Kaki Motors, a company that has been involved in importing Isuzu vehicles manufactured by Japan Motors Limited for the past 20 years, has announced its new role as an agent and assembler in Ethiopia. The company recently inaugurated a factory in Alemgena, Sheger city of the Oromia region, at a cost of 450 million ETB. This factory serves as the first vehicle assembly, sales, agent, and manufacturer of Isuzu in Ethiopia.
Gebremichael Girmaye, the managing director of Kaki Motors, revealed to Capital that the assembly factory, sales center, and after-sales center cover an area of 20,000 square meters and required an investment of 450 million ETB. Additionally, 5 million dollars have been allocated for further investments.
During the launch on October 14, 2003, the managing director stated that the completed factory has the capacity to produce 2,500 trucks per year and will create job opportunities for over 750 individuals.
Established in 2003, Kaki Motors is engaged in various sectors, including export, import, manufacturing, transport, and service. Presently, the company operates four vehicle and five spare parts sales centers, along with three repair service centers. They also have a main spare parts storage and distribution depot in Awasa, with plans to open sales and repair centers in Diredawa, Bahir Dar, Jima, and Mekele in the near future.
Kacha, a digital finance service provider in Ethiopia, has officially commenced operations after receiving the first personal payment document from the National Bank. Kacha Digital Financial Service obtained its trial license from the National Bank in June 2022 and has been conducting trial applications using different levels and service options.
Having successfully collaborated with various banks and mobile money transfer service providers, Kacha has now received permission from the National Bank of Ethiopia to launch its services at full capacity. The company’s application and services launch program encompass a range of digital finance offerings, including money transfers, loans, cardless ATM withdrawals, and an international remittance system.
To solidify partnerships, Kacha recently held a signing ceremony with various banks, microfinance institutions, and other strategic partners. Additionally, the company has established collaborations with international remittance providers to facilitate secure foreign remittances. Kacha emphasizes the development of a system that grants both senders and receivers access to additional financial services.
During the inaugural World Economic Outlook (WEO) presentation event in Africa at the National Bank of Ethiopia (NBE), the International Monetary Fund (IMF) provided insights into Ethiopia’s economic prospects and challenges. The presentation, led by Tobias Rasmussen, the Resident Representative, Jean-Marc Natal, the Deputy Chief of the WEO Division, and Martin Stuemer, the Economist of the Commodities Unit, showcased the report’s findings released in conjunction with the joint annual event with the World Bank in Marrakesh, Morocco.
The presentation shed light on Ethiopia’s economic conditions, regional dynamics, and global trends. Rasmussen acknowledged Ethiopia’s significant economic progress while emphasizing the need to overcome remaining obstacles. The country has been experiencing robust and steady growth at a rate of approximately 6 percent, with projections indicating that this growth trajectory will continue. IMF forecasts estimate that Ethiopia’s GDP will increase by 6.1 percent this year and 6.2 percent in 2024, surpassing global and regional growth rates.
Rasmussen also highlighted a notable disparity in growth rates between oil-importing and oil-exporting nations, suggesting that greater diversification leads to more resilient economies. In this context, Ethiopia has outperformed even among oil-importing countries, which further underscores the positive trajectory of its economy.
However, the WEO report indicates that 2023 has been a challenging year for economic activity in sub-Saharan Africa. Global inflationary shocks resulting from Russia’s war in Ukraine have led to higher interest rates globally, resulting in reduced global demand, increased spreads, and persistent pressure on currency values. As a result, growth in the region is expected to decline for the second consecutive year, from 4 percent to 3.3 percent in 2023, with a projected recovery to 4 percent in the following year.
According to the estimates, sub-Saharan oil-importing nations are predicted to experience growth rates of 3.7 percent and 4.5 percent in 2023 and 2024, respectively, while oil-exporting countries are expected to see growth rates of 2.6 percent and 3.1 percent in the same period.
In terms of fiscal management, Ethiopia has exhibited a more significant decline in government deficits and public debt compared to the rest of the region. Rasmussen highlighted a sharp reduction in the ratio of public debt to GDP, projecting a decline from 54 percent in 2021 to 37.9 percent in 2023, with further reduction to 31.2 percent anticipated in the coming year. This reduction has been achieved through measures such as identifying external debt and addressing funding and debt challenges. The external debt has decreased from 29.1 percent of GDP in 2021 to 17.9 percent in 2023. Additionally, the current account deficit is expected to decline from 4.3 percent in 2022 to 2.4 percent in 2023.
However, the IMF report highlights certain difficulties. While inflation has somewhat decreased, average annual inflation rates remain high. The government’s declining revenue poses budgetary challenges, particularly in the context of ongoing fiscal consolidation. The IMF report indicates a decrease in government revenue to 7.7 percent in 2023, compared to 8.5 percent in 2022 and 11 percent in 2021.
Apart from inflation and declining government revenue, Ethiopia faces other economic challenges, including a decline in exports and limited foreign reserves equivalent to less than one month’s imports. NBE Governor Mamo E. Mihretu, who attended the WEO presentation, expressed concerns about the impact of inflation and global economic issues on Ethiopia’s economic progress.
The IMF predicts that macroeconomic imbalances in sub-Saharan Africa are improving, with declining inflation rates and efforts to establish more sustainable state finances. However, uncertainties persist, and development may be hindered by stalled reform initiatives, increased political unrest, and external risks such as China’s economic downturn. The region continues to face challenges, including high inflation rates in many countries, exchange rate pressures, elevated debt vulnerabilities, and widening economic disparities, particularly in resource-intensive nations.
The WEO event held in Addis Ababa on October 20 marks a significant milestone as the first of its kind in Africa, according to IMF experts.
Omnia Business and Leisure Travel and Wennovate Consult, in Partnership with the Indonesian diplomatic mission in Addis Ababa provide conducive ways for participants to join two major events that will be held in the well-known Islamic financing and halal business global hub.
The two companies that have been engaged on facilitating different business oriented tours disclosed that they have facilitated for the business community in Ethiopia to tap into the knowledge and experience disclosed this time around, which they developed to boost the growing business environment from the well accepted events that will be held in Indonesia this month.
In the statement sent to Capital, they are set to elevate the Trade Expo Indonesia 2023 and Halal Expo Indonesia 2023, “This two significant events will open doors for businesses, foster international collaborations, and promote cultural understanding.”
The 38th Trade Expo Indonesia (TEI) is slated to be held at the Indonesia Convention Exhibition BSD Tangerang, from October 18 to 22, 2023. TEI is the largest international B2B-focused hybrid trade show in Indonesia, expected to attract over 100,000 visitors from across 100 countries. The event will showcase a diverse range of products and services across seven categories.
It is stated that TEI is an opportunity for businesses to connect, learn, and explore and will feature special programs such as business matching sessions, seminars, and workshops.
Halal Expo Indonesia which will be held from October 25 to 29 is also the largest B2B Halal Exhibition and Conference in Indonesia, poised to attract over 50,000 visitors from more than 50 countries. The exhibition will showcase a wide array of products and services from the realm of halal industries, including Islamic finance and banking.
