Protest-Hit Ethiopian Region Plans Oil Company to Quell Unrest

A central Ethiopian region that’s seen almost two years of sporadic anti-government protests is planning a new private oil company and is in talks to import Middle Eastern crude, part of an economic initiative authorities say will address some of the roots of the unrest.

Oromia Petroleum Share Co., the planned venture, will import the oil via Djibouti, process it at a new large-scale refinery and distribute it to gas stations owned and operated by local youths, Tekele Uma, head of the region’s transport authority, said in an interview. Potentially creating more than 50,000 jobs, it will build a transportation network initially benefiting farmers and manufacturers in the Oromia region who send their products to the capital, Addis Ababa, and other cities, he said.

The company would compete with the National Oil Co., whose shareholders include Saudi Arabian billionaire Mohammed al-Amoudi. NOC is one of Ethiopia’s biggest fuel suppliers, according to a feasibility study shared by Tekele. Oromia Petroleum targets a 21 percent share of Ethiopia’s fuel market within five years of operations.

Ethiopia is ranked Africa’s fastest-growing economy by the International Monetary Fund, but unrest has threatened to derail the boom. The protests that began in Oromia in 2015 over alleged land grabs and political neglect later spread to the Amhara region, with security forces accused of killing at least 600 demonstrators, according to the Association for Human Rights in Ethiopia. The government has acknowledged there were casualties and said they included security personnel. Foreign investment slumped after protesters targeted businesses, including those owned by Nigerian billionaire Aliko Dangote.

‘Economic Revolution’

The Oromo Peoples’ Democratic Organization, one of four parties that make up Ethiopia’s ruling coalition, describes the fuel project as part of an “economic revolution” that seeks to quell the discontent. After the protests, Tekele said, the OPDO “reshuffled leaders from top to bottom and said we’ll have to answer economic grievances and issues of good governance.”

Further plans will be announced in the coming weeks and months, Tekele said. He declined to name the companies in talks to supply the oil.

Oromia Petroleum seeks to capture seven percent of Ethiopia’s commercial fuel market in its first year, according to the feasibility study produced in May. Four companies currently control 90 percent of Ethiopia’s fuel market, while demand is growing at an average 7 percent a year, it said. The planned refinery, in Oromia’s Dukem town, would be linked to Djibouti by a recently completed $4.2-billion, Chinese-built railway that runs to Addis Ababa.

In its first two years, Oromia Petroleum will aim to build 80 gas stations in Oromia, the Southern Nations, Nationalities and People’s Region, and Dire Dawa -- facilities that will employ 2,500 people in total, according to the study. Besides distributing fuel, the company plans to operate related businesses such as cafes, spare-part shops and mechanical workshops, it said. Within five years, Oromia Petroleum plans to expand to 165 stations across the nation, according to the study.

Ethiopia’s annual fuel consumption was about 3.5 billion liters (925 million gallons) last year, according to the feasibility study. Thirteen oil companies currently supply about 740 fuel stations in the country, with Oromia having 220, the largest concentration in all Ethiopia’s regions. The companies include Total SA, OiLibya and NOC. Read more here

Chinese-led Project to Turn Ethiopia’s Biggest Dump into Economic Driver

June 19, 2017 - A Chinese-led waste-to-energy project will start generating power in September in Ethiopia's biggest garbage dump, which will help fuel the country's rapidly growing economy.

The Reppi Waste-to-Energy project in Kolfe Keranio, a sub-city of the capital Addis Ababa, is slated to be opened in September, China's People's Daily newspaper reported on Monday.

The project is a significant part of the cooperation between China and Ethiopia, as the country is seeking to develop its green energy capacity, Azeb Asnake, CEO of Ethiopian Electric Power told the People's Daily.

The Reppi dump, also known as Koshe, meaning "dirty" in the country's most widely spoken language Amharic is the biggest dump in the country and has been polluting the water and soil nearby for more than 50 years.

According to the People's Daily, the Ethiopian government invested $100 million in the waste-to-energy project and the China National Electric Engineering Corporation started construction work in September 2014.

The project will be able to burn 1,280 tons of waste each day which will produce electricity in its power plant, the newspaper report said.

"More than 200 waste-to-energy power plants have been built in China, which has provided great experience and technology for the Reppi project," according to a China National Electric Engineering Corporation employee, who added that all the equipment used in the project was made in China.

Ethiopia is one of Africa's fastest growing economies but its development has left some behind, Reuters reported. At least 115 people were killed in a landslide at the Reppi dump in May, home to hundreds of people who make a living by scavenging through the garbage, according to Reuters.

Source:- Global Times

Ethiopian parties agree to negotiate on terrorism, media laws

ADDIS ABABA, June 19 (Xinhua) -- Seventeen Ethiopian political parties, including the ruling party the Ethiopian People's Revolutionary Democratic Front (EPRDF), on Monday agreed to negotiate on various proclamations and laws, including an anti-terrorism law.

The 17 Ethiopian political parties, who are undergoing discussion to broaden the country's political sphere, have also agreed to negotiate on the Mass Media and Freedom of Information Proclamation.

Shiferaw Shigute, head of EPRDF Office, on Monday assured representatives of opposition parties that his party is ready to negotiate on suggestions made.

The ruling party, however, stressed that it is not in favor of amending the aforementioned law and proclamations. One of the areas that the ruling party rejected to discuss is the draft agenda tabled by six opposition parties demanding the current state of emergency for negotiation.

"The Ethiopian People's Revolutionary Democratic Front can not negotiate on the matter while the country is under emergency rule," local media FBC quoted Shigute as saying.

Opposition parties also requested to discuss on various articles that includes Article 39 of the Ethiopian constitution on secession and self-determination. Shigute, however, said that his party "will not negotiate on such articles since parties have no right to negotiate on the issues and amend the country's constitution."

Shigute also opposed opposition parties' request to discuss on the condition of political prisoners, saying that "the party doesn't negotiate on the issue as there is no political prisoner or a prisoner of conscience in Ethiopia."

Ethiopia, which has been under a state of emergency for over 7 month now, has embarked on a nationwide reform process since the end of 2016 in a bid to provide concrete answers to the preoccupations of the public. Read more here

Chinese business delegation sparkles at Ethiopia

ADDIS ABABA, June 19 (Xinhua) -- A delegation of 70 companies from Shenzhen City, China's innovation hub, is attending a show in Ethiopia's capital Addis Ababa and locals are thrilled about the ample business opportunities on the horizon.

The delegation is in the east African country for the China (Shenzhen) Trade and Investment Promotion Meeting and Shenzhen Products show from Monday to Tuesday.

Lu Pengqi, Vice Chairman of China Council for the Promotion of International Trade (CCPTI) says there is good reason why business delegation from Shenzhen will attract attention.

"With Shenzhen's Gross Domestic Product (GDP) reaching at 283 billion dollars in 2016 and GDP per capita standing at 25,000 dollars, the city is one of China's most developed and richest," Lu said.

Shenzhen transformed from little more than a fishing village to "China's Silicon Valley" in less than 40 years. It is home to a population of nearly 12 million and more than 5,300 Chinese enterprises including tech giants Huawei, ZTE, and Tencent, which in total have made overseas investments estimated at 80 billion U.S. dollars.

While trade relations between Ethiopia and its top trading partner China has reached 3.6 billion dollars in 2016, investment from Shenzhen city and Guangdong province to Ethiopia still lags compared to other Chinese provinces, says Tadesse Haile, Ethiopia's state Minister of Industry.

"Ethiopia offers Shenzhen a huge market as a next best destination in Africa, complemented by its desire to be a leading light manufacturing hub and middle income economy by 2025," says Haile.

Ethiopia's state minister of Industry was in particular referring to Shenzhen's reputation for knowledge intensive industries in addition to labor intensive industries like Textile and leather.

With Shenzhen popularly called China's "Silicon valley" for its reputation as innovation and entrepreneurship center, Ethiopia plans to tap its Information Communications Technology (ICT) ambitions on experiences from the likes of this entrepreneurial Chinese city.

The East African nation with a population of about 100 million, is focusing on labor intensive industries like textiles and leather to give its 45 million workforce mass employment while hoping ICT will give it a technological edge.

Already Chinese government is facilitating business capacity training and management skills to Ethiopian business community and experts.

It is hoped that this will help in fostering technological innovation and creative talent as a springboard for competitive export to the global economy.

Ethiopia hopes to transform its largely agrarian economy with manufacturing taking 50 percent share of GDP, creating annually 2 million job opportunity for youth.

"Ethiopia is at a crossroads between the Middle East, Africa and Asia giving access to wide market and huge human capacity as well as capable of creating large job opportunity," says Afework Solomon, President of Ethiopia's Chamber of Commerce and Sectoral Associations (ECSA).

Fitsum Arega, Commissioner of the state owned Ethiopian Investment Commission (EIC) points to another advantage the country has to attract Shenzhen investors.

"Ethiopia has constructed, is constructing or plans to construct 13 industrial zones across the country using Chinese expertise and companies for the most part," he says.

Arega also points labor cost being 10 times cheaper than Shenzhen, companies can invest in sectors like textile and apparel and be assured of good return on their investments.

Already Ethiopia gives a 10-15 years tax holiday on companies investing in its industry parks while giving access to duty free European and U.S. markets.

Arega further spoke about Ethiopia's ambitions in energy sector, requesting Shenzhen's experience in particular with solar and wind projects.

Ethiopia is currently undertaking large solar, wind, hydro and geothermal projects with a plan to increase its electricity generation capacity from current 4,200 MW to 17,300 MW by 2020.

While the first day of the trade and investment promotion meeting focused on hard statistics there was another reason, Ethiopian business people and officials welcome investment from Chinese cities like Shenzhen.

"Ethiopia feels at ease with Chinese businesses with China's economic achievement of becoming the world's second biggest economy in a short time being an inspiration," says Solomon.

That ease has translated into Chinese exports accounting for about 87 percent of Ethiopia's import in 2013.

It has also meant that between 1992-2014, 814 Chinese private companies' invested and commissioned projects valued at 1.6 billion U.S. dollars. Read more here

Ethiopian Air Said to Plan $3 Billion Deal for Airbus A350s

Ethiopian Airlines Enterprise plans to buy 10 of Airbus SE’s newest A350 wide-body jets in a transaction worth more than $3 billion at advertised prices, according to people familiar with the plan.

The deal is set to be announced this week at the Paris Air Show, according to the people, who asked not to be named as the order negotiations are private. Ethiopian will take the mid-sized A350-900 version of the plane, which has a list price of $311 million, according to one person.

Sub-Saharan Africa’s largest carrier already has an order for 12 -900 variants, though it has also been looking at the stretched -1000, as well as Boeing Co.’s rival 777-8, Chief Executive Officer Tewolde Gebre Mariam said last year.

Ethiopian Air wants more wide-body aircraft to help extend a hub-based business model that relies on transferring lucrative inter-continental travelers via its home base in Addis Ababa to and from destinations across Africa.

The airline didn’t respond to repeated calls and emails seeking comment. A spokesman for Airbus said it doesn’t comment on discussions with customers.

Ethiopian is separately weighing an order for Bombardier Inc.’s Q400 turboprop and C Series single-aisle jet against models from Embraer SA, it said in May.

Ethiopian Airlines Enterprise plans to buy 10 of Airbus SE’s newest A350 wide-body jets in a transaction worth more than $3 billion at advertised prices, according to people familiar with the plan.

The deal is set to be announced this week at the Paris Air Show, according to the people, who asked not to be named as the order negotiations are private. Ethiopian will take the mid-sized A350-900 version of the plane, which has a list price of $311 million, according to one person.

Sub-Saharan Africa’s largest carrier already has an order for 12 -900 variants, though it has also been looking at the stretched -1000, as well as Boeing Co.’s rival 777-8, Chief Executive Officer Tewolde Gebre Mariam said last year.

Ethiopian Air wants more wide-body aircraft to help extend a hub-based business model that relies on transferring lucrative inter-continental travelers via its home base in Addis Ababa to and from destinations across Africa.

The airline didn’t respond to repeated calls and emails seeking comment. A spokesman for Airbus said it doesn’t comment on discussions with customers.

Ethiopian is separately weighing an order for Bombardier Inc.’s Q400 turboprop and C Series single-aisle jet against models from Embraer SA, it said in May.

Read more here