September 23-29, 2024

Oromia Tourism urges removal of Travel Advisories; Khat revenues plummet; Corridor Development in Wollega & Demolitions in Shaggar; TPLF infighting continues; EOC charged with human trafficking.

Business & Finance

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• The inaugural conference of the Ethiopian Family Business Forum (EFBF) has identified weak governance structures, lack of formal succession planning & inadequate talent management practices as some of the main challenges hindering the continuity of Ethiopian Family Businesses (EFB). 

• A recent HST Consulting study found the average EFB lifespan to be 30 years, with political instability being a major cause of closure. 91% of inherited businesses crumble after the 2nd generation, while 6% reach the 3rd & just 2% reach the 4th. 

• Get-As International Plc, a recognized conglomerate under the family of business magnate Getu Gelete, is positioning itself to become one of the 3 pioneer non-bank foreign exchange bureaus.

• EthSwitch has reported a 251% increase in its fund transfer services, processing $270.7 billion over the last fiscal year. ATM transactions stood at $94.5 million, up 32% from last year, while POS terminals grew by 125% to $2.18 billion. The firm reported a gross profit of $1.05 billion & a 51% rise in card production.

• The Premium Switch Solution, co-owned by Awash, Hibret, Berhan, Oromia, NIB & Addis International banks, signed a deal with S2M to modernize electronic payments on Sept 24. Meanwhile, Zemen Bank has mobilized over $500 million in forex over the last fiscal year. 

• Anbessa International Bank reported remarkable growth over the last fiscal year despite significant challenges due to the 2020-22 war. Total deposits surged to 35.6 billion & forex earnings saw a 37% rise while overall capital grew by 20%.

• The Ethiopian Deposit Insurance Fund (EDIF) has issued a Sept 24 statement on its activities over the last year, reporting that 31 banks & 55 microfinance institutions have started paying the legally required annual premium. 

• Khat exports to Somalia have plummeted due to the effects of the Ethio-Somalia diplomatic fallout, as well as taxes levied by regional administrations. Revenues are down 55% compared to 2 years ago and 25% since last year. 

• Ethio Telecom announced plans to increase foreign remittances to 282.85 million, expand its mobile network by adding 1,298 new lines, and introduce other key initiatives during its annual budget meeting on Sept 19. 

• Ethio Telecom has officially launched a nationwide copper-to-fiber network switch-off initiative, enabling them to provide customers with significantly faster speeds and improved quality than the copper network. 

• The Oromia Tourism Commission has written a Sept 27 open letter urging the international community to “reconsider travel advisories on Ethiopia” as these can “harm the image of Ethiopia”. This comes despite 6 years of militarized conflict in the Oromia region, resulting in extensive civilian casualties, kidnappings, arbitrary arrests & a humanitarian crisis. 

• A local tour guide in Lalibela, Amhara region has reported an estimated 90% drop in tourist numbers due to the ongoing conflict, with serious financial consequences for those in the tourism sector. Meanwhile, Ethiopia has introduced a new Tourism Satellite Account (TSA) to quantify the sector’s contribution to GDP, investment & employment. 

• The Ethiopian Transport Providers Association issued a Sept 20 statement expressing concerns about the Ministry of Transport & Logistics (MOTL)’s decision to abruptly halt the operations of fuel-powered cross-border vehicles without conducting a study or offering alternatives to service providers, citing the government’s initiative to transition to electric vehicles (EVs). Cross-border drivers have also complained of arbitrary taxes and unnecessary fines imposed on vehicles operating outside of Addis Ababa. 

• The Industrial Parks Development Corporation (IDPC) is spearheading a restructuring that would enable IDPC to assume control of ailing manufacturing industries leasing space in state-run industrial parks. Under the reform, the IDPC will also transform into a Group following the decision to upgrade industrial parks into Special Economic Zones (SEZs). Learn more about industrial policy here. 

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Economy & Development

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• The IMF announced that it has reached a staff-level agreement with Ethiopian authorities on the 1st review of the country’s 4-year $3.4 billion Extended Credit Facility (ECF) program in a Sept 27 statement, allowing Ethiopia to access around $345 million in funding. 

• This  week saw sharp disparities in exchange rates among commercial banks. The spread between buying & selling rates varied widely, from as low as 3.4% to 16.5%, indicating inconsistent responses from banks to the new market conditions following the macroeconomic reform. 

• Public servants have expressed dissatisfaction over recent salary increases, highlighting that skyrocketing inflation & cost of living after the macroeconomic reform has made the wage increases redundant. Residents of the Afar region noted that stabilizing the market would offer more relief to low-income populations than raising wages. 

• The government aims to increase the capital of the Ethiopian Petroleum Supply Enterprise (EPSE) by ETB 120 billion, supported by the IMF, to mitigate the financial impacts of the macroeconomic reform and address significant debt. Learn more about the recent reforms in this interview. 

• The Ministry of Finance (MOF) issued a Sept 19 letter urging banks & insurance companies to contribute hundreds of millions of Birr to fund a Road Corridor Development Project (RCDP) in the Wollega zones of the Oromia region. NBE reported that it was not informed of the MOF’s request. 

• The government is considering importing fuel through Berbera port, Somaliland to mitigate chronic shortages, citing the reduced capacity of the Horizon fuel depot in Djibouti. Sidama regional authorities recently took action against those suspected of involvement in illegal fuel purchases in Hawassa city amidst a chronic fuel shortage lasting over a year. 

• A recent study by the Overseas Development Institute (ODI) has forecasted that the EUDR, set to take effect on Dec 30, 2024, will have significant economic repercussions for Ethiopia, warning that it could slash GDP by as much as 0.6%.

• Ethiopian and Chinese scholars have partnered to establish an advisory think-tank aiming to enhance trade, investment & industrial cooperation between the 2 countries, with the Africa-China Investment & Trade Facility center launched in Addis Ababa this week. Meanwhile, Chinese investors have urged the government to ensure a stable regulatory framework and improve bureaucratic processes to promote trust & encourage investment. 

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Society & Human Rights

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• The Ethiopian Center for Human Rights Defenders has expressed “deep concern” about the increasing harassment, intimidation and unlawful detentions faced by journalists & human rights defenders. Learn more about rising censorship in Ethiopia here.

• The Ethiopian Human Rights Commission (EHRC) released its quarterly report on Sept 25, revealing over 260 civilian casualties and widespread property destruction across 5 regions from June-Sept 2024 due to ongoing conflicts. EHRC has called for an immediate ceasefire to address the ongoing violence, while the US has urged the government & armed groups to cease targeting civilians. 

• EHRC has accused the federal government of ignoring the policy recommendations it has forwarded in a bid to avert the widespread human rights violations in the country, noting that violations continue to take place, particularly in the Amhara and Oromia regions

• A road accident involving a public transport vehicle traveling from Wolayta zone, South region to Dawro zone, Southwest region has resulted in 28 deaths, including 2 children. 

• The Meskel festival was celebrated on September 26 in Meskel Square, Addis Ababam featuring distinguished guests including Ethiopian Orthodox Patriarch Abune Mathias & President Sahle Work Zewde.

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Governance & Corruption

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• The Ministry of Trade & Regional Integration (MOTRI) has announced that it has established national standards for 6 categories of products to ensure consistency, accessibility, & quality at Sunday markets.  The 6 categories include vegetables, fruits, oilseeds, grains, animal products and industrial goods. 

• The Ethiopian Agriculture Authority has approved a directive to restrict the use of a range of veterinary drugs by prohibiting over-the-counter sales of drugs that can anesthetize or sedate livestock, newly introduced veterinary drugs, veterinary drugs containing new ingredients and hormones, and analgesic & sedative drugs.

• The government has expanded duty-free privileges to include imports brought in by the MInistry of Defense, Federal Police, INSA, and charity organizations under government supervision. In line with the proclamation, imports in the form of cash, silver, & gold through the NBE are also duty-free. 

• EthSwitch, a share company jointly owned by all Ethiopian banks, has announced the election of Solomon Desta, the Deputy Governor of the National Bank of Ethiopia, as the new Chairman of its Board of Directors.

• The Ministry of Education (MOE) has increased the school feeding quota per student from ETB 23 to 32 and added items like scrambled eggs to the menu to address rising market prices. However, some schools are reducing portion sizes & failing to adhere to menu guidelines. Learn more about the state of education & attempts to address rising unemployment in Ethiopia here & here. 

• Students and parents in various rural areas of the Amhara region have reported a significant decline in enrollment and chronic disruptions to education during the current academic year, with various schools closed due to security concerns as a result of ongoing conflict. 

• Residents and officials of Goro Dola woreda, Oromia region have announced the reopening of local schools that had been closed for the last year due to protests over the woreda’s inclusion into the newly-established East Borena zone. 49 schools were destroyed due to the violence. 

• The Road Corridor Development Project (RCDP) in Oromia’s Shaggar city surrounding Addis Ababa has led to the demolition of several homes and businesses without any compensation, leaving residents aggrieved. 

• Citizens that have been depositing money for over 21 years to buy condominiums through a lottery system have expressed their frustration as new housing units are instead being allocated to individuals displaced by urban development projects. Efforts to address this through appeals to the EHRC, Ombudsman & the Prime Minister’s Office have so far proven unsuccessful. 

• The government designated 14 routes exclusively for public transportation in Addis Ababa, in a bid to mitigate a significant rise in traffic following the reopening of schools this month. However, the decision was rescinded soon after and is now pending approval from stakeholders. 

• Public transporters in Addis Ababa are facing financial constraints following a recent MOTL order to transition from associations to share & private limited companies with stringent requirements and minimum vehicle quotas. The decision aims to modernize the city’s taxi fleet to improve quality & efficiency, but has failed to take into account financial & infrastructure constraints. 

• 4 leaders of the Ethiopian Olympic Committee (EOC), including President Ashebir W/Giorgis, have been charged with human trafficking and related offenses following the poor performance of the Ethiopian athletics team & accusations of corruption during the 2024 Olympics. Despite the mounting pressure, President Ashebir has confirmed that he has no intention of resigning. 

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Humanitarian Needs

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• WFP has highlighted that aid delivery could face further delays in the Amhara region due to security conditions and warned that millions will face severe food shortages unless it secures $341 million by Feb 2025. WFP plans to implement a new national strategy in mid-2025, focused on enhancing Ethiopia’s food system & supporting those who are most in need.

• IDPs sheltering in Gondar city have reported a lack of proper medical services at local hospitals, despite the receipt of medical supplies donated by the diaspora in Jan 2024. Residents reported serious medicine shortages and exploitative practices by doctors. 

• UNHCR has reported that 780 of the Sudanese refugees who were living along the road after fleeing their camps in the West Gondar zone, Amhara region due to repeated militant attacks, have been repatriated to Sudan and are receiving support there. Those who did not return to Sudan have been relocated to the Metemma refugee camps near the border. 

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Politics

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• The Tigray Interim Administration (TIA) issued a Sept 22 statement announcing that regional security forces would continue to operate under its command and emphasizing that the TIA & regional security forces would remain neutral amidst increasing tensions and infighting amongst the TPLF leadership.

• TPLF Chairman Debretsion G/Michael has issued a Sept 24 statement rejecting the TIA’s authority to command regional security forces, asserting that the TIA’s mandate is limited to administrative tasks and “does not extend to commanding regional security forces”. Learn more about the internal TPLF divisions & their impacts in this interview.  

• TIA President Getachew Reda and TPLF Chairman Debretsion have engaged in a series of public consultations in Tigray amidst increased TPLF infighting, with each aiming to sway the public towards their faction. 

• Opposition NAMA Spokesperson Dr. Desalegn Chane has called attention to the plight of Amhara prisoners of conscience & urged support for their families, highlighting that many have been arrested for over 2 years, resulting in significant financial burdens for their families.

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Conflict & Security

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• The Dessie City Administration in the South Wollo zone, Amhara region has announced the arrest of individuals suspected of kidnapping a 7-year-old & demanding a ransom of $700,000. 

• 3 civilians were killed in the Begi & Kondola woredas of the West Wollega zone, Oromia region on Sept 22, with residents & family members attributing the killings to “government forces.”

• Residents of Horro Guduru Wollega zone, Oromia region have reported significant transportation challenges due to frequent road closures and a shortage of transport options as a result of ongoing conflict in the area. 

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Geopolitics

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• Egypt’s Foreign Minister (FM) has expressed Egypt’s willingness to participate in peacekeeping missions in various African countries, including South Sudan, during a discussion with the US Secretary of State. This comes amidst increased regional tensions following Somalia’s order to expel Ethiopian peacekeeping troops & replace them with Egyptian troops. 

• The Egyptian Embassy in Somalia has warned Egyptian citizens in Somalia not to travel to Somaliland, citing the “unstable security situation in the region”. This follows recent comments by Somaliland denouncing the presence of Egyptian troops in Somalia following the Egypt-Somalia military defense agreement. Learn more here. 

• Witnesses reported that a ship loaded with military equipment, including weapons, has docked at the port of Mogadishu as per the Egypt-Somalia military defense agreement. The Ethiopian FM warned that arms shipments to Somalia “exacerbate fragile security” & expressed concern that the weapons “could end up in the hands of terrorists.” Somalia rejected this & accused Ethiopia of importing weapons into Puntland & violating its sovereignty. 

• The Ethiopian FM has expressed optimism regarding anticipated “positive outcomes” from the upcoming Nile Basin Summit, which is scheduled to be held in Uganda in Oct 2024 and is expected to pass a “historic resolution” that will enable the implementation of the Nile Cooperation Framework Agreement (CFA).

• The International Organization for Mediation, proposed in 2022 by China and 19 member countries from Africa and Asia including Ethiopia, has announced that its official launch will take place around the end of 2025. 

• A Sept 22 bomb attack took place in northern Pakistan in the presence of diplomats from over 10 different countries, including the Ethiopian Ambassador to Pakistan. The bombing resulted in 1 death & 4 injuries, with all the diplomats reported unharmed. 

• Ethiopians living in Lebanon have expressed concern about repeated Israeli strikes in the country, highlighting the plight of Ethiopian domestic workers and insufficient support from the Ethiopian Consulate in Lebanon. Other Africans in Lebanon have also expressed concern. 

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