More than 40 companies failed to meet standards set by the Addis Ababa Environmental Protection Authority (AAEPA).
Forty-one manufacturing companies, two plastic factories, and a hotel were unable to obtain Environment Impact Assessment Certification. AAEPA conducted over 100 environmental impact assessments (EIA).
The assessments are being done to help create a healthier environment and are mandated by directive no 21/98.
Gutema Moreda, Vice Manager of AAEPA says they are working to protect the city from a polluted environment.
AAEPA hands out environmental certificates for over 400 types of work including; manufacturing industries, mines and service orientated companies. AAEPA also supervises these businesses.
“The authority is doing its best to carry out its responsibility by strictly following environmental laws,” he said.
Addis Ababa is home to over 2,000 manufacturing companies, which is 65 percent of all the industrial businesses in the country. Most of them are located along river banks in the southern and western part of the city. They discharge their waste directly into the rivers and as many as 90 percent of these companies do not have any kind of treatment plant and release their solid, liquid and gaseous waste untreated into the environment.
This is just one of the reasons that city’s rivers are polluted. They also face increasing human population, uncontrolled urbanization, inadequate sanitation and infrastructure. People urinate, defecate and throw their trash in the rivers. Apparently Little Akaki River is the most polluted because it is surrounded by factories and the large open air shopping area. The assessments were conducted during the second quarter of the fiscal year.
Over 40 businesses flunk environmental tests
The global chemistry champion eyes Ethiopia for a better market
BASF, who has been operating in Ethiopia for many years, sees opportunities for industrial growth in Ethiopia. The company with approximately 122,000 employees its Group nearly all sectors and almost every country in the world generated sales of around €63 billion in 2018.
Organized into six segments: Chemicals, Materials, Industrial Solutions, Surface Technologies, Nutrition & Care and Agricultural Solutions. BASF generated sales of around €63 billion in 2018.
The company showing its interests in Ethiopia with its high population in addition to the recent economic growth reforms.
The company supply pesticides i.e. herbicides, insecticides, fungicides for crops with the key ones being for wheat, barley, maize, and flowers.
It puts a product into a market it goes through more than 10 years of research from the synthesis of an active molecule to having a product in the market. Stringent tests are done in the various laboratories worldwide including Europe and Africa for efficacy, formulation, environmental impact, residue tests with trials in the laboratories, greenhouses and in the fields.
Once a product is produced and it sees the opportunity to have it in the country, local government regulations then apply.
In Ethiopia, the government demands that if it does field trials under local conditions in the recommended research stations for up to 3 years before they are granted registration to allow their distributors to import into Ethiopia.
Having over 80 businesses globally, BASF produces various products, the majority of which have relevance to this country. The interest from various industries for BASF products in Ethiopia is very high. Distributors or business partners are not getting any foreign currency to import chemicals from BASF to drive their industries because of foreign currency shortage.
The company opened a laboratory in Nigeria to serve the Home and Personal Care customers. Products for Africa must be tailormade locally and this will now be possible through this laboratory. In the future, more laboratories will be built across Africa to serve BASF customers. As BASF business grows in Ethiopia the opportunity for similar laboratories across industries could be evaluated and considered
“BASF sees opportunities for industrial growth in Ethiopia. Its products are great enablers for this growth in key industries such as agriculture, leather, construction, pharmaceuticals, automotive paints, home and personal care, human and animal nutrition, in insulation products like polyurethanes” Gift Mbaya, Business Lead and General Manager BASF TRO Ethiopia told Capital.
BASF recently acquired the Vegetable Seeds business increasing its Agricultural Solutions offerings to farmers. Operating under the brand Nunhems®, the successful vegetable seeds business comprises 24 crops and about 2,600 varieties. BASF Vegetable Seeds business also operates an office in Addis.
Risky Business Sports betting drawing minors, fostering addiction
Is is only recently that sports betting has come to Ethiopia. The companies are often owned in a joint venture with foreigners and their customers are mostly youth including students below 18. Some African countries are considering blocking sports betting in a bid to protect youth but the business is flourishing in Ethiopia. Betting is common all over the world, but the English Premier League is the most popular.
Mesfin Kebede, 37, a father of two daughters is an accountant. He works at one of the private commercial banks. During his lunch break, Capital found him waiting in line at one of the Axum Sports Betting branches around Addis Ababa Stadium. Axum Sports Betting, a subsidiary of a Turkish-based Company was launched three years ago. Now it has nine branches in Addis Ababa. This center caters to customers betting on world sports. “EPL, Spanish league and champion’s league matches have mainly gotten the attention of people, weekdays are the busiest days as most European clubs have their day game,” a receptionist at Axum Betting told Capital.
At Axum Betting, the minimum bet is 20 birr and you can win up to 14,000 birr. People can win as much as 300,000 birr.
“I have become very addicted to betting. I visit up to three days per week. I spend more than 2,000 birr a minimum per month but, since I started betting last year I have only won one time and that was just five thousand birr,” Mesfin says.
Currently there are over ten betting firms operating sports-betting services from the National Lottery Administration.
The betting companies have branches in regional states, each company has over 30 branches on average.
“I always bet whenever Manchester United plays. I never miss a single game and get a fraction of coin, Mesfin says.
Henock Woldie, is a senior football analyst at R&D consultancy. The company conducts deep analysis on soccer world-wide and for Ethiopian Premier league clubs such as St. George using analytics.
“The chance of winning from betting is less than 10 percent as the system allows you to try every detail like the winning team, goal difference, first scoring team, name of scorer, minutes of scoring etc.” Henock says.
Therefore, it narrows the chance of winning which broadens the betting companies advantage. They make huge profits from it, he adds.
Yodit, her name has been changed upon request, works in one of the betting companies as a reception and casher. She said that her company collect 50 thousand birr on average from the 70 branches in Addis Ababa and regional branches daily.
Mengistu Yirga in his early 20’s was also lining up at another sport betting company around Megenagna to bet on a weekend match.
He was writing his prediction on a piece of paper, but now he uses a computer. “I bet in any nearby betting company as long as Manchester United has a game” he said.
“The thing is more than an addiction for me; I go late to bed as long as I bet that day. I stalk on my smart phone to follow the match results online,” Mengistu says.
Even though, the law allows sport betting above 18 years old, Capital witnessed students with uniforms standing in line to bet during the middle of the week, when the European champions’ league game took place that night.
Hulu Sport Betting PLC, a company fully operated by Ethiopians, includes Ethiopian Premier League matches in their betting.
“It’s not gambling, rather it’s trying your chance through knowledge as the system puts every detail of the teams’ past matches, the current status, and the last match performance,” Abrham T/mariam Deputy Manager of Hulu Sport Betting says.
The maximum winning lottery at Hulu Sport Betting is 64,000 birr by 20 birr, though the maximum winning cap is 300,000 birr.
The number of sport betting companies in Ethiopia is low compared to other African countries.
As the business needs an Internet connection, sometimes, the network affect us, Abrham says.
According to an agreement with the National Lottery Administration, all betting companies are obliged to disperse 20 percent or more from their net profits to sport institution or clubs, however none of those betting companies have been discharging their corporate social responsibilities.
“Yes, we made such agreement in written form, but Hulu Betting has not been profitable since entry, that’s why we haven’t done that,”Abrham says.
In neighboring Kenya, there are more than 20 local and international firms who opened their doors to betting services, making it the third-largest market in Africa next to South Africa and Nigeria.
The combined size of the gambling industry in Kenya, Nigeria, and South African is projected to be worth 37 billion USD in 2018. In Kenya alone, a 2017 study found that an estimated two million individuals are engaged in mobile-based sports betting.
It’s estimated that by the year 2022, the global gambling market could be worth 635 billion USD, according to new findings by Dublin-based Research and Markets.
“You have no idea, my friends and I have started closely following other European leagues apart from EPL for the sake of betting,” says Mengistu.
Bottled water companies ask for excise tax lift
A letter signed by the management of 33 local bottled water companies has been sent to the Ministry of Finance asking for the lifting of excise taxes on bottled water.
Currently around a 20 percent of excise tax is levied on packed waters. The basis for excise tax computation is the total cost of the product for items manufactured locally and CFI value in case of imported goods.
Getnet Belay, Board Chairman of Ethiopian Bottled Water and Soft Drinks Manufacturing association told Capital that excise tax which is applied to the bottled water is unreasonable.
“The government has not levied an excise tax on food because it is a necessity. However, the government collects excise taxes from the bottled water companies this a paradox. We need the government to lift it.’’
He added that though excise taxes are levied on the final product by taking their total costs into consideration, the government is levying taxes when the raw materials are imported as well on the final products of the manufacturers. This exposes manufacturers to unfair competition with imported goods, which are taxed once when they come into the country.
Capital asked Getnet Belay if the bottled water price will be decreased if the government lifts the excise tax.
“Why not, it will be decreased.” he said.
He added that the association is also asking the Standard Agency to allow bottled waters without neck sleeves.
“You know consumers drop the neck sleeves on the street which is polluting the environment. You don’t need neck sleeves for bottled water.”
Currently the government is planning to conduct a study in collaboration with the Ethiopian Revenue and Customs Authority (ERCA) to amend the Turn Over Tax (ToT), Value Added Tax (VAT) and Excise Tax.
The study is aimed at making an efficient tax system following the adjustments made along with the latest income tax and tax administration proclamations. In addition to this, the study will put into consideration the global market. As it stands the TOT rate is 10 percent for services and 2 percent for goods, while there is a 15 percent VAT on items sold. Excise tax on the other hand is 30 to 100 percent.
The study would also try to address the low level of tax contribution to the Gross Domestic Product (GDP), which currently stands at 13 percent – one of the lowest in the world.
