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  • Can farming in Ethiopia be successfully commercialised?

    There may be a property and infrastructure boom in the Ethiopian capital of Addis Ababa, but more than 70% of Ethiopians still live in rural areas - farming grain and livestock.

    The government, with the help of international donors, is trying improve the country's farming sector, to boost production and put more farms onto a commercial footing - but there is still some way to go.

    The BBC's Lerato Mbele reports from the Ethiopian town of Wonji, just south Addis Ababa, for Africa Business Report.

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  • Ethiopia says China's ZTE could lose part of $800 mln in row over terms

    PARIS - Ethiopia has told Chinese telecoms firm ZTE Corp it risked losing part of its deal worth $800 million to expand the nation's network because of differences over costs of upgrading existing systems, an Ethiopian minister and executive said.

    The deal last year with monopoly state-run operator Ethio Telecom was part of a $1.6 billion package, split between ZTE and another Chinese firm Huawei Technologies Co Ltd [HWT.UL].

    The African nation of more than 90 million people wants to double mobile subscribers to 50 million in 2015 and expand its 3G service. The overall contract includes a plan for Huawei roll out a high-speed 4G network in Addis Ababa.

    "We have contractual issues unresolved," Communications and Technology Minister Debretsion Gebremichael told Reuters. "Swapping existing technology with no additional costs is one."

    He said Ethiopia's government expected the firms to upgrade existing equipment without extra charge, but added ZTE had said this would cost an additional $150 million to $200 million.

    "Discussions with Nokia and Ericsson is plan B in case it does not work out," the minister said in Paris, where he was attending a business forum.

    A source close to Nokia said last week that Ericsson and Nokia could be in the running to replace ZTE.

    ZTE officials had no comment when asked about a report on the dispute last week. Ericsson and Nokia officials had no comment when asked on Tuesday.

    The $1.6 billion contract was awarded under a long-term loan package to be paid over a 13-year period with an interest rate of less than 1 percent, Ethiopian officials said. Analysts said other firms might find it tough to match such terms.

    Ethio Telecom Chief Executive Andualem Admassie, who was also in Paris, said a decision was expected in a "matter of weeks" but said ZTE's contract would not be scrapped altogether.

    "There is nothing about ZTE being pushed out. They are going to continue, but they may lose some of their market share which was allotted before," Andualem said without giving details.

    "We approached two companies - Nokia and Ericsson. Possibly it is going to be Ericsson," he said, without offering details.

    Ethiopia has said it will not follow other African nations that in handing telecoms licences to private firms, saying the income generated helped finance railway and other projects.


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  • Ethiopian named African Airline of the Year

    Ethiopian Airlines, the largest and most profitable airline in Africa, is pleased to announce that it was named the African Airline of the Year by the African Airlines Association at its 46th Annual General Assembly held in Algiers between November 9-11, 2014.

    Ethiopian was crowned Airline of the Year for its exceptional results in 2013, consistent profitability, and sound strategy, which has enabled it to forge win-win partnerships with fellow sisterly African airlines. This is the third year in a raw that Ethiopian has continued to receive the award from AFRAA.

    Upon receiving the award, Ethiopian Group CEO Tewolde Gebremariam remarked: “We are highly honored for this recognition by fellow sisterly airlines in Africa. The award goes, first and foremost, to the more than 8,000 employees at Ethiopian, who work very hard every day to provide the best services on the ground and in the air to our valued customers. We also thank our customers for giving us the opportunity to serve them and for travelling on Ethiopian in great numbers. It is also a testimony of the soundness of our Vision 2025 fast, profitable and sustainable growth strategy.

    Although Africa is registering rapid economic and travel growth, this growth is primarily benefiting non-African carriers. The times are really challenging for African airlines, whose very survival is at risk, unless two things happen very quickly.

    Firstly, African carriers must look inwards in the continent to leverage on the available internal resources to create synergy through collaborative partnership among themselves. Today, Africa has world class Aviation Training Centers, MRO facilities and management expertise. I am convinced that there are ample opportunities for deepened commercial, technical and other types of partnerships among African carriers.

    Secondly, Africa must become one single unified market without any restriction for African airlines. The continued fragmentation of our skies is only benefiting foreign carriers and will lead to our certain demise. African governments must act now and fast to unify African skies, which would also give great impetus to the continent’s economic integration.

    Ethiopian is a global Pan-African carrier currently serving 84 international destinations across 5 continents with over 200 daily flights using the latest technology aircraft such as the B777s and B787s. In August 2014, it was also a recipient of the Passenger Choice awards as the Best Airline in Africa in the most extensive survey of passengers in the industry.

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  • Al-Amoudi Plans to Double Sales From Ethiopia Coffee

    Horizon Plantations Ethiopia Plc, majority-owned by Saudi billionaire Mohamed al-Amoudi, plans to almost double annual revenue at coffee projects within three years as part of a $500 million agricultural investment program.

    The company will spend $25 million to train workers, improve roads and replace washing units at the Limmu and Bebeka coffee plantations, which together have over 18,000 hectares (44,479 acres) under coffee, General Operations Director Kemal Mohammed said in a Sept. 17 interview in Addis Ababa, Ethiopia’s capital.

    The development is part of a five-year investment program in al-Amoudi’s agriculture projects, which also include Upper Awash Agro-Industry Enterprise, the country’s largest orange grower with 1,200 hectares of citrus, and the 10,000-hectare Saudi Star Agricultural Development rice farm, he said.

    “We are sure because of the initiatives we have now, because of the inputs and techniques we’re applying, the productivity will increase to the maximum at the end of the five years,” Kemal said about the coffee plantations.

    Ethiopia, Africa’s biggest coffee producer, may see earnings from shipments of Arabica coffee rise 25 percent to about $900 million in 2014-2015 as prices rise because of shortage caused by a drought in Brazil, an exporters’ association said last month. Horizon bought the two coffee farms for 1.6 billion birr ($80 million) last year from the Ethiopian government, which is seeking investment in projects that process agricultural products.
    Coffee Estate

    Bebeka, in southwest Ethiopia, is the world’s biggest unfragmented coffee estate with 10,030 hectares under plantation, according to the company’s website. It was established in 1975 when the former socialist government nationalized land and also produces black pepper, cinnamon, cardamom, ginger and turmeric.

    Limmu, 350 kilometers (218 miles) southwest of Addis Ababa in the Oromia region, has 8,000 hectares under coffee and produces 5,000 tons a year of the beans.

    Al-Amoudi, born in Ethiopia in 1946 to an Ethiopian mother and Saudi father, is one of the country’s largest foreign investors and operates its biggest cement factory and only large-scale gold mine. He also runs construction and oil operations in Saudi Arabia, Sweden and Morocco and is the 143rd richest person in the world with a net worth of $8.6 billion, according to the Bloomberg Billionaires Index.

    Investment in Limmu may help double production to about 1.5 tons a hectare by 2018, Kemal said.

    Bebeka Coffee Estate doubled production to about 1.4 tons of coffee last year, according to Kemal. Around 90 percent of the company’s coffee last year was directly sold to buyers in countries including the U.S., Germany, South Korea and Japan, Kemal said.

    Source: bloomberg

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  • Ethiopia: Boeing Aircraft Turned Into a Restaurant

    Ethiopian Airlines-owned property - a Boeing 737 aircraft - has been sold and turned into a hotel and restaurant business here.

    Guttama Gutta, the owner of the new aircraft hotel, told The Reporter that he invested some 30 million birr for the purchasing, refurbishing and decoration of the aircraft, which is now located in the town of Burayu, some 15 km west of the capital.

    Guttama said that he made the investment in the hope of creating a type of recreational center in Burayu. The construction and installation of the aircraft, and having it ready for catering services, took two years, Guttama said.

    When asked why he wanted to set up an aircraft restaurant in the town, he explained that his intention was to upgrade his previous business and by doing so the aircraft business came up. The engineless aircraft is said to provide both indoor and outdoor service where the Boeing 737 aircraft will host 60 individuals at a time for food and drinks.

    Guttama added that the restaurant will provide services for weddings, birthdays and meetings.

    Source: thereporterethiopia

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