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From paper to edible oils

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AMA Business Group diversifies to build an oil factory

AMA business group that is engaged in production of paper and paper packaging manufacturing turns its face to construct another big oil factory in Sidama Regional State that is worth 1.7 billion birr.
According to the AMA group, after its construction the factory will have a capacity to produce 300 tons of edible oil and other related inputs per day.
On Sunday December 27, 2020, the foundation stone was laid on a 3,500 square meters of plot in Hawassa which is attended by senior federal and state officials both from the Ministry of Trade and Industry and the Sidama regional government.
The company which has been engaged in producing paper and paper packaging has been operating since 2013 in Hawassa which was the former capital of the South Nation Nationalities and Peoples Region.
AMA will also build other factories on an area of 100,000 square meters and will include seven projects. These include cooking oil, plastic, cardboard, soap, sacks, tin cans, and coffee mills. The first is the oil plant, which is expected to produce 100 tons of oil a day in the first year. By the end of the second and third years, it will be able to produce up to 300 tons of oil a day.
Behailu Tefera, General Manager of AMA Trade Enterprise said that the first project is designed to meet domestic demand. He said the first phase will start with the importation of palm oil, which will be used in collaboration with the regional government to produce soybean and wool. He further explained that the products of the factories in the industrial park will be interconnected. He also said that a jerrycan factory will be set up there. According to Behailu, factory shades will be built by foreign institutions, but the installation will be carried out jointly by locals and foreigners.
As Behailu said after its completion, the factory will create job opportunities for more than 200 people. He emphasized that the factory will bridge the gap the priorities of the nation to stop imports of edible oil. The factory is set to play a great part and the government is also supporting the construction of the factory.
The government has set to suspend the import of edible oil as of the beginning of Ethiopian New Year after local pressers are at a final stage to commence massive production. Besides Shemu PLC, which is located in Dire Dawa, industries are being constructed in Bure and Debremarqos by Belayneh Kinde and Workqu Aytenew that does have a huge capacity that will use local oilseeds and import crude oil as input. East Africa Holding, Hamaressa Presser, located in Harar is also the other promising industry.

Ministry of Finance revises investment incentives

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Ministry of Finance has prepared a new directive for investment incentives and will take over investment board duty.
With the aim of encouraging new private investments, the Government is preparing a new investment incentive draft. Initiated by the Ethiopian Investment Commission, the Ministry of Finance is preparing the draft incentive document.
The purpose of revising the incentive is said to encourage investors in accordance with the new investment proclamation approved in January 2020.
According to Tadesse Kassa /PhD/, legal advisor of the commission, the new draft will have measured shifts on investment incentive, “The first change will be the draft gives the Ministry of Finance power to decide on incentive packages which is the mandate of investment board and also will change amounts of incentives of the different investment sectors.”
As he said, currently using the old incentive directive more than seven governmental offices have the power to decide on the new draft but now only the ministry of finance will have the power to decide.
Including the National Bank, main Department of Immigration and National Affairs, Ministry of Trade and Industry, Ministry of Foreign Affairs, Ethiopian Customs Commission, Ethiopian Investment Commission, Industrial Park Development Corporation, and regional administration currently have the power to decide on incentive package under the Ethiopian investment board chaired by the Prime Minister on the 2012 incentive regulation.
The board has authority to forward recommendation for approval to the council of ministers on incentive related amendments including granting new or additional incentives than what is provided for under existing regulation.
Also as Tadesse said, the change to authorize Ministry of Finance to decide on the package may create confusion since most of the investment related works are done by the investment commission.
Ethiopia offers a comprehensive set of incentives, particularly for priority sectors, such as: Customs duty payment exemption on capital goods and construction materials, Investors have the right to ask a refund of customs duty paid on inputs, Income tax exemption of up to 6 years for manufacturing and agro-processing, and up to 9 years for agricultural investment. Additional 2-4 years income tax exemption for exporting investors located within industrial parks and 10-15 years exemption for industrial park developers;
As part of its promotion of investment in Ethiopia, recently the Ethiopian investment commission has held discussions with ambassadors, government officials, investors from America, Asia, Australia, Africa, and other countries and also with regional investment office representatives on the newly amended investment legislation conducive investment opportunities in the country.
As the commission said, the government is highly working on the growth of investment to increase income generated from export.
By increasing both local and foreign investment the government is planning to enable the country earn nine billion dollar in the coming ten years from export of manufactured products.
As the commission said, besides increasing the investment the government is doing certain due diligence to make the country among the top 50 countries in the world in terms of the ease-of-doing business to boost its quest for industrialization.
In a bid to create a large number of job opportunities, increase the contribution of the manufacturing industry to the GDP and align the development of the industry with the sustainable and green economic development strategy, the government is planning to give a lot of incentives to investors.
Besides the effort to attract new investment, the plan is also aiming to boost the production and productivity capacity of existing firms.
The ministry also identified some of the possible challenges to achieving the plan. Strong competition in the international market in terms of product quality and quantity makes the world competitive.
The commission also invited foreign investors to work in joint-venture with Ethiopian investors particularly in value addition and other investment areas. Improving the quality of exportable products, and focusing on high-tech industries have also been identified as efficient solutions to increasing the competitiveness of the manufacturing industry.
“The new laws aim to increase in-bound investment and address some of the administrative challenges facing investors on the ground.”
In terms of Fiscal incentives the current directive of incentive gives Tax holidays for priority sectors, Duty free import of capital goods, Provision of land with competitive lease prices, Income tax holidays (1 – 9 years), Duty exemption of raw materials used as inputs for export, Investment credit support further accessible and efficient one – stop- shop services at EIC and industrial parks is also consider as benefits for investors.
During the last five months the country has earned 1.1 billion dollar from foreign direct investment as the EIC commissioner Lelise Name said, however as she said certain challenges to the investors has held up the growth such as security challenges, bureaucracy, land and local awareness have been raised as challenges for the investment.
Because of the political instability in the country, as the commissioner said until 2019 more than 400 investments has been burned down and only one percent of them has been reorganized.

The unique tradition of Ethiopian Christmas under COVID-19

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There is no greater feeling than the ‘come together feeling’ of the holiday season. The Ethiopian Christmas itself presents this great and joyous warm feeling and is popularly referred to as Genna in Amharic. Genna over the years has always been a pinnacle of vibrancy but this season the lights have dimmed down as a result of the pandemic.
Amongst the festivity, Christmas is a year where stores, homes and streets alike are filed with decorations. Similarly, during Genna boutiques are often spotted displaying red cloths, Christmas lights are lit as well as huge Christmas trees decorated in the corners or entrances of malls. The Ethiopian Christmas is often quite unique from the rest of the world as it is always welcomed by a 43 day fasting prior. Although the fast has been smooth thus far, the holiday market seems to have become a bit slower and much quieter, a shadow of what it once was.
Genna is often embraced with joy and celebrated in groups of friends and family by eating an array of scrumptious Ethiopian delicacies such as ‘Doro Wot’ (Ethiopian National Chicken dish), lamb stew and mouthwatering beef stews accompanied with Injera and traditional drinks. However, a myriad of challenges stemming from the pandemic effect/ burden, current situation of the country, slow economy have become a negative contributor for the slow season as ‘business becomes very slow.’ Slow season is a common complaint shared by both parties’ between the consumers and the buyers. The capital in previous years was graced by the presence of cattle, chicken and eggs amongst a flurry of activities in different streets but that seems to have fizzled.
Muktar, who owns boutiques at Megenagna recalls previous Gennas as seasons where the streets were full of activities filled with high purchasing power by the consumers. “At Christmas time, we usually sell kids cloths at a rapid pace. Similarly, cloths for other ages are also high. This time round there is low demand despite having clothing products,” Muktar noted as he expressed how much the degree has killed the pockets of the consumers.
Beside the boutique business, the cattle market in the capital has become low unlike recent seasons where cattle would have been sold out within the first two weeks before the holiday.
During the holidays, it is always fun to visit holiday expos at the Addis Ababa Exhibition Center, which is buzzing with exciting crowd, music and food. However, the shopping experience might be less fun this time round. This comes after the restriction to public gathering and closure of Bazaars and Expos following the pandemic outbreak. After a yearlong break, the last week of December served exhibitions at exhibitions at different places of the capital. The prices are comparatively lower to the normal market and as result people flock in numbers to save their coin whilst having a great experience. Trade fairs have been difficult to take part across the country owing to the insecurity challenges and the pandemic. The Genna Expo that was recently launched showed low turnout. The vendors lamented of the low turnout as opposed to other years as well as reluctance to purchase items. The expos are still on going at the Ghion hotel.
As expected, the holiday market also reflected a slower movement of things as well as not so cheap goods. Food items a household necessity during the holidays. These food items can range from groceries to live chicken, eggs, sheep and butter.
Traders in the capital, source their butter, eggs and chicken from various parts of the country mainly from Harer, Gojjam, Arbaminch and Jimma. In most markets across Addis Ababa, the price tag for eggs currently ranges from birr 5.50 to 6 birr. The price of eggs has remained stable at the turn of the new year, despite low supply and demand as opposed to the previous trading of egg and chicken products in previous years.
Similarly, household items such as a kilo of butter ranged from 320 birr to 350 birr with not much increase projected than last year’s price.
A kilo of onions is priced at a price range of 13 birr to 16 birr which is almost similar compared to the price last year as well as during the past three holidays.
Like the onion market, a similar trend was also observed in the capital’s biggest cattle markets, Kera. Kera, one of the largest cattle market is waiting for the last days to in expectance for the market to rocket in sales. The supply of cattle comes from far and wide from the likes of Harer, Wellega, Bahirdar, Jimma, Gonder and Wolayita mostly used for the celebration. Though the country has been battling the pandemic and the recent conflict the price has stagnated.
For cattle acquired from Harer is said to cost 20,000 birr and that of Wellega ranges between 20,000 birr to 30,000 birr whilst Bahirdar 25,000-40,000 and cattle from Wolayta costs the least price ranging between 15,000-20,000 birr.
Fitsum, a cattle trader at Kera, says the market may show increase of 1500 to 2000 birr in respective prices at the last or peak final days of the holiday but not much increase will be expected when compared with last year. This is attributed by a decline in supply of the cattle related with the political unrest of the country.
During holidays it is a common scene to see herds of cattle, flocks sheep and goats that are to be consumed for the holiday along with men carrying live chickens in neighborhoods.
During the days leading up to Genna, a small sized sheep will easily sell for 3,000 birr with a midsized sheep costing 4,000 and above. The delight of having a sheep continues to be out of reach for many during the holiday and those who cannot afford to spend 3,000 birr will simply buy beef from the butchery to make a special meal.
Chicken, is another holiday favorite and is what many resort to, and for this holiday live birds were selling between 250 and 300 birr. As most people prefer to buy live chickens for religious and freshness reasons, processed frozen supermarket chickens still remain cheaper.
It’s not all about meat alone, vegetables remain as important during the holiday as well. Although not a lot of change has been seen with vegetables lately, some items such as garlic which skyrocketed around two years ago, hasn’t shown any difference. Garlic is sold for 60 birr per kilo; red onions which are extremely important for most holiday meals are sold for 16 birr per kilo, an improvement from last holiday when they sold for 18 birr per kilo. Tomatoes are going for 10 birr per kilo, while carrots are 8 birr and potatoes are 7 birr.
The above prices are usually found in open markets, prices at smaller fruit and vegetable kiosks around the city will be higher. As always, in some markets, shoppers will be able to get discounts if they are buying in bulk. Other shops such as Fresh Corner also provide discounts on seasonal produce and are worth checking out.
Although it is said the day before a holiday is the best time to by sheep and chicken, vendors usually get anxious to get rid of their stock and go home, there have been times that this has not been the case.
Optimistically, the slowing of everything will soon change and with a new kind of spirit in the air that seems to be felt, many are hopeful that things will pick up again.
The Central Statistics Agency’s monthly inflation data showed that the total inflation recorded in December 2020 was 19.5 percent higher than the same month last year.
Also according to the central statistical agency December showed a slight decline in grain prices.
Inflation compared to the same month last year shows current inflation, of which food inflation rose by 22.7 percent in December 2020. Most cereals (especially rice) this month, Teff, wheat, maize, barley and sorghum prices decreased slightly over the previous month. But meat prices continue to rise. Some foods, especially tomatoes, onions, garlic, cabbage, carrots, butter, cooking oil, and cheese and eggs, have also declined. However, inflation in the same month last year was relatively low compared to the same month last year.
On the other hand, the inflation of non-food items index increased by 15.8 percent compared to the same month last year. Over the past few months, inflation in non-food items has been steadily rising. Inflation of non-food items in the index is one of the main reasons for the increase over the same period last year, especially in clothing and footwear, rent, home care and energy, furniture and home furnishings, home furnishings, medical and transport, especially in cars. It is an increase in prices. Overall inflation in December 2020 showed an increase of 0.6 percent compared to the previous month.

Alemtsehay Lelissa

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Name: Alemtsehay Lelissa

Education: Degree in Law

Company name: ORNAS HANDCRAFT

Title: Manager

Founded in: 2009

What it does: Hand-woven textile home accessories

HQ: Addis Ababa

Number of employees: More than 10

Startup Capital: 32,000 birr

Current capital: 3.5 million birr

Reasons for starting the business: Passion

Biggest perk of ownership: Hard working and good social interaction

Biggest strength: Persistence

Biggest challenging: Manufacturing space

Plan: Expanding and working hard on export market

First career: Teacher

Most interested in meeting: PM Abiy Ahmed

Most admired person: PM Abiy Ahmed

Stress reducer: Prayer

Favorite past time: Spending time with my child Bama

Favorite book: Bible

Favorite destination: Europe

Favorite automobile: Toyota Rav4