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20th NCCP

Staff Reporter
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Ambassador Hu Changchun, Head of Mission of China to the African Union talked to Capital about the 20th National Congress of the Communist Party of China and the commitment to Africa. Excerpts;  

 

Capital: What is the most important political achievement of the 20th National Congress of the Communist Party of China?

Ambassador Hu Changchun: The 20th National Congress of the Communist Party of China (CPC) took place at a critical time when China embarks on a new journey to build a modern socialist country in all respects and advances toward the second centenary goal. The most important political achievement of the Congress is the election of a new CPC Central Committee with Comrade Xi Jinping at its core, which further established General Secretary Xi Jinping’s core position in the CPC Central Committee and in the Party as a whole and the guiding role of Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era. This fully reflects the common will of the Party and the Chinese people, and it is of decisive significance for the cause of the great rejuvenation of the Chinese nation.

In addition, the Report delivered by General Secretary Xi Jinping at the 20th National Congress also extracted the essence of Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era-“Six Musts”, that is, we must put the people first, we must maintain self-confidence and stand on our own feet, we must uphold fundamental principles and break new ground, we must adopt a problem-oriented approach, we must apply systems thinking, we must maintain a global vision. The “Six Musts” are not only the fundamental principles for promoting the modernization of Marxism in China, but also the worldview and methodology of Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era, and are also used to guide the new era.

Capital: How do you view China’s achievements and changes in the past decade?

Ambassador Hu Changchun: General Secretary Xi Jinping pointed out that in the past decade, China has experienced three major events of great immediate importance and far-reaching historical significance for the cause of the CPC and the people: the 100th anniversary of the founding of the CPC, the socialism with Chinese characteristics entering the new era, and the completion of the historical task of poverty alleviation and building a moderately prosperous society in all respects.

In the past decade, China’s economic aggregate and structure have undergone qualitative changes. Its status as the world’s second largest economy has been further consolidated and improved, and its scientific and technological strength and comprehensive national strength have also leapt to a new level. Compared with 2012, China’s GDP has increased from 54 trillion yuan to 114 trillion yuan, accounting for more than 18% of the global economy from 11.4%, and China’s contribution to world economic growth has remained at around 30%. China is the largest engine of global economic growth. China’s ranking in the Global Innovation Index rose from 34th to 11th. The average life expectancy has increased to 78.2 years, and nearly 100 million rural impoverished population have all been lifted out of poverty. The world’s largest education system, social security system, and medical and health system have been established. The ecological environment has also undergone historic, transformative and overall changes.

Capital: What is the secret of the Communist Party of China’s eternal vitality?

Ambassador Hu Changchun: One of the “secrets” of the CPC’s ability to maintain its vitality and strong leadership is that the it persists in integrating the basic principles of Marxism with China’s specific realities and fine traditional culture, so as to realize the sinicization and modernization of Marxism. Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era is the latest achievement. The second “secret” is that since the birth of the CPC, it has established its original mission to seek happiness for the Chinese people and rejuvenation for the Chinese nation, and has always represented the fundamental interests of the overwhelming majority of the people. The third “secret” is that the Chinese Communists insist on promoting self-reform while maintaining integrity and innovation, and have the courage, mind and responsibility to turn the blade inward. This is a strong support for the party to maintain its youthful vitality. China has launched an unprecedented anti-corruption struggle in the past decade and achieved an overwhelming victory. On the new journey, we will also insist on promoting comprehensive and strict party governance.

Capital: What is the mission of the Communist Party of China in the new era?

Ambassador Hu Changchun: General Secretary Xi Jinping pointed out in the Report that “From this day forward, the central task of the Communist Party of China will be to lead the Chinese people of all ethnic groups in a concerted effort to realize the Second Centenary Goal of building China into a great modern socialist country in all respects and to advance the rejuvenation of the Chinese nation on all fronts through a Chinese path to modernization.” To build China into a great modern socialist country in all respects, a two-step strategic plan has been adopted: Basically realize socialist modernization from 2020 through 2035; Build China into a great modern socialist country that is prosperous, strong, democratic, culturally advanced, harmonious, and beautiful from 2035 through the middle of this century.

Building China into a great modern socialist country in all respects is a symbol of realizing the great rejuvenation of the Chinese nation and a great dream of the Chinese people and the Chinese nation. In the next 30 years, all work of the CPC and China will be carried out around this central task.

Capital: The Report to the Congress put forward the concept of Chinese path to modernization. What is it?

Ambassador Hu Changchun: There is no set form of modernization or one-size-fits-all modernization standards in the world. Chinese path to modernization contains elements that are common to the modernization processes of all countries, but it is more characterized by features that are unique to the Chinese context. The features are: It is the modernization of a huge population, of common prosperity for all, of material and cultural-ethical advancement, of harmony between humanity and nature and of peaceful development.

Chinese path to modernization offers humanity a new choice for achieving modernization. It is a proposition on the diversity of mankind and an attitude of exchange and mutual learning among different civilizations and countries. The CPC is ready to exchange and learn from other political parties in the world, jointly enrich the path to modernization, and better bring happiness to its own people and people around the world. Also, China will never “export” the Chinese model or ask other countries to “copy” China’s practice. As President Xi Jinping said in his recent meeting with South African President Cyril Ramaphosa on the sidelines of the G20 Summit, “China supports South Africa in exploring a modernization path that suits its national conditions.” Every country’s efforts to independently explore a modernization path suited to its national conditions should be respected.

Capital: How do you view the statement in the Report to the Congress that “building a human community with a shared future is a way forward for all the world’s people”?

Ambassador Hu Changchun: China has always adhered to the foreign policy of safeguarding world peace and promoting common development, and is committed to building a human community with a shared future. This fully demonstrates the CPC’s determination and will to work tirelessly for the cause of human progress, and greatly enhances the confidence and strength of human society in pursuing a brighter future.

The Belt and Road Initiative proposed by China, one of the practical actions to promote a human community with a shared future, has become a popular international public good and platform for international cooperation. China has signed more than 200 Belt and Road cooperation documents with 149 countries and 32 international organizations. Not long ago, President Xi Jinping put forward the Global Development Initiative and the Global Security Initiative, which have injected new impetus into safeguarding world peace and promoting common development.

At present, the major changes and the pandemic unseen in a century are intertwined, the world economic recovery is struggling, regional conflicts and crises keep cropping up, and food, energy, climate and other issues keep rising. All these further demonstrate the truth of the concept of building a human community with a shared future. In the face of common threats and challenges, no country can cope with them alone or remain immune. Only by building a human community with a shared future, promoting the common values of all mankind and jointly addressing global challenges can security be safeguarded and prosperity be sustained.

Capital: Will the 20th CPC National Congress bring new opportunities for China-Africa cooperation?

Ambassador Hu Changchun: Adhering to the principles of “sincerity, real results, amity and good faith” and“pursuing greater good and shared interests”, China is committed to strengthening solidarity and cooperation with other developing countries, including African countries, and safeguarding our common interests. This year, President Xi Jinping sent a congratulatory message to the 35th African Union Assembly and exchanged congratulatory messages with Chairperson of the African Union and Senegalese President Macky Sall on the 20th anniversary of the establishment of China-AU diplomatic relations, demonstrating the high degree of political mutual trust between China and Africa. During President Xi Jinping’s meeting with President Sall on the sidelines of the G20 Summit, Sall spoke highly of the high-quality mutual trust and high-level relations between Africa and China as China is the first country to openly support the AU to join the G20. With the implementation of the outcomes of the Eighth Ministerial Meeting of FOCAC, new achievements have been made in the “Nine Projects”, deepening China-Africa friendly relations.

The Report shows that China is committed to the basic state policy of opening-up, firmly pursues a win-win strategy of opening-up, and continues to provide new opportunities for the world with China’s new development. The AU is about to launch the second ten-year plan of Agenda 2063. Under the new situation, China-Africa cooperation is embracing new opportunities. We stand ready to work closely with AU institutions to implement the important consensus reached by China and AU leaders, strengthen strategic consultation and coordination, promote friendly exchanges in all fields and at all levels, consolidate and deepen political mutual trust between China and Africa, uphold and practice true multilateralism, jointly build the Belt and Road Initiative, advance the Global Development Initiative, and accelerate the implementation of the UN 2030 Agenda for Sustainable Development. We will make new contributions to the building of a China-Africa community with a shared future in the new era.

Capital: Recently, the 17th G20 Heads of State and Government Summit was held. The theme of this summit is “Recover Together, Recover Stronger”. China’s attendance has attracted much attention from the public. What’s your opinion on this?

Ambassador Hu Changchun: Recently, President Xi Jinping attended the 17th G20 Summit in Indonesia and the 29th APEC Economic Leaders’ Meeting in Thailand. During this visit, President Xi Jinping delivered important speeches at multilateral and bilateral meetings with leaders of other countries, telling the story of the 20th CPC National Congress, the story of Chinese path to modernization and the story of win-win cooperation between China and the rest of the world in a systematic, in-depth and insightful manner, looking forward to the bright prospect of China’s high-quality development and high-level opening-up, sending a strong signal that China will continue to promote world peace and development and deepen opening-up and cooperation.

This year, the global geopolitical and economic situation has been under constant pressure. At the G20 meeting, President Xi Jinping put forward China’s proposal, calling on all countries to foster a sense of a human community with a shared future, advocate peace, development, cooperation and win-win results, let unity replace division, cooperation replace confrontation and inclusiveness replace exclusivity, and promote more inclusive, beneficial and resilient global development. He made clear that the prosperity and stability of the world cannot be built on the basis of the poor getting poorer and the rich getting richer. Modernization is not the prerogative of any country, and countries that take the lead should sincerely help other countries develop. President Xi Jinping has always had developing countries in mind, implemented the community vision of “common development is true development” in his diplomatic actions. He also put forward building a global partnership for economic recovery and the International Cooperation Initiative on Global Food Security, and explicitly supported the AU to join the G20.

G20 Bali Leaders’ Declaration reflects the consensus of all parties and major outcomes of cooperation, and incorporates China’s important ideas and propositions in international economic cooperation. The list of G20 practical cooperation projects includes 15 cooperation projects and initiatives proposed by China, which fully demonstrates China’s support for multilateralism and contribution to G20 cooperation. International public opinion believes that in the face of a severe and complex international situation and major challenges to human development, China once again called for solidarity and cooperation, put forward a global governance plan with strategic vision, played a constructive role in promoting the success of the conference, and reflected China’s open, proactive attitude and rational and inclusive image.

NBE, Finance Ministry gear dynamic approach to counter economic turmoil

Muluken Yewondwossen
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NBE, Finance Ministry gear dynamic approach to counter economic turmoil

National Bank of Ethiopia (NBE) and Ministry of Finance (MoF) are looking into alternative tools to combat the macroeconomic situation in the country against the traditional tight fiscal and monetary policy instruments.
In his latest appearance at parliament, Yinager Dessie, Governor of NBE, underlined that; foreign currency shortage, inflow reduction of official and non-official remittance, slowdown of some export items like gold, instability and logistics, the value of external debt service increment, inflationary behavior as internal issue and Ukraine-Russia conflict and price hike on some strategic commodities like petroleum is affecting the economy.
To ensure economic stability the governor pointed out that the central bank and MoF had geared for tight monetary and fiscal instruments which however were difficult to implement, “Imposing tight monetary and fiscal policies has become unfeasible due to the reality on the ground.”
“The internal and external situational pressures have made it difficult to introduce controlling instruments in monetary and fiscal policy,” he added.
In most cases, NBE is responsible to introduce monetary policies to mitigate pressures in the economy. For instance it has recently introduced the establishment and operation of treasury bonds through directive no. MFAD/TRBO.001/2022.
Based on the new directive banks will now buy the treasury bonds at 20 percent of fresh loan disbursement.
According to the new directive that has become effective as of November 1, 2022, every month each bank shall notify NBE in writing its own respective allotment amount within ten days after the end of the reference month with the applications ratio for the allotment being 20 percent of disbursement.
The interest rate for each treasury bond shall be two percentage points higher than the minimum saving deposit rate, which is seven percent. The bonds shall have a maturity period of five years but the government will pay interest accrued on the bonds on annual basis.
Similarly, MoF is expected to impose fiscal policy instruments like tax issues to manage the economy including duty free schemes for some basic commodities and even allow the Franco Valuta modality to import commodities like edible oil and infant foods.
The finance Ministry has also allowed importers to not mention the hard currency source when importing basic commodities through Franco Valuta.
However the effect on the market is not perceptibly successful with regards to price reduction, even though some commodities shall be available in the shops shelves through the initiative that MoF introduced in the past budget year.
“Now we are responsively discussing with MoF to come up with alternative instruments to introduce a mitigation mechanism to tackle challenges that face the economy,” the governor said on his quarterly report to the Plan, Budget and Finance Affairs Standing Committee at parliament.
Since the conflict in northern Ethiopia erupted, foreign partners particularly western countries and organizations have pressurized the government in different schemes including holding approved foreign grants and loans. In contrast, the government has been committed to settle its debt service even though the inflow was lower which made government to allocate significant amount of foreign currency for debt service.
The overall amount of foreign financing disbursed over the last one year (2021/22 budget year) was much less than what it was over the previous 4 years.
Despite the challenges, Yinager pointed out that positive results have been realized in agricultural productivity which slightly contributed to ease the burden in the economy.
“The new intuitive introduced by the government on agricultural productivity has contributed to mitigate the economic pressure to some extent but we have to expand it in other areas to narrow the demand and supply gap,” he said.
He called other regulatory bodies and regional administrations to work strongly in connection to production and productivity in every aspect including agriculture sector which is pivotal in supporting the monetary and fiscal policy.

Cement shortage stifles the market

Metasebia Teshome
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Cement shortage stifles the market

No foreseeable silver bullet to rescue the situation

Shortage of cement hits the market hard as factories production go down.
Retailers in the city, contractors and builders shed light on heavy concerns to access cement even at twice its rate.
Contractors who are involved in different sized projects alarmed that they are engaged on building the backbone of the economy yet they face the hurdle of accessing cement.
“In recent times we have been buying cement at double the rate from distributors,” they explained their claim to Capital adding, “It is becoming more difficult to get cement at even higher pricing as there is a shortage of cement in the whole market.”
In the past months staffs that have links with the marketing and distribution have been twisting the access for their benefit, hacking the system and as a result have reaped the benefits of selling twice the original amount. Currently cement shops in over the city are sitting empty as lack of product becomes widespread.
The country’s production capacity at around 12Mt/yr. This compares to 15Mt/yr from 13 companies as reported by a local news source although this figure is likely to also include grinding plants. Yet the same source also placed the actual working capacity at 6Mt/yr due to old machinery and poor maintenance.
Unfortunately it also mentioned issues with security in the country reducing the overall production and became a live issue a few weeks ago with news that at least 30 employees of Dangote Cement were reportedly kidnapped in early December 2022 by an armed group that calls itself the Oromo Liberation Army. This is particularly alarming for the company given that its country manager was shot dead in 2018. Two employees of the Mugher Cement plant were also taken hostage by the same group in October 2022 although thankfully they were later freed.
Derba MIDROC Cement signed a contract with Sinoma International Engineering in recent weeks to build a US$282m upgrade at its integrated Derba cement plant in Oromia. The move is the latest in a steady stream of projects that have been announced in Ethiopia over the last few years. Other recent developments include a deal in July 2022 by businessman Getu Gelete to buy PPC’s stake in Habesha Cement and plans in August 2022 by investor Worku Ayetenew to build a US$1bn cement plant with a production capacity of 12,000t/day. Alongside these capital intensive projects, the government has been trying to regulate the price of cement through measures such as setting fixed prices, limiting the volumes that individuals can buy and asking producers to cut distributors out of the supply chain.
According to reports as for the market in Ethiopia, Dangote Cement said that its sales from Mugher plant rose by 1.8% year-on-year to1.7Mt in the first nine months of 2022 and that the unit was running at full capacity in the third quarter. It reckoned that it held a 42% market share during this period, out of a total market of around 4.2Mt. Previously, it said that the total market for the whole year was 7Mt in 2021.
Meanwhile, the government disclosed that it has taken several measures regarding cement distribution and its high price points. However things on ground seem different.
Despite the production being stated to be lesser than the market demand, experts who follow the sector claimed that the product is available in the market but the price is highly inflated.
In recent decisions of the Ministry of Trade and Regional Integration, individuals are no longer allowed to acquire over 15 quintals of cement at once for any construction works. Factories must sell cement to authorized agents only. Agents who are only approved by the regional and city administrations to have the right to hold the product, a move targeted at paralyzing unauthorized trucks or warehouses from hoarding.
It has been well noted that factories are working under production for reasons that stem from security, shortage of raw material as well as foreign currency.

ESLSE inclines to swap two tankers for profitable bulkers

Muluken Yewondwossen
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The state owned logistics mammoth, Ethiopian Shipping and Logistic Services Enterprise (ESLSE) discloses that it is on the final stage of swapping its two tanker vessels after clearing all its credit stemming from the takers.
It can be recalled that the successful logistics had embarked to purchase nine vessels at a total price tag of USD293.5million courtesy of a loan backing from the Export Import (EXIM) Bank of China. ESLSE is now planning to make a swap for the two tankers targeting to make more profits through purchase of bulk carriers.
From the onset of the arrival of the tankers in Djibouti, which is the major port site for Ethiopian vessels, both vessels laid idle for six months until a Kuwaiti company which is affiliated with Ethiopia, through an oil supply partnership, took administration on behalf of the Ethiopian vessel operator.
After the administrative takeover, the vessels were then transferred to a Dubai based management company.
As per the agreement, the Dubai based company handled the ship and technical management while ESLSE look over the chartering. This however was not a profitable venture.
“The crew and the management are not ours,” Roba Megersa, CEO of ESLSE pointed out whilst reminding that the tankers were not profitable since their arrival.
As Roba further shed light on the matter, he expressed that the logistics enterprise thought it best to part ways with the vessels but faced delays due to debt, “Now the vessels are free from any credit. So we shall move on with the plan.”
As per the information Capital obtained from the CEO, the process has begun to let go of the tankers through a swap arrangement or sale and purchase agreement (SPA).
A Singapore based brokerage, Stanford Shipping, has taken up the process to transfer the tankers to interested operators.
As planned, the enterprise has targeted to swap the two tanker vessels with bulk carriers which are vessels that ESLSE is conversant with. “Dry bulk carriers are more profitable and highly on demand in the global logistics business,” the logistics firm’s head opined.
“We are finalizing to conclude the process. We hope that the process is fully completed in the coming six months,” Roba explained.
In the past fiscal year, ESLSE successfully closed the credit that it paid for the financer, which now makes for a swifter conclusion to a swap modality.
The logistics guru explained that the conventional swap scheme targets second hand vessels, “Nonetheless, if we want a new built ship it may take up to two years to receive the vessel.”
“We can get relatively younger vessels with the SPA. This will lead to us resuming operations swiftly,” he added.
The shipping company’s target is to acquire dry cargo carriers with a range of five years. It is worth noting that most ESLSE tankers have passed almost a decade of service.
“Such business acumen in our sector is common. For instance, MSC is operating vessels obtained from the second hand market,” he explains, adding, “Once you have management of a vessel that is relatively new, then operation will be smooth which automatically leads to profits.”
According to the plan, ESLSE has targeted to get an ‘ultramax’ dry bulk carrier, a midsize vessel, with up to 64,000 DWT on the swap of the two tankers.
“We are also considering swapping the two tankers with two ‘supramax’ vessels that have a capacity from 50,000 to 60,000 DWT with some additional charges,” the CEO added.
Both types of vessels will be the first for ESLSE, which is currently operating nine ‘handysize’ vessels with about 28,000 DWT. Nevertheless, it has operated the supramax and ultramax dry bulk carrier through lease to ship cargos like fertilizer and coal.
The two vessels that ESLSE wants to swap were built in November 2012 and January 2013 and have about 42,000 DWT capacity. They are also significant in that they are the first oil carrier ships for the operator.
The latest vessels of ESLSE got into business at different periods but have played a pivotal part in the first Growth and Transformation Plan.
ESLSE was initially established in the mid-1960s as a shipping company and was then amalgamated with some other public logistics enterprises in 2011 to form ESLSE. The firm is the strongest vessel operator and is the only cross continent operator in Africa.
When the seven 28,000 DWT multi-purpose vessels were built they cost USD 32.5 million each while the two oil tankers price points was USD 37 million each.
About 16 years ago, the enterprise also bought two multi-purpose vessels from China, ‘Shebelle’ and ‘Gibe,’ named after two rivers in Ethiopia.
In the last budget year, besides services to Ethiopian cargo, cross trade services amplified the performance of ESLSE leading it to amass over 5.6 billion birr in profit before tax for the year.
In the budget year, a total 7.2 million tons of cargos shipment have been managed through different operations including vessel, inland, freight forwarding and port and terminal services.
In regards to marine operation, the firm managed operations of 3.6 million tons which is 93 percent of its target.

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