm hospitality, and inviting ambiance had already earned my loyalty.

It was a lesson in perception, things are not always as they seem. Who would have thought that a simple act of generosity and a brilliant marketing strategy could create such a memorable experience?

Container Ships Keep Global Trade Afloat While the World Looks Away

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Shipping is often overlooked as a foundation of global trade. Consumers easily recognise familiar brands, yet few can name the major maritime carriers that help deliver products worldwide. However, in recent years, logistics disruptions have thrust container shipping into the public eye.

Remembering the crucial role shipping plays may inspire us to broaden our perspective the next time we pick up an imported product. The mobile phone users hold, or the laptop on their desk, likely contains components sourced from multiple continents — some from factories in Asia, others from mining sites in Africa or electronics hubs in Europe — and all converged in a shipping container. Those who enjoy morning coffee should remember that there is a good chance the beans travel halfway across the world, perhaps from the lush highlands of Ethiopia to kitchens through a series of meticulously coordinated shipments.

Maritime transport underpins the global economy. According to the 2023 UNCTAD report, more than 80pc of international trade volume moves by sea, and in most developing countries, the figure is even higher. This scale is possible because containerisation has cut costs. Wherever we are — home, office, or outdoors — chances are we are surrounded by items that arrive in a shipping container. Pick up any object and consider where its materials originated.

Countries contribute components or raw materials. A smartphone might draw parts from over 40 countries on six continents. The interdependence of modern production spans the globe, connecting materials from one region with manufacturing centres in another.

Food supply chains also owe much to container shipping. Rice from India or Pakistan and fruit from South America or South Africa often arrive in local grocery stores at reasonable prices, thanks to ocean liners.

Coffee from Ethiopia reaches consumers in Europe, Asia, and the United States using the same method. Fresh produce, once deemed too perishable to travel, now crosses oceans in temperature-controlled containers that reduce spoilage. A few decades ago, the thought of enjoying a fruit grown thousands of miles away seemed impractical. Today, reefer containers equipped with ever-evolving technology maintain stable conditions en route, ensuring that products arrive in peak condition.

Containerisation fundamentally reshaped global commerce. Before the modern shipping container, goods moved in bags, barrels, or crates, and port operations were almost entirely manual, slow, and prone to damage. Transporting cargo by horse, camel, or donkey imposed severe constraints on volume and distance, and goods that did survive the trip were often too expensive for the average consumer. Railways, introduced in the late 19th century, helped speed cargo movement on land, but differences in package size and multiple handling points still caused delays and losses.

The two world wars revealed logistics bottlenecks, particularly for the United States, which needed a faster and safer way to move supplies across oceans. One early solution came in 1948 with the “Transporter,” a corrugated steel container able to carry four metric tons of cargo by plane, ship, train, or truck. While useful, its limited size capped its broader appeal.

A defining moment arrived in 1956, when Malcolm McLean, frustrated by the lengthy time it took to transfer cargo from trucks to ships, set out to streamline the process. Teaming with an engineer, Keith Tantlinger, McLean developed a 33-foot container with increased strength and specialised hardware. On April 26, 1956, the vessel Ideal X departed from the Port of Newark with 58 of these containers, which were loaded in under eight hours. Under the earlier breakbulk system, loading a comparable volume would take three days. The cost savings were profound. Moving one ton of cargo reportedly fell from around six dollars to sixteen cents.

As container technology matured, new models and larger ships emerged, boosting efficiency and lowering costs. These developments catalysed global commerce, connecting distant markets and enabling businesses to source materials and customers across international borders. Through these steel boxes, globalisation took on a tangible form.

Despite its crucial role, container shipping remains a mystery to many. In Cyprus, “Adopt a Ship” brings maritime awareness into elementary schools, linking classrooms with shipping companies so that students can track voyages and learn about ocean transport. Similar efforts could nurture a deeper appreciation elsewhere. Indeed, the resilience of mariners who keep global trade alive deserves recognition.

During the Covid-19 pandemic, seafarers faced prolonged stints at sea and limited shore leave due to strict quarantine measures. Yet they persevered, ensuring a steady flow of essential supplies.

However, shipping challenges are not limited to the pandemic. The sector struggles with fluctuating fuel prices, regulatory pressures to reduce emissions, and the complexities of coordinating multimodal networks. Each potential snag has far-reaching consequences, as disruptions can echo up and down supply chains, slowing manufacturing or delaying deliveries to consumers. Yet, the industry has proven remarkably adaptable, embracing digitisation, advanced tracking, and automation to drive greater transparency and efficiency.

In an interconnected world, shipping is the silent artery that keeps trade alive. The 97pc cost reductions might sound astonishing, but they speak to why consumers today can sample produce from around the globe; why a manufacturer can keep a production line moving; and, why retailers can stock items at prices accessible to a broad consumer base. It is a marvel of modern efficiency, and yet, for the most part, it operates far from public view.

Ethiopia’s Closed Financial System Can’t Open the Door to Innovation

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For one-and-a-half decades, Ethiopia’s state-led economic growth model generated impressive expansion in gross domestic product (GDP) but left behind a series of financial and structural complications. The grand vision of transforming the economy’s fundamentals never progressed beyond rhetoric, and the ambitious structural changes that policymakers promised remain elusive. While recent reforms have been introduced with much fanfare, their outcomes are still unclear. They have yet to alter the country’s economic reality meaningfully.

A well-developed financial system is a key driver of any robust economy. It goes beyond simply disbursing credit to established businesses. As the economist Joseph Schumpeter argued, banks fuel growth through what he dubbed “creative destruction.” It involves channelling funds toward risk-taking entrepreneurs who introduce novel products, adopt unconventional production processes, and break into untapped markets.

This process of disruption makes resources available for innovators, and such a financial system has the potential to propel economic development to new heights.

Ethiopia’s experience demonstrates what happens when that system fails to do its job.

Entrepreneurship and access to finance are the most critical elements in economic development. A vibrant system for protecting property rights and financing new ventures promotes the formation of businesses that can bring fresh ideas to the marketplace. Developed economies long ago established institutions such as equity markets, pension funds, and insurance companies that cater to ventures of all sizes. These structures have given businesses a lifeline and a robust ecosystem for seeking diverse forms of capital.

However, banks dominate the financial sector in much of the developing world, including Ethiopia. Relationships, insider information, and collateral arrangements often influence decisions about who gets credit. This approach generally benefits established traders and property developers over small manufacturers or agricultural enterprises, which traditional metrics deem too risky.

Over the years, private banks in Ethiopia have leaned heavily on relationship-based lending. This has meant that entrepreneurs, especially those with untested ideas or technology-driven concepts, find themselves outside the circle of favoured borrowers. When domestic banks step up, they typically demand collateral that many young or innovative companies do not possess. Even manufacturing firms with assets fare poorly in this environment, owing to fears of market volatility or logistical challenges. Agriculture, crucial as it may be for national food security, also struggles to win bank financing because of seasonal uncertainties, weather risks, and infrastructure gaps.

To compensate for the shortcomings of these private banks, policymakers turned to state-owned financial giants. The Commercial Bank of Ethiopia (CBE), the country’s largest lender, poured billions of dollars into public infrastructure, including power generation, railway lines, and mass housing projects, while the Development Bank of Ethiopia (DBE) extended loans to private companies in agriculture and manufacturing. Yet, political interference in financial institutions took its toll.

Non-performing loans (NPLs) accumulated to alarming levels, raising fears of a domino effect that could destabilise the wider financial system. In a move that would have caused political firestorms in more transparent economies, Ethiopian authorities quietly took over a massive portion of CBE’s bad loans last October. The absence of public debate or legislative scrutiny exposed the governance gap, revealing the risks of depending on institutions without sufficient checks and balances.

The outlook for the country’s entrepreneurs is incredibly bleak.

Across the world, startups that disrupt established markets turn to venture capitalists or private equity investors who can look past immediate collateral requirements and instead value innovative potential and long-term growth. Ethiopia lacks these alternative funding mechanisms. It has also been nearly impossible to tap capital markets because there have been no functioning stock exchanges where new companies could list their shares and attract investors who might diversify across different industries.

In the past two decades, a handful of entrepreneurial ventures attempted public share subscriptions to raise equity, but the results were largely disastrous. Many of these businesses vanished within a few years, leaving investors with valueless certificates and eroding public trust in share offerings. The lack of oversight over such ventures, combined with unscrupulous operators looking to make a quick profit, led to a spate of failures. This brought deep scepticism among Ethiopians, many of whom came to see share subscriptions not as an investment in the future but as a high-stakes gamble.

Hopes ran high when federal authorities launched the Ethiopian Securities Exchange (ESX) after years of planning. Projections suggested that about 50 companies, mainly from the financial services sector, would list their shares and inaugurate a new chapter in the country’s capital markets. However, details of which companies will appear on the exchange remain unclear. The stringent listing requirements set by regulators protect investors from dubious operators, yet they also raise the bar high for legitimate entrepreneurs lacking extensive track records.

That irony has tempered some of the initial excitement as policymakers struggle with balancing investor safeguards and the need to provide fresh avenues for capital formation.

Broader economic and political uncertainties continue to cast a long shadow. Firms of all sizes remain wary of bureaucratic delays, arbitrary decisions by local officials, and corruption that can sap the energy of the most ambitious startups. Property rights, another crucial element in building confidence, still need to be strengthened to assure investors that the rules of the game will not shift overnight. Corruption, often experienced at the local level where permits and licenses are granted, blunts innovation and steers capital toward unproductive channels.

Overcoming these hurdles demands a new financial architecture that identifies, evaluates, and funds new ideas rather than defaulting to tried-and-tested ventures. Mortar and brick banks, whether public or private, should reinvent themselves if they are to stay relevant. The state can also create space for more specialised funding platforms, such as venture capital firms and private equity funds, while regulators can encourage a culture of accountability to build trust in capital markets. Such structural changes become even more urgent in a political environment prone to sudden shifts that push investors toward speculative activities instead of productive enterprises.

The years ahead will show whether the long-promised transformation can take hold. Policymakers have begun to acknowledge that relying on heavy government intervention and relationship-based financing will not deliver the entrepreneurship or productivity gains the economy needs. Yet, without stronger institutions, better regulation, and more openness to risk-taking, the economic reforms may prove little more than a fleeting attempt at change.

The potential is enormous, but so is the tough call to turn a notoriously insular financial system into a catalyst for growth and innovation.

Climate Displacement Is Also a Health Crisis

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Every year, 21.5 million people are forcibly displaced by floods, droughts, wildfires, and storms. This number is set to rise dramatically over the coming decades, with up to 1.2 billion people expected to be driven from their homes by 2050. The unfolding climate crisis is not only a humanitarian disaster but also a global health emergency.

Climate displacement poses both direct and indirect threats to public health. Disrupting care services deprives affected communities of access to doctors, hospitals, and pharmacies. Climate-induced migration also exacerbates poverty, overcrowding, and social instability. Food production is often severely affected, while unsanitary living conditions fuel the spread of infectious diseases.

As the climate crisis threatens to derail global efforts to achieve the United Nations Sustainable Development Goals (SDGs), the health and well-being of hundreds of millions of people in the developing world are at risk. High-income countries are not immune: In the United States alone, 3.1 million adults were displaced or evacuated due to natural disasters in 2022.

Pharmaceutical companies should play a pivotal role in bolstering global health resilience. Their involvement is particularly critical in conflict zones at the forefront of the climate-displacement crisis, where life-saving medicines and vaccines are often in short supply. While the pharmaceutical industry has made strides in reducing carbon dioxide emissions and adopting more sustainable practices, its efforts fall far short of mitigating climate-related disruptions to supply chains. These vulnerabilities were on full display in 2017, when Hurricane Maria devastated Puerto Rico’s drug manufacturing sector, which at the time accounted for nearly 10pc of all drugs consumed in the US.

Some pharmaceutical companies, such as Novartis and Novo Nordisk, have launched targeted programs to aid populations displaced by extreme weather events, while others have donated cash or supplies in response to natural disasters. The demand for these donations has risen with increasing climate and humanitarian needs. Hikma, a generic medicine manufacturer founded in Jordan, reported four million dollars in donations in 2020, and 4.9 million dollars in 2023, mostly serving the needs in the surrounding region.

No company has developed a comprehensive strategy to ensure displaced communities have sustained access to health products. A more holistic approach is needed. Amid the ongoing climate-displacement crisis, pharmaceutical companies should adopt a four-pronged strategy to strengthen healthcare systems.

For starters, they could help deliver medicines to vulnerable communities in remote areas by revamping their supply chains, from building redundancy into shipping networks to redesigning products to be more stable in hot climates where refrigeration may be unavailable. They should include robust systems for the large-scale distribution of generic drugs, frequently the most effective tools for managing disease outbreaks.

Pharmaceutical companies should invest in research and development to create vaccines, diagnostics, and therapeutics targeting climate-sensitive diseases. Rising global temperatures are accelerating the spread of mosquito-borne illnesses such as dengue, malaria, and Zika, as well as waterborne diseases like cholera and shigella, putting displaced populations at even greater risk.

Yet, despite the need for innovation, the 2024 Access to Medicine Index – which ranks the efforts of pharmaceutical companies to improve access to essential drugs in developing countries – shows that the Research and development (R&D) pipeline for emerging pathogens and neglected tropical diseases is drying up. Compounding this problem is the lack of research into new antibiotics to combat the escalating threat of antimicrobial resistance, exacerbated by extreme weather and poor sanitation.

Pharmaceutical companies should forge long-term partnerships with humanitarian organisations focused on climate displacement. Public-private collaborations have also proven effective in strengthening health resilience. Since 2010, for example, leading vaccine manufacturers like GSX and Pfizer have supplied Gavi, the Vaccine Alliance, with billions of vaccine doses, protecting vulnerable populations in some of the world’s most resource-constrained countries.

Lastly, pharmaceutical companies should boost efforts to cut greenhouse-gas emissions across their value chains. While the climate impact of pharmaceuticals may get less attention than traditional manufacturing industries, the sector emits more CO2 per one million dollars of revenue than the automotive industry.

The active support and engagement of shareholders, employees, and other stakeholders is crucial. Investors, in particular, should encourage companies to align their business practices with global health and climate goals. This is not only an ethical choice but also one that promises long-term financial and reputational benefits. Climate displacement is not a distant or hypothetical threat; it is a rapidly escalating health emergency.

The pharmaceutical industry has a moral responsibility to act. To do so effectively, companies must get ahead of the curve and provide vital, life-saving treatments to those on the front lines of the climate crisis.

When Companies Fail to Learn, They Learn to Fail

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Investing in electric-vehicle battery production may seem like a sure thing. At first glance, Northvolt – the Swedish EV battery developer and manufacturer that filed for bankruptcy protection in November – appeared to have all the advantages and capabilities needed to succeed.

For starters, the market fundamentals are undeniably strong. EV production is projected to grow exponentially. Tesla is trading at more than 100 times its earnings, whereas Toyota, the world’s largest manufacturer of gasoline-powered cars, has a price-to-earnings ratio of 10. Supporting these optimistic market projections, Northvolt had already secured 50 billion dollars in sales orders, and raising capital proved remarkably easy.

Northvolt attracted a star-studded roster of investors, bringing in an unprecedented 15 billion dollars in startup funding, with Goldman Sachs and Volkswagen leading the charge.

Expertise was another major strength. Northvolt’s founders, Peter Carlsson and Paolo Cerruti, were former Tesla executives with deep experience managing global supply chains. Battery production seemed like a logical extension of their expertise. Northvolt also established partnerships with leading suppliers from Japan, South Korea, and China, bringing seasoned professionals to its facilities and enabling technology transfers.

Concerning human capital, Sweden consistently ranks among the top-performing countries in the OECD’s Assessment of Adult Competencies. As a member of the European Union (EU), it has access to talent from 26 other developed economies, while its flexible immigration policies attract skilled professionals from around the world. At its peak, Northvolt employed nearly 7,000 workers from more than 100 countries, including experts from South Korea and China.

Northvolt’s base in Northern Sweden offered abundant renewable hydropower, proximity to key mining resources, and a strong metallurgy tradition, making it an ideal foundation for building a sustainable, low-carbon battery supply chain. Buoyed by its initial success, Northvolt’s leadership pursued aggressive expansion, unveiling ambitious plans to build new facilities in Canada and Germany. For a time, the company seemed unstoppable.

Then, seemingly overnight, it spiralled into crisis and collapsed.

What went wrong?

According to a Financial Times investigative report, the cause of Northvolt’s downfall was shockingly simple. The company’s primary battery plant in Skelleftea operated at less than one percent of its intended capacity. With sales far below projections, the company struggled to fulfil contracts, haemorrhaging cash in the process.

Northvolt’s inability to ramp up production stemmed from the difficulties of integrating its complex supplier network, which included China’s Wuxi Lead, Japan’s Marubeni, and several South Korean firms. Although each supplier was an industry leader, their employees and equipment had never worked together. The diverse technologies, manufacturing methods, and languages created insurmountable barriers, resulting in a disjointed operation that never jelled.

If a Global South country attempted such an ambitious project and failed, it might have been dismissed as a classic example of a developing economy biting off more than it could chew. But when a highly developed country like Sweden, with its abundant financial, human, and technological resources, stumbles so dramatically, it points to a deeper issue that warrants closer attention.

Contrary to conventional wisdom, technology is not just about machines, blueprints, and financial capital. Its successful deployment depends on the tacit, hard-earned knowledge that exists within experienced teams and enables people to collaborate seamlessly. Consider, for example, an orchestra: even with a renowned conductor, top-quality instruments, and flawless sheet music, the real challenge lies in creating an ensemble capable of performing in perfect harmony.

Northvolt failed to recognise how much it did not know. The company underestimated the steep learning curve it needed to climb to integrate a complex manufacturing operation across cultures, technologies, and work practices. Most critically, it failed to give itself the time to acquire that knowledge before scaling. That is why it failed to integrate its various components, while Japan’s Panasonic achieves this daily with similar resources and expertise.

But these challenges are hardly unique to Northvolt. Across the developed and developing world, companies and policymakers often assume that having the right resources ensures success. They overlook the invisible yet vital learning process, which involves bridging knowledge gaps through trial, error, and adaptation.

The key takeaway from Northvolt’s collapse is that companies should recognise and address knowledge gaps before pursuing ambitious growth strategies. Otherwise, they risk overextending themselves before mastering the fundamentals, leading to disaster.

This lesson applies equally to national industrial policies. Northvolt’s failure serves as a cautionary tale about the perils of corporate miscalculation. But, it also offers a valuable lesson about the time required for complex industries to develop the tacit capabilities needed to operate at scale.

Ignoring this reality – whether due to overconfidence or external pressure – can doom even the most promising, best-funded projects. In business and policymaking alike, success requires patience and a clear understanding of knowledge gaps. Northvolt lacked both – and suffered the consequences. For everyone else, it is a case study of what to avoid.

The Vanishing Reverence for Marriage

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Marriage is meant to be a lifelong bond, built on love, trust, and commitment. It is a promise to stand together through life’s challenges.

Yet, divorce rates in Addis Abeba are soaring, raising concerns about how this sacred institution is being tested in today’s fast-paced, individualistic society. For some, marriage seems to be reduced to a social media event, wedding photos today, divorce announcements tomorrow. The speed and frequency of separations are alarming.

The Civil Registration and Residency Services Agency (CRRSA) recently reported a 34pc increase in divorces compared to last year, with 3,769 couples separating in just six months. These are not just statistics; they represent broken families, distressed children, and communities struggling with fractured relationships.

Divorce, even when justified, leaves deep scars, especially on children. Psychologists warn that children from broken homes often struggle with self-esteem, identity, and future relationships. Many internalise parental conflicts, leading to emotional wounds that can take years, if not a lifetime, to heal.

The public nature of modern divorces is an additional worry. Social media has become a battleground where individuals air grievances about failed marriages, sharing intimate details that may bring temporary relief but have long-term consequences, especially for children.

Such public disputes not only damage reputations but also create emotional confusion for children caught in the middle. The hostility makes reconciliation nearly impossible and deepens divisions that might have been healed over time.

Marriage comes with lifelong consequences, yet many enter it unprepared. Even after separation, parents must remember their responsibilities to their children. Sadly, some drag their children into conflicts, creating hostility and resentment. This damages their emotional well-being and hinders their ability to form healthy relationships in the future.

Regardless of their differences, parents share a lifelong bond through their children. Shielding them from divorce-related trauma and co-parenting amicably can make a big difference in their emotional development.

Marriage demands effort, understanding, and sacrifice. Yet, many enter it with unrealistic expectations, focusing more on the wedding spectacle than the marriage itself.

I recall a story shared during pre-marital counselling, a young couple from a wealthy family had a lavish wedding with luxury cars and a mansion as gifts. The very next morning, they wanted to return to their parents’ homes and immediately filed for divorce. This real-life tragedy shows how some fail to understand the difference between a wedding and a marriage.

Before I got married, my husband and I committed to pre-marital counselling with experienced couples. We wanted a lasting marriage, so we sought wisdom from those who had navigated decades of married life. For over a year, we immersed ourselves in lessons, with the last six months being particularly intense. No topic was off-limits.

We learned about the realities of living together, differing upbringings, and the importance of prioritising our bond. We were taught how to communicate openly, resolve conflicts without judgment, and manage finances wisely. The lessons even covered uncontrollable life challenges like fertility issues and how to handle them gracefully.

Most importantly, we were taught to protect our marriage from external interference, to be emotionally and financially independent from our families.

One of the most valuable lessons was learning the importance of boundaries, both within our families and with others, regarding our marriage. We were advised never to discuss marital issues with family or friends, as it often worsens conflicts. Instead, we were encouraged to seek guidance from spiritual leaders or mentors who could offer unbiased advice.

The premarital counselling experience was transformative. By the time we walked down the aisle, we were not only prepared but deeply committed to nurturing our relationship. In over two years of marriage and parenthood, the wisdom we gained continues to guide us.

Many couples I know who went through premarital counselling ended up parting ways before saying “I do.” Others used the lessons to build lasting, happy marriages. Interestingly, the same advice that helped some walk away also helped others stay together, sparing both from the heartache of divorce. This indicates how important such counselling is, it offers clarity, strengthens bonds, and paves the way for healthier futures.

Psychologists suggest that the rise in divorce rates is due to a culture of instant gratification in modern society. Many people approach relationships with the mindset that if something is not working, it is easier to walk away than fix it. This view overlooks the truth: marriage requires patience, effort, forgiveness, love, and resilience.

In an age where people can swipe left or right to find a partner, the idea of working through hurdles may seem outdated. However, true love and commitment are not about avoiding difficulties but facing them together. A successful marriage is not one free of conflict, but one where both partners are willing to resolve issues with love, mutual respect, and understanding.

Our premarital counselling mentor often said that marriage is not just about two people but also about the legacy they create together. Whether raising children, building a home or business, or contributing to the community, a strong marriage can positively impact society.

As a happily married woman, I can say that marriage is one of life’s most profound commitments. A society must work to preserve the sanctity of marriage by promoting love, understanding, resilience, and mutual respect.

Those who consider marriage should remember that it is not just a milestone, but a lifelong journey. They should be prepared for it, invest in it, and honour it.