On a dilemma in the Horn
Should the West go on helping a repressive Ethiopia?
Feb 22nd 2007 | ADDIS ABABA
THE second most populous country in Africa and one of the poorest, Ethiopia is a test case for the West in its efforts to eradicate extreme poverty on the continent. But its government's undemocratic leanings have presented donor countries with a dilemma. Should they continue to funnel their taxpayers' money to a country that routinely jails and tortures its critics or should they turn off the tap and thereby hurt the blameless poor?
Most donors are keeping up or even increasing their giving. Britain, with qualms, is upping its aid from $180m last year to $260m this year. Some donors have harmonised and even pooled their support. Many have signed up to schemes to promote transparency and hold the government to account. Whether the nastier bits of Ethiopia's government will co-operate fully is moot.
So the donors—Western governments and charities—think that on balance they should continue to improve farming, health care, education and access to water in the rural areas where 85% of Ethiopians live. There are signs that the government's ambitious poverty-reduction strategy is working. Infant mortality is down, school attendance and literacy are up, though only 40% of Ethiopians can read and write.
Eritrea's regional role The Economist
Farming practice may be improving. In Ethiopia's wet highlands farmers may try to diversify crops. Ethiopia hopes to export hydroelectricity to neighbouring Djibouti and Sudan. Some agronomists think that, with enough investment, Ethiopia will be able to feed itself. That may be optimistic. The population of 75m-plus is growing by about 2m a year. Food prices in Addis Ababa, the capital, rose last year by 27%.
In any event, Meles Zenawi's government is finding it hard to run the show. Some 80% of the people in Addis Ababa probably back opposition parties. In response, the government has become harsher, muzzling free speech and forcing independent newspapers to close. Many journalists are in jail on trumped-up charges. Dissidents have been disappearing, along with critical websites. Telephones are often tapped. For more than a year, text messaging on the country's small number of mobile phones has been hampered by “technical difficulties”.
The government keeps up a hum of fear with attacks on opposition supporters. Teachers are a favourite target. Some have been beaten so badly in detention they could not stand up in court. Even schoolchildren have faced the authorities' wrath. In Ambo, west of the capital, some 14 of them in a secondary school were detained; some were allegedly tortured. The usual charges, if brought at all, are sabotage or treason. Suspects are often “found” to have links with familiar bogeymen: neighbouring hostile Eritrea; the Oromo Liberation Front, a movement in the centre and south; or, in the heartland of the once-ruling Amhara around Addis Ababa, “terrorist groups” whose existence is fuzzy.
The opposition's lot may be worsening. Dissidents say as many as 250 supporters were rounded up on terrorist charges after the African Union summit last month; some have disappeared. The opposition's main leaders have been in prison for over a year. Torture, especially against lesser-known prisoners, is common. If rural areas are taken into account, extrajudicial killings may run into thousands. But the opposition is divided, often has regional rather than national allegiances, and tends to take its cue from radicals in exile.
Moreover, despite help from abroad, the economy is struggling. Exports are worth $1 billion against imports of $5 billion. Sales of coffee and flowers to the West have increased but not enough. Mr Zenawi has applied for membership in the World Trade Organisation. He has also asked China for loans—some say for $3.5 billion.
But most of all he is banking on keeping up his friendship with the EU and the United States, whose administration was delighted by the Ethiopian armed forces' recent success in invading neighbouring Somalia, capturing its capital, Mogadishu, and smashing the Somali Islamists who had taken over there. Still, there are conflicting attitudes to Ethiopia in Washington. Congress has lambasted Mr Zenawi's human-rights record and demanded cuts in aid. The Pentagon, on the other hand, is dead keen to boost his armed forces.
In September, hundreds of thousands of Ethiopians from their vast and far-flung diaspora are expected to visit their homeland to celebrate the coming of the third Christian millennium, according to their ancient church's calendar. Some hope Mr Zenawi, in a gesture of conciliation, will free some of his opponents from jail before then. But do not bet on it. Mr Zenawi has got used to wielding an iron fist.
Market approach recasts often-hungry Ethiopia as potential bread basket
The African nation produces more maize than neighbors Kenya, Uganda, and Tanzania combined.
By Scott Baldauf | Staff writer of The Christian Science Monitor
Source: The Christian Science Monitor
ADDIS ABABA, ETHIOPIA
Change: Eleni Gabre-Madhin will soon start up a commodities exchange.
Imagine if Ethiopia, that land of skin-and-bone children that defined African famine in the 1980s, could turn from the world's largest recipient of food aid into a bread basket, not only feeding itself, but its neighbors also.
It could happen.
Ethiopia actually produces more maize than east African neighbors Kenya, Uganda, and Tanzania combined, but since most Ethiopian farmers are subsistence growers, only 30 percent of that food actually reaches the market.
The quickest way to change this, says economist Eleni Gabre- Madhin, is to bring profit back into agriculture, to give Ethiopian farmers enough information so that they can grow what the world wants and get paid more for growing it.
"Ethiopia is the second-largest maize producer in Africa, and yet Ethiopian farmers are getting poorer and poorer," says Ms. Gabre-Madhin, the head of Ethiopia's soon-to-be-functioning commodities exchange. "We're going to have to do something very dramatically different. The stakes are high."
What Gabre-Madhin is proposing may sound grandiose – she wants to set up a commodities exchange, similar to the Chicago Board of Trade. But her free-market passion has convinced Ethiopia's left-leaning Prime Minister Meles Zenawi to make her proposal his top domestic priority this year. Most Ethiopians earn their livelihoods from agriculture, and anything that promises to increase incomes and help Ethiopia compete on the global stage is welcome.
"You can see in the world today that globalization is a trend, and Ethiopia cannot be a country outside the global effort," says Berhan Hailu, Ethiopia's minister of information. "The government has been following the free market since 1993-94, and now the government is taking concrete means to bring this about in agriculture."
There are 10 million farmers in Ethiopia, a country of 80 million, growing mostly cereals such as wheat, maize, sorghum, barley, sesame, and an Ethiopian grain called "teff." Yet, few farmers travel more than 12 miles from their homes in their lifetimes, so they have very little information about what their food would be worth if they did decide to sell it. When they do sell, they sell to a local trader, who then sells to another trader, and another, adding cost to the food when it finally reaches the consumer in large cities like the capital, Addis Ababa.
"The farmer doesn't know the price – he might get five cents here, but on the other side of the country, where there's a drought, he might get three times the price," says Gabre-Madhin. "So let's imagine the farmer goes to a warehouse where you have constant updates with the latest market prices. Now the farmer starts thinking nationally, not locally."
Similarly, traders in Addis Ababa would never buy product unless they saw the quality themselves. This is understandable. Some farmers have a nasty habit of adding dust and stones to their grain to increase the weight – and, thus, the value – of each sack sold. Under Gabre-Madhin's plan, each warehouse would have an independent neutral party that would test and grade the farmer's harvest, allowing traders in Addis Ababa, and potentially outside Ethiopia, to place bids on food, sight unseen.
Convincing farmers and traders to abandon the only system they've ever known will not be easy, of course. But by making the process of buying and selling food more transparent and predictable, everyone should benefit.
"As an investor, I need stability, and only a commodity market can offer that," says Guruprasad Rao, an agricultural commodities broker from Dubai, on a recent trip to Addis Ababa to buy sesame seed. "Whenever you have a lack of information, nobody knows the size of the crop. If everyone knows the size of the crop, they can predict prices better, and they can make better decisions."
Already, he sees farmers switching from their traditional crops to more profitable export crops. Over the past three years, sesame-seed production has risen nearly 200 percent, from 199,000 tons in 2001 to 380,000 in 2005, says Mr. Rao, even though sesame seeds are not used in local Ethiopian cuisine. All of it is destined for the Middle East. A commodities exchange will only accelerate this trend, he adds.
While most academics applaud Ethiopia's embrace of the free market, some say that there are no easy fixes for a landlocked country that lacks good roads, reliable electricity, and where there is little investment in irrigation for those years when the rain clouds don't provide.
"Ethiopia suffers routine market failures, so possibly this will help," says Ross Herbert, an economic analyst at the South African Institute for International Affairs in Johannesburg. "But the bigger problem is that there is too much peasant agriculture, and too few systems to overcome the vagaries of the weather, such as irrigation and better roads, adequate supplies of fertilizer, and so on."
Rod Gravelet-Blondin, the head of the agricultural-products division at the Johannesburg Stock Exchange, cautions that a commodities market will only work if it is actually used by the majority of the farmers and traders. "It will take time, but ... a market-based economy is a good place to start," he says. "I think Ethiopia looked at Asia and said, 'Those guys got it right, they managed to turn their economy on its head through developing their agriculture.' "
For her part, Gabre-Madhin says she considers her project "a calling."
"Can we pull this off? I believe we can," she says. "This is not just a couple of years of my life. It's a mission."
Ethiopian Airlines records half bln profit in six months
By Eskinder Michael
Addis Ababa, Ethiopia Ethiopian, the nation’s flagship carrier, announced that it has recorded over half a billion birr in profits in the first six months of this fiscal year.The 505 million birr profit recorded in the six months exceeds that of last year’s by 141 million birr or 39%, a growth attributed to a more conventional approach to its performance.
Ethiopian won the African Airline of the year award last fiscal year and carried 1,093,729 passengers. This figure, when compared to the number of passengers in the first six months of last fiscal year shows a 21% increase. The airline can boast an increased and encouraging profit record this season as it has been competing with international airlines such as Emirates, British Airways, Turkish Airways and others.
fiscal year that Ethiopian introduced a 10.5 million USD passenger management system called the Sabre Sonic Passenger Solutions technology platform, SABRE. After signing the deal, Ethiopian stopped using the SITA system. The airline currently uses Sabre Sonic reservations, online booking, e-ticketing, code-sharing and departure control systems. It has also started using the Sabre Traveller Loyalty System frequent flyer management product and the Sabre Air Price fares management system. Though there were some delays in serving customers when the SABRE system was launched, the system seems to have become well integrated in the airline’s daily routine.
Ethiopian is Africa’s aviation pioneer and has recently embarked on an ambitious expansion program. It will also be Africa’s launch customer for the new Boeing 787 Dreamliner in 2008. CEO Girma Wake was quoted as saying that Ethiopian plans to expand significantly over the next five years and needs to up grade its marketing, operational and decision-support systems. Sabre Airline Solutions Passenger Management System Portfolio will play a key role in harnessing Ethiopian’s growth plan. Ethiopian Airlines is expected to sign a partnership agreement with Lufthansa this week. When the agreement is signed, the two airlines would strike a partnership on code sharing procedures, which have been under negotiation with the two parties for a long time.
According to the financial report of the enterprise, the airline secured a net profit of 277 million birr in the year 2003, from a net profit of 79 million birr in year 2002. For the period June to December 2005, Ethiopian recorded a 208 million birr profit before tax, registering a 19.9% increase in revenue at a time when many airlines around the world were filing for bankruptcy. The operating costs of the airline for the same period have shown an increase of 21.9% to 2.4 billion birr. Ethiopian Airlines has become one of Africa’s largest airlines 60 years after its establishment and is still expanding. With the construction of a new Cargo Terminal and the order for ten Boeing 787 Dreamliner jets, which will be delivered from 2008 on, the carrier is getting prepared for a splendid future in air transport both in passenger and cargo services.
MP arrested over alleged rape case
By Eskinder Michael
Addis Ababa, Ethiopia Yitayew Tiruneh, CUD Member and Member of Parliament was arrested on Wednesday February 14, 2007 at the Kirkos Sub-City Police Station after being indicted for alleged rape. Yitayew was stripped of his immunity when the House of People’s Representatives convened last Tuesday February 6, 2007. The House stripped Yitayew of his immunity after it had received complaints that the MP had allegedly raped a 15-year-old girl.
His immunity was revoked so that he could be tried for the rape case only. His immunity against being prosecuted for other cases still stands. The MP had voiced his concern over the allegation saying that it was some sort of attack on his status. It was stated that the accused entered the house of the victim located in the Kirkos Sub-City Kebele 02 at 8:00 in the morning and allegedly performed the act.
The victim had reportedly presented a letter to the HPR saying that he hadn’t raped her, but so far the letter hasn’t worked in his favor. Ato Worku, another MP, contested the decision by the parliament saying that the victim was actually not 15 years old, but 18 and that she had been married while living in rural Ethiopia. He also said that this was supported by a police report.
Software giant SAP to enter market
By Tedla Yeneakal
Addis Ababa, Ethiopia Sap AG, the world's largest enterprise software company officially announced that it is eying the Ethiopian market after its announcement on Tuesday this week to contribute 100 thousand Euros to be put towards school lunches for children. Serge Blockmans, general manager, SAP East Africa and Democratic Republic of Congo, told Capital in a telephone interview from the United States that they had seen a growing interest when company officials paid a visit to study the Ethiopian market.“We see a growing public interest and the social contribution SAP made this week is part of our first global responsibilities,” he said. “Practical experience of academic concepts enhances educational experiences and helps students put theory into modern business practice.
”According to a press release from SAP, it is investing in two education initiatives to support capacity building through the SAP University Alliances Program to provide the Mekelle Institute of Technology and Addis Ababa University with supporting materials and training as well as SAP’s global network of academic researchers on IT topics. Blockmans further said that the alliances program enables university faculty to employ SAP’s enterprise software within their own curricula for business stimulations, case studies and research projects. “Both universities will be connected to the University Competency Center in Magdeburg, Germany, which will provide hosting services, technical assistance, training courses for professors and curriculum development support.” the release from the company said.
More over, Blockmans told Capital that the school feeding support is made through the World Food Program’s Food for the Children initiative and SAP is funding daily free lunches for impoverished communities with the aim of inspiring them further in their education. SAP is one of the world’s leading providers of business software and operates in more than 120 countries engaged in high tech, retail, financial services, healthcare and the public sector with subsidiaries in more than 50 countries.
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