Posts filed under ‘investment’
Ethiopia brand featured in Milan
One of the new Pinko Bags with an Ethiopian flare.
By Getachew Teklu
An Italian fashion and bag designer has launched a series of bags with what has been described as an Ethiopian flare. The move at Milan’s Studio Giangaleazzo Visconti on Thursday night, saw Pinko unveil six Ethiopian versions of its signature cotton Pinko Bag.
More than a hundred women in Addis Ababa, about 65 of whom were recruited and trained especially for the project, produced the eco-friendly, 100 percent cotton Pinko Bag for Ethiopia collection, and the results of their efforts are in the Italian brand’s stores now at 58 euros (about $76) per bag, the company said.
The idea has been praised by women here in Ethiopia, who told Bikyanews.com that they are pleased that “we are a part of the fashion world and the price is not so bad that even we might be able to buy one some time.”
Halle Desa, 33, said she believed the concept of eco-fashion was something that “should really pick up in the future because it can really help to be a global thing for us here in Africa and the West.”
Marina Spadafora, the collection’s creative director, said she drew inspiration from colorful body-painting traditions in southern Ethiopia’s Omo Valley, and cited photographer Hans Silvester’s work as a resource. “I’ve been working on sustainable fashion for years,” she said, “and finally here was a chance to use Ethopian art.”
Ethiopia produces first military drone aircraft
A US military drone (Source: CIA)
By Tesfa-Alem Tekle
February 14, 2013 (ADDIS ABABA) – An Ethiopian military source has told Sudan Tribune that the country has built the first unmanned aerial vehicle (UAV) or drone which could be used for multiple purposes.
A US military drone (Source: CIA)
After undergoing testing, the locally made drones, have demonstrated their capability of performing a number of militarily and civilian applications, according to the source.
Speaking on condition of anonymity from the country’s air force base in Debrezeit town, a military official told Sudan Tribune that the drones are equipped with onboard sensors, cameras and GPS to carry out cost-effective monitoring activities even across difficult landscapes like the highlands of Ethiopia.
Besides serving in a number of military missions – such as in monitoring border security – the UAVs will also be deployed to perform geophysical surveys, assist forest protection and monitor forest fires or other natural disasters.
The drones have already made test flights performing a geophysical survey of Ethiopia’s controversial grand renaissance dam, a massive hydro-power plant project the country is constructing on the Blue Nile River near to the Sudanese border.
In recent years, many African countries have shown growing interest in using drones as a cost-effective way to control huge infrastructure facilities, as well as areas rich in natural resources such as oil, mine and gas sites.
In 2011 Ethiopia signed an agreement with Israeli manufacturer BlueBird Aero Systems to purchase drones.
Binyam Tekle, a lecturer and researcher at a government university, says the development of indigenous drones is a great achievement for Ethiopia and will help strengthen the national army.
Due to Ethiopia’s long and fragile borders with Eritrea, Somalia, Kenya, Sudan and more recently South Sudan, he said it is timely for the country to use UAVs to monitor these shared and often tense and porous zones.
“With Eritrea-backed rebels and Somalia’s al-Qaeda linked al-Shabaab terrorists repeatedly posing threats to national security, using UAVs will be crucial for Ethiopia to avert planned attacks,” he told Sudan Tribune.
Ethiopia is a key regional security partner to the United States particularly in the war on terror due to its proximity to Yemen and Somalia.
In 2011, the Obama administration launched a drone base in Ethiopia for counter-terrorism operations in the Horn of Africa, particularly to attack al-Qaeda affiliates in Somalia. Earlier this month, it was revealed that the US has had a drone base in Saudi Arabia, with its existence kept secret by the US media in collusion with the Obama administration.
In recent years, Ethiopia has made tremendous achievements in the defence sector by managing to manufacture its own military equipment and defence systems.
On Thursday, Ethiopia marked its first ever Defence Force Day under the theme “Our constitutional loyalty and public nature would be preserved”.
A defence exhibition was staged in the heart of the capital, Addis Ababa, demonstrating the level of progress the nation has made.
Light and heavy modern weapons, as well as different vehicles manufactured by the army-run automotive industry were also displayed at the exhibition.
Government officials said that Ethiopia has built a defence force capable of breaking any internal or external enemy.
The Horn of Africa nation has one of the strongest army and air forces on the continent and often contributes troops to United Nations peace keeping missions.
Ethiopia spends around 2.4% of its GDP on the military.
Source Sudan Tribune
Ethiopia’s soleRebels footwear brand takes on the Asian market
Bethlehem Tilahun Alemu, founder and CEO of soleRebels
BY Kate Douglas
Ethiopia’s soleRebels footwear company that has received an immense amount of international attention, was recently featured in the December edition of the Chinese Vogue magazine alongside well established brands such as Armani, Chanel, Gucci and Valentino. This comes at a time when soleRebels is positioning itself strategically for expansion across Asia.
The company, which opened its first Taiwan store in Kaohsiung last month, has just unveiled its second store in the city of Taichung. “The city is incredible, a must go tourism destination in Taiwan,” said Bethlehem Tilahun Alemu, founder and CEO of soleRebels. “The crowds in the area where we are located are fantastic. Additionally Taichung is also a footwear epicentre, home to the Asian design centre for the planet’s largest footwear brand (Nike). It’s probably one of the most visited and watched footwear hubs in Asia.”
Alemu said that the response to both stores has been positive and the environmentally friendly soleRebels brand is regarded highly in the market. “[Taiwan] is one of the top 10 footwear markets in the world,” added Alemu. “Plus it is a gateway market into further Asian expansion including China where we plan to open stores in 2013. We feel very strongly that Taiwan is the perfect place for soleRebels to anchor our Asia wide roll-out.”
SoleRebels, which is the world’s first fair trade certified footwear brand, is also opening its third store in Taiwan this week in Pingtung City. “This opening is even more significant as it puts us well on the way to our goal of 30 soleRebels stores in Taiwan by 2015,” she told How we made it in Africa.
In addition, the company is also expected to soon launch stores in Singapore, India, Malaysia and Indonesia. “We feel strongly that there is immense potential for the brand all over Asia and Southeast Asia and so it’s natural for us to be in these markets,” continued Alemu. “In the United States we will roll out quite a few locations in 2013, beginning with our flagship New York City store.”
Having started in 2005 with just five employees, the company is expanding fast and creating jobs both locally and globally. “We are adding thousands of domestic, full-time, creative and well paid jobs over the next 36 months,” she said. “Through our store openings we will also create 600-800 global jobs by 2016.”
The company is planning on building a new factory in Ethiopia, replacing the current facility. “It allows us to continue to grow community employment to new heights as there will be many new jobs created when this facility is operational,” stressed Alemu.
SoleRebels predicts its global retail roll-out to add over US$15-20 million in revenues by 2015, and by 2020 Alemu aims to have over 150 retail stores worldwide. For more info visit: http://www.solerebelsfootwear.co/
How Africa’s first commodity exchange revolutionised Ethiopia’s economy
By Lauren Everitt
While government leaders, NGOs and corporations devise strategies to churn out more food for future generations, Eleni Gabre-Madhin is taking a different approach. Concerned by a 2002 famine in her home country of Ethiopia that followed bumper crops in 2000 and 2001, the Stanford-educated economist decided it was time to go beyond food production and take a hard look at distribution.
The result? Africa’s first commodity exchange. As the founder and outgoing CEO of the Ethiopia Commodity Exchange (ECX), Gabre-Madhin established a reliable interface for buyers and sellers to meet – an idea that has inspired other African countries to follow suit. Gabre-Madhin won the Yara award at the African Green Revolution Forum in Arusha, Tanzania, for her role in transforming Ethiopia’s commodity market.
What prompted your decision to found Africa’s first commodity exchange in Ethiopia? I had been doing research on grain markets and other agriculture markets in Africa for many years and, as it happened, I did my PhD on grain markets in Ethiopia. One of the things I kept seeing over and over, which I’d seen in other parts of Africa, was just how difficult it was for buyers to find sellers and sellers to find buyers, and how difficult it was to enforce the contract.
You’d see that a seller, such as a farmer, for example, who sold grain to a trader wouldn’t get paid for weeks, sometimes months. There were cases in the coffee market in Ethiopia where people had committed suicide because they had outstanding loans and their buyers hadn’t paid them. So there were all sorts of cases of contract default.
Then from the buyers’ perspective you’d hear that they’d have to inspect the grain or coffee visually to check if it was really the quality they’d been told it was. They would have to reweigh it and rebag it to see if it was the actual quantity and quality that they were contracting.
So these are all the problems in the supply chain that make us poor and make us food insecure. If people can’t get grain where it’s produced really efficiently to where it’s needed, then you have markets that are segmented. You have pockets of surplus where prices collapse and places in other parts of the county where prices shoot up because there’s a deficit and there’s no grain coming in.
That’s exactly what happened in 1984 in the big famine that claimed a million lives in Ethiopia. There was obviously a shortage in the north and yet Ethiopia had to go to the world and beg for food aid, but there was a grain surplus in the fertile parts of western Ethiopia.
When I found out about this, I said: “It can’t just be about producing more – sure, producing more is important but we’ve got to figure out how to distribute it. We’ve got to figure out how to make an efficient market work for everybody – for the farmers, for the buyers, because otherwise we’re always going to be in this cycle.”
The same thing happened in 2002, when there were consecutive bumper harvests in 2000 and 2001, and Ethiopia was doing really well. Then six months later prices collapsed almost to zero, and farmers could not sell the grain. Six months later, in mid-2002, Ethiopia went to the world for emergency food aid for 14 million people at risk of starvation.
I was so shocked. By that time I had my PhD and I knew this was what I wanted to work on. I had the idea of a commodity exchange – I’d written about it in my dissertation. I did my PhD at Stanford, which is really specialised on commodity markets.
What other sorts of dialogues are ongoing about distribution? Now, there is more interest in markets and issues around distribution. In the Ethiopian debate about food security and famine, people would always say, “More seeds, more fertiliser, more irrigation – these are the things we have to do.” And yes, we have to do all that, but then here you are – you get a bumper harvest and six months later people are still going to starve.
Every crisis leads to an opportunity so that crisis led me to tell the government: “We have 40 or 50 PhDs in economics working on production issues, and four of us have written PhDs on market issues, and that’s how skewed our development policy is – we’re always talking about production and we have to have a more balanced perspective on how we’re going to prevent hunger in Ethiopia, and we have to think about the marketing side.” That somehow resonated, and the government decided to start up a whole initiative on markets. That’s how I got invited to start the project on the commodity exchange and subsequently left the project and then started the exchange.
Has the idea of a commodity exchange gained traction elsewhere on the continent? Around Africa, our exchange in Ethiopia has gained a lot of visibility: 18 countries have come to visit it. There has been a huge amount of interest. Many countries are writing it into their policies – that they want to have a commodity exchange. Organisations like the UN Food and Agriculture Organisation, New Partnership for Africa’s Development, UN Development Programme, the World Bank – all these organisations are now sort of saying, we have to take this seriously, and help countries think through initiatives like the Ethiopia commodity exchange.
As the outgoing CEO of the exchange, what will you do next? I’ve seen this enormous demand, and that’s going to be my next chapter – to sponsor that demand, which in a sense has been created by the initiative in Ethiopia. I feel this is the natural next step for me.
And how will you do that? I’m setting up a company that will carry out precisely this kind of project for different countries, bringing in knowledge, technology and management experience. At this point, there are about six countries, I would say, that are moving quite aggressively on getting commodity exchanges set up in Africa, and that’s really exciting.
You have talked about a disconnect between buyers and sellers – how does a commodity exchange address that and hold both parties accountable? Basically, it’s a membership-based system. We have members of the exchange that buy a membership seat, just like Charles Schwab and Merrill Lynch are seat holders on the New York stock exchange or Cargill is a member on the Chicago board of trade.
When you buy a membership seat, you use that seat to trade either on behalf of yourself or clients, who you may sign up. We have members of the exchange who trade on behalf of farmers, who themselves are farmers, and members who are buyers, such as industrial processors, flour millers, exporters, roasters, etc.
The members follow the rules of the exchange in the sense that they will bring a commodity to our warehouse, get it graded, certified, weighed and essentially stored in a warehouse that we are operating. This means we have a guarantee that we know what the quality is, we know what the quantity is and we know it will be delivered at sale.
On the buying side, we have a clearing house that takes the buyer’s funds into a pre-trade cash account that is used for exchange trading purposes. The exchange has no involvement besides providing the platform for the buyer and seller to physically or virtually meet, and once they’ve agreed on the terms of the price and what the quantity is, then our clearing house will take the funds from the buyer from that pre-trade cash account and transfer it to the seller the next day. Also the next day, we will take the warehouse receipt from the seller and transfer the ownership to the buyer. So the exchange is the third-party guarantor of the transaction, and that’s the key point.
Having a guarantor for the transaction means you don’t need relatives or special connections. You don’t have to beg people to pay you or chase after them. You don’t have to check if the quality is really grade one. The exchange is guaranteeing the quality, quantity, payment and delivery. That’s a very big value-add proposition to the market – that if you trade through the exchange, you will receive payment the next morning.
That means we are a “T+1″ clearing and settlement system; the day of trade being “T”. T+1 means that tomorrow morning you’re paid. Even stock exchanges that have been around for 20 years are still taking two or three days after trade to effect payment. We’re settling the next day. This is a financial revolution in Ethiopia – that somebody who sold is guaranteed payment the next day, especially when you imagine how many people have committed suicide or spend a large part of their time trying to get paid.
This is a very big change in our market – that people can go to market saying, “I’m going to sell at whatever price I want, and I will get paid.” Same thing for the buyers: “I will get my delivery, I will get my commodity when I want it, not months later.”
There are exporters who used to default on their export contracts because the supplier had not yet met their contract. Or processors, like millers, who would get a delivery but it would be full of sand or stones. They’d put it in their machines, and their machines would break down. All these problems are not going away because of our system.
The smallholder farmer was the theme of the African Green Revolution Forum. Are they able to access the commodity exchange easily? In our exchange, 12% of the members are farmer co-operatives that are representing 2.4 million small farmers in Ethiopia. That’s a massive number in just four short years and relative to the amount of investment. Millions and millions are being spent on linking farmers to markets, and here with less than $10m we’ve accessed 2.4 million farmers in four years.
More importantly, even if they don’t trade directly through the exchange, because of the transparency around the pricing, all the farmers in the country are now using the ECX price as the reference price. There are 15 million coffee farmers in Ethiopia, for example, and they are referencing their local market sales off the ECX price. This basically means that the margin between the local price and the ECX price has narrowed almost by half. So if a trader knows what the central market price is, but the farmer doesn’t know, the trader will try to bring it down. Even if the prices are going up, the trader is buying at the lowest possible price to get a big margin – that margin has shrunk down to half of what it used to be because of the transparency of the system and because everybody’s using the same system.
We’re getting 1.2m calls a month for market prices off the market data server, of which 70% come from rural areas. When the Tanzanian president, Jakaya Kikwete, came to ECX in May, he asked a trader who was part of our meeting, how do you negotiate with the farmers? How do you set prices with the farmers? And she looked at him and said: “Mr President, even if I wanted to cheat farmers I can’t, because they know the prices before I do.”
Source: The Guardian
IMF says economy to grow 7 percent
By Aaron Maasho
(Reuters) – Ethiopia’s economy is expected to maintain a growth rate of 11 percent in 2012/2013, newly-appointed premier Hailemariam Desalegn said on Tuesday, predicting a slump in crippling inflation rates that have plagued the country in recent years.
“Our economy has grown by a growth rate of over 11 percent in the past few years and we estimate this rate to be maintained this fiscal year,” he told lawmakers on Tuesday during his first appearance in parliament as the country’s leader.
The International Monetary Fund in June raised its economic growth forecast for Ethiopia to 7 percent from 5.5 percent owing to slowing inflation.
Official estimates have tended to be generally higher than the Washington-based body’s growth projections.
Hailemariam was sworn in last month after his long-standing predecessor Meles Zenawi died from illness in August.
Under Meles, the Horn of Africa nation embarked on ambitious infrastructure projects to improve its economic competitiveness, including a multi-billion dollar plan to scale up energy generation.
Inflation, however, soared during his last four years in power, peaking at 64 percent in July 2008.
The rate slowed to 19 percent last month from 20.2 percent in August, helped by a slowdown in the rate of food price rises.
“We have managed to lower inflation by subsidising oil and wheat. We will work to raise agricultural productivity, subsidies and savings to reduce the inflation rate to single-digits this year,” Hailemariam said.
The IMF has said tight monetary and fiscal policies have contributed to declining inflation, through the termination of central bank financing of the budget and significant sales of foreign exchange.
The body warned Ethiopia last year that excessive monetary growth was the principal cause of its rising inflation, while private bank lending restrictions and a tricky business environment would slow economic growth.
High coffee earnings in the past few years have also boosted the economy of Africa’s biggest coffee producer, as have rising gold, oil seed and livestock exports.
Ethiopia is the world’s fourth-largest sesame exporter after China, India and Myanmar. (Editing by Yara Bayoumy)
The World Bank has approved US$ 1.15 billion interest-free credit to help Ethiopia
The Bank approved a four-year country aid strategy which aims to improve the service delivery within the state institutions. This was endorsed by the World Bank’s Board of Executive Directors in New York, US.
The latest loan facility accounts for nearly a third of Ethiopia’s annual aid package of US$ 4 billion a year.
“The new Country Partnership Strategy (CPS) for Ethiopia seeks to build on the development progress over the last five years of its previous strategy and to help its government and communities go further to enhance growth, more jobs, better health and education, and significantly less poverty,” the Bank said in a statement.
The interest-free credits would support key services to poor people across the country. The Bank said the funds would help to further develop road networks to help promote better regional trade and internal travel.
Bank officials said following the approval, it agreed to mobilize US$ 600 million in development financing for the third phase of the Promoting Basic Services (PBS III) programme, which serves nearly 84 million people in Ethiopia.
Guang Zhe Chen, Bank’s Country Director for Ethiopia, said the anti-poverty plan will continue to contribute to Ethiopia’s rapid progress towards achieving most of the Millennium Development Goals, by providing funding for crucial staff to help to improve key services such as education, health, food production, water and sanitation.
“Promoting improved access to quality, decentralized basic services is also central to the core elements of Ethiopia’s new CPS,” the Bank official added.
The plan is co-financed by the Government of Ethiopia, the European Union, the UK Department for International Development, the African Development Bank, Italy and Austria.
Launched in 2006, the programme has helped hire over 100,000 new primary school teachers at the district level; more than 38,000 health extension workers nationwide; and some 45,000 agricultural extension workers.
The programme has also promoted transparency and citizen engagement by posting its budgets and performance score-cards in 84% of its operating districts and encouraging greater social accountability.
Donors praise Ethiopia for its ability to help reduce its under-5 mortality rate from 123 per 1,000 live births in 2005 to 88 per 1,000 live births in 2010.
The Bank said it would support the Government’s impressive progress in expanding the road network; the Ethiopia Transport Sector Project will invest US$ 415 million to upgrade five main roads that will play an important role in supporting economic growth in Ethiopia over the medium to long term.
The roads project will help provide better access for industrial, agricultural and tourism developments, and will also provide improve access for beneficiaries in the project areas to essential services.
Source World Bank
Ethiopia Sugar Signs $500 Million Deal With China’s CDC Bank
Ethiopia Sugar Corp. said it’s signed agreements with state-owned China Development Bank Corp. for $500 million in loans to build two refineries, part of a plan to boost output of the sweetener almost tenfold by 2025.
Ethiopia’s Finance Ministry and the state-run sugar company have signed memorandums of understanding with the Chinese lender for loans to build the plants in Ethiopia’s South Omo Zone, Sugar Corp. spokesman Yilma Tibebu said in an e-mailed response to questions on Sept. 24.
China Development Bank has advanced $123 million for a factory in the northeastern Afar region, he said. The factories will be built by the Ethiopian state-owned Metals and Engineering Corporation, an amalgam of former military companies. China Complant Group Inc. is also working on the Afar project, Yilma said.
Last year, Ethiopian Sugar started building 10 cane plantations and factories with the goal of making the sugar-importing Horn of Africa nation one of the world’s 10 biggest exporters of the sweetener by 2025.
The building program will cost “close to 100 billion Ethiopian birr ($5.5 billion),” with about half required in foreign currency, said Asfaw Dingamu, Ethiopian Sugar’s deputy director-general for the legal and communications department.
Seeking Loans
“We’re looking for loans,” he said a Sept. 22 interview in the capital, Addis Ababa. “We’re negotiating with Chinese banks.”
Ethiopian Sugar plans to provide about 40 percent of the money through sugar sales, with the rest of funding to be equally split between Ethiopian state banks and external lenders, he said.
Sugar Corp. generated 3 billion birr in profit from existing factories and sales of imported sugar in the year to July 7, Asfaw said. The government plans to increase production to 2.3 million metric tons of cane by 2025, and the country produced 265,000 tons last year, he said.
It spent 12 billion birr over the past two years on design work, irrigation infrastructure, roads and worker housing, he said. Ethiopian Sugar will need 100,000 workers to operate six plantations being set up in South Omo, Asfaw said.
A delayed sugar project at Tendaho in the Afar region will be producing at 30 percent capacity in January, Asfaw said. The factory is being built by India’s Overseas Infrastructure Alliance with a $394 million loan from the Export-Import Bank of India.
To contact the reporter on this story: William Davison in Addis Ababa at wdavison3@bloomberg.net
To contact the editor responsible for this story: Antony Sguazzin at asguazzin@bloomberg.net
The Ethiopian Billionaire: Sheikh Mohammed Al Amoudi
Sheikh Al-Amoudi made his fortune in Saudi Arabia, but he remains intensely loyal to the country of his birth- Ethiopia.
Mohammed Al-Amoudi is literally a man of many parts; born in Ethiopia to an Ethiopian mother and a Yemeni father, Al-Amoudi grew up in Saudi Arabia, yet he is the largest individual investor in Sweden.
To date, Al-Amoudi still remains intensely loyal to his Ethiopian roots, and his multi-billion dollar investments in Ethiopia’s agricultural sector illuminate his devotion to the African country of his birth. But his fame and extraordinary fortune is not in Ethiopia, but in Saudi Arabia and Sweden.
When he was 19, Al-Amoudi migrated from Ethiopia to Saudi Arabia with his family. In Saudi Arabia, the young Al-Amoudi built a personal relationship with the Kingdom’s ruling family. As a result, in 1988 he cornered an important contract to build the Saudi government’s $30 billion nationwide underground oil storage complex. That contract cemented his fortune and instantly made him a billionaire.
Al-Amoudi eventually returned back home to Ethiopia in the mid-1980s and founded Mohammed International Development Research and Organization Companies (MIDROC), a diversified holding company which he used to gobble up gold mines from the government at a fraction of their real market value. Today, MIDROC Gold is Ethiopia’s exclusive gold exporter. One of its mines, called Legedenbi, has annually produces close to 5,000Kg of gold and silver.
Apart from mining, Al-Amoudi invested in several other sectors of the Ethiopian economy. He built the Sheraton Hotel in Addis Ababa, which is the country’s foremost 5-star hotel. He acquired 70 percent of Ethiopia’s National Oil Corporation and founded Tossa, Ethiopia’s first industrial steel production plant, which is expected to produce at least 1.9m tonnes of steel per annum as from 2014.
Al-Amoudi’s other holdings in the country include a 69 percent stake in Addis Tyre, Ethiopia’s sole manufacturer of Tyres; Saudi Star Agricultural Development Plc, which is developing 1,200,000 acres of Ethiopian land for the production of rice, sugar, wheat and other commodities.
The bulk of the Sheikh’s business success has also been built around Sweden. In 1994, Al Amoudi spent $750 million in acquiring Sweden’s largest integrated energy company, OK Petroleum, and subsequently renamed the company Preem Petroleum. He invested heavily in extending the capacity of its refineries, substantially increasing the number of its gas service stations around the country and acquiring more deep offshore assets.
In 1999, Al-Amoudi’s Swedish-registered investment company, Corral, acquired a controlling interest in two Moroccan oil refining companies- Samir and SCP. Al-Amoudi merged the two companies and further invested half a billion dollars in modernizing the plant. Today, Corral is the undisputed market leader in Morocco’s Energy sector, both in distribution and refining.
Al-Amoudi’s empire built around construction, mining and oil employs over 40,000 people in Sweden, and the man who many love to refer to as ‘The Sheikh’ has given away millions of dollars to philanthropic causes in religion, sports and education in Ethiopia, the United States and Saudi Arabia.
In July 2010, he financed the creation of the Sheikh Mohammed Hussein Al Amoudi Center for Breast Cancer Research at King Abdulaziz University in Saudi Arabia. He is also one of the largest donors to the William J. Clinton foundation, and has fully funded the King Abdullah Institute for Nanotechnology at King Saud University.
About
Sheikh Mohammed Hussein Ali Al Amoudi (Ge’ez: ሞሓመድ አልአሙዲ, Arabic: محمد حسين العمودي; born 1946 in Dessie, Ethiopia but grew up in Weldiya) is a Saudi Arabian /Ethiopian business magnate who lives in Ethiopia and Jeddah, Saudi Arabia. In 2006 his net worth was estimated as between $2.5 and $6.9 billion, causing Arabian Business to rank him as the world’s 8th richest Arab, and Forbes to rank him as the world’s 77th richest person. Al Amoudi’s father is Yemeni and his mother is Ethiopian. He immigrated to Saudi Arabia in 1965 and became a Saudi citizen. Depending on disparate ethnic categorizations, and Al Amoudi’s mixed Ethiopian and Yemeni parentage, he is considered to be the richest black person in the world and/or one of the richest Arab.
Al Amoudi made his fortune in construction and real estate before branching out to buy oil refineries in Sweden and Morocco. He is said to be the largest foreign investor in both Sweden and Ethiopia. He holds an Honorary Doctorate in Philosophy from the Addis Ababa University and has been honoured with the Swedish RoyalOrder of the Polar Star by King Carl XVI Gustaf of Sweden.
Source: Ventures Africa
China brings jobs to Ethiopia but at what cost?
By James Melik
While Europe is struggling with recession, it is a very different story in Africa where the continent overall is expected to enjoy growth of 6% in 2012.
But there is concern that the fruits of economic expansion and foreign investment are not being evenly shared around.
One example of Chinese investment is a shoe factory just south of the Ethiopian capital Addis Ababa, on a huge industrial site known by locals as China Town.
Two production lines make 2,000 pairs of shoes every day for global brands, including Guess and Tommy Hilfiger.
Despite perks such as the factory having its own canteen and tennis courts, and the workers being supplied with their own uniform, the workers often receive a wage which is only a fifth of what a worker in an indigenous factory would receive.
Delivering skills
The shoe factory is run by the Huajian Group, whose vice president Helen Hai says that instead of receiving higher wages, the workers are trained in shoe-making skills.
“I took 86 Ethiopian graduates to China to teach them how to make shoes,” she says. She is adamant that after their training, workers can choose to remain or to work for other shoe factories.
“We offer tennis courts, uniforms, food – and in the future we will also offer free accommodation,” she says. “And we are also in the process of applying for a Fairtrade certificate as we definitely treat our workers fairly.”
She adds: “In the past China has given a lot of money to African countries, but now we want people here to have the capability to make goods themselves – that is why training is always the core in our strategy.”
Local sourcing
Shoe manufacturing has something of a tradition in Ethiopia, and another smaller factory is run by Bethlehem Tilahun Alemu.
“I wanted to show that it is possible for a local person to be globally successful,” she says, “And that is exactly what we have done.”
It is a powerful idea which has provided an example for many young women and men in Ethiopia.
Her Sole Rebels company employs 75 people, making the soles of shoes from recycled car tyres and the uppers from Ethiopian spun cotton.
“The culture of recycling has been in Ethiopia for a long time, and recycled tyres have long been used for shoes,” she notes.
She explains how it is her ethos to employ local people, and says that 99% of the shoes they produce are exported.
“This is a local grass-roots business that we built from scratch. We have a brand and authenticity,” she says.
She is also proud that her company is certified as Fairtrade.
“We pay our people four or five times what other people are paying,” she says, adding that she is not worried about her workers getting trained and then going to work for Chinese factories – because they will not get paid as much.
Local attraction
Helen Hai says the Huajian Group plans to invest $2bn (£1.3bn) in Ethiopia for a variety of reasons, including Ethiopia’s “good economic policy”.
Its competitive labour in the global market was also an attraction – compared with China, it is one-seventh cheaper to employ someone in Ethiopia.
The good supply of raw materials – leather for making shoes – and its good geographic location, allowing easy access to Europe and the rest of Africa, were also factors.
“We signed an understanding with the Africa Development Fund,” she says.
“We will jointly invest $2bn in the next 10 years – which will create job opportunities for 100,000 people.”
She maintains that the biggest challenge for investing in Ethiopia is that people are not familiar with doing international business, although she is confident that will change over time and her company is working closely with the government to solve that issue.
Investment encouraged
Long-time Africa campaigner Sir Bob Geldof says people should not worry about Chinese investment in Africa and rebuffs the idea of economic colonialism.
“China is not interested in that. Africans are not going to go through that kind of experience again, ever,” he says.
“Shut up, get down here, get on with it and it is mutually beneficial. You can talk about what sort of government works best, about values, about rights.
“Those things are being talked about. When they are ignored, there is no growth, just instability, war and hunger.”
He further maintains that democracy is not a prerequisite for growth.
“How do we know that? Look at Singapore or China. Business leaders there work with whatever government they have to – their job is to create business.”
Ethiopia shoe factory widens footprint of China in Africa
DUKEM, Ethiopia–A steady drone of machines hum as workers assemble shoes in a Chinese-built industrial park outside Addis Ababa, the first in Ethiopia by the Asian giant deepening its presence in Africa.
A handful of Chinese supervisors at the Huajian factory watch hundreds of Ethiopian workers trim leather, glue soles and lace up boots in the Eastern Industry Zone in Dukem, 30 kilometers (20 miles) south of the Ethiopian capital.
It marks a shift in China’s traditional investments in Africa, which mainly involve heavy infrastructure development and oil production, while for Ethiopia it offers an alternative to export of unprocessed raw materials.
“The two sides have a commitment, they say ‘you should have something, I should get something,’” said Qian Guoqing, the deputy director of the Eastern Industry Zone.
Huajian, one of China’s biggest shoe manufacturers, plans to invest up to US$2 billion (1.5 billion euros) in Ethiopia to make shoes for export to Europe and North America.
Construction of the industrial park started in 2009, and rows of three-storey green and yellow buildings now stand on a patch of the expansive land. The government says it plans to build five more industrial zones throughout the country to attract further foreign investment.
When completed in 2014, the US$250 million project will host over 80 factories and create 20,000 local jobs. Currently six Chinese-run factories operate in the zone, including a car assembly plant and a plastics factory.
However, analysts say large-scale investment in Ethiopia has risks and its financial benefits are still uncertain.
“It’s not a risk-free strategy and it’s not necessarily clear that it will work,” said Stefan Dercon, development economist at Oxford University.
“The Chinese … take the opportunities now in Ethiopia where they make the trade-off between very high rewards. That’s pretty risky in the first few years of doing this, and we’ll have to wait and see.”
To minimize risks and attract investors, the Ethiopian government is offering four-year tax breaks, cheap land and free electricity to investors in the industrial zone.
But challenges abound: foreigners complain of poor telecommunications, overbearing bureaucracy and the absence of a port in the landlocked Horn of Africa country.
Cultural differences, the language barrier and a poor work ethic among the locals also pose hurdles, said Paul Lu, Huajian’s human resource manager, but noted that the availability of labour and raw materials were key attractions.
“We came to make shoes and we had to consider the resources — Ethiopia is very rich in leather,” said Paul at the factory’s entrance, where about two-dozen people were waiting for job interviews.
Source China Post
