The Ethiopian beverage industry is facing significant challenges due to new government taxes and regional state fees, creating a formidable burden on manufacturers. The additional financial pressures are threatening the stability of major players in the sector, including Coca-Cola and Habesha Beer.

The government has recently imposed a series of taxes on both soft drink and alcoholic beverage producers. Regional states have further complicated matters by introducing their own regulations and checkpoint fees, exacerbating the financial strain on companies.

Coca-Cola, a global leader in non-alcoholic beverages, has been particularly affected. According to Niguse Alemu, Director of Legal Communications for Coca-Cola Africa in Ethiopia, the company has seen a dramatic increase in costs associated with checkpoint fees. “Previously, we would pay an average of 5,000 birr per truck. Now, the fees have soared to between 30 and 50 birr per soft box,” Niguse explained.

The tax burden has increased with new fees becoming legally enforced rather than being paid voluntarily, as was the practice in the past. Niguse also noted that Coca-Cola’s extensive distribution network, which relies on 400 trucks, is now under severe pressure due to these rising costs. Additionally, the regional government’s recent imposition of more than 90,000 birr per truck in taxes is a sharp increase from previous levels.

Habesha Beer, another significant player in Ethiopia’s beverage market, is also struggling under the weight of these new regulations. Adane Teka, the Corporate Communications and Government Affairs Manager at Habesha Beer, highlighted how the increased checkpoint fees and regional taxes are impacting the company’s operations. “The higher costs are forcing us to raise product prices, which in turn affects consumer demand and our annual profits,” Adane said.

The situation is compounded by ongoing security concerns, which further hinder the industry’s ability to operate effectively. Security issues in regions like Oromia and Amhara have led to interruptions in production and distribution. For instance, Coca-Cola’s new factory in Sebeta, Oromia, and its modern facility in Bahir Dar, Amhara, are not operating at full capacity due to these security challenges.

The cumulative effect of rising taxes, regional fees, and security concerns is placing immense pressure on Ethiopia’s beverage industry. As the sector grapples with these challenges, there are growing fears that without significant intervention or adjustment in policies, many companies may struggle to sustain their operations.

The industry, which plays a crucial role in Ethiopia’s economy, faces an uncertain future if these issues are not addressed promptly. Both Coca-Cola and Habesha Beer emphasize the need for a more stable regulatory environment to ensure their continued success and contribution to the national economy.

The International Center for Strategic Alliances is proud to present the 15th Edition of the Connected Banking Summit, taking place in Addis Ababa, Ethiopia. This pivotal event brings together global banking executives, experts, and leaders to discuss the future of the industry under the theme “Bolstering the Economy with Digitization and Financial Inclusion.”

The summit features an impressive lineup of speakers, including high-profile figures from the Ethiopian government, banking sector, and international organizations. Dr. Yeshurun Alemayehu Adde, State Minister of the ICT and Digital Economy Sector at the Ministry of Innovation & Technology, will share insights on Ethiopia’s digital transformation initiatives.

Tilahun Esmael Kassahun, CEO of the Ethiopian Securities Exchange (ESX), will provide an update on the capital markets’ role in driving financial inclusion. Other notable speakers include senior executives from leading Ethiopian banks, such as Hibret Bank, Amhara Bank, Awash Bank, Ahadu Bank, Cooperative Bank of Oromia, and Enat Bank.

The summit also features experts from international organizations, including Endashaw Tesfaye, Digital Financial Services Expert at the United Nations Capital Development Fund (UNCDF), and representatives from cybersecurity firm Kaspersky, as well as consulting firm KPMG.

“This event is a testament to the banking industry’s commitment to innovation and digital transformation in Ethiopia,” said Mohammed Thoufiq, the organizer of the Connected Banking Summit. “By bringing together industry leaders, we aim to drive the adoption of cutting-edge technologies and foster financial inclusion, which are crucial for the country’s economic growth.”

The summit explores the impact of technologies like artificial intelligence, machine learning, and digital assets on the financial services ecosystem. It also provides unparalleled networking opportunities for C-suite executives, senior managers, and decision-makers driving the adoption of modern banking solutions.

The Connected Banking Summit is supported by a distinguished group of sponsors, including Kaspersky as the Official Cybersecurity Partner, Infosys Finacle and Panamax as Gold Sponsors, KPMG as the Knowledge Partner, and Backbase as a Bronze Sponsor.

The event coincides with the prestigious Innovation & Excellence Awards, recognizing the banking industry’s most innovative and impactful achievements. Attendees will have the chance to witness the celebration of these prestigious accolades.

For those interested in attending the 15th Edition Connected Banking Summit, a limited number of passes are still available. Professionals in the banking, financial services, and technology sectors are encouraged to register now to secure their spot at this landmark event.

In a groundbreaking move for Ethiopia’s technology landscape, Wingu Africa and Gebeya Inc. have officially launched the country’s first data center Talent Cloud. The initiative, unveiled on Tuesday, July 23, 2024, at ICT Park in Lemikura, represents a significant step forward in developing human capital for the East African data center industry.

The new Talent Cloud solution, a collaboration between Wingu Africa, a leading carrier-neutral data center operator, and Gebeya Inc., a prominent Pan-African tech company, is set to revolutionize the industry by focusing on talent development and infrastructure innovation.

Wingu Africa’s data center, which is the first carrier-neutral facility in the region, features a Tier 3 infrastructure with the capacity to host up to 800 racks and 10 megawatts of power. Gebeya Inc. specializes in SaaS-enabled custom talent cloud innovations, complementing Wingu’s infrastructure with its expertise in technology leadership.

Demos Kyriakou, Co-Founder and Deputy CEO of Wingu Africa, expressed enthusiasm about the partnership. “We are thrilled to partner with Gebeya Inc. on this transformational initiative. Our collaboration will not only enhance the skills of many individuals but also create significant employment opportunities within the data center sector,” Demos Kyriakou said. He emphasized that the initiative aligns with their mission to advance technological development and skill-building across the continent.

Amadou Daffe, CEO of Gebeya Inc., highlighted the impact of the Talent Cloud initiative. “This Talent Cloud initiative equips individuals with essential data center capabilities and creates sustainable employment opportunities that drive economic growth in the region,” Amadou stated.

The partnership aims to train and certify 1,000 young people in data center infrastructure and technologies through their unique Skills Cloud platform over the next year. This ambitious goal underscores the commitment of both organizations to address the skills gap in the data center industry and foster a new generation of tech professionals in East Africa.

Wegagen Bank, in partnership with Qena Software Design, a leading fintech company, has officially launched its new digital loan service named “Efoyta.” This service aims to cater to various segments of the community by providing accessible digital loans. The announcement was made on July 22, 2024, during a ceremony held at the Planet Hotel in Mekele.

The event was graced by esteemed guests, including Dr. Alganech Tesemma, along with board members and management of Wegagen Bank, clients, representatives from Qena Software Design, and other invitees.

The “Efoyta” digital loan service is primarily designed to support small, micro, and medium-sized businesses by providing them with the necessary capital to expand their operations and create job opportunities. Additionally, it aims to offer emergency loans to salaried employees.

Abdishu Husen, the Chairman of the Board of Directors of Wegagen Bank, highlighted that the service is intended to help individuals and businesses overcome financial challenges and realize their plans. He emphasized that many citizens face difficulties in executing their ideas due to financial constraints, and the “Efoyta” digital loan service will enable them to achieve their goals.

Moreover, Abdishu Husen noted that the launch of this service aligns with the bank’s strategic plan to provide financial services that improve the lives of various community segments. By offering accessible loan services, Wegagen Bank aims to enhance the financial inclusivity and economic well-being of numerous individuals.

This new service is expected to make a significant impact by transforming the lives of many people who previously had limited access to credit facilities. It reflects Wegagen Bank’s commitment to innovation and dedication to meeting the diverse financial needs of its customers.