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National liquor privatization delayed

Muluken Yewondwossen
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National liquor privatization delayed

Compensation of former owner leads to court injunction

The privatization process of National Alcohol and Liquor Factory (NALF) has been delayed due to a claim by the former owner.
Late last fiscal year, the agency that at the time was know as the Ministry of Public Enterprise (MOPE), but is now called the Public Enterprises Holding and Administration Agency (PEHAA) opened a bid document for NALF. The alcohol factory is the largest in Ethiopia and the bid was the largest ever offered for a government enterprise by local investors. Lominat Beverages Plc, owned by the prominent business personality Binyam Berhane and Brook Worku, who is also well known in the spirit industry, offered 3.62 billion birr to fully own NALF.
In the bid opening late last June, Lominat, Pure Alcohol and Beverages Manufacturing and Metadim Manufacturing tabled their offer. The last two companies, both local, offered close to 1.7 billion birr and over 1.5 billion birr respectively, which are also very high compared with the tagged price of PEHAA. The floor price that the former ministry tagged was 1.27 billion birr.
Even though the company, that offered the highest price is expected to secure the company when they make a down payment the factory has not yet been transferred to Lominat.
Lominat is getting ready to build another beverage factory and they wanted to include NALF as an additional conglomerate.
Wondafrash Assefa, Public Relations Head of PEHAA, told Capital that the Ministry of Finance, which oversees the agency, has given a grace period to settle the down payment.
This was done at the company’s request, however the deadline for that grace period ended this week.
“The Ministry of Finance extended the deadline even though the first grace period ended,” he added.
Sources who are close to the matter said that the company is ready to settle the down payment, which commonly is 35 percent.
Sources said that the problem transferring the factory is related with Berhane G.Medhin, the former owner, who bought the factory during the period of the emperor from the original founder Elias Papassinos, a Greek citizen. Capital learned that the company has received a court injunction because of a claim from the former owner which makes it unfeasible to transfer the factory to Lominate.
“About 20 years ago the valuation work of the enterprise was conducted and the government approved giving some money as to the former owner,” Wondafrash said. “The government has called the former owner to get 2.7 million birr in compensation, but he preferred to secure the entire factory which has branches in different locations in Addis Ababa and its surrounding areas,” he said.
“After the Ethiopian Privatization Agency (EPA) did a survey on the company it gave two options. One was for me to pay the 26.4 million birr to the government and take back my company or for me to get a compensation payment. I took the first offer and responded to the EPA, later renamed MoPE that I would pay the money and take over the NALF. Until the final week of my stay in Addis Ababa about 28,000 Eritreans were deported. Due to the Ethio- Eretria border conflict, many were taken away as a threat to the national security,” Berhane, who was one of those deported, told for Capital during an interview last September.
Wondfarsh recalled the letter written about two decades ago to the former owner. The letter was written by mentioning the ‘Review of Properties Taken in Violation of the Relevant Proclamations (Amendment) proclamation no. 193/2000’ that allowed the government to posses the enterprise and settle the former owner’s required sum.
The proclamation article 7, sub article 1 states that: where a property taken in violation of the law: a) cannot be returned to the owner due to substantial public investment made on it or is administered as an inseparable unit of other properties or due to other reasons related to the public interest; or b) is owned by a public enterprise which is being dissolved and liquidated in accordance with Article 39 of Proclamation No. 25/92; the former owner shall be entitled to compensation. The amount of compensation shall be assessed and determined by the Agency.
In June Brook, CEO of Lominat told Capital that NALF is worth what his company offered. “To be frank the company is one of the most profitable public enterprises, and has a huge market in the country,” he said.
The major shareholder of Lominat, which was formed in 2014 by the two businessmen with the goal of joining the beverage and sprit industry, Binyam is well known in the import and distribution of various commodities including distribution and trading alcohol and sprits over three decades.
Lominat planned to develop the local market at international standards. Brook stated that Lominat would provide import substitution and export products. The products of NALF are prominent in the region mainly the South Sudanese market.
“We can produce the alcohol products and different brands that are imported from abroad and substitute exports by 90 percent,” Brook told Capital in June.
NALF is the collection of four factories three in Addis and one in Sebeta, 25km west of Addis.
In the 2016/17 budget year NALF’s sales were 607 million birr with a growth of 132 million birr compared with the 2015/16 budget year.
The net profit of 122.4 million birr after tax, which has showed a 30 million birr increase within a year, is also a record amount registered by the liquor factory for the stated period, but last year’s performance was expected to be higher since it had expanded.
The National Tobacco Enterprise, which was transferred to Japan Tobacco as major shareholder of the tobacco monopoly and full ownership of Meta Beer by Diageo are also two record privatization sales that have occurred recently.

Constitutional Inquiry intervenes in CCD real estate case

admin
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The Country Club Developers (CCD) appeared before the Federal High Court last Thursday with an injunction after a proceeding gave one month for the General Manager to hand over six houses that had been delayed for ten years.
Messele Haile, the founder of CCD, appeared before the Federal High Court’s 6th Civil Bench on January 14, 2019, and heard the judge order the handover of the six homes which lay on 1,000sqm. Messele was summoned to explain why his company failed to deliver the houses. Then the court ruled in favor of the home owners.
Following the ten-year court battle, the applicants opened an execution file after the company failed to comply with their amicable agreement which was to hand over the houses within 16 months. Four months after deadline they sued.
The presiding judge ordered CCD to handover the houses within one month. The owners said they were delayed from delivering the houses because they were waiting for finishing material from abroad. The company asked for three months but the applicants refused stating that enough time had been given.
On February 14 a hearing was held to see if the homes were indeed delivered by the one-month deadline. However, the real estate company’s lawyer Tamagn Beyene appeared with an injunction order given from the Constitutional Inquiry (CI) advisory council of the House of Federation (HoF).
The Chairperson of CI, Meaza Ashenafi, wrote on January 28, 2019, that the execution file at the Federal High Court’s 6th Civil Bench would be put on hold until the case obtains a final ruling in the House.
Appealing to the lower court’s decisions CCD’s lawyers submitted their application to the inquiry on September 17, 2016. The appeal stated the decision given by courts at all levels including the Cassation Bench denied that they had jurisdiction. This is because the property is located in the Legedadi Legetafo city administration in Oromiya Region. Therefore, the lawyers argued, the case should be decided by Oromia courts.
The real-estate developer asked for the inquiry to interpret article 80/2 of the constitution which delegates that regional courts deal with federal matters. The appeal also mentioned that the houses are being built with a land lease agreement obtained from the regional government and there is an argument over the regional land and investment laws.

IDEOLOGY OF COMMON SENSE

Staff Reporter
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IDEOLOGY OF COMMON SENSE

In decades past, the anchoring political ideologies in the West mainly rested on the amorphous yet dichotomously charged categories of left and right. To be sure, extreme parties of either never really usurped full state power in the nation-states of the West, at least not after WWII. It was usually center left or center rights political parties that worked the administrative organs/governments of the state in a revolving manner. Currently, the traditional polar positions of opposite parties seem to have come together on certain concrete issues. This doesn’t mean political ideologies are fusing together, far from it. But there are indications that agreements can be reached on certain critical matters, thereby forging temporary alliance between formerly and formally polarized political positions!
War is something many a sheeple (human mass) would consider an abomination, yet the war industry not only thrives, but also instigates wars so that continued profit can accrue to its associated elites. The deep state is setup to dominate others and make good with their resources. Wars of all kinds; cultural, economic/financial, educational, propaganda, etc. are employed to this end! Recall our definition of the deep state: It is the military-intelligence-industrial-banking-media-complex. The killings of innocent lives and the destruction of properties, to say nothing about the onslaught on our fragile ecosphere, are considered mere ‘collateral damages’, to use the sickening phraseology of the deep state. It is also because of the doings of the deep state, migration is becoming a major point of contention, even amongst the constituent members of empire. It is such practical matters that are bringing the traditionally polarized parties together. It seems ‘Common Sense’ is finally making a comeback. For instance, the European sheeple has started to vigorously reject the old political parties, which have always been under the thumb of the deep state. Refugees on the shores of the belligerents, ‘Yellow Vests’ on the streets of European metropolis, all have one thing in common-the utter dissatisfaction of the global status quo or what the late Samir Amin insisted on calling ‘polarizing globalization! In this regard, the so-called rightist deputy prime minister of Italy, Mr. Salvini has interesting views; he says it is the French in collaboration with NATO that destabilized MENA (Middle East and North Africa). The French he insisted still continues to colonialize countries in Africa, creating the mass exodus of people to Europe. In Italy and on this particular point, both the left leaning (Five Star Movement) and the rightist (Lega Nord) seem to be in agreement. They also refused to support the US and vassals in their project of ‘regime change’ in Venezuela!
Banking/finance is another of the component of the deep state. In late modernity finance has become, instead of an intermediary, an end on its own! In such a financialized world it is only those that are closely connected to the money spigot who benefit, rather disproportionately, from all activities, not only economic/business. Those not within the inner loop of the deep state, including the sheeple, are considered non-essentials, hence, their needs are relegated to the back burner, so to speak. But such neglects have now created consequences that are threatening to derail the groovy train of the one percenters. Since the unfettered access to all spheres of societal existence has given the market the upper hand, the ideology of ‘Common Sense’ was ostracized and visibly demoted. In a nutshell, neo-liberalization is a diktat that every thing under the sun must obey the logic of profit via commodification. To the disciples of neoliberalism, it doesn’t matter whether life is preserved or not, so long as accumulation remains paramount! The result: extreme polarization, both between and within countries, as well as catastrophe in the world of natural! Forty years of ‘waiting for goodies’, as promised by neo-liberalization, has proved untenable (comparatively speaking.) The 1% have made good on their exploits, while the rest are losing grounds on a daily basis. As we never tire of mentioning, the main culprits of this globally lopsided economic arrangement are; ‘fiat currency’ and ‘fractional reserve banking’! Here again, Mr. Salvini is spot on in regards to the ownership of the Italian gold. See the articles on page 44.
The current government in Italy is a coalition of the right and left, and yet they seem to work together on critical issues. In fact, they are spreading the words to their contemporaries in places like France and Belgium. The duos encourage the ‘Yellow Vests’ (France, Belgium, Netherlands, etc.) to take charge and change their respective governments. ‘Direct democracy is the future,’ is what they are explicitly saying to the European sheeple. See Studdert’s article next column. The old ways of doing politics by proxy proved not only inefficient, but actually became the main source of structural/political corruption within the nation-states! The reigning plutocracy is facing ‘Common Sense’ from diverse segments of society. The deep states’ wars of Syria, Libya, Yemen, etc., have impacted humanity’s conscience and is reinforcing the belief that psychopaths are not fit to run nations! In conclusion, the opposite ends of the political spectrum seem to have come together. The polar ends are joining and are forming a kind of circle, albeit on specific agenda items. Defying the simplistic categorization of left and right, might well be the world’s political future!
Here is the old language of Common Sense as it becomes relevant again. “Countries want independence, nations want liberation and people want revolution.” Chinese Communists. Good Day!

Major book focusing on Ethiopian economy launched

Muluken Yewondwossen
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Major book focusing on Ethiopian economy launched

The first single country handbook in Africa focusing on the Ethiopian economy has been published by Oxford University Press, although the price is extraordinarily high for Ethiopian readers.
‘The Oxford Handbook of the Ethiopian Economy’ was officially introduced during three ceremonies held last weekend at the Economic Commission for Africa for the foreign community, Ethiopian Economics Association (EEA) for economists and contributors to the book and at Ethiopian Skylight targeting the business community.
It is 1,008 pages with 50 chapters classified into six sections. The sections focus on the key areas of the Ethiopian economy including economic development, social policy, agricultural and rural transformation, industrialization and urbanization, and structural transformation in the African continent. The beginning looks at context, concepts and history.
In the book 70 well known economists and other professionals participated and 42 percent of the writers are not Ethiopians.
Arkebe Oqubay, Special Advisor to the Prime Minister, who is one of the three editors and a writer for the book said at the ceremony held at EEA on Saturday February, 9 that the handbook took about four years to become a reality.
Arkebe, who wrote; ‘Made in Africa: Industrial Policy in Ethiopia’ published in 2015 by Oxford, told Capital the Oxford Economic Handbook is the first for an African country. It came to fruition at the invitation of Oxford University Press because they were impressed by the country’s unique way of economic principles and growth.
It was challenging to develop the book because of struggles with research practices and trends, and lack of accurate or inaccessible data for policy suggestions. There were also several problems including funding shortages. Gender disparities are one of the issues that need to be worked in light of the fact that only 14 female authors were involved in the handbook out of 70 70 participants.
Twelve more volumes selected from the chapters in the handbook will be developed.
“The second edition of this volume is expected to be published in 2025 that should be updated and give an opportunity for authors that did not contribute to the current one,” Arkebe said.
He told Capital that the major focus area was giving pure information and scholarly standards and original content free from bias, while give freedom for scholars so they can reflect on their research freely.
“It has, for instance, criticized the gaps of the government. My chapter has also shown ways that problems can be solved,” he said. “Since the main target of the handbook is showing details of the Ethiopian economy on a knowledge basis and using it as a reference for researchers and government policy it has to be quality.” He added that to keep the originality one chapter was dropped because the subject had been published before.
The PM advisor said that the handbook would have several advantages besides an input for research and scholarship.
“Investors who are looking at possible destinations may consider Ethiopia because this handbook has several inputs for their assessment and it would make it easy to evaluate their options in the country,” he said.
The statement issued during the book launching held at EEA stated that the handbook is expected to serve a wide audience, including researchers, academics, policymakers, and practitioners, and is expected to be a major source for graduate and undergraduate students.
Fantu Cheru, Senior Researcher and Emeritus Professor, African Studies Centre, Leiden University, The Netherlands, and Christopher Cramer, Professor of the Political Economy of Development, SOAS, University of London, UK are the other two editors of the handbook. The two editors also helped write chapters like Arkebe.
Authors like Teferi Abate, Christopher Clapham, Menberetsehai Tadesse, Mekonnen Manyazewal, Admasu Shiferaw, Yohannes Ayalew, Seid Nuru, Assefa Hailemariam, Zinabu Samaro, Ayelech Tiruwha, Edlam Abera, and Carols Lopes were involved in the production of the 50 chapters.
The book allocates four chapters for agriculture and three for the coffee sector which is the leading areas of the 50 chapters. Lack of adequate focus on health and economy and construction sector as a chapter has been criticized as a problem with the first edition of the Ethiopian economic handbook.
The price of the book is USD 135 which is very expensive for Ethiopian audiences.
“It will be a good reference for students in higher education. We are working to get funds from donors to distribute the book at universities in the country for free,” Arkebe told Capital.
The PM’s advisor is in the process of publishing two books: ‘China-Africa and an Economic Transformation’ and ‘How Nation Can Learn’ that will be published by Oxford in the coming April and May respectively. Another book of Arkebe’s, ‘African Economic Development’ published by the same press is expected to be available by February 2020.

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