Ethiopian Business ReviewIn modern economies, keeping tax rates at reasonable levels is uncompromised, because of its significance in promoting the development of the private sector, creation of a transparent economy, and the formalization of businesses. The reality is different in Ethiopia. Tax is usually misunderstood as an instrument to increase government revenues, even at the expense of businesses’ survival, with the latest being the excise tax bill introduced by the government last month.
The 2018 Corruption Perception Index, published by Transparency International, measures the perceived levels of public sector corruption in 180 countries and territories. The index scores on a scale of zero (highly corrupt) to 100 (very clean). Accordingly, sub-Saharan Africa is the lowest scoring region on the index, and has failed to translate its anti-corruption commitments into any real progress. A region with stark political and socio-economic contrasts and longstanding challenges, many of its countries struggle with ineffective institutions and weak democratic values, which threaten anticorruption efforts.
Ashenafi EndaleAnother ‘flawed decision’ just around the corner
Learning from media outlets of new rules, laws or regulations to be enacted the next day without any consultations with the very entities it will govern, is a very common phenomenon in Ethiopia. The new excise tax law is no different. It was after the draft proclamation was approved by the Council of Ministers that businesses affected by the amendment started to voice their concerns. While the government plans to raise tax revenues in congruence with the growth of the economy, businesses are likely to feel the brunt of the bill. Many are complaining that the bill will adversely impact their revenues, while government officials argue the amendment of excise tax rates has shifted the burden of excise tax from producers and importers to end consumers. EBR’s Ashenafi Endale investigates.
Tadesse Tilahun, CEO of NOC Ethiopia, Discusses the 2019 Financial Performance of his Company, the State of the Oil Industry
Born in 1950 in Wollega, western Ethiopia, Tadesse Tilahun, a father of three, made tremendous strides in his career before becoming a Shareholder and General Manager of National Oil Ethiopia (NOC). After studying accounting in the School of Commerce and Addis Ababa University, he directly joined the Shell Group where he acquired professional trainings in several countries. At Shell, he served in many African countries at numerous managerial positions.
Operations, Oil and Chemical Marketing General Manager of Shell in Nigeria; Shell East Africa Hub Regional Supply and Operations Manager (based in Kenya and encompassing 11 countries); and Country Chairman and General Manager of Shell Ethiopia Limited are among his former posts at the Shell Group. Before he was invited to NOC, Tadesse had already accumulated deep expertise on the east African oil market.
Having one of the largest reserves of human and natural resources, Ethiopia should have had a prosperous economy. However, it is one of the poorest countries in the world, as manifested through low per-capita income and low human-development index. The vast expansion of education and health services over the past two decades has not solved the problems of farmers and pastoralists or changed the lives of the overwhelming majority. As a result, the contribution of human capital to economic growth remains insignificant in Ethiopia. EBR’s Ashenafi Endale explores to shed light on the matter.
Despite having an immense potential, poultry farming is still at its infancy in Ethiopia. Commercial poultry production is characterized by a large number of small-holder farms, and few medium to large scale poultry farms. Production is concentrated mainly in the Addis, Bishoftu and Adama areas, with some small concentrations around northern and southern rural towns. Farmers lack basic knowledge on good poultry keeping practices and the inputs needed (feed, vaccines, drugs, and hardware such as drinkers and feeders) are scarcely available. Meanwhile, the demand for poultry is growing in a market which is characterized by seasonally fluctuating prices owing to religious fasting periods. EBR’s Ashenafi Endale explores.
Kiya AliOnce home to emperors of the imperial times of Ethiopia, and later serving as a torture facility for Dergue regime, Unity Park has become the talk of the town since its opening three months ago. Financed by the United Arab Emirates, the construction of the Park cost more than USD160 million. The park displays what Ethiopia looked like during the 19th and 20th centuries along with Ethiopia’s great and recent emperors, including Emperor Menelik II and Emperor Haile Selassie, both of whom are featured with life-size waxwork statues. It also features the post-1991 political works of EPRDF-led government in the form of sculptures in the garden, representing the nine ethnic-based regional states. EBR’s Kiya Ali, who visited the park last month, explores.
For an Ethiopian who has not been there before, groups of people who play music loudly in the middle of sidewalks and colorful matatus are distinct characteristics of Kenya’s capital, Nairobi. A Pentecostal preaching the Bible on the side of the road, long queues for transportation, and deafening music from boutiques, on the other hand, are commonalities the city holds with the Ethiopian capital Addis Ababa. EBR’s Kiya Ali, who visited Nairobi last month, explores.
Abebech Gobena defines selfless giving, even losing her marriage to help someone in dire need of help. Life-long friends and colleagues witness her altruistic acts. Indeed, she is a living testament that someone’s inner candle will not go off as long as it lights up another candle. Her endeavors range from caring for children in need as well as economically developing other members of her community. Her work is perhaps the first of its kind in Ethiopia—an inspiration to many—and her name and goodwill will live long. EBR’s Kiya Ali looks into this exceptional woman’s life and work.
Not more than 10 oil suppliers were operational in Ethiopia a decade ago. Now that is just history. The number has now tripled, reaching 33 as of December 2019. Not only this, the ownership structure of these companies has also changed greatly. While oil suppliers established a decade ago were largely owned by foreigners or big corporate, they are now being replaced by locals. But making a profit and staying afloat has not been easy for the majority of them, largely because of the low profit margin set by the government and shortage of forex needed to import lubricants and bitumen. EBR’s Ashenafi Endale explores.
