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Ethiopia world's second most expensive place to get a fixed broadband connection

You think your broadband fix is expensive? Think again.

A report released by the International Telecommunications Union (ITU) reveals that, Ethiopia has the second most expensive fixed broadband service anywhere in the world. A broadband service taken for granted in much of the developed world would literally cost, an arm, a leg and some in Ethiopia. According to ITU figures, it would cost nearly 21 times the average monthly salary in Ethiopia.

The most expensive place for broadband is Central African Republic. Ethiopia which has recently been ranked as the second poorest country behind Niger has one of the lowest mobile and internet subscribers ratio in the world. According to world internet users, less than 1 percent of Ethiopians use internet.

More than five years has passed since Meles Zenawi promised universal internet access in Ethiopia within three years. The country has a shameful record in almost all ICT indicators.

Read related story from BBC News

Six Arrested in Japan for Involvement in 2008 Citibank Scam of Bank of Ethiopia

NTDTV

On Thursday, Japanese police arrested six people who were allegedly part of a multi-million dollar scam. $27.2 million was illegally transferred from the National Bank of Ethiopia account at Citibank in 2008.

The arrested suspects were three Nigerians, two Japanese and one from Ghana.

Sources say the six are suspected of money laundering approximately $6.5 million of the funds wired from the $27.2 million scammed from the Citibank account in the United States.

U.S. prosecutors said that in October 2008, the suspects made a total of about 24 wire transfers amounting to almost $27.2 million to various accounts they controlled in Japan, South Korea, Hong Kong, Australia, China, Cyprus and the United States.

Sources say most of the $6.5 million transferred to the Japanese accounts have been withdrawn, although it's not known at this time where the money has gone.

From September through November of last year, the suspects sent fake-signed documents to Citibank appearing to match signatures of officials at the National Bank of Ethiopia.

Ethiopia denies rebels chased oil, gas firms away

* Petronas has not pulled out of Ethiopia, minister says

* Govt negotiating deals with three more oil and gas firms

By Barry Malone

ADDIS ABABA, Sept 2 (Reuters) - Rebel claims that Malaysia's Petronas has stopped oil and gas exploration in Ethiopia are lies and three more firms are in negotiations to start exploration in the country, its mines minister said on Thursday.

Ogaden National Liberation Front (ONLF) separatists and local media said state-owned Petronas had pulled out of the Horn of Africa nation after a gas field it was exploring was overrun by the militants in May.

"The rebels took no gas field," Mines and Energy Minister, Alemayehu Tegenu, told Reuters in an interview. "That didn't happen. Petronas have not ceased operations. They have just suspended work to evaluate their portfolio."

Petronas have yet to comment on the reports.

The ONLF is fighting for independence for the mainly ethnic-Somali Ogaden and has warned international oil and gas companies to stay away or face attack.

Firms including Petronas and the Vancouver-based Africa Oil Corporation are exploring the Ogaden for potential oil and gas reserves. Twelve foreign mineral firms are exploring Ethiopia for deposits.

Apart from a small discovery of natural gas, which Petronas has signed a $1.9 million deal to extract, Ethiopia has not uncovered significant oil or gas deposits.

The government says the Ogaden basin may contain gas reserves of 4 trillion cubic feet and points to oil-producing neighbours such as Sudan and Yemen as evidence there could be major oil deposits under Ethiopia's vast deserts.

Alemayehu said Ethiopia was secure and the government was negotiating new exploration licenses with three foreign firms. He did not name them.

'OUR MILITARY IS IN CONTROL'

"We have no complaints from companies exploring here about our security," the minister said. "We have secured them. Our military is in control."

Alemayehu also said peace negotiations with one faction of the ONLF were at an advanced stage. ONLF spokesmen have denied a deal is imminent.

The Ethiopian government has reported some skirmishes with the rebels in the past six months, but regular accusations from both sides are hard to verify. Journalists and aid groups cannot move in the area without government escorts.

Ethiopian forces launched an assault against the ONLF -- who have been fighting for more than 20 years -- after a 2007 attack on an oil exploration field owned by a subsidiary of China's Sinopec Corp, Asia's biggest refiner.

"Since that attack, we have secured the area," Alemayehu said.

A British geologist was shot dead in the Ogaden last July while working for IMC Geophysics International, subcontracted to Petronas. The ONLF denied involvement and the government said 'bandits' were responsible.

Analysts say the rebels are incapable of ousting the government but can hamper development and weaken security forces in the Ogaden with hit-and-run attacks. (Editing by George Obulutsa and James Jukwey)

Ethiopia rejects dam criticism, targets 10,000 MW

By Barry Malone

ADDIS ABABA (Reuters) - Ethiopia on Thursday rejected criticism of its massive hydropower dam projects and vowed to push ahead with plans to boost its power generating ability from 2,000 MW to 10,000 MW within five years.

The Horn of Africa nation's ambitious dam building programme has drawn fire from human rights groups as well as from Egypt and other Nile River countries.

"We have a plan to reach 10,000 MW within the coming five years," mines and energy minister, Alemayehu Tegenu, told Reuters in an interview.

"Most of the energy we plan to generate will come from hydropower."

Ethiopia is overwhelmingly reliant on dams for its energy needs and has opened three over the last year, bringing the total number in the country to seven.

Another two are being built, including the huge Gibe III -- a project that foreign charities say could leave more than 200,000 people reliant on food aid.

Rights groups, spearheaded by Survival International, have started an online campaign against the dam, which would generate 2,000 MW, and are lobbying international lenders not to contribute to its 1.4 billion euro cost.

"These organisations do not want Ethiopia to develop," Alemayehu said.

"Criticising countries like Ethiopia is their source of income. They have no reason to attack our dams. We have environmental and social plans in place."

The European Investment Bank (EIB) said last month that it had decided not to help fund the project but did not say why it had made that decision.

Alemayehu said it was possible the EIB had been pressured by rights groups.

"But I don't know their reason," he said. "It's not a big problem for us. We have other options. And the funding at the moment is coming from our government."

"NO NILE WAR"

Ethiopia's hydropower plans are also closely watched by Egypt and Sudan who fear more dams on Ethiopia's stretch of the Nile could leave them thirsty.

After more than a decade of talks driven by anger over the perceived injustice of a previous Nile water treaty signed in 1929, Ethiopia, Uganda, Tanzania, Rwanda and Kenya signed a new deal in May without their northern neighbours.

The five signatories have given the other Nile Basin countries -- Egypt, Sudan, Burundi and Democratic Republic of the Congo -- one year to join the pact but the countries have been split by behind-the-scenes rows since the signing.

Under the 1929 deal, Egypt, which faces water shortages by 2017, is entitled to 55.5 billion cubic metres a year, the lion's share of the Nile's flow of 84 billion cubic metres. Some 85 percent of the Nile's waters originate in Ethiopia.

The nine countries are due to meet again in the Kenyan capital Nairobi in November.

"What we will construct on the river will never cause any problems for the Egyptians," Alemayehu said. "But the Egyptians always stand against Ethiopian development. They need to understand better what we are planning."

Alemayehu, however, ruled out the possibility that war could erupt over the Nile.

"That will never happen," he said. "Never."

Ethiopia plans to export power to neighbouring Sudan, Djibouti and Kenya as soon as it meets its own growing energy needs, Alemayehu said.

Ethiopia rationed power for five months this year with outages every second day, which closed factories, hampered exports and fuelled a currency shortage.

"We should have no need to ration power in 2011 with our new dams," Alemayehu said. "We are now building interconnectivity infrastructure with Sudan and Djibouti and that should be finished within six months."

Power demand in Africa will rise by 150,000 MW between 2007 and 2030, according to the International Energy Agency.

Ethiopian birr devalued, IMF welcomes move

By Barry Malone

ADDIS ABABA (Reuters) - The Ethiopian birr was devalued by 16.7 percent on Wednesday, according to exchange rates published on the central bank's website, a move welcomed by the International Monetary Fund (IMF).

The birr was quoted by the National Bank of Ethiopia at a weighted average of 16.3514 against the dollar compared with 13.6284 on Tuesday. A central bank official confirmed the new rate but was not authorised to make further comment.

"The IMF welcomes this move given it will help bolster Ethiopia's competitiveness," IMF representative in Ethiopia, Sukhwinder Singh, told Reuters. "It will need to be supported by appropriate monetary policy."

Last month, the government unveiled an ambitious five-year economic plan which targets average annual economic growth of 14.9 percent over the period and aims to end the Horn of Africa nation's dependence on food aid.

Ethiopia is Africa's biggest coffee exporter and the world's fourth largest exporter of sesame. It is also one of Africa's biggest potential markets -- with a population of 80 million -- and most of its people have no telephones or bank accounts.

The devaluation is the Horn of Africa nation's fourth since January 2009. Devaluations can spur economic growth and reduce current account deficits to the extent they boost exports and discourage imports, although they carry the risk of importing inflation.

'DEPRECIATION LIKELY TO CONTINUE'

"I think it's related to the new five-year plan and a strategy of export promotion and import substitution," Tewodros Mekonnen, an economist with local think tank, the Ethiopian Economic Association, told Reuters.

"Obviously there's a risk it could cause inflation. It will probably also boost foreign direct investment and remittances."

Inflation in Ethiopia hit a high of 64.2 percent in July 2008.

After that peak, the government halted state borrowing and increased bank reserves to drive down the rate.

The country's central bank also instructed private banks to restrict borrowing.

The inflation rate slowed to 5.7 percent in July.

"Years of high inflation have eroded the country's export competitiveness, and the government has continually favoured sharp currency depreciations to counteract this," Joseph Lake, an analyst at the Economist Intelligence Unit, told Reuters.

"Though inflation has eased in recent months, this pattern of currency depreciation is likely to continue. Low levels of foreign exchange reserves, and twin fiscal and current-account deficits will continue to put pressure on the currency," Lake said.

The country -- one of the world's biggest recipients of foreign aid -- is keen to attract foreign investment in agriculture and mineral exploration.

Ethiopia has operated a managed floating exchange rate regime since 1992.