2merkato

The government of Ethiopia has reached an agreement with the Export-Import Bank of India (Exim) for a 91 million dollar loan to fund exports and consultancy services for the development of the country's sugar industry.

The loan went in to effect as of 21 May 2011 and the agreement was executed as of February 18, a statement from the Reserve Bank revealed.

The agreement concluded on 18 February 2011 is for funding eligible goods and services, including consultancy services, machinery and equipment from India for the purpose of financing the development of the sugar industry in Ethiopia.

About 75 percent of the goods and services, including consultancy services, from the credit provided under the agreement, have to be sourced from India according to the press release.

Source: Economic Times

Wednesday, 15 June 2011

Ethiopian Airlines said that it started again flights to neighbouring Djibouti which had been temporarily suspended because of ash cloud from a volcanic eruption in Eritrea. The ash cloud has cleared. 

Flights to some cities in northern Ethiopia like Mekele, Gonder, Axum and Bahir Dar, and Khartoum, the capital of Sudan, remain suspended, the airlines said today.
The volcanic eruption which caused the temporary suspension of flights to destinations in northern Ethiopia occurred early Monday morning at Dubbi, 350 km north of Asmara, the capital of Eritrea.

Ethiopian Airlines had to cancel flights as reported here due to the volcanic ash.

Source: Bloomberg

Wednesday, 15 June 2011

Culture and Tourism Bureau of the Southern Nations, Nationalities and People's State said it had collected over 71.6 million birr income from tourism.

Mikias Israel, deputy head of the bureau said yesterday that the 71.6 million birr was obtained from 403,470 local and 72, 537 foreign tourists who visited attraction sites in the region over the last nine months.

Mikias said the amount of the income obtained and the number of tourists who visited the region over the last nine months had increased by 56 percent and 45 percent respectively, in comparison with the same period the previous year.

Expansion of infrastructures such as road, telecommunications, electricity and tourists' facilities as well as extensive promotion made by the bureau contributed to the income and increase in number of tourists, he said.

The region is rich with sites of natural and historical attraction like crocodile ranches, hot springs, caves and waterfalls among others and Mikias said the Bureau was doing its best to exploit these.

Source: Walta Information Centre

Wednesday, 15 June 2011

The Endowment Fund for the Rehabilitation of Tigray (EFFORT) is preparing to establish a factory for the production of PVC raw materials at a cost of two billion birr. The factory will be set up near Mesobo, Tigray Regional State, an area endowed with large limestone deposits.

Currently, about 40,000 metric tons of raw materials are imported for manufacturing PVC products in the water development and the construction sectors. The company aims to reduce the flight of foreign currency by supplying the demand for the raw material.

Sources say that the factory will use Chinese technology, though it has made no official announcement regarding its decisions. The formation of the company, supervised by Ezana Mining Development (another EFFORT company), is not yet complete.

This factory will become the fourteenth EFFORT company next to Mesfin Industrial Engineering, Mesobo Cement Factory, Sur Construction, Baba Dimensional Stone, Trans Ethiopia, Express Transit, Guna Trading, Addis Pharmaceuticals, Sheba Tannery, Hiwot Agriculture, Almeda Textile, Experience Ethiopia and Ezana Mining Development.

Source: The Reporter

Tuesday, 14 June 2011

Seacom Ltd., a company that operates a fibre-optic link in East Africa, said it was planning to extend the cable into Burundi, Southern Sudan and Somalia in cooperation with partners as demand for internet services continues to grow.

"We would like to expand our footprint," Julius Opio, the company's regional head, said. But he refused to give more details.

Opio said that the first country to be linked to the cable would be Brundi once it has installed 1,300 kilometres (810 miles) of fibre network next year. The cable would then be extended to Southern Sudan within a year of its independence, scheduled for July 9. Over the following two or three years, the cable will be extended to Somalia, he said.

The company currently has fibre-optic links in Djibouti, Ethiopia, Kenya (where its east and north African office is based), Rwanda, Tanzania and Uganda, Opio said.

Source: Bloomberg

Tuesday, 14 June 2011

Over 4.4 million dollars was obtained from the export of 14,000 kg of opal over the last 11 months, the Ministry of Mines announced today.

According to the Ministry, compared with the volume opal exported and the amount of money earned from the same mineral last year, the income earned over the reported period has registered a significant increase.

Ethiopia has been exporting opal to over 27 countries including the United States, India and China which are its leading customers.

Between 2008 and 2009 Ethiopia had made about 241,564 dollars and 1.2 million dollars exporting 656kg and 100,000kg of opal respectively, the Ministry said.  

Source: Walta Information Centre

Tuesday, 14 June 2011

The 97 megawatt Amerti-Neshi multipurpose hydroelectric power project is going to start generating electricity with one of its two 48.5 megawatt turbines becoming operational in a week's time. The other turbine is scheduled to start operation on 15 September 2011.

The dam was built on the Neshi River, five kilometres from where it joins the Amerti River, both of which feed into the Finchaa River which flows out of the Abay River. The dam's reservoir started collecting water on 22 July 2010 and can hold 448 million cubic metres.

Construction on the dam was started by China Gezhouba Group Co (CGGC) in September 2007, nine months after the signing of the project contract.

The construction was estimated to cost around 137 million dollars according to Ministry of Water and Energy. Out of the total cost of the project, 85 percent of the funding was acquired in a loan from the Chinese Export-Import (Ex-Im) Bank, while the balance was supplied by the Ethiopian government.

The project includes the installation of a 241 km transmission line at a cost of 445 million birr.

Additional dams planned to be constructed over the coming five years include Gibe III which will generate 1,870MW of electricity, and Genale Dawa III and Genale Dawa VI which will generate 254 megawatt, and 246 megawatt, respectively, all in the Southern Nations Nationalities and Peoples Regional State.

Geba I and Geba II, with the capacity to generate 215 megawatt and 157 megawatt, respectively are in the Oromia Regional State.

In addition, in Amhara Regional State there are the Chemoga Yeda I and Chemoga Yeda II projects which will generate about 162 megawatt and 118 megawatt of electricity respectively.

Source: Fortune

Tue Jun 14, 2011

Allana Potash Corp said it found a new high-grade potash zone in its property in Ethiopia, driving its shares up by 12 percent.

The company said that results from drilling in Hole 19 at the company's Dallol property in Ethiopia's north eastern Danakil Depression yielded over 61 percent of potash over 0.90 metres. That was by far the highest grade potassium chloride (KCl) Allana had come across, Dundee Securities said in a note to clients, and rated the company as their "top pick" among small potash explorers.

The company said Hole 12 yielded 22.3 percent potash over 6.8 metres. About 90 percent of potash produced is used as fertilizer, known as potassium chloride. Demand for fertilizers like nitrogen, phosphate and potash has grown dramatically.

Alana has at least 16 drill holes which will be considered for the resource update in the company's upcoming technical report.

Dundee said that Allana would have a large resource upgrade and would be able to produce at exceedingly competitive operating costs.

At present, Allana Potash Corp has estimated resources of 105 million tonnes and "will have a significant upwards revision once the updated NI 43-101 technical report is prepared and completed over the coming five to seven days, the brokerage said.

The potash mineralization in the Danakil Depression is well known, with mining carried out sporadically from the early 1900s. Other mining corporations in the basin include BHP Billiton and India's Sainik Coal Mining, which is planning to start mining at the Musley deposit.

Source: Reuters
 

Monday, 13 June 2011

The annual rate of inflation in Ethiopia rose to 34.7 percent in May from 25.6 percent in April as food prices climbed, the Central Statistical Agency (CSA) said today.

Food prices increased 41 percent in the year, compared with a 32.2 percent increase in April, it said.

According to IMF, one of the major causes of inflation in Ethiopia is "excessive" growth in the supply of money, which expanded 35 percent at the end of March. The IMF had previously predicted an increase of 22 percent in money supply in the current fiscal year.

The government, however, says that high international prices of commodity are responsible for the increase in inflation. Global food prices hiked in nine of the last 11 months, reaching a record in February, amid decreasing grain supplies and rising demand, according to the United Nations.

The price of oil has hiked due to unrest in the Middle East, but after the region stabilizes, prices in Ethiopia will drop, Hailemariam Desalegn, Deputy Prime Minister said on June.

The negative real interest rates that have resulted from rising inflation are discouraging a necessary boost to Ethiopia's national savings rate, the country director of the World Bank in Ethiopia, Ken Ohashi, said on June 7.

Ethiopia may find it difficult to sustainably finance its five year growth plan unless it increases its savings from the current official rate of 5 percent of gross domestic product, Ohashi said.

The IMF predicted on May 31 that Ethiopia’s growth rate might fallfrom 7.5 this year to 6 percent in the fiscal year to July 7, 2012, partly due to inflation. The government's forecast for the current fiscal year is 11.4 percent. However, Hailemariam said that the government would achieve its growth targets, Hailemariam said.

Source: Bloomberg

Roads Authority Requests 20 bln birr

Monday, 13 June 2011

The budget earmarked for the 2011/12 fiscal year is over 100 billion birr, sources at the Ministry of Finance and Economic Development (MoFED) said. The draft budget proposal was scheduled for submission to the council of ministers last week.

The 2011/2012 budget is 20 billion birr more than the current fiscal year's budget.

About 45 billion birr of the total is set aside for regional states as a budget subsidy which was allocated by Prime Minister Meles Zenawi. The regional states will use 70 percent of their share of the budget for road construction projects to connect 18,000 districts throughout the country except those in Dire Dawa and Addis Ababa.
The road construction in the districts is estimated to cover about 76,000 kilometres, the Ethiopian Roads Authority, which was entrusted to survey the projects, has in and of itself requested a budget of 20 billion birr from the federal government. If the request is granted, about 50 billion birr will be spent on road construction alone in the coming fiscal year.

About 35.9 billion out of the current fiscal year's budget of 77.2 billion birr went to capital projects while 24.2 billion was allotted as budget subsidy for regional states, and 17.6 billion was set aside for ordinary expenses. However, an additional seven billion birr was approved when finances ran short in the middle of the year.

Source: The Reporter