February 2013 – Page 2 – Ethiopian Business Review

The share of Boeing, the world’s largest aerospace company and leading manufacturer of commercial jetliners and defense, space and security systems, fell by 2.5 pct, on January 18, 2013 according to AFP.

This happened following the frequent incidents the Boeing 787 Dreamliner encountered. Some of the problems include ignition of its battery pack on Japan’s All Nippon Airways, the largest operator of the plane, shortly after the flight landed at Boston’s Logan International Airport. Fuel and oil leaks, crack in the cockpit window and a computer glitch were also found. These erroneously indicated a brake problem. Following this, the United States Federal Aviation Administration (FAA) has grounded all dreamliners in its jurisdiction, on Jan, 18. This follows another incident in Japan. All Nippon Airways said a cockpit message showed battery problems and a burning smell were detected in the cockpit and the cabin.

Applying some form of regulatory measure on the activities of businesses is always one of the major concerns of every nation. This is critically important to regulate the economic, social and political life of their citizens. Among the forms of regulatory measures, licensing is the most common instrument.

Business licenses are permits, issued, inspected and revoked by government agencies, that allow individuals or companies to conduct businesses within their jurisdiction. This doesn’t, however, mean that business licensing is a standard requirement in every nation.

Protocol and Etiquette

In contemporary world, thorough knowledge and use of proper manners is essential for establishing good relationships at all levels of interaction. Although standards for proper behavior have existed since the beginning of time, protocol and etiquette are the means by which good relationships are maintained and accomplished by implementing these conventional standards.

A lack of knowledge about protocol and etiquette results in offending others and hurting our business.

Now that the cost of living is rising dramatically in Addis Ababa and throughout Ethiopia employers are being forced to pay attention to the challenges their employees face. Many organizations now must revise salary scales or develop them due to pressure from employees to raise salaries. The competition for competent employees is also becoming stiff for skilled labor especially in the financial industry.

To retain good employees companies need not only to revise salary scales but fringe benefits as well. Many people feel that increasing salary improves performance but its most important function is retaining and attracting competent employees. To improve performance organizations must have incentives for individuals, groups and organizations.

Mulugeta Assefa, Chairman of the Freight Forwarders and Transistors Association, said on December 13, 2012 at a business lunchon discussion organized by the Addis Ababa Chamber of Commerce and Sectoral Association at Hilton Addis.

Abebe Abebayehu, a Senior Private Sector Development Advisor with the Ethiopian Public Private Consultation Forum/Ethiopian Chamber of Commerce, made a brief presentation on the challenges and opportunities of multimodal transport (MMT) in Ethiopia. Abebe explained that MMT requires efficient transport system which is usually achieved by liberalizing the sector.

Graph 1:Ethiopia’s GDP Growth Rates in Comparison with that of Sub-Saharan Africa 2004 – 2011 Source: World Bank, World Development Indicators (2012); and IMF, World Economic Outlook (2011).

This figure shows the overall economic performance of sub-Saharan Africa (SSA) and Ethiopia. From a high base of close to 14pct real GDP growth in 2004, Ethiopia achieved a growth rate of nearly double the region. Ethiopia’s model of massive public sector investment is attributed for the consecutive double digit growth. The country’s economic indicators seems to replicate the 1960’s and 70’s situation of Asian tigers; at the start of their economic takeoff. This broad based growth is set to continue in the foreseeable future according to the World Bank.

Anyone who has been in and out of Addis Ababa in the past four years would find it hard to ignore the changes that have swept the burgeoning city. When I left the capital in 2008, there was no denying that the city was at the edge of a boom; and for a young student who has to leave her country in search of opportunity, there is nothing more exciting than the prospect of development. The most apparent evidence of this boom came in the form of road construction. Twice a year, I would return to the city, only to be shocked and awed at the sprawling new overpasses, neatly-tiled sidewalks and widened avenues. Only this year, upon my permanent move to the city, did I begin to understand the downsides of such sweeping undertakings.

Addis Ababa concluded celebrating its 125th founding anniversary recently. Though the city managed to become the permanent diplomatic hub of Africa in the second half of the 20th century, it is far from becoming the economic and cultural center of the continent. It seems that the city has missed the essential ingredient its name carries which literally translates to being a fresh flower. Such a connotation alludes to neatness, being livable in terms of social and economic infrastructure like schooling, health, water and sanitation, electricity, housing, and transport facilities. The development of the city is not up to its history writes Mango B., Ethiopian Business Review Special Contributor, though it is on fast track to catch up with its peers in the developed world.

When the Ethiopian economy was hit by a foreign currency crunch in 2009, the East African Bottling Share Company, which bottles Coca Cola in Ethiopia, was forced to stop production. The Company was unable to import raw materials because opening a letter of credit (LC) was a challenge at the time. This led to the closure of its plant in March 2009. Production resumed when the Commercial Bank of Ethiopia allowed the bottler to open a 1.8 million dollar LC. Four years later, the Ethiopian Economy is experiencing the same bottleneck. However, this time around, the Company seems prepared for the storm. It has received a 25 million dollar transfer from its shareholders abroad so that history will not repeat itself. Mr. Greig Jansen, Managing Director of the Company talks with Amanyehun R. Sisay, Executive Editor of Ethiopian Business Review about the situation and what is in store for Coca Cola, Excerpts:

Addis Ababa Chamber of Commerce and Sectoral Association (AACCSA) is preparing to begin a one hour television program. The chamber has concluded an agreement with the Ethiopian Radio and Television Agency to start transmission of the program as of February 2013, the Relations and Media Department of the Chamber said.

Boeing’s share declined following Dreamliners battery problem, others

Business License: Major Legal Effects of Validity, Renewal and Cancellation

Appropriate Protocol, Netiquette in Email Communications Builds Confidence, Boosts Business

Consistent Salary Scales Retain Good Employees

“I don’t want to hear the word multimodal anymore”

Ethiopia’s GDP Growth Rates in Comparison with that of Sub-Saharan Africa

Trading Comfort for Development: A City-Dweller’s Rationale for Patience on the Road

Addis Ababa: A Gradual Change Taking Roots

You Cannot Afford Not to Invest in Ethiopia

AACCSA to Begin TV Program