FORTUNE+ VIDEO SPONSORED CONTENTS ADVERTORIALS FORTUNE AUDIO Fortune Careers New TRADE AFRICA New

Fortune Logo
The top five companies holding the highest portfolios of non-performing loans at the Development Bank of Ethiopia (DBE) are all Turkish owned.

The top five companies holding the highest portfolios of non-performing loans at the Development Bank of Ethiopia (DBE) are all Turkish owned. Together with one other Turkish company, six foreign companies owe the Development Bank an aggregate of 8.7 billion Br in non-performing loans.


BMET Energy, Telecom Industry & Trade Plc

These companies have failed to service their debts, and the Bank has repossessed the plants of three companies already, including the recently defaulted Ayka Addis. Turkish owners have abandoned six other companies.  Desperate to survive, some of the remaining companies established with Turkish investment are braving the odds, by reaching outside their core competence to produce raw materials to keep their plants running.


Ayka Addis Textile & Investment Group

The current situation is a far cry from the jubilation and enthusiasm that greeted Turkish investors when they first started to come to the country a decade and a half ago. No less than 244 Turkish companies have entered Ethiopia's market since 2013, while currently 95 Turkish-owned companies, employing an aggregate of over 21,000 people, soldier on.  The cause for the hardship has been pegged on the usual suspects - forex crunch, poor infrastructure, shortage of raw materials and a lack of a skilled labour force – the same challenges that face companies that operate in Ethiopia. But the authorities, as well as experts, say that the Turkish companies have a major shortcoming - mismanagement.


MNS Manufacturing Plc

"Most of the companies have management problems," said Abebe Abebayehu, chief of the Ethiopian Investment Commission (EIC). Due diligence and project evaluations, as well as feasibility studies, were not properly carried out by government agencies when these companies started investing here, according to Abebe.

Experts suggest that preparing more competent contracts, audits and prior vetting of the competence and qualifications of the management teams of investing companies will go a long way in avoiding these pitfalls and the dilemma investors face in Ethiopia.


You can read the full story    here    




PUBLISHED ON Feb 16,2019 [ VOL 19 , NO 981]

How useful was this post?

Click on a star to rate it!

Average rating 0 / 5. Vote count: 0

No votes so far! Be the first to rate this post.



Related Posts

Editors' Pick

Exclusive Interviews

State Enterprises from Oracles to Apprentices

Dec 22 , 2024 . By TIZITA SHEWAFERAW

Charged with transforming colossal state-owned enterprises into modern and competitiv...

Agenda

Rising Costs, Inflation Threaten Insurance Industry

Aug 18 , 2024 . By AKSAH ITALO

Although predictable Yonas Zerihun's job in the ride-hailing service is not immune to...

Agenda

BREWING DISCONTENT

Jul 28 , 2024 . By TIZITA SHEWAFERAW

Unhabitual, perhaps too many, Samuel Gebreyohannes, 38, used to occasionally enjoy a couple of beers at breakfast. However, he recently swit...

Fortune News

Electric Vehicle Push Leaves Investors in the Lurch

Jul 13 , 2024 . By AKSAH ITALO

Investors who rely on tractors, trucks, and field vehicles for commuting, transporting commodities, and f...

Commentaries

Health Policy Reforms Walk a Tightrope of Bitter Pills, Bold Cures

Ethiopia's reform of health policies has been marked by bold initiatives, hard lesson...

In Business as in Football, Culture Shift Triumphs, But Silverware Remains Elusive

Mikel Arteta's tenure at Arsenal began in late 2019, when the football club was reeli...

Fineline

Leaders of the National . . .

Leaders of the National Election Board are in a charm offensive mood, of a sort. Last week, they organised a rare tour for members of the me...

When the country’s most. . .

When the country's most senior diplomats and envoys return back to their posts after two-week debriefings, they leave behind a point or two...

Editorial

Mismanaged, Trade Liberalisation Could Pour Cold Water on Local Hopes

Mar 2 , 2025

The domestic economy has endured a punishing half-decade. A global pandemic throttled...

Africa Wants to Mark Own Homework with Homegrown Credit Agency

Feb 23 , 2025

Africa is a place where the frustrations of its elites run high due to what they feel...

IMF Tells Ethiopia to Stay the Course, with Leap of Faith on the Market

Feb 16 , 2025

Madame Kristalina Georgieva, managing director of the International Monetary Fund (IM...

The Race to the AUC Follows Mahamat's Grand Entrances, Quiet Exits Legacy

Feb 9 , 2025

This week, the African Union's (AU) annual summit in Addis Abeba is set to be more th...

Gallery

Parliament Approves New Cabinet Members

Oct 6 , 2021

Parliament Approves New Cabinet, Incorporates Opposition Leaders Lawmakers have approved today the nominations of 22 ministers, including three opposition leaders. Two MPs have voted against, while 12 abstained...

2020 in Posterity

Jan 5 , 2021

TIGRAY VOTES DESPITE "NULL & VOID" THREAT

Sep 9 , 2020

IN-PICTURE: LAUREATE'S RECEPTION  

Dec 14 , 2019

PM Abiy Ahmed (PhD) at a Gala Dinner Called for the Awarding of the Félix Houphouët-Boigny Peace Prize

May 6 , 2019

Faces, Voices of Addis Abeba

Apr 26 , 2019

Sunday With Eden

The Emotional Toll of Worry

Last week, I spoke with an expecting mother from church. After congratulating her, I shared my excitement. Out of curiosity, I asked where s...

Soaring Rent Crisis Pushes Residents to the Brink

Addis Abeba is in the grip of a worsening housing crisis. Rent prices have surged to record levels, forci...

Life Matters

Online Toxicity Hijacks Social Media

One minute, people are laughing at a meme on social media; the next, they scroll through a barrage of com...

The Increasing Presence of Women in Leadership

Following the recently concluded 38th AU Summit, I was captivated by the presence of incoming heads of st...