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Coffee and Tea Authority drafts proclamation to boost spice sector

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By Muluken Yewondwossen

In a groundbreaking move, the Ethiopian Coffee and Tea Authority (ECTA) is currently in the process of drafting a proclamation that aims to propel the spice industry to new heights. Recognizing the immense potential for significant foreign currency generation from the sector, ECTA has taken on the responsibility of monitoring the development and marketing of spices in the country.

Experts have long emphasized the need for the government to pay more attention to the spice industry, as its actors have repeatedly called for support. They have highlighted the sector’s capacity to create employment opportunities, generate foreign exchange, and contribute to overall socioeconomic development.

Ethiopia boasts a diverse agroecological landscape that is highly conducive to the production of high-quality spices. However, challenges in terms of industry expertise, quality control, and proper regulation have hindered its progress. Issues such as processing, post-harvest handling, packaging, and transportation have adversely affected the quality of spices, limiting their export potential.

Currently, Ethiopia’s main spice exports include ginger, turmeric, red pepper, black fennel seeds, and coriander. However, efforts are underway to diversify and cultivate additional varieties, such as black pepper. Stakeholders have expressed strong demand for Ethiopian spices in international markets, emphasizing the need for sustainable supply and improved quality.

To address the challenges faced by the spice sector and unlock its full potential, the Ethiopian government is focusing on key areas such as agricultural extension services, the use of improved seeds, and enhancing post-harvest operations. Experts believe that with the right attention and support, the sector has the potential to generate over USD 100 million in revenue, surpassing its previous peak of USD 20 million.

ECTA has been actively involved in the development of the spice industry, particularly for products that have a strong presence in international markets. The authority has been encouraging farmers and commercial investors to grow spices like vanilla and black pepper within coffee fields, leveraging the existing infrastructure and resources.

One of the significant challenges in the spice sector has been the lack of effective governance for supply chain participants, in contrast to the well-regulated coffee industry. To address this, efforts are underway to create comprehensive legislation through the upcoming “spices quality and marketing proclamation.” This proclamation aims to regulate various aspects of the industry, including marketing strategies, quality control measures, logistics, and export practices.

The proclamation seeks to improve the supply of high-quality products, combat illegal activities, regulate contraband, and enhance Ethiopia’s reputation as a reliable supplier of premium spices in the global market. Stakeholders, including the Ethiopian Spices, Aromatic and Herbs Growers and Exporters Association, are actively providing input on the draft proclamation to ensure that it aligns with current market conditions and supports the overall development of the sector.

In addition to the proclamation, a directive for quality monitoring and marketing of spice products was implemented in March 2023. This directive has already made significant progress in addressing issues such as adulteration, hoarding, and artificial price hikes. It also covers crucial aspects such as quality control, harvesting practices, and effective marketing strategies for various spices. Furthermore, the directive designates the Ethiopian Commodity Exchange as the secondary market platform, providing additional avenues for spice trade.

To further enhance the spice industry, the regulation includes provisions for technical certification, value addition, processing industries, storage facilities, and quality certification for wholesalers and retailers. It establishes clear guidelines for market participants and distinguishes between primary, secondary, and export markets.

Ethiopia, with its rich heritage of producing more than 50 types of spices out of the 109 recognized by the World Spice Organization, is determined to leverage its immense potential and establish a thriving spice sector characterized by improved quality standards and increased market access.

Ethiopia seeks France’s support for peaceful access to sea, enhanced naval presence

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By our staff reporter

Ethiopia asserts that it has been actively engaging neighboring countries in peaceful discussions regarding its need for a sea outlet. However, there seems to be a tendency to misconstrue Ethiopia’s genuine intentions and exaggerate its desires.

The recent situation in the Red Sea has prompted Ethiopia to advocate for a naval force presence in the region, with the primary goal of ensuring comprehensive safety and security. This viewpoint was shared by Dima Nego, Chairperson of the Standing Committee, during a meeting held on Wednesday, January 17th. The meeting involved a delegation from the National Assembly Committee on National Defense and Armed Force of France and the Foreign Affairs and Peace Standing Committee of the Ethiopian Parliament.

Tawfik Abdullahi (Amb), the chair of the Foreign Relations Subcommittee, took the opportunity to address the French delegation, led by Thomas Gassilloud, the chair of the National Assembly Committee on National Defense and Armed Force. The discussion took place at the parliament’s office of the Foreign Affairs and Peace Standing Committee. Tawfik reminded the French delegation that Ethiopia is actively involved in multiple peacekeeping missions, emphasizing the region’s significance as a top priority for the country.

Tawfik clarified that Ethiopia’s approach to acquiring a sea coastline is based on a peaceful give-and-take approach. He highlighted that Ethiopia has persistently presented its proposal to regional countries, expressing the need for a sea outlet, but unfortunately, there has been misinformation suggesting that Ethiopia is willing to resort to war to achieve its objective.

A senior diplomat and parliament member explicitly stated that some of Ethiopia’s allies, including the European Union, have misinterpreted Ethiopia’s nonviolent endeavors. The diplomat emphasized the importance of France’s support, given its good exposure and careful monitoring of the region. France’s assistance will greatly contribute to Ethiopia’s goal of peacefully gaining access to the sea.

Dima Nego recalled that France played a pioneering role approximately five years ago when Ethiopia reestablished its naval force. This historical collaboration strengthens the belief that France will continue to support Ethiopia’s efforts to expand its naval capabilities. The recent agreement between Ethiopia and Somaliland also provides favorable conditions for Ethiopia to activate its marine force.

Furthermore, Dima Nego expressed confidence that his administration is fully prepared to address any issues amicably. The members of the Standing Committee echoed their desire for France to maintain its support across various sectors, including politics, technology, tourism, and investment.

Proposal to establish independent Chamber of Industry advances, separate from Chamber of Commerce

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By our staff reporter

A proposal has been submitted to the Council of Ministers (CoM) that would allow the industry sector to establish an independent lobby group. As part of its efforts to revise controversial statutes, the present administration has focused on Proclamation No. 341/2003, which pertains to the Sectorial Association and Chamber of Commerce. Over the past few years, several draft proclamations have been written and presented to stakeholders for discussion, aiming to restructure the creation of associations using a new framework. However, most of these drafts were unable to progress until the latest one was approved by the Ministry of Justice and forwarded to the Council of Ministers.

According to sources, previous draft proclamations encompassed both the industry and commerce sectors. Another draft legislation was also introduced to reorganize the lobby group under commerce, but it failed to gain consensus among interested parties. On the contrary, a proclamation to establish a separate Chamber of Industry has now reached the ratification stage, thanks to the support of the Ministry of Industry. One of the issues raised about the current law is that the industrial sector lacks sufficient representation within the association.

Opponents argue that creating a separate lobby group would be detrimental to the interests of the business community, as the industry sector is already associated with commerce, either directly or indirectly. They argue that this is consistent with the experiences of other nations, stating that if the industry sector is formed separately, advocacy efforts and influence would be fragmented, resulting in decreased revenue and a loss of unified voice.

However, proponents of establishing a Chamber of Industry assert that an independent association would vigorously defend the interests of the industry and effectively advocate for its issues with relevant bodies. They argue that since the industry is of paramount importance to the nation, it requires a strong, autonomous association that can solely focus on its unique challenges.

Furthermore, it has been reported that a draft proclamation to establish a Chamber of Commerce has also been presented, with the industry sector included in the text. However, sources indicate that the Ministry of Justice has returned the draft proclamation, prepared by the Ministry of Trade and Regional Integration, requesting the exclusion of the industry part. Experts suggest that the proposed commerce proclamation would significantly impact the activities of municipal chambers, particularly the Addis Ababa Chamber, and grant more power to the national chamber. Additionally, the impending draft proclamation on commerce would allow large businesses employing numerous individuals and operating in multiple regions to directly join the Ethiopian Chamber, including major members like banks affiliated with the Addis Ababa Chamber.

It is anticipated that the Council of Ministers will soon approve the draft proclamation to establish the Chamber of Industry, marking a new development, and subsequently send it to parliament for approval.

Djibouti Port facility completes $70 mln expansion, enhancing Transshipment capability

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The Djibouti port facility has recently completed its expansion worth USD 70 million. The purpose of this expansion is to meet the growing demand in the region and enhance transshipment capabilities. As a result, Ethiopian customers will have the opportunity to enjoy lower rates for their shipments.

Today, January 22, President Ismail Omar Guelleh of Djibouti attended the opening ceremony of the extensive extension of the Doraleh Container Terminal (SGTD) in Doraleh, Djibouti. Thanks to this recent development, the port is now capable of accommodating the largest container ships, including the Malaccamax vessel. The project has added four additional high capacity gantry cranes, increasing the number of cranes by 50%. Furthermore, the stacking yard has been expanded, resulting in a 20% increase in capacity.

Apart from facilitating Ethiopian import-export operations, the objective of this new development is for Djibouti to become a major player in the transshipment industry. Abdillahi Adaweh Sigad, the CEO of SGTD, stated to Capital that the expansion will not only boost transshipment revenue but also offer various benefits to Ethiopian clients. Berisso Amallo, the CEO of Ethiopian Shipping and Logistics (ESL), expressed his satisfaction with the expansion, highlighting that ESL can now bring vessels of any size to the Djibouti port.