October 2015 – Ethiopian Business Review

The current drought in Ethiopia has left more than 8.2 million people in need of aid. However, will this situation affect the country’s overall economic growth? That’s a subject of debate for many. Some say that one harvesting season isn’t likely to be overly detrimental to the country’s development goals. Prior droughts, however, paint a different picture. World Bank data demonstrates that Ethiopia’s GDP fell by 7Pct during the 1985 drought. Others are concerned that the drought will directly contribute to the country’s already increasing inflation rates. EBR’s Ashenafi Endale spoke with key stakeholders to learn more about the far-reaching implications of the current drought.

In his position, Tesfachew Taffere is responsible for reducing difficulties that developing nations such as Ethiopia face in international trade and development. His job is vital, since the gap between poor and wealthy nations continues to grow. Tesfachew was in Addis Ababa to launch the 2015 Trade and Development Report for the United Nation Conference on Trade and Department (UNCTAD), which deals with making the international financial architecture work for development. He says that while the ambitious development goals of some countries are impressive, many lack an integrated approach to developing their economies, which ultimately hurts achieving the goals set out in the plans.

Is the high cost of hotel rooms in Addis Justifiable?

According to a recently released report, Addis Ababa is the most expensive African city in which to book a stay in a quality hotel. This finding has generated a debate among hoteliers in the city – about the supply and demand for quality hotels. Some say that the country’s hotel industry is still growing and that its best years are yet to come. Others, however, say that more needs to be done to improve the quality and standards of promising hotels in the country. EBR’s Fasika Tadesse spoke with industry insiders to learn more about the on-going debate.

In recent years, the term ‘green economy’ – economic activity that is environmentally conscious – has generated buzz among policy makers. For sub-Saharan African countries like Ethiopia, the potential of developing their economies in an environmentally friendly manner is especially pertinent. This is because millions in the region rely on agriculture; a sector recurrently affected by climate change.

Though mobile technology has been relatively slow to come to Africa, data demonstrates that reality is quickly changing. A report by Political Feature Consultancy states that 90Pct of Africans will use mobile phones by 2017. In Ethiopia, the number of mobile phone subscribers has reached 32 million and that figure is likely to change fast, as on-going network coverage keeps growing. This has inspired several mobile phone manufacturers to establish operations in the country. The government says that this segment of the manufacturing sector is important to create jobs and save foreign currency. That is why it provides numerous incentives for companies engaged in the sector. Industry insiders, however, say foreign currency shortages and the illegal smuggling of mobile apparatuses – which controls 65Pct of the market – are threatening their operations. EBR’s Fasika Tadesse spoke with the involved parties about the promise and difficulties facing the sector.

A Man – and a Sector – at a Critical Juncture

EBR’s Fasika Tadesse spoke with Meshesha about this critical juncture, where NGOs, once seen as critical to Ethiopia’s development goals, hold a tenuous relationship with the government. Meshesha says there is a grave misperception about NGOs and the work they do in the country. The following is an excerpt:

The High Cost of Dialysis Puts Patients Suffering from Kidney Failure in Jeopardy

Kidneys serve an important function for humans – they are the organs that purify the blood by removing waste from it. Kidney failure, therefore, is a serious condition for people who suffer from it, usually requiring costly dialysis treatment. In Ethiopia, there are only a few medical centres that offer the treatment – and of those who do, one session can cost anywhere from ETB985 to 2,530. For the country’s poorest patients, this could prove to be detrimental financially and some medical professionals are calling on the government to intervene and improve the situation. EBR’s Meseret Mamo spoke with medical practitioners and those close to the issue to learn more about what is being done to help make dialysis more accessible in Ethiopia.

Ethiopia’s basketball programme has a rich history in Africa. In the 1950s, the country’s team was among Africa’s top five – and Ethiopia was even a founding member of the Federation of International Basketball Association (FIBA) African Championship. However, since the mid-1960s, the country’s basketball performance has been declining. In fact, Ethiopia hasn’t had a national basketball team for the last ten years. Basketball insiders say that this is due to the lack of structural support for the sport and a dearth of training facilities in the country. To that end, some people are trying to improve the status of the sport. EBR’s Ashenafi Endale spoke with basketball officials to learn more about what’s being done to bring prestige back to Ethiopia’s basketball programme.

Mind the ‘Attention Gap’

‘Insurance fraud’ has existed since the commencement of the insurance business in its modern sense. In general, insurance fraud transpires when a beneficiary acquires a benefit to which he or she is not otherwise eligible. The insurance directive issued by the National Bank of Ethiopia (NBE) in 2014 specifically defines fraud as “an act or omission by shareholders, directors, employees, customers, policyholders or insurance auxiliaries committed with the intention of gaining dishonest or unlawful advantage for the party committing fraud or for other parties.”

A few years ago, Melinda and I visited with a group of rice farmers in Bihar, India, one of the most flood-prone regions of the country. All of them were extremely poor and depended on the rice they grew to feed and support their families. When the monsoon rains arrived each year, the rivers would swell, threatening to flood their farms and ruin their crops. Still, they were willing to bet everything on the chance that their farm would be spared. It was a gamble they often lost. Their crops ruined, they would flee to the cities in search of odd jobs to feed their families. By the next year, however, they would return – often poorer than when they left – ready to plant again.

How Costly Will the Drought be?

‘Not all trade is beneficial… The problem with exporting agricultural products is someone else decides the price for the producer.’

Paying Top Dollar

Is the high cost of hotel rooms in Addis Justifiable?

Is Ethiopia Ready for Carbon Trading?

Foreign Currency Shortages, Illegal Imports Cast Shadow on Booming Local Mobile Phone Assembly

Meshesha Shewarega Executive Director of CCRDA

A Man – and a Sector – at a Critical Juncture

Life in a Person’s Account

The High Cost of Dialysis Puts Patients Suffering from Kidney Failure in Jeopardy

Can Ethiopian Basketball Return to its Former Glory?

Insurance Fraud:

Mind the ‘Attention Gap’

Who Will Suffer Most from Climate Change?