Ethiopian Business Review – Page 13 – Ethiopian Business Review

Housing Prices Have Tripled in Less than Two Years

Buying houses from real estate developers incurs 15Pct Value Added Tax (VAT) and 6Pct title deed transfer fee on the actual price tag. Additionally, real estate developers take more time to deliver housing units which further escalates the cost of construction—ultimately pushing the price tag further up. The price of houses developed by real estate firms has further skyrocketed because of the price of finishing materials, which are almost entirely imported, have dramatically shot up by over 200Pct over the past couple of years. This is attributable to the worsening foreign currency shortage and subsequent rising exchange rates of major foreign currencies against the local currency.

This makes houses built by real estate companies over expensive for the vast majority of Addis Ababans. As a result, house buyers have been looking for affordable options.
Villas developed by unlicensed individuals have become one of the options. These players have lesser tax obligations and deliver houses for less in a shorter time span by using adhesives and other chemicals to shorten the curing time of concrete. For this and the curativeness of the business, they are mushrooming and becoming more active in the housing market.

As their number increases, there is fear that the market will become even more informal and out of the watchful eyes of the government. EBR explores.

The global payments business leader, Mastercard Inc., has inked a partnership agreement with a local tech firm, Eaglelion System Technology.

MasterCard, a global payments company with a global reach that spans more than 210 countries, chose to collaborate with the tech firm to provide financial, technical, and advisory support on several products the firm developed.

Eaglelion has developed platforms with the monikers “Getrooms,” an accommodation search engine; “Get Fee,” which was unveiled in association with the state-owned Commercial Bank of Ethiopia; and “Dubepay,” a novel”buy now, pay later” consumer financing platform in alliance with Dashen Bank.

“In the age of the digital world, it is a matter of urgency to revolutionize and make Ethiopian finance system, thereby boosting the flow of remittances in the country,” said Bersufikad Getachew, founder of Eaglelions System Technology, whose fintech-based platform portfolio increased by more than ten in just two years.

“We are gearing up to launch the first continental financial summit with the aim to foster financial inclusion and regional economic integration,” he said.

Elfaged Aregahegn, the business development director for MasterCard in Ethiopia, Sudan, and Somalia, revealed that the cooperation deal will begin to be implemented in January 2023 and said that the corporation considers the relationship to be a game changer.

MasterCard is a technology company in the global payments business, renowned for developing advanced payment solutions and seamlessly processing billions of transactions around the world, with over 1.9 billion cards and 35.9 million acceptance locations in 210 countries and territories and 150 currencies.

South Africa, Ethiopia, and other African nations anticipate receiving a portion of a USD 40 billion fund from Vatican and UK businesses to help their economies and fund government development initiatives.

The initial benefactor from these companies may be Tanzania, which is now working on its two large-scale strategic projects, the Julius Nyerere Hydropower and Standard-Gauge Railway (SGR).

Liberalization might increase prospects for foreign investment—it nurtures competition and improves efficiency. When trade and investment obstacles are lifted, businesses must engage in a more intense competitive field for market share. Resultantly, consumers will purchase goods and services of superior quality at lower prices. It can also inspire innovation and the improvement and efficiency of production methods of businesses. The ensuing cost savings may then be passed on to customers in the form of lower prices or better quality. A more prosperous firm then leads to increased tax revenue for governments.

Every year, the African Business Top 250 Companies charts the rise of innovative, strategic and resilient African businesses that straddle the continent, make huge profits and invest billions into Africa-wide strategies to seize future opportunities.

Telecommunications firm MTN Group soars from #13 to #4 on this year’s ranking after more than doubling its market capitalization to USD24.5 billion, up from USD11.1 billion in 2021.

Ethiopia garnered USD121 million from the export of 22,689 tons of meat and meat products during the 2021/22 fiscal year.

The 11^th edition of ETHIOPEX and 7^th session of ALEC tandemly kicked off at Ethiopian Skylight and will continue until 29 October 2022. Over 4,000 visitors, traders, and stakeholders from Ethiopia and neighboring countries are expected to visit the event organized by Prana Events and supported by the Ministry of Agriculture, Pan African Chamber of Commerce and Industry, and SNV Netherlands Development Organization.

The historic Africa Hall, home to the genesis of the United Nation’s Economic Commission for Africa (UNECA) and the Organization of African Unity (now African Union) is to be renovated via USD56.9 funding from the UN. The work will begin in November and is expected to finalize in mid-2024.

The landmark building built in 1961 was dedicated to the “services of the African people” by Emperor Haile Selassie and of which, member states of the UN have recognized the need to preserve and update its functionality and sustainability while preserving culture and patrimony.

The project area comprises 8,300 square meters of floor area and 4,500 square meters of landscaped areas and will feature a new visitor’s center. The ceremony to commence the works was led by Antonio Pedro, acting Executive Secretary of UNECA and Tesfaye Yilma (Amb), State Minister for Political and Economic Diplomacy at the Ethiopian Ministry of Foreign Affairs.

The makeover of the hall is hoped to strengthen heritage tourism, one of the tenets of the AU’s Agenda 2063 program.

Africa Hall’s Renovation

Photo Credit: Samuel Habtab

The CFO Forum Ethiopia was held in Addis Ababa with the purpose of creating a platform for finance professionals and stakeholders. Organized by the local consulting firm HST and the Association of Chartered Certified Accountants (ACCA) Ethiopia, this year’s them was “Ethiopia’s International Financial Reporting Standards (IFRS) Adoption. The journey to-date and the way forward.”

HST presented the major factors making Ethiopia’s IFRS implementation difficult and these included the shortage of appropriate experts and expertise, inadequate regulation, shortage of appropriate training and education systems, lack of support by company owners and other stake holders, and the high cost of implementation.

Ethiopia has chosen to fully adopt IFRS and is now amongst approximately 120 nations to have done so.

If there is any commonality among the series of political administrations that have ruled Ethiopia over the decades, it is the demonizing of Egypt as a nation that always dreams of the downfall of Ethiopia as a nation. Even though these administrations do not present concrete evidence as to the extent of Egypt’s involvement, one may not fall far from the truth to assume that Egypt benefits less from a sturdy east African nation capable of taking its fair share of a river’s waters that have disproportionately only benefited Egypt for centuries.

The backbone of the Ethiopian economy in both job creation and export values, Coffee registered record numbers in the just completed Ethiopian fiscal year of 2021/22, passing the USD1 billion mark for the first time in history. Even though prices have been inflated due to inflationary pressures worldwide, quantities exported have also grown. The fiscal year saw 300,000 metric tons exported to gain USD1.4 billion.

Housing Market Goes Crazy

Housing Prices Have Tripled in Less than Two Years

MasterCard ink partnership MOU with local Tech firm

Firms from Vatican and UK to invest USD 40 billion fund in Africa

Liberalization is Inevitable Should be Planned

Top 10 African Companies in 2022

Poultry & Livestock Expo Kicks-off

Africa Hall’s Renovation for USD57 million

Forum for Finance Leaders

Egypt Intervention Excuse too Cliché

Top 10 Coffee Exporters, 2021/2022 Fiscal Year