AFRICA'S PRIDE

PENRESA FOCUS ON ETHIOPIA SEPTEMBER 2019 EDITION

Sahle-Work Zewde Abiy Ahmed Yinager Dessie Dagmawit Moges

Breaking Through Barriers And Forging

A New Ethiopia

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thiopia’s new Prime Minister, His Excellency Abiy Ahmed, has made bold moves since obtaining office. “If you want to go fast, go alone,” he says. “If you want to go far, go together.” By embracing gender parity and appointing a new gender-balanced cabinet and Ethiopia’s first female president, Mrs Sahle-Work Zewde, Abiy Ahmed has made a monumental step forward for Ethiopia. On gender inclusion, President Zewde said: “It is very important for a woman to believe there is nothing she cannot do. Africa has really wonderful women to be celebrated. As Africans, we cannot be satisfied with what we have because we are not there yet. We need more women.”

The new Prime Minister and President represent hope for change. The youth of Ethiopia are impassioned with the belief that they can and will make a difference.

Abiy Ahmed said, “The young generation of today should repeat the victory of Adwa by defeating current challenges and barriers.” Gender is no longer one of those barriers. Abiy Ahmed said of women: “Under numerous difficulty and trying conditions, you have built Ethiopia; you have made history; shaped generations; and brought us to this day. In your struggles, you have huge sacrifices so that we have a better country.”

In pursuing progress, the government has enacted Phase II of the Growth and Transformation Plan, which aims to convert Ethiopia from a poor, agricultural state to a middle income, industrialised economy by 2025. Ethiopia is the second most populous country in Africa with over 100 million people. In 2017, its GDP expanded by 10.9% and is expected to grow by 8.5%, positioning Ethiopia as one of the fastest growing countries in the world.

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As new Prime Minister Abiy Ahmed breaks through the patriarchal structures of the past, his focus on Ethiopia’s strengths will take the country to the future.

ETHIOPIA - Africa’s Pride

Sahle-Work Zewde, Ethiopia’s first female president

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www.penresa.com info@penresa.com This report is sponsored and produced by PENRESA and did not involve the reporting and editing staff of any third party.

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Much of the growth that the country has enjoyed stems from the agriculture sector, the country’s strongest industry.

Eighty-five percent of Ethiopia’s workforce consists of agricultural workers. Although a profitable sector, Abiy Ahmed has bigger plans. “Even though the progress being made in the agricultural sector is encouraging, we have failed to sufficiently support this sector with the necessary technology and as a result failed to collect the dividends that we were supposed to get from it as a country.”

For this reason, the GTP II is focused on combining agriculture with the rapidly growing manufacturing sectors through mechanisation. “Mechanisation lets you scale up your farming,” says Oumer Hussen, Minister of Agriculture. “In that regard, we are using the Agricultural Transformation Agency, which is introducing new technology for the sake of mechanisation. This will let us evolve from the traditional way of farming.”

The telecom sector has also experienced incredible progress in recent years.

Frehiwot Tamru, CEO of Ethio Telecom, knows the importance of communication in an expanding economy. She states, “Telecommunication has a significant social, cultural and economic impact on modern society. It is fundamental for the economic development of any nation. I believe that the telecom market reform is to bring about economic growth of the country.” Ethio Telecom currently has 2G coverage in 85% of the country, 3G coverage in 22%, and select coverage of 4G

in Addis Ababa, with plans to expand their networks toward 5G in the future. These statistics make Ethiopia among the leading countries in the continent in the telecom sector. Dr Ing. Getahun Mekuria, Minister of Innovation and Technology, states, “as a government, we see [the sector] as a very good environment for creating jobs and wealth because it will unleash the power of the service industry. The GDP coming from technology will be huge.”

With the economy positioned to improve in the coming years, the finance sector is poised to ensure that investors are in the right hands. Ethiopian Insurance Corporation brings peace of mind and leads the insurance market with 43 years of experience, 1,500 employees and 102 branches in the country. CEO of EIC Netsanet Lemessa states, “we are financially strong. We are planning to invest more than ETB 200 million for IT infrastructure and software development.” In addition, Awash Bank has worked diligently toward economic growth in Ethiopia for the past 25 years.

Recognised as the fastest growing private bank in Ethiopia, Awash Bank works to service individuals, businesses, corporate customers and the public at large through its 400 branches, ATMs and especially through its dedication to financial inclusion.

In working with the telecom sector, Awash Bank has made mobile and Internet banking more accessible and easier to use.

Enormous opportunities across various sectors in the country are garnering attention from investors worldwide. Abiy Ahmed says, “due to the fast growth that our country has achieved over the past years, our successes in poverty alleviation; in building basic infrastructure; in human resource development and the like are visible for everyone. In this regard, the government has taken policy and practical actions to contain price inflation; to stabilise the foreign exchange market; to keep the heath of the financial sector; to expand the reach and access of financial services needed for the economy; to generate foreign currency; to encourage savings and investment; to create employment opportunities; to increase the per capita income of the people as well as to reduce abject poverty.” The GTP II envisions 11% average annual economic growth with an improved trade balance and higher foreign reserves. “The Prime Minister is working hard. He wants to bring change here,” states Tsehay Shiferaw, CEO of Awash Bank. “Within the next few years, Ethiopia will be changed. Look at the economic growth. The country is moving.

The leadership is committed and strong and dedicated. Everything will come.”

Enhancing the ease of investment in Ethiopia

B As Prime Minister Abiy Ahmed opens Ethiopia to the world, investment potential has never been greater.

Thanks to the Ethiopian Investment Commission, the process is now easier and more streamlined for foreign investors.

Opening The Window Of Opportunity To Foreign Direct Investment efore becoming Ambassador to the United States, Fitsum Arega was Commissioner of Ethiopian Investment Commission (EIC) and Chief of Staff to Prime Minister Abiy Ahmed. As Chief of Staff, Arega became the voice of the administration, as communicator of PM Abiy Ahmed through Twitter. His tweets received overwhelming positive public response. In seven months, his followers grew to 50,000, setting a new standard for other government officials while disrupting the bureaucracy of public/governmental communication.

The EIC handles investment issues such as licensing and promotion, playing an important role in the expansion of FDI. The EIC has succeeded in this goal through attracting large investments to Ethiopia’s new industrial parks.

Industrial parks are key drivers for investment growth, enhancing the telecom, service, manufacturing and agriculture sectors’ potential for export growth, technology and skills transfer.

They create a sustainable business environment, linking local workers to manufacturing and aid the ease of investment. Ambassador Arega states, “before industrial parks, it used to take on average four years to access land, build factories, access power and other infrastructure and eventually start production. Now, it will take two to three months.”

Additionally, PM Abiy Ahmed has introduced political and economic reforms to open the country to the world. For example, PM Abiy Ahmed has lifted restrictions on foreign investment in packaging, forwarding and shipping services, allowing foreign firms to invest in stakes of up to 49%. At his address at the G20 Compact with Africa, PM Abiy Ahmed stated, “key priorities for the government of Ethiopia are attracting high quality foreign direct investment into productive sectors.”

Late last year, Ethiopia debuted their online investment guide, a reliable source for investors to access up-to-date information about investment opportunities and areas for reform in the country.

“The investment guide is about making relevant and up-to-date content available to existing and potential investors,” said Amb. Arega. “It should help us bridge the gap between foreign investors and small and medium enterprises.” The iGuide details topics related to: business procedures, taxes, processes in acquiring land, labour force expectations, infrastructure quality, legal rights and even sectors with high investment potential.

FDI has consistently grown in Ethiopia over the past ten years, reaching US $4 billion in recent years. Ethiopia also offers a strong and growing economy that brings confidence that products and services will be profitable. Ethiopia’s annual economic growth, ranging between 8.5% to 10% for the last decade, plays a large role in the success of FDI. According to EIC, more than US $2.2 billion FDI capital entered Ethiopia in the first six months of 2018, a 22% increase from the previous year. With the support of PM Abiy Ahmed, these figures are set to increase.

At the annual World Economic Forum in Davos Switzerland, PM Abiy Ahmed encouraged global business leaders to invest in Ethiopia as his administration has embarked on bold reforms.

He said, “Ethiopia is undergoing significant institutional reforms to enhance the ease of doing business and increase our global competitiveness.

The private sector should be an integral part of our economy. We are committed in opening up the economy.” Some of the recently opened sectors include telecommunications, logistics, energy, aviation, and railways. “Improving the political environment and the business climate is our priority,” the Prime Minister said.

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FDI Opportunities

ETHIOPIA - Africa’s Pride

Minister Round Table The Cradle Of Humankind Looks Forward To A New Era

The Government At Work To Ensure Continued Growth Penresa interviewed key members of the new Ethiopian government as well as the Governor of the National Bank to hear about their plans to consolidate Ethiopia’s achievements and attract new investors.

Hon. Oumer Hussen, Minister of Agriculture

Hon. Dagmawit Moges, Minister of Transport

Ethiopia is going through a phase of bustling and lively change, as evidenced by the recent historic appointment of the country’s first female President and gender-balanced government. Penresa interviewed prominent members of the new government, Hon. Oumer Hussen, Minister of Agriculture, Hon. Dagmawit Moges, Minister of Transport, Hon. Getahun Mekuria, Minister of Innovation and Tech, Hon. Jantirar Abay Yigzaw, Minister of Urban Development and Housing, as well as Yinager Dessie, Governor of the National Bank of Ethiopia. We had the opportunity to ask them about their mandates, their achievements and their goals and hopes for their country.

opening up the logistics sector and creation of logistic hubs. We aim to create a platform where different stakeholders can participate.

Over the last two decades our country has made significant progress in road construction, and we plan to keep this course: there are various technologies that we are trying to implement with the support of the World Bank. We adhere to strict transparency in the Ethiopian Roads Authority Management Information System, and we award contractors through open tenders that enable us to get the most efficient price.

What are your plans to ensure sectoral economic growth?

Hon. Hussen: A few weeks ago, the government opened a new US$ 61 million Agricultural Processing Industrial Park. As farmers always rely on market, they might shift sometimes from the product we need to a more valuable product. In this Industrial Park there is a demand-driven approach for our farmers. Parks like this are not simply located in a specific area: they’re tailored for the potential of the farmers and the farming type, resulting in a big economic impact for our farmers, guiding them to using modernised techniques. We are trying to make sure that irrigation also follows this pattern.

Hon. Yigzaw: With the construction sector booming, we are planning a number of new projects. Some of them, like the Grand Ethiopian Renaissance Dam, have already started. Among the other projects are power generating facilities, various kinds of industrial establishments and a railway crossing the country.

The first railway line connecting Djibouti to Addis is already operational, and we are in the process of building a second one. Furthermore, the government has allocated a budget for road and highway expansion, and we are committed to improving irrigation across the whole country. The construction sector constitutes a notable portion of Ethiopia’s GDP, and the government is committed to increase funding for infrastructures.

Hon. Moges: We have plans to improve the efficiency of the Maritime Affairs Authority, which will aid logistic movements within the country and, in turn, will impact exports: lower logistics costs would make our exports more competitive on a global market. The cost of imported items, on the other hand, would decrease, enhancing our country’s purchasing capacity. We are striving to reduce the time necessary to advance logistics movement by integrating the railway and road transportation systems, and creating a smooth flow to the Modjo dry ports. This will be supplemented by

Hon. Mekuria: In the upcoming two years, at least 2-5% of Ethiopia’s GDP should come from technological value addition, and as Minister of Innovation and Technology I am committed to achieving that goal.

We have planned different strategies: one is value addition to agricultural products such as coffee, as well as to the way agricultural products are transacted: e-commerce has to come to Ethiopia.

Another strategy our ministry is pursuing is embarking on technological products such as drones and automotive spare parts, because Ethiopia shouldn’t be importing all of its spare parts for automotives from abroad. Drones are something we

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Dessie: Our economy has grown steadily with double digits in the last twelve years, which is an impressive achievement: we’ve gathered valuable experience on how to lead development, which has given us a lot of energy to move forward.

Our financial sector is growing at a fast pace and private banks have good financial indicators, be it capital, liquidity or profit. We have a very conducive financial environment, but there is still a mismatch between supply and demand. Private and public investment and consumption have grown steadily, but on the other hand exports have not increased as much as we hoped. This has created a deficit we are committed to resolve, and we have developed short and long-term solutions to do so. Works are underway to build thirteen industrial parks. When operational, those parks will increase our export volume and our forex. The industrial parks will host mainly textile, manufacturing and pharmaceutical factories, with most of the investors coming from China, the US and Europe.

Furthermore, we are progressively privatising state-owned enterprises such as telecoms and flag carrier Ethiopian Airlines. The reasons for this are mainly two: first of all, this will give us some forex to help pay off our foreign debt and our imports.

Secondly, privatisation will expose our companies to foreign experience, enabling Ethiopian companies to compete on the international stage.

We are also trying to mobilise funds from the World Bank and from countries such as the UAE. Remittances are quite important as well, and they are increasing: Ethiopians living abroad are happy with the new political climate, with the opposition discussing with the ruling party. Overall, we are trying to solve the forex issue, all the while putting a lot of emphasis on export as a lasting solution to sustain our economy.

Do you think this is the right time for foreign investors to come and invest in your country?

Hon. Moges: Through the opening of the EthioDjibouti railway, the utilisation of different kinds of accesses and the issuance of the LAPSSET Corridor, we are going to create a smooth flow of goods with Kenya and, hopefully, South Sudan. With a population of 100 million, I believe that we have the largest market and we can make our country more successful in western and central Africa as well.

Thanks to our new leadership and the new ideas that

we are planning to carry out in our country, we are opening up our doors like never before this year in order to guarantee a business entry. We are intent on supporting start-ups and individuals with foreign investment and ensure a smooth entrance into business; we are here to provide the sustenance they require because together we will be able to grow and make a difference.

Hon. Yigzaw: There are many opportunities in this country because we are a developing nation.

As FDI is crucial for us, we are negotiating with many potential players: the USA, our neighbouring countries, Europe, Far East countries. The government is committed to building industrial parks across the country, especially in the agroprocessing sector. Investing in that is crucial, and we are in touch with several countries to bring in investors. Our Ministry is deeply interested in working with such investors, and we are preparing development plans for them. We need foreign players to come and invest in technological advancement and industrialisation.

Hon. Mekuria: We are a very young country, and our government is dedicated to put Ethiopia at the forefront of development. Since no development can take place without technology, we are liberalising different state-owned enterprises, giving priority to our Telecom industry. It is also worth mentioning that the Eastern African e-commerce logistics hub is taking place in Addis Ababa: it is a Universal Postal Union (UPU), and my ministry is working to make Addis the Eastern African e-commerce hub. With the e-commerce logistic hub coming there and the presence of Ethiopian Airlines, Addis will become the logistical reference point for the whole Eastern African region.

Dessie: After going for some time in the direction of public intervention in sectors such as transport and energy, we realised that the government alone cannot carry this burden, and we went for Private and Public Partnerships, selecting 15 projects that will go on through PPPs. The government is still on the radar in order to invest in other projects, but we also encourage both the local and private sector to invest in infrastructure. As a developing country, we have a big deficit in infrastructure, transport and energy. Our private-public mechanism will allow us to expand these infrastructures both in urban and rural areas, where most of the population does not have power. The government will be in this with regulations and taxation. However, we want more foreign companies to come and invest in the energy sector, especially solar off grid power supply systems.

Hon. Getahun Mekuria, Minister of Innovation & Technology

Hon. Jantirar Abay Yigzaw, Minister of Urban Development and Housing

Yinager Dessie, Governor of the National Bank of Ethiopia

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are deeply focused on, as well: we have been laying very good foundations to make Ethiopia known for its drones in the future. We could employ them to transport cargos, medical and pharmaceutical supplies to rural areas.

ETHIOPIA - Africa’s Pride

Ethiopian Airlines Soaring To New Heights

Air Transport Connecting People And Goods To The Cradle of Humankind Ethiopian Airlines has been in the business for over 70 years. The flag carrier is at the forefront of the country’s exciting new reform era.

Founded in 1945, Ethiopian Airlines is the country’s flag carrier, playing a pivotal role in its economic growth and enabling air connectivity between Ethiopia, Africa and the world. It is safe to assume that the country’s outstanding tourism increase would have been unthinkable without the carrier’s invaluable contribution.

The appointment of the first female President and the first gender-balanced cabinet in the history of the country is an hallmark of the bustling era of reform Ethiopia entered with Prime Minister Abiy Ahmed’s ambitious agenda: “Women’s empowerment is a defining tract for this administration,” says Tewolde GebreMariam, CEO of Ethiopian Airlines.

“We hosted H.E. President Sahle-Work Zewde at a ceremony held on March 8 celebrating the International Women’s Day through a flight operated by an allwomen crew. The president praised the great and still undervalued potential of women. The upward momentum in women’s empowerment in this country will inspire girls all across Ethiopia, Africa and the rest of the world to dream big and smash the glass ceiling.”

Ethiopian Airlines has a prominent role in the Growth and Transformation Plan pursued by the country. The carrier has been growing significantly for years, impacting other sectors: “We catalyse the achievement of GTP goals on the economic, social and diplomatic fronts,” says Tewolde GebreMariam.

“Our ever-expanding freight transport fleet facilitates the export of goods, which has led Ethiopia to stand next to Kenya in horticulture export.”

Ethiopian Airlines has also been helping establish other indigenous 8 | FORBES AFRICA SEPTEMBER 2019

“Ethiopia is rightly dubbed ‘Land of Origins’. We have immense untapped potential that can propel us further on the path of growth.”

Tewolde GebreMariam, CEO of Ethiopian Airlines African carriers, with more joint ventures in the pipeline. “As a Pan-African carrier, we believe that African companies should claim their rightful share in the African air transport market, dominated by non-African carriers”, claims GebreMariam. “The normalisation of relations with Eritrea has opened up the country’s airspace to cross over to some of our destinations, leading to more efficient services connecting our countries to the world”.

With more than seven decades in the business, Ethiopian Airlines has navigated the ups and downs of Africa’s

aviation landscape. “According to IATA, the global airline industry will generate a net profit of US$ 35.5 billion in 2019, a higher figure than 2018,” explains Gebremariam.

“African carriers have improved compared to the past year, and IATA projects that some airlines in the region will continue to generate profits, and we are among those happy few.”

Ethiopia’s phase of reforms holds the promise of new and better political, social and economic achievements. The country has great prospects for growth and prosperity in the years to come: according to Ernst & Young’s Africa attractiveness report, East Africa outperformed all other regions, attracting a 30% share of the continent’s total FDI in 2017. “Ethiopia stood fourth in East Africa in terms of FDI attraction in 2017: the opening to private and foreign investment of key sectors such as telecoms, shipping, power generation and aviation sectors, previously exclusive to government ownership, our country is set to attract even more FDI,” said GebreMariam.

“Ethiopia,” he continues, “is the cradle of humanity and civilisation. This is the country where humankind, coffee and the Blue Nile trace their roots. We host multiple UNESCO-registered heritage sites such as the obelisks of Axum, the rock-hewn churches of Lalibela, the castle of Fasilides at Gondar, also known as “The Camelot of Africa”, the historic town of Harar and many others. We enjoyed one of the highest tourism increase rate in the world, last year. The full potential of tourism in Ethiopia is yet to be unleashed.”

Phone: +251-11-517 8759 Fax: +251-11-661 1474 Email: OnlineBooking@ethiopianairlines.com

CEO of Ethio Telecom

Ethio Telecom Preparing For A Different Tomorrow Under Frehiwot Tamru’s competent and experienced leadership, Ethio Telecom earned ETB 36.3 Billion (USD 1.26 Billion) revenue during the Ethiopia’s 2018-2019 fiscal year, a 7% revenue growth from the prior year, after slashing its tariff by 40% - 50%.

With a Master Degree in Business Administration (MBA) from Open University, UK, Information System, Accounting, and proven experience in leading the telecom sector, she was appointed by Prime Minister Dr Abiy Ahmed as the first woman Chief Executive Officer for Ethio telecom in July 2018.

Frehiwot was the first woman to be assigned as Deputy Chief Executive Officer in 2009, after serving as Chief Information Officer from 2007 for the state-run Ethiopian Telecommunications. She left the company in 2012, to establish and run her own IT company until July 2018.

The combination of her business and technical experiences enabled her to create business and technology intimacy. She has induced profound changes in the company within a couple of months of her appointment.

Can you tell us about the telecom sector in Ethiopia?

Telecom service started 125 years ago in Ethiopia. Successive investments have been made to expand the services and the sector has undergone many changes.

Today, we have network and system capacity to serve up to 68 million subscribers, with 85% geographical network coverage. Total subscribers are 43.63 million with mobile subscribers reaching 41.92 million, fixed 1.22 million. Data and internet users are 22.3 million. Tele-density stood at 44.5% while mobile penetration reached 42.8 %. We have around 21,000 kilometers of fiber optics covering the country.

Despite many challenges we have achieved a lot in the telecom sector here in Ethiopia. But this remains insufficient mainly because telecommunication technology is evolving at breakneck speed, and customer demands are keeping pace with these sweeping changes. As the demand for data is growing fast, we are planning on expanding our network capacity.

We are getting prepared for a different tomorrow, to become the preferred telecom operator in the upcoming competitive telecom market. Accordingly, we are using new approaches and ways of doing

business to improve customer service and quality of service while expanding infrastructure new revenue stream and expand product portfolio.

How will the telecom market reform and the opening up of the market usher in a new era of investment and growth to Ethiopia?

Telecommunication has a significant social, cultural, and economic impact on modern society.

It is fundamental for the overall economic development of any nation. I believe that the telecom market reform is to bring about economic growth of the country.

A well-managed telecom market reform will bring us better opportunities in terms of better services and financial performance. As CEO, I work passionately and determinedly to enhance Ethio telecom and get ready for a competitive market and become a preferred operator for the benefit of our nation.

Why is NOW the right time to invest in Ethiopia?

I believe it is time to exploit Ethiopia’s vast opportunities with passion for the benefit of our nation, with new approaches and new way of doing things.

The Ethiopian government has shown its commitment to economic reform by increasingly opening its borders to regional and international capital and calling upon investors and entrepreneurs to invest in the economy, that is why it is the right time to invest in Ethiopia. The fact that a wide range of political and economic policy changes have been introduced indicates the government’s desire to provide greater space for the involvement of the private sector (both domestic and foreign) and enhance their participation in the economy. The Ethiopian government has shown its commitment for economic reform including the Ethiopian telecom market, because of its importance as enabler to development in other sectors.

I can say meaningful steps and measures have been taken by the government to create an engagement and collaboration among citizens, private sector and government to ensure national economic growth.

“In today’s world, telecom service is essential in promoting life-enhancing services.”

Tel: +251(0) 115 51 57 00 Fax: +251(0) 115 51 57 77 P.O. Box 1047 Addis Ababa, Ethiopia www.ethiotelecom.et Twitter: @ethiotelecom_ Facebook: @ethiotelecom

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Frehiwot Tamru

ETHIOPIA - Africa’s Pride

Tewodros Ashenafi Chairman and CEO of SouthWest Holdings Ltd

Providing Opportunity With Innovative Entrepreneurship Response Founded in 2003 by Tewodros Ashenafi, SouthWest Holdings Limited aims at meeting Ethiopia’s demands through a wide range of businesses such as: energy, logistic services, real estate and hotel services.

“My personal interest is to create as many jobs as possible and see how I can push entrepreneurship among other things.”

6/F, Adams Pavilion Building.

Addis Ababa, Ethiopia Tel: +251 113489 606 Fax: +251 113489 807 info@swholdings.com www.swholdings.com

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Tewodros Ashenafi is a pioneer in many aspects. At the age of 20, he was the first African president of a Beta Theta Pi chapter in the US, a fraternity founded in 1839 with 200+ members of the U.S. Senate and House of Representatives including two Speakers of the House. He is the very first Ethiopian to ever own oil concession in the country’s history. He was elected first ever Ethiopian Young Global Leader by the World Economic Forum (Davos) in 2009, and is an important presence in think tanks, as well as being the very first African invited to join the Atlantic Council’s International Advisory Board. Ashenafi has directly, and indirectly, assisted in bringing US$2 billion into Ethiopia, as well as carrying out the largest privatisation and private transaction in Ethiopian history, with National Tobacco Enterprise’s (NTS) US$1.4 billion enterprise value privatisation. Penresa had the immense pleasure to sit down with him to discuss Ethiopia’s future narrative and the opportunities involved therein.

You have had a long career, which also involved important positions in companies such as SABMiller and JTI in Ethiopia. Can you tell us how you started your career?

I left Ethiopia when I was 12 years old because of the issues Ethiopia was facing at that time. I went to a boarding school in the U.S., Columbia Undergrad.

Then I joined investment banking at Merrill Lynch.

I returned to Ethiopia and I saw an opportunity in the oil and gas field. I ended up bringing in Petronas and after that, I myself stepped in with some investors to invest in energy concessions. We had the opportunity to enter various privatisations.

Subsequently we have done other businesses: oil and gas services, logistics, and so forth.

You have a new hotel in the pipeline. Can you talk about that?

We are going to set up a new hotel, which is part of an interesting African brand. We will disclose that in the next few months, but it is an African brand, it is going to be a boutique hotel, a good place to hang out.

How are SouthWest’s vision and objectives aligned with Ethiopia’s economic expansion?

Ethiopia has nearly two million young people entering the work force every year. The key task for the country is to create millions of jobs to absorb all these young, educated people into the workforce.

SouthWest Holdings will continue to invest in job creation and help young people to start up their own businesses in the future.

What are some of your CSR initiatives?

SouthWest has been involved in various CSR projects ranging from rehabilitating a school in the Somali region and to donating veterinary medication, to supplying computers and ICT to schools in Gambella, as well as providing a variety of support to cultural and religious institutions.

SouthWest Holdings Ltd. has helped facilitate some of the largest investments in Ethiopia. Can you elaborate upon SouthWest Holdings’ expansion plans for growth over the next five to 10 years?

We are looking at infrastructure, agri-business, manufacturing, and technology industries which have great potential in Ethiopia over the next decade. Our philosophy is to do everything to add value to our country. The growth of country must have a good infrastructure to resolve logistic constraints. Once our people have sufficient food security to satisfy their basic needs, then our people can focus on technology improvement and enhance productivity. We don’t see many other places in the world with the potential that Ethiopia has and we are interested in playing our part in this development.

Can you give us a last message of confidence?

I think that I do not see a better opportunity anywhere in the world with the type of returns that can be gained in this country. With patience, resistance, fortitude, and understanding about how Ethiopia works, I honestly don’t think there are bigger opportunities elsewhere.

ETHIOPIA - Africa’s Pride

Equatorial Business Group (EBG) Strengthening the country through the development of strategic trading sectors

Sustaining And Supporting Ethiopia’s Empowerment Established in April 1993, Equatorial Business Group (EBG) is a private limited and diversified business entity which is deeply invested in four major trading sectors: Automotive engineering, energy systems, elevators and escalators and pharmaceuticals and medical equipment and supplies.

“When it started, EBG’s main business was the importation of electrical and electronics household and office equipment supplies,” states Mekuria Ayele, General Manager of EBG. “Soon, the owners understood that the company needed additional resources to pursue its efforts in diversifying its businesses. So, they invested heavily and the company became engaged in more strategically significant business lines which supported the development of the country.” Indeed, EBG has since gone on to obtain exclusive authority in dealership and distribution rights for a number of prominent and illustrious manufacturers.

EBG is the point of contact in the provision of heavy duty Volvo trucks, buses, and construction equipment.

“The idea was to import and distribute these very much needed products in the country,” confirms Mekuria. The provision of holistic after-sales support

by EBG has been one of the main factors for the success of the Volvo business in the Ethiopian market.

EBG also imports and distributes Mazda pickups, Cherry automobiles, Jinbei minibuses and Foton agricultural machinery. These followed the conclusion of dealership agreements with respective manufacturers, with the aim of mainly supporting agriculture and investors in that camp: these are not only luxury cars for city life, but they are also used for developmental and commercial purposes.

The after-sales support for these vehicles are provided at the dealers’ facility recently constructed for the purpose.

Intent on contributing towards solutions to the nation’s power shortage 12 | FORBES AFRICA SEPTEMBER 2019

“We will continue to grow this business by opening pharmacies within and outside Addis. From an ethical point of view, it is a noble business.”

Mekuria Ayele, General Manager of Equatorial Business Group – Ethiopia issue, EBG, under a dealership agreement with Cummins, supplies, installs, tests and commissions both open and closed Cummins power generators of deferent capacities for standby and prime use, as well as providing after-sale support.

“We signed a dealership agreement with Otis (a leading company in the sector) because the skyline of Addis had started changing and the upcoming buildings were in need of lifts and escalators. Major buildings in Addis bear the brand name OTIS for their elevators

and qualified technicians ensure the after-sales supports,” affirms Mekuria.

Furthermore, in order to assist Ethiopia’s health sector, EBG is working with certified multinational companies, such as GlaxoSmithKline, AstraZaneca, Sanofi, MSD, Novartis, etc. by importing and distributing pharmaceuticals, medical equipment and supplies including veterinary stock. A recent development in the pharmaceutical business has been a decision by EBG to enter into the retail pharmacy business. By opening a chain of pharmacies, EBG aims to access genuine medicines to the people needing them at reasonable prices. This business started last year and one pharmacy is already operational. Three additional pharmacies are scheduled to start by the summer of this year. “We will continue to grow this business by opening pharmacies wherever there is the market, even outside Addis,” claims Mekuria, adding “From an ethical point of view, it is a noble business.”

With strategic branches across Ethiopia, the Group counts upon a dedicated workforce of over 300 skilled professionals and 200 support staff.

The different businesses within EBG are operated as distinct entities, each led by a senior director while sharing human logistics and financial resources. With excellent corporate governance in place and a commitment to transparency, accountability and social responsibility, EBG has strategically built itself up to be one of Ethiopia’s most important groups in the business areas it is engaged in.

Dedicated to the provision of solutions and products required in key sectors, EBG is an upstanding example of focus and determination in championing Ethiopia’s growth.

8964, Addis Abeba. Ethiopia Phone: 011-4424955 / 4422168 Fax: +251-11-4422148 / 4422186 Web: ebg.com.et Email: ebg.plc@ebg.com.et zewdu.mekuanent@ebg.com.et

ETHIOPIA - Africa’s Pride

Mr. Basar Arioglu. Chairman, Yapı Merkezi Mr. Emre Aykar. Board Member, Yapı Merkezi Chairman, DEIK Turkish – Ethiopia Business Council

Transporting Ethiopia Into A Bright Future With the completion of the outstanding Awash-Weldia railway drawing close, Yapı Merkezi is eager to expand its Ethiopian operations.

How do you evaluate Ethiopia in general, especially considering One of the conditions of the tender was the arrangement of PM Abiy Ahmed’s appointment of the first-ever female president financing for 85% of the contract, which took us 1.5 years. and gender-balanced cabinet?

Financing was made possible with a US$300 million loan from For us, Ethiopia is the land of the origin of mankind, of longthe Turkish Eximbank. Other financiers, like the Export Credit distance runners and opportunities.

Agencies (ECA’s) of Denmark, Sweden, Switzerland, Austria and It is the oldest independent country in Africa, one of the fastest Italy, Development Bank of Southern Africa and international economically growing countries in the world, has the lowest banks including Credit Suisse, ING, Deutsche Bank supplied the crime rate in Africa, rich fauna and significant natural and mining remaining US$1.3 billion. resources.

This award-winning financing package is the highest raised It is macroeconomically stable and there are big opportunities in by an international financing market in an African country privatisation programmes, especially in agro business. and opened the way for Ethiopia to issue The government prioritised the reorganisation her first Eurobond amounting US$1 billion in of domestic prices, the liberalisation of foreign December 2014.

Environmental and social management trade, the privatisation of state enterprises and of the project, including health and safety, the promotion of domestic and foreign private expropriations and resettlement, livelihood investments. restoration of the project, affected people have Additionally, Ethiopia is one of the most been managed satisfying IFC Performance important business partners of Turkey in Africa.

Standards, Equator Principles and OECD Currently, approximately 120 Turkish companies common approach. are actively working in Ethiopia creating jobs The successful implementation of the Awashfor more than 25,000 locals. Their investments Weldia Project has opened the way for new exceeded US$2 billion. Turkish trade volume reached US$500 million and contracting services “The successful opportunities in the region and led to our winning amounted to US$2.5 billion. implementation of the tender of another mega railway project in Tanzania.

We strongly believe that it is convenient and of the Awash beneficial for us to expand our activities in Ethiopia major construction projects are currently on a large scale.

Weldia Project What being executed in the country by Yapı Merkezi and what are the company’s competitive advantages?

What role do the Ethiopian operations have for an has opened For the railway line between Awash and Weldia, international company like Yapı Merkezi?

Ethiopia is the first sub-Saharan country where the way for new we’re also providing components such as power electrification, signalling, telecom, we have been awarded a large contract, the tender opportunities supply, stations and all infrastructures. On average 8,000 of Awash-Weldia railroad in 2012. in the region.” people are employed in the project, 6,000 are Works started in August 2014. The route is locals. There are also 242 local subcontractors approximately 400 km, including 10 km of employing an additional 4,000 Ethiopians tunnels, 6 km of bridges, 42 km of culverts and making local labour force around 10,000 people.

10 stations. In addition to two main camps in Shewa Robit In addition to materials bought in Ethiopia, we have 1,300 and Kombolcha, we established nine mobile camps providing foreign suppliers from 13 different countries. 99.8 million m3 access roads, electricity, water and security. Since Ethiopia is of earthworks are being carried out, 1.7 million m3 of concrete, landlocked, we established a strong organisation in Djibouti to 4.6 million tonnes of ballast and 700,000 pieces of concrete take care of customs and logistics. Until now a total of 243,000 sleepers are produced, 2,300 km of electrification cables and tonnes of material, both as bulk and in 8,700 containers, are 430 km of rail are being installed. shipped to site without major problems.

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ETHIOPIA - Africa’s Pride

It is the biggest and most challenging railway line in Ethiopia, constructed by European standards using the highest rail technology, a design and build project for which we paid special attention to the following characteristics: - Reflecting the identity of Ethiopia - Being adjustable to higher capacities for future demands - Being simple but aesthetic - Being secure - Optimising construction period - Optimising operation costs - Being a model for Africa.

Yapı Merkezi, established in 1965, has significant experience in the construction of rail systems. We have constructed 3,600 km of track, 110 km of tunnel, 95 km of bridges, 400 stations and 21 workshop and depot areas. Today, 3,5 million passengers are daily using our systems safely, economically, comfortably.

We have the know-how to construct rail systems, making our company very competitive in these kind of major infrastructure projects.

One of the bridges constructed on the route.

Yapı Merkezi was ranked 82th in the ‘Top 250 International Contractors List’ of 2018. What were some of the company’s biggest milestones?

One of the major milestones in our history is the 23km Istanbul Metro Project which was awarded to the Consortium we established with ABB from Sweden in 1986. Another milestone is the Dubai Metro Project, comprising 75 km of track including 45 stations, carried out in 2007-2012 in joint venture with Obayachi, Kajima and Mitsubishi. Then we built Ankara-Konya High Speed Train (250 km/h, 212 km of double track) in Turkey; Casablanca Tramway System in Morocco, Izmir Metro (116km of double track), Bir Touta – Zeralda Railway line (23km of double track) in Algeria, all of which granted us a higher rank in ENR lists.

Which CSR initiatives have you launched in Ethiopia to empower the community?

The project’s potential environmental and social impacts are managed according to local and international standards and best practices. Environmental impact monitoring, health and safety management, social and environmental awareness, traffic safety programmes were essential parts of this process. Our Corporate Social Responsibility projects include construction, traffic and environmental safety trainings as well as HIV/AIDS and STD prevention trainings. To date, 45,155 students from 85 schools and 17,254 people from 84 villages have attended. Training brochures, reflective school bags and t-shirts have been provided to the students nearby the construction areas. Traffic signs, speed breakers and awareness billboards have been installed. We have also constructed river crossings, churches and mosques, access roads and water wells, and provided voluntary healthcare services to the villages alongside the project alignment.

Are there upcoming projects in the pipeline? How do you see your chance of realising more projects in Ethiopia?

In Ethiopia, the government implemented Growth and Transformation Plan (GTP I) for the period 2010-2015. Then

Robbit Station.

the GTP II covering the period 2016 – 2020 was put into effect.

In these plans, railways are featured as the preferred mode of transportation for goods in bulk a lower cost and in a shorter time. Thus, the development of national railway networks which was the flagship of programmes of GTP I remained as a priority infrastructure going forward to GTP II. We are following the implementation of this plan because it includes the construction of 2,741 km of national railway network. Additionally, 41 km of light rail are foreseen to be constructed and put into operation in Addis Ababa during the GTP II period.

We believe that the experience accumulated during the construction of Awash-Weldia railway and our successful performances in the country gives us a good chance of being awarded some of these projects. We believe in the strength of the Ethiopian people and we will continue our efforts to take part in its bright future.

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ETHIOPIA - Africa’s Pride

HMY Holdings Encouraging international partnerships to create local employment.

Striving For A Prosperous And Stable Ethiopia HMY Holdings continues to consolidate its position and invest aggressively in the burgeoning economy. Hailemichael Yihdego foresees a bright future for Ethiopia and his company.

“Ethiopia will take its rightful place on the African and global stage given its rich history and the commitment of the people.”

Hailemichael Yihdego, Founder of HMY Holdings

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The history of HMY Holdings is an inspiring tale of success in the face of adversity. The company was founded in the 1980s by Hailemichael Yihdego, an orphan turned entrepreneur trying to make a living in the construction sector distributing building materials.

‘Self-made’: a term too often used in an exaggerated manor, truly applies in the journey of Yihdego. From shining shoes as a young man to driving a taxi.

Later in the 1990s, Yihdego began working with foreign partners to start importing steel and timber leading his company to grow exponentially. Its humble early days far behind, HMY Holdings is now one of Ethiopia’s largest family owned conglomerates.

While construction and distribution of building materials remain the company’s core focus, HMY Holdings has successfully expanded with investments and interests across real estate, retail development, banking, insurance, manufacturing and recently, hospitality.

The company has reached an understanding with an international hotel brand to open a five-star hotel in Addis Ababa within the next couple of years. Works for the building, set to become one of Ethiopia’s tallest hotels, is already under way and will employ an estimated initial workforce of five hundred people.

Responding to our request for an interview, HMY Holdings replied with a short letter signed by the tycoon adamant that “Ethiopia will take its rightful place on the African and global stage given its rich history and the commitment of the people.” The letter stressed the company’s “commitment to driving its purpose and contributing to the nations bustling economy in these times of rapid change.”

Indeed, Ethiopia is going through unprecedented change and HMY Holdings is strongly in support of this. As one of the oldest nations in the world, Ethiopia has seen many trying times both politically and economically. The current reforms intend to bring an opportunity for businesses to compete in a more open and progressive Ethiopia.

In addition, Yihdego highlighted the importance of “maintaining the interests of the people,” as the country moves in its journey of integration into the

global system. “As our economy is opening up to foreign actors whose experiences we want, it is critical that local partners and the society play a significant and defining role in shaping the directions and objectives of these wide ranging investments.”

Ethiopia has been seeing continuous growth rates over the last decade, and with the increased influx of FDI, the country shows great promise for the continuation of this upwards growth trajectory.

As such, HMY Holdings has over the past decade in particular, been working on developing both is corporate and family governance structures to accommodate planned joint ventures with international partners. Moreover, HMY Holdings holds dear its multi-generational lineage and is adamant to continue building its resilient family brand on the continent and the global stage.

“We aim to strategically align ourselves with the opportunities we are seeing in Ethiopia. The gender parity in the current cabinet, for instance, only solidifies our country’s status as a progressive beacon in the continent. As a company we intend to play our part in this continued journey towards equality and diversity.”

Furthermore, HMY Holdings emphasised its expansion efforts highlighting real estate and manufacturing as key growth markets. The company accentuated the importance of having a diversified economy and praised the governments investments in key sectors, such as manufacturing.

“We are, and want to continue to be, part of the ‘Made in Ethiopia’ growth generation. Our country is made up of many talented people and a wonderful diverse culture, which we can showcase on the global stage.”

While he does not underestimate the challenges that lie ahead, Yihdego’s faith in his country is strong as steel: “Without struggle there is no progress. Ethiopia is a safe and beautiful country,” he says. “It is strategically located in East Africa and is the second most populous country in Africa with a population of more than 100 million people. Whoever comes here to invest will have vast opportunities and success. HMY Holdings will continue to aggressively push forward. We are in it for the long run.”

ETHIOPIA - Africa’s Pride

Zekarias Amsalu Dubale Founder and Managing Director of Ibex Frontier

Connecting Investors With Opportunity Ibex Frontier sources deals and opportunities as a premier Pan-Ethiopian investment and route-to-market advisor, connecting startups with strategic investors and ecosystem players across key global cities.

“Past infrastructure investments, dynamic and young working generation, focused support by the government and increasing tech capital are paving the way for Ethiopia to be the next tech hub.”

IBEX Frontier LLC Washington DC, London, Addis Ababa Email: Zekarias@ibexfrontier.com Website:- www.ibexfrontier.com

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Since founding Ibex Frontier, Zekarias Amsalu Dubale has worked tirelessly to create visibility, access and opportunity to the Ethiopian tech & startup ecosystem, gaining international recognition as one of the Global Top 100 Most Influential People Of African Descent Under 40. Zekarias sat down with Penresa to tell us about Ibex Frontier and why the future of investment is in Ethiopia.

You have been a well-known champion for Ethiopia’s potential. Why is Ethiopia the next African tech hub?

Ethiopia has been heavily investing in its infrastructure for the last 20 years and as a result, it has now one of Africa’s largest fibre optics lines extending more than 21,000km. The huge expansion investment in telecom industry means Ethiopia has the most mobile telecom subscribers in Africa, with 44 million active subscribers.

Ethiopia is generating around 300,000 university graduates, out of which about 70% are STEM graduates. Past infrastructure investments, dynamic and young working generation, focused support by the government and increasing tech capital are paving the way for Ethiopia to be the next tech hub.

What are some challenges that innovators and investors must overcome to be globally competitive?

While Ethiopia has the talent pool, innovators face challenges in venture-funding, mentorship, IP Protection and soft skills that help propel their innovations globally. The emerging incubation hubs will be instrumental in closing these gaps.

The regulatory reforms in ease-of-doing-business will resolve many of these obstacles. Additionally, insights provided by Ibex Frontier will address challenges that investors face when it comes to investing in tech including capital requirements, forex operation, repatriation of profit/capital. We have been working hard to demystify Ethiopian tech investment through lectures in Silicon Valley, New York, Paris, London and Addis Ababa and we will continue to do so in the future.

With a median age of 18, how can the public and private sector collaborate to build its human capital to bridge the digital divide?

Strong collaboration is required between the public/private sector including organised, monitored and rewarding internships and work experiences between industry and higher education institutes. Ibex Frontier has teamed up with Silicon Valley-based Global Innovation Catalyst to create 500k innovation jobs in Ethiopia. We work with the Ministry of Innovation and select universities and give graduates priority in tech based employment opportunities by providing training and financial support. If these efforts are duplicated by industries and private sector players, the human capital in Ethiopia will be on the right side of the digital divide.

How does Ibex Frontier contribute to the development of Ethiopia’s tech sector?

We provide visibility, access and opportunity to the sector with our Ibex Digest that offers insight and helps startups in health-tech, fintech and logistics raise capital. We have convinced Silicon Valley-based tech companies relocate their BPO tech jobs to Ethiopia. Given the regulatory changes, e-commerce, fintech and digital inclusion will be a focus for Ethiopia in the future. We are focused on helping investors seize these opportunities. We are also bringing the premier Africa Fintech Summit to Ethiopia in November 2019 for the first time.

We plan to use this platform to help fintech and e-commerce startups match with global strategic investors and ecosystem players.

Why NOW is the right time to invest in Ethiopia?

We are advising on deals in excess of US$100 million in sectors including mining, manufacturing, technology and fintech. Given Ethiopia’s huge market base, increasing disposable income, new opportunities created with economic liberalisation and privatisation as a result of solid economic growth and infrastructure development over the last 20 years, now is the right time to invest in Ethiopia.

From soil to supermarket, the ATA is reconstructing agriculture in Ethiopia

Cultivating A Future Through Mechanisation And Modern Technology Ethiopia’s Agricultural Processing Industrial Parks are industrialising the agriculture industry - and the country.

E

thiopia’s agriculture industry brings in more FDI than any other sector. Over the past fifteen years, Ethiopia’s economic improvement has been a remarkable example for all of Africa, especially in agriculture, with its growth at double-digit levels.

As the most exported sector in the entire country, agriculture is crucial in transforming Ethiopia from a poor, agricultural state to a middle income, industrialised economy by 2025.

Through the implementation of modern technology and industrialisation, Ethiopia sees a future in agriculture that is ripe with opportunity.

The Agricultural Transformation Agency, which connects the Ministry of Agriculture and the private sector, is laying the foundation for the future of agriculture through mechanisation. In March, the government opened a US$61 million Agricultural Processing Industrial Park. Its purpose is to link farmers to processing plants, creating a strong value chain within the agriculture industry and resulting in more wealth for farmers. Khalid Bomba, CEO of ATA, states, “The goods that these agro-industrial parks are processing allow value addition in the country. In this way, we are actually able to produce the goods that you see in supermarkets.

Until five years ago, if you went to a supermarket in Ethiopia, most of the agricultural products would be imported from outside Ethiopia.”

The parks allow the sector to evolve through modern farming approaches that will strengthen the value chain.

Hon. Oumer Hussen, Minister of Agriculture states, “farmers always rely on the market. In this Industrial Park, there is a demand-driven approach for our farmers. That produces a big economic impact and guides them to using modernised techniques.” Moreover, modern techniques appeal to Ethiopia’s young, tech-savvy workforce. Bomba tells Penresa, “The way agriculture has been practised in Ethiopia traditionally is not attractive for the youth. There are many other activities that you can commercialise and industrialise that make it more attractive for young people.” Agricultural service centres offer diverse opportunities for young people

where they work directly with farmers through distribution, finance or accounting.

Today, agricultural workers consist of up to 85% per cent of the labour force. Esayas Kebede, General Manager of Ethio Agri-CEFT, one of the largest private players in the Ethiopian agro-processing industries, states that “agro-processing Industrial Parks can create even more jobs than agriculture [alone], for example if a farmer has a degree in agroprocessing, he/she can either go into industry or service.”

Thanks to agriculture, the Industrial Parks have brought diversity to the job market.

In addition, the ATA has collaborated with OCP Group, pioneers of Moroccan fertiliser, resulting in the biggest publicprivate partnership of the country, totalling US$ 7 billion. OCP Group is tailoring Ethiopian soil to its specific crops. Mostafa Terrab, Chairman and CEO of OCP Group explains, “not all crops need the same nutrients. The role of our fertiliser is to fill the gap between the nutrients in the soil and the growing needs of the crops.” To understand this need, OCP Group and the ATA have implemented Soil Fertility Maps in various districts of Ethiopia, with plans to merge them by the end of 2019. Soil Fertility Maps help farmers understand their soil content, which will enhance the ease of farming.

The ATA is also enacting underground water mapping. By identifying where water aquifers are located, farmers will be able to irrigate easily with minimal technology. Bomba states, “Farmers have a GPS map that tells them exactly where to drill with a minimum of 85% accuracy, meaning that almost 9 times over 10, when you drill following that map, you find water.” Additionally, the ATA debuted the 8020-farmer hotline, where farmers can call toll-free for extensive information about their soil. “This weekend we reached our four-millionth registered user,” says Bomba. “This is all digitised, we know where the farmers are calling from, so if there is an issue with the soil, we send an automated message to every farmer in a particular area. This is an innovation that is changing the way farmers work.”

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ETHIOPIA - Africa’s Pride

Agriculture

ETHIOPIA - Africa’s Pride

OCP Group Ethiopian Government & OCP Group work to empower Ethiopian farmers

Ethiopian Government & OCP Group Committed To Ethiopia’s Green Revolution The Moroccan state-owned company OCP has been a key player in the phosphate industry since it was founded in 1920. It manages the world’s largest phosphate reserves and has a 62% market share of phosphate-based fertilisers in Africa.

This is a story of collaboration with multiple partners to address the needs of local Ethiopian farmers and working with the Ethiopian government to transform the country’s agricultural sector and make it a continental farming champion.

OCP’s commitment to increasing African crop yields and promoting sustainable agriculture is one of the company’s driving forces, as it looks to tackle the challenge of feeding a global population which is set to grow dramatically by 2050.

With a worldwide presence along every aspect of the supply chain of phosphate and phosphate products from extraction and production to commercialisation and export, OCP’s experience in managing the soil and plant nutrition required to feed the soil and promote higher crop yields is critical to the hopes of African farmers.

In 2012, Ethiopia’s Agricultural Transformation Agency (ATA) launched a transformative project: Africa’s first soil fertility mapping exercise, EthioSIS, or the Ethiopian Soil Information System.

Mostafa Terrab, Chairman & CEO of OCP Group, explains “building on our collaboration with ATA on Ethiopia’s soil fertility map, we committed to developing a range of adapted fertilisers depending on each region’s soil characteristics and crop mixes. We produced prototypes of those fertilisers in our facility in Morocco and tested for two different agricultural seasons under the sponsorship of the Minister of Agriculture and with total transparency. Our approach in Ethiopia is further proof of OCP’s commitment to the development of Africa’s agricultural sector.”

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An Ethiopian farmer supported by OCP Group in the region of Debre Berhan in Ethiopia.

Since 2016, OCP has been awarded tenders for direct supply of 700,000 to 800,000 tonnes of customised fertilisers yearly, enriched with micro-nutrients such as zinc and boron, bringing a significant rise in Ethiopia’s crop yields.

Further soil fertility maps are now ongoing in four agricultural regions of Ethiopia (Oromia, Amhara, Tigray and SNNP); this will produce important new data to help Ethiopian farmers identify their own soil and crop specific needs, which will provide even more detailed information for fertiliser recommendations.

The key to this unique collaboration is to create a powerful and sustainable development of Ethiopia’s agriculture, which is not limited to the supply of adapted fertilisers only, but will also target local production of fertilisers in in the country.

This local solution is an acknowledgement of the profound benefits to a southsouth partnership, which brings together the transformation of natural resources from both countries, sharing knowledge based solutions between Morocco’s OCP Group & the Ethiopian Government, resulting in a proposed US$3.7 billion joint fertiliser plant in Dire Dawa, Ethiopia.

“The plant will be a major game changer to Ethiopia,” an OCP representative said, “by not only transforming Ethiopia into a producer (currently a net importer), but also an exporter to the neighbouring countries.” The OCP representative went on to say: “with an initial capacity of 2.5 million tonnes of fertilisers, the

new Ethiopian plant aims at being fully functional by 2023/2024. A second phase, with a further US$1.3 billion invested, will increase production capacity to 3.8 million tonnes and meet the nation’s growing local demand for fertilisers. It will be the largest fertiliser plant in Africa and allow for Ethiopia’s self-sufficiency in fertiliser production, as well as tapping into its potential of becoming a major fertiliser supplier and exporter in the African market.”

In April 2019, the OCP Group signed an agreement with the Ministry of Agriculture and farmers cooperatives unions to revamp and improve operational capacity, in the nation’s five fertiliser-blending factories.

OCP is joining hands with regional and federal stakeholders and farmers to set in motion a long-term plan to increase the number of blending factories in Ethiopia to 17.

In a further display of Morocco and Ethiopia’s excellent agricultural collaboration, OCP was part of the EWA (Empowering Women in Agriculture) meeting at the 32nd African Union Summit in Addis Ababa in February 2019, once again confirming its support for working African women in the field(s) and its contribution to ensuring their empowerment, in line with the UN Sustainable Development Goal (UN SDG) 5 on gender equality and empowering all women and girls.

One of the OCP Group’s core values is to ensure it reduces its environmental impact through recycling water, energy, and mining resources at every step of the value chain, a further dimension of its commitment to sustainability and the UN SDGs. The hope being, together, we can both build up Africa as the global food solution to the future billions on our planet, while at the same time making it possible to reduce our own carbon footprint.

International Media Relations OCP Group Email:international.media@ocpgroup.ma

ETHIOPIA - Africa’s Pride

Horizon Plantations Developing the nation’s agricultural sector in order to boost exportation

Broadening Ethiopia’s Export And Agricultural Horizons Horizon Plantations PLC represents the innovation and operation of largescale agricultural and agro-processing ventures in Ethiopia and Africa.

Commencing activities with a capital of ETB 190 million in 2003, it has since been responsible for the development of different projects in agriculture and manufacturing, expanding its lines of businesses to include 15 companies with an ever-increasing capital of over ETB 10 billion.

A subsidiary of the MIDROC Investment Group, Horizon’s growth over the years comprises the undertaking of six enterprises scattered far and wide around the country (four plantations and two agroprocessing industries) namely: Bebeka Coffee Plantation, Limu Coffee Farm, Gojeb Agricultural Development, Coffee Processing and Warehouse Enterprise (CPWE), Upper Awash Agro-Industry Enterprise and the biggest tyre-producing factory in east Africa, Horizon Tyre Share Company.

Owning the largest coffee plantations in Africa, Horizon began acquisitions of formerly state-owned farms in 2009 which established it as Ethiopia’s largest washed Arabica producers. Limu is a six-farm operation on an area of 12,116 hectares and Bebeka is one of the world’s biggest unfragmented coffee estates on 10,030 hectares. Its capacity to harvest and supply quality and sustainable agricultural produce can be seen through its UTZ, Rainforest Alliance and 4C Association certification of its crops. “We have the highest productivity in coffee in Ethiopia. The national average is 600kg/ ha, while our greenfield developed coffee farms produce 1500kg/ha,” explains Jemal Ahmed, MD of Horizon Plantations PLC. “Our coffee is crucial to Ethiopia’s development because it generates a lot of forex and because we consume a lot of coffee as Ethiopians. We are amongst the best certified producers of coffee.” Horizon 22 | FORBES AFRICA SEPTEMBER 2019

“We have a strong team, a productivity projector and recently we launched large scale outgrower schemes on tea development; our exports are increasing every year.”

Jemal Ahmed, MD of Horizon Plantations PLC additionally grows a variety of spices, pulses, beans, oil seeds, and a variety of fruit and vegetables, as well as cotton and organic honey for which it also has processing facilities. In agro-processing, it produces canned food such as fresh tomato paste, orange marmalade, guava nectar and tomato juice.

Horizon’s commitment to growth and innovation in order to increase productivity can be seen in its remodelling and reshaping of Ethiopian agricultural and manufacturing sub-sectors. It is predominantly involved in driving the development of export-oriented large-scale perennial crop plantations

and the production of annual crops in order to guarantee food security. Since its establishment in year 2008, Horizon has further upped its stakes by continually boosting higher output with a more global view. “After we took over government enterprises through privatisation, not only did we cover the highest increase demand of the nation market, but we also managed to start exporting,” states Ahmed. “We have a strong team, a productivity projector and recently we launched large scale outgrower schemes on tea development; our exports are increasing every year.”

In 2017, Horizon Plantations PLC carried out a further expansion scheme worth ETB 1.1 billion whereby it purchased coffee bean milling and drying machines, replaced old coffee trees and introduced a drip-irrigation practice at Bebeka plantation. At its coffee plantations, it planted tens of millions coffee seedlings. and replaced old coffee trees. It has also invested in training, road improvements and washing station upgrades in order to ensure a significant increase in production, while creating 10,000 job opportunities.

Horizon is leading the way in the production and supply of processed fruits and vegetables and is determined to provide customer-focused and superior quality products through the implementation of modern, sustainable and environmentally friendly production and processing techniques, as well as the transfer of knowledge within the communities in which they move. Horizon’s prospects are excellent as it continues to press past the skyline and fully emerge as leading agricultural producer, processor and exporter in Ethiopia, and beyond.

Nani Building 15th floor.

P.O. Box 6049, Addis Ababa, Ethiopia. +251 115 549 784 info@horizonplantations.com www.horizonplantations.com

General Manager of Ethio Agri-CEFT Plc.

The Cream Of The Crop Ethiopia’s largest private player in agricultural and agro-processing industries consolidates its successful exportation strategy while dedicating itself to the integration of farm development through environmentally sustainable systems.

Agribusiness expert and General Manager of Ethio Agri-CEFT, Esayas Kebede, talks to Penresa about the importance of implementing modernised farming and adding value through agro-processing, as well as the importance of specialisation in order to boost exportation.

Can you detail how the new Agricultural Processing Industrial Park facility will benefit the nation?

The agricultural sector is currently working in a traditional fashion and that creates a lot of jobs.

Agro-processing can create even more jobs than agriculture, for example if a farmer has a certificate or a degree in agro-processing, he/she can either go into industry or service. That is a main shift and an opportunity for us, because we can produce the required volume and quality for the agroindustry parks. We are currently still exporting primary agricultural products, like coffee; being able to process crops here will increase value and greatly benefit the nation’s economy.

You are one of the biggest exporters in the agricultural and agro-processing sector. How do you see exports developing in the country?

As a company, we are the biggest privately held producers of coffee in East Africa; with a production of approximately 2,000 metric tonnes. The productivity of our company is five metric tonnes per hectare, whereas the national productivity is around 0.6 metric tonnes. We export coffee for major different international companies. Therefore, we do not have any marketing issues; all our coffee is fully booked due to its quality, traceability and delivery as per requirements. We also produce tea: we are producing 7,000 metric tonnes per annum, 2,100 metric tonnes of which are exported; we have a seat in Mombasa where 40% of export goes to Unilever. Due to climate change, there are problems in the cultivation of tea in Kenya, but we cultivate our tea in the highlands here where it is easier. We have expanded; 4,500 of metric tonnes of tea is distributed locally,

approximately 80% of the total share of tea produced in the country is our tea. Moreover, we also produce roses; annually, we produce 80 million flowers. These go to Europe and the Middle East; for example Royal FloraHolland is one of our most important clients. We are producing around 5,000 metric tonnes of soya beans and we also produce maize (around 40,000 metric tonnes) and sunflowers. The input cost is increasing globally, but the agricultural commodity price is stable.

Crop diversity is essential to bringing about sustainable food security. How are you utilising neglected crops and plants across the country to enhance food and nutrition security?

We have 18 different cultivations, with different plants growing within a 10 kilometre radius. Diversification here is good, but at the same time we need to focus on specialisation.

If you specialise some of the crops and produce quality products, you will have a comparative advantage in supplying agro-industry and external markets. We produce small quantities in such an area, and that is a problem for export: we must consolidate. We are using technology as well, we know our soil and what its demands are, so, we can use the right fertiliser and that is what makes all the difference.

FORBES AFRICA readers would like to know why NOW is the right time to invest in Ethiopia and its agriculture sector?

The agriculture sector here in Ethiopia is the reason why you should invest here in Ethiopia, in Africa. If you invest in Europe, the return percentage is about 9%, while if you invest here you can get 20-25%, especially in the lowland area where 65% of the area accommodates 35% of the people. So, we have enough land owned by the government, making it easily accessible. We need the technology and experience of investors and they will reap the profits. There is opportunity now, untapped resources and business; it is the time to come to Ethiopia.

“We are using technology as well, we know our soil and what its demands are, so, we can use the right fertiliser and that is what makes all the difference.”

Lesotho Avenue, Nefas Silk Lafto Subcity, Woreda 03 P. O Box 1006 Telephone 251- 113 69 03 79/ 08 ethioagriceft@ethionet.et www.ethioagriceft.com

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ETHIOPIA - Africa’s Pride

Esayas Kebede

ETHIOPIA - Africa’s Pride

AFREXIMBANK Focus On Ethiopia

Ethiopia’s Path To Continued Success Afreximbank has been working with the public and private sector to assist the country in its inspiring journey to greatness.

O African Export-Import Bank Banque Africaine d’Import-Export 72B El-Maahad El-Eshteraky Street Roxy, Heliopolis, Cairo 11341, Egypt afreximbank.com 24 | FORBES AFRICA SEPTEMBER 2019

ver the course of the past fifteen years Ethiopia has outstandingly managed to turn around its stereotyped image as a haven for poverty and mismanagement.

The country has enjoyed robust economic growth for quite some time, with GDP growth rates averaging 10% over the last decade and positioning the country as one of the fastest-growing in the world. According to IMF projections, the positive trend is poised to continue in the near future, with Ethiopian GDP forecasted to grow by 8.5% in 2018/19.

The sustained and impressive growth performance achieved by the country is a combination of several factors, including improving macroeconomic management, strong investment and changing patterns of growth which have been reflected in expanding manufacturing output and industrial production. The welfare and development impact of the impressive growth performance have been positive as well. Between 2000 and 2016 national poverty rates fell markedly, from 44 % to 23.5 %, with significant reduction in both rural and urban areas. From the fiscal standpoint, the sustained economic growth rates and ongoing process of structural transformation are broadening the tax base. Government revenues increased by about 9.6 % over the same period and is supporting the expansion of public investment to further crowd-in private investment and sustain high rates of economic and per capita income growth.

On the other hand, Ethiopia’s trade balance still remained largely negative in 2017, with imports outpowering exports by US$ 11.8 billion, mainly due to several major infrastructure expansions projects (e.g. the Ethiopia-Djibouti railway). Ethiopia, as a matter of fact, imports machinery, electrical goods, vehicles,

refined petroleum and packed medications from countries such as China, USA, India, Japan and Italy, while the country mainly exports coffee, gold, leather goods and apparels. Albeit the Ethiopia’s intra-African trade rate is still a minor share (7.2%) of its total trade, the country enjoys a rich and long history of trading relationship with neighbouring nations like Somalia, Djibouti and Kenya.

The African Export-Import Bank (Afreximbank) has been working in cooperation with Ethiopian authorities and businesses to ensure access to its vast array of financing and advisory services, in accordance with its strategic goals of spearheading expansion and diversification of African trade as well as transforming of the continent through industrialisation and export development. The Bank’s long-standing collaboration with the CBE, Ethiopia’s main bank, has facilitated the crucial import of power and energy equipment for more than US$ 90 million.

Moreover, Afreximbank has committed to supporting Ethiopian entrepreneurs willing to engage in export manufacturing, including in value adding sectors such as coffee, cotton, leather goods and other commodities in an effort to stimulate trade.

Ethiopia’s improving economic landscape has created a flourishing roster of trade and investment opportunities that have put the country on the global investment map, with Foreign Direct Investment (FDI) registering an impressive growth over the last few years (from 0.6% of GDP in 2012 to 5.4% in 2016).

Afreximbank which has been part of the country’s success story is strengthening its presence to further support both sovereign and corporate entities in their quest for growth and export diversification, most notably through increased private sector access to foreign currency to help the country close its funding gap for trade-supporting infrastructure and improve its trade balance. Furthermore, the bank has been promoting the establishment of Industrial Parks and Special Economic Zones to increase value-added products in key sectors such as agro-processing, apparel, footwear and leather in an effort to help the country diversify its sources of growth and trade.

As the government of Ethiopia continues to work hard to diversify its economy and emerge as a major intra and extra African trade powerhouse, Afreximbank will be there all the way to help finance industries as well as trade-related services and activities and contribute to forge strong and enriching trade partnerships with other African countries and the world.

ETHIOPIA - Africa’s Pride

Tsehay Shiferaw Chief Executive Officer

Optimising Resources To Become A First-Choice World Class Bank Ethiopia’s biggest private bank, Awash Bank, has crafted a ten-year strategic roadmap which has resulted in an outstanding operational growth and superior financial performances over the past three years.

“Awash Bank has been recognised as the most profitable and the fastest growing private bank in all parameters.”

Awash Towers, Right Side P.O.Box: 12638 Tel: 8980 | +251115570167 Fax: +251115570136 contactcenter@awashbank.com www.awashbank.com

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Tsehay Shiferaw, CEO of Awash Bank, shared his views and ambitions to Penresa about the strategies the Bank has implemented in order to achieve its vision of becoming East Africa’s largest private bank by 2025.

Awash Bank is a pioneer private bank established in 1994 after the demise of the Military Regime in 1991 and the subsequent opening up of the banking sector to the private operators.

Awash Bank provides full-fledged banking services to individuals, businesses, corporate customers and the public at large with the objective of enhancing shareholders’ value and at the same time assisting the national economic growth of Ethiopia. The bank is one of the financial operators driving the economic growth of Ethiopia during the last 25 years.

Awash Bank has mobilised a significant amount of resource from the public and allocated it to the sectors that are an engine of economic growth. The bank mobilises different type of deposits that are mainly categorised into demand deposits, savings deposits and fixed deposits. It also provides full-fledged Interest Free Banking Deposit Services and Safe Deposit Box Service for precious items in the buildings the Bank owns in city as well as outlying regions of the country.

In addition to the above conventional banking services, new deposit products such as Awash Muday Bank and Toy Money Box Services, Lucy Women Special Saving Accounts, Financial Products and Services for Tour and Travel Operators, Elders as well as Religious Institutions are going to be introduced to the public very soon and the introduction of these products will further uplift the position of the Bank in addressing the demands of the unbanked and underbanked part of the population.

The Bank avails various need-tailored credit facilities to its customers such as

Term-Loan, Overdraft, Merchandise Loan, Letter of Guarantee and full-fledged Interest Free Banking credit services. The experience of the Bank in financing customers engaged in import and export business is also tremendous and, in fact, this financing scheme dates back to the formation of the bank.

Awash Bank has benefited from the double-digit economic growth of Ethiopia as evidenced from its extraordinary organic growth that resulted in sizable asset expansion. The Bank has opened more than 400 branch offices nation-wide, expanded its ATMs, POS, Mobile Banking (including M-wallet services) and Internet Banking services. In this regard, it has contributed to the financial inclusion endeavour of the government through expansion of different channels and is still continuing to aggressively invest in digital banking services.

Awash Bank has crafted a ten-year strategic roadmap that enables it to be the First Choice World Class Bank and one of the Top Ten Private Banks in East Africa by 2025. To this end, the bank has implemented various strategic initiatives during the past three years that cemented the leading position of the Bank among the private banks operating in Ethiopia. During the past three years, the Bank has been recognised as the most profitable and the fastest growing private bank in all parameters. Comparative analysis of top banks in East Africa vis-à-vis Awash Bank also reveals that Awash Bank is performing above average performance in almost all parameters.

Looking ahead, Awash Bank is well positioned to maintain its leading position among private banks operating in Ethiopia through a strong brand that allows access to a wider customer base, deploying state-of-theart technology and through employing and retaining talented and qualified manpower.

ETHIOPIA - Africa’s Pride

M-BIRR Major mobile money platform ensures Ethiopia’s social and financial transformation.

Driving Ethiopia’s Mobile Money Revolution M-BIRR is the first and largest mobile money service in Ethiopia, mobilising Ethiopian banks and microfinance institutions (MFI) through its convenient, efficient and reliable mobile wallet software. With services provided by the six MFIs including the five largest MFI’s in Ethiopia (namely ACSI, DECSI, OCSSCO, OMO and ADCSI), M-BIRR has built up a network of more than 1.5 million users nationwide since its launch in 2015.

Thierry Artaud, Chairman of MOSS ICT, the technology firm supporting M-BIRR services, states: “We are the leaders and pioneers of mobile money in Ethiopia; we have kick-started this revolution. We are here to deliver services to Ethiopian Financial Institutions by providing business, marketing and strategy consulting services to them; together we were the first organisation to have created a real-time payment settlement system.” Named after the country’s currency, M-BIRR is the only payment service in the country which has been designed for crossover services between MFI’s and bank payments while offering an extensive range of services.

With a network of branches and agents in over 8,000 locations taking in cash deposits, transferring funds between accounts and giving out cash, M-BIRR provides its users with the means to pay, among other things, groceries, fuel, farming inputs and chemicals, as well as facilitating the payment of Ethiopian Airline tickets and DSTV bills.

Recently, M-BIRR also partnered with pay-as-you-go solar payment platform provider, Angaza, providing rural communities that live off the electrical grid to buy solar kits in instalments and at discounted rates. Artaud explains

“We are the leaders and pioneers of mobile money in Ethiopia; we have kick-started this revolution. We are here to deliver services to Ethiopian Financial Institutions.”

Thierry Artaud, Chairman of MOSS ICT Consultancy Services the important role mobile money has in closing distances: “Mobile money is a massive operation and requires a huge amount of resources and a vast network of agents. Today, around 300 people are supporting agents and branches every two weeks, with roughly 8,000 people from all stakeholders currently working in making M-BIRR a reality.”

With 85% of Ethiopia’s population living in rural areas and a national low banking services penetration, M-BIRR’s drive to increase financial inclusion has been one of its key objectives, including the facilitation of rural customers’ access to social welfare payments.

Under the direction of the World Bank, Ethiopia’s Ministry of Finance, Food Security and M-BIRR have partnered tocreate a platform for the governmentrun initiative, Productive Safety Net Programme, providing digitally delivered payment and financial assistance to the underprivileged, including small farmers. “Thanks to this project, four million poor people receive money through M-BIRR in their villages,” affirms Artaud.

In 2018, the European Investment Bank (EIB), announced its support of M-BIRR business development and social inclusion with a fourmillion euro equity investment under the 800 million euro Impact Financing Envelope financing tool. Co-investing with DEG, a subsidiary of Germany’s KfW, this was the first time EIB invested in mobile financial technology in Africa.

Since it began its operations in Ethiopia six years ago, M-BIRR has transacted a total of ETB 18 billion, the equivalent to over US$640million.

Its deep and underlying impact upon Ethiopia’s economy lies in its determined assistance in opening new markets, developing business opportunities and providing possibilities for small businesses, while supporting microfinance institutions in order to set up more agents and branches to reach remote rural areas and ultimately assist the country’s growth and transform the face of finance for Ethiopia forever.

MOSS ICT Snap Plaza, Bole, Addis Ababa www.mossict.com Tel: +251 115 175 600

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ETHIOPIA - Africa’s Pride

Ethiopia Insurance Corporation Ethiopia’s giant insurer provides diversification prospects for insurance and investment.

Securing Ethiopia’s Valuable Assets Established by Proclamation No. 68/1975 on the 1 January 1976, the Ethiopian Insurance Corporation (EIC) was set up through the merging and combination of assets and liabilities of 13 national private insurance companies with a paid up capital of US$1.29 million.

The Corporation is on a mission to engage all classes of insurance business in Ethiopia as well as guaranteeing the provision of insurance services to the masses. “Financial strength is one of the competitive advantages of EIC,” states Netsanet Lemessa, CEO of Ethiopian Insurance Corporation.” After the nationalisation of the companies, we worked alone for more than 19 years and this really developed our capital. We are financially strong now.” EIC manages, administers, supervises and directs all insurance business transactions and negotiates, arranges, co-insures and contracts reinsurance treaties and policies with re-insurance companies as well as insurance companies. Once the market opened up for local investors in 1994, EIC was then re-established as a public enterprise, with a paid-up capital of ETB 61,007,038, and now reached ETB 592,000,0000. “Usually when companies want to insure their property, they come to EIC for their needs,” explains Lemessa. “The public prefer to be in the hands of the government as a warranty for liquidation or bankruptcy.”

With 37 types of non life insurance policies to cover property and liability risks and 19 types of life insurance policies, EIC counts upon a number of major and diversified clients engaged the various areas such as Aviation, Beverage, Construction, Power, Telecom, Manufacturing, industry etc. “Currently, there are huge developments in construction, power and infrastructure,” states Lemessa. “And EIC is getting good business from the construction. There is construction everywhere, in power, roads and telecommunications and we are really benefiting from these projects. They are 30 | FORBES AFRICA SEPTEMBER 2019

“Because of our strong capital, we are not afraid to invest. We are planning to invest more than ETB 200 million for IT infrastructure and software development.”

Netsanet Lemessa, CEO of Ethiopian Insurance Corporation valuable assets.” EIC also has diversified contracts with international insurers, associations of insurance, reinsurance pools and reinsurance companies. It accepts inward insurance business from a number of international insurance companies and deals with outward reinsurance business with the most renowned international re-insurers and is member of national and international insurance and reinsurance organisations including: the Ethiopian Insurance Association, Federation of Afro-Asian Insurers and Re-insurers, African Insurance Organisation and the Organisation of Eastern and Southern African Insurers.

EIC also co-finances different projects

in collaboration with banks and is a shareholder of African Reinsurance Corporation, the African Export-Import Bank, Motor Engineering Company of Ethiopia and the Universal Investors Share Company. “We have a strong relationship with international insurance companies, especially Munich Re, which is our leader,” affirms Lemessa. “We also work with wellknown Chinese insurance companies such as PICC, PINGAN, and CPPIC and sometimes transnational and international companies don’t even make a bid in the market because they often know us before they come to the country.”

With a view of improving performance and powering the sector growth, the Corporation is dedicated to providing training sessions for potential employees that focuses on the principles and practices of insurance and educates its trainees on the use of insurance and accounting software (INSIS and AGGRESSO). “We have more than 1,500 employees and 102 outlets in the country,” adds Lemessa. “We are really top-heavy on these branches network and our infrastructure, especially our IT and because of our strong capital, we are not afraid to invest. We are planning to invest more than ETB 200 million for IT infrastructure and software development.”

During EIC’s recent performance evaluation (2018/2019), it was revealed that the corporation had generated ETB 299.2 million from investment and other incomes, higher by 39.6% compared to last year’s same period performance.

With 43 years of promoting efficient, cost effective and innovative solutions for reliable insurance service and investment activities, EIC continues to firmly and dynamically lead the Ethiopian insurance market share, as it paves it way towards become world class insurer by 2025.

P.O. Box: 2545 Addis Ababa, Ethiopia Phone: +251-11-551-2400 www.eic.com.et eic.mdxvs@eic-et.com

ETHIOPIA - Africa’s Pride

Dr Eleni Gabre-Madhin Founder of blueMoon and blueSpace

Creating An Ecosystem Of Change And Innovation Ethiopia’s first youth-focused agribusiness incubator and seed investor is on a mission to shift mindsets and transform exceptional ideas into innovative companies that make the difference.

As the founder of blueMoon, the first youth agribusiness incubator and seed investor in Ethiopia, and also founder of blueSpace, Ethiopia’s first co-working space company, Eleni Gabre-Madhin is globally renowned as a thought leader on agricultural markets and African development. Focusing on Ethiopia’s youth and the need to think-out-of-the-box, she is currently intent on transforming the world, one dream at a time.

“There is no place on earth with a monopoly on good ideas.

We have so much potential for brilliant minds to come up with exceptional ideas that have a shot at changing the world.”

METI Building, 8th floor Namibia Avenue (between Edna Mall and Atlas Hotel) Bole sub-city Addis Ababa, Ethiopia Tel.: +251-11-667-4810 info@bluemoonethiopia.com www.bluemoonethiopia.com

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Please tell us about your vision for blueMoon.

How do you help other people launch their ideas?

First, demographics is such a driver, we really can’t expect any kind of economic growth or any kind of FDI to absorb the amount of young people we have in Ethiopia into the labour force. About three years ago, I was having lunch with a friend, and he said, “my goodness, three or four people have come up to you in the last half hour asking for advice. What are you going to do with all this social capital, credibility, and reputation?” So that’s where the idea of an incubator was born, as a way to identify and nurture young people with amazing ideas that are innovative, scalable, and have the potential to have big impact. During incubation, ideas become concretised and go from a crazy idea to an investible business. To do this, we need the whole ecosystem around startups: mentors, seed investment, business services, information, technical experts, and more. I believe that there is a rare breed of people who see problems and think: “Hey, I can solve this. This is an opportunity, not a problem.” These kinds of gamechanging dreamers are everywhere, and I firmly believe that there is no place on earth with a monopoly on good ideas. But the difference between where ideas thrive and grow and scale, and where ideas shrink and die, is the fertile ground on which those ideas fall. In Ethiopia, blueMoon is that fertile ground. And having launched a little over two years ago, we have incubated fifty companies to date, and aim to incubate three hundred companies in five years.

How have you mitigated risk?

Because incubation itself is a pretty risky undertaking, I decided to focus on a sector that

I knew well, and where I knew the players and the policy makers, and this was agribusiness.

Hence, blueMoon’s focus on agribusiness, although this is very broadly defined, and includes pre-production, post-production, data, waste, energy, nutrition, and fintech linkages.

Secondly, I partnered with a seasoned tech professional, Shem Asefaw, who joined blueMoon and we decided to build a strong track on digital agriculture, or agri-tech, a cutting edge area that is now ripe for innovation and attracts huge venture capital interest. As a consequence of this, we have established blueLab, the first state-of-the-art agri-tech Innovation Lab in Africa, and raised about US$ 1 million from the government of Denmark to finance it. blueLab provides technology services to our companies and beyond, with four pillars: Block Chain, IOT and AI, Digi-fabrication, and Mobile Commerce. A third way to reduce risk was to take an ecosystem approach and fill the gaps as we go. This led to our launching a co-working space company, blueSpace, earlier this year, where new and growing businesses can use office space and accompanying services, and this is the first in Ethiopia, as well. So a lot of firsts and a lot going on in just a few very exciting years!

Next we plan to set up Ethiopia’s first domestic currency seed fund, to enable us to scale up our efforts in investing capital into businesses we incubate. For this, we hope to engage with the government in a matching fund scheme, and for the government to become a first-loss investor, like elsewhere in the world, in order to attract private investors. We believe we have found a champion in the minister of Innovation and Technology and prime minister. With our huge population of young people, we have so much potential for brilliant minds to come up with exceptional ideas that, once in a blue moon, have a shot at changing the world.

And, if we can mobilise everyone in the ecosystem, from universities to investors to government policymakers, I believe we will do this in Ethiopia.

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ETHIOPIA - Africa’s Pride

Closing article Creating peace, equality, and opportunity in Ethiopia

Leading The Way To The Future

U

Ethiopia is lighting the path to progress by pursuing peace, appointing its first female president and selecting a gender-balanced cabinet, demonstrating that it is never too late to make a difference and create a country for the people.

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nder new Prime Minister Abiy Ahmed, Ethiopia is leading by example by making unprecedented changes that are pushing the country forward. The most publicised change under the new administration is the selection of the country’s first female President, Sahle-Work Zewde. He has embraced gender parity by appointing a gender-balanced cabinet with ten female ministers, where the roles of the Minister of Peace, Industry and Trade, Transport and more are held exclusively by women. PM Abiy Ahmed has even appointed some parastatals such as Lelise Neme, CEO of Industrial Parks Development Corporation. According to Neme, “He believes in the young generation, that they can be a CEO and that women can lead. What he has done within the last eight months could not be done within six years or ten years. It’s just a miracle, that is the only word I have for it.” PM Abiy Ahmed’s dedication to equality has caught the attention of the entire world, but the gender-balanced cabinet was only the beginning.

The liberating changes in Ethiopia are being called the Third Revolution, marking the shift from years of authoritarian rule toward democracy. PM Abiy Ahmed has released thousands of political prisoners, ended media censorship and is working to reform strict laws. The government is also working toward the partial privatisation of state enterprises which will allow for competition and help fund major development programmes. This progress has ignited passion in Ethiopians. Netsanet Lemessa, CEO of Ethiopian Insurance Corporation tells Penresa, “what our Prime Minister is doing will immediately change our country. I would like to thank him. I want to give my word to assist him as much as I can in the insurance sector.”

The future is now. The monumental changes that Ethiopia has achieved and is working toward opens the door to incredible investment opportunities. As Ethiopia entered the African Continental Free Trade Agreement on March 21, 2019, the financial sector is prepared for foreign investment. Ethiopia’s banks are placing their headquarters along the same road to improve the ease of doing business and increase FDI through a modern and stable financial sector, affectionately called the ‘Wall Street of Addis Ababa’. Among these, the new 198-metre Commercial Bank of Ethiopia central office will soon be the tallest building in East Africa.

Most notably, the investment climate is especially positive due to PM Abiy Ahmed’s dedication to pacification with neighbouring countries. Even before PM Abiy Ahmed was appointed, Ethiopia has been considered a hub in East Africa in spite of being a land-locked country, thanks to their flight connections with Ethiopian Airlines. Now, through PM Abiy Ahmed’s leadership, trade is destined to improve. On July 9, 2018, PM Abiy Ahmed signed a historic peace deal with Eritrea, ending a twenty-year conflict that reopened the borders between the two countries. “Forgiveness frees the consciousness. When we say we have reconciled, we mean we have chosen a path of forgiveness and love.” With this philosophy, it appears that the atmosphere of goodwill is spreading across the Horn of Africa.