Blog – Page 48 – Ethiopian Business Review

Afewerk Mengesha Captures Ethiopia’s Essence through Art

Afewerk Mengesha is a renowned Ethiopian artist who has significantly contributed to the country’s art scene. Born in 1943 in Addis Ababa, Afewerk was one of the first Addis Ababa Fine Arts School graduates in 1963. Despite facing challenges due to his hearing impairment, he pursued his passion for art and has since become known for his works exploring Ethiopian history, culture, and modern life themes. Afework’s artistic journey has been marked by perseverance, as he overcame obstacles to establish himself as a professional artist, working in various roles before focusing on his studio practice after retirement. His paintings, often executed in oil on canvas, have been exhibited at prestigious venues in Ethiopia, showcasing his ability to capture the essence of his homeland through his distinctive artistic vision, writes EBR’s Eden Teshome.

Beyond-BMI-Unveiling-the-Best-Tools-for-Healthy-Weight-Management.jpg

One of the most concerning health challenges facing modern society is obesity. Obesity increases a person’s risk of developing many health problems. Studies show that people with obesity die younger than people who have a healthy weight. The studies also show that the risk of death goes up the heavier a person is. The degree of increased risk depends on how long the person has had obesity and what other medical problems they have. People with “central obesity,” those carrying extra weight in the belly area, might also be at risk of dying younger. EBR’s Dr. Brook Genene takes a closer look at this health issue and how it affects Ethiopians.

Ethiopia’s Import Substitution Strategy Fuels Economic Growth

Ethiopia has long grappled with a reliance on imported construction materials, stifling the growth of its domestic industries. However, a renewed push towards local production is poised to transform the country’s construction and telecom landscapes. The government’s import substitution strategy has identified over 90 products, including telecom equipment and construction materials, to be produced domestically within the next decade. Companies like Woda Metal Industry have established local manufacturing facilities, providing network operators with telecom towers and other critical infrastructure. This shift towards domestic production is a significant catalyst for Ethiopia’s industrialization and economic development, unlocking cost savings, job creation, and export opportunities. By reducing reliance on imported materials, Ethiopia aims to build a more self-reliant, globally competitive economy bolstered by technological innovation and a thriving ecosystem of local suppliers and manufacturers, writes EBR’s Eden Teshome.

The Cost of Ethiopia’s Reliance on Foreign Contractors

Ethiopia has seen rapid industrial growth in recent years, facilitated by the construction of new industrial parks by Chinese multinational firms. While the government initially sought to involve local contractors in building these parks as part of a capacity-building initiative, the local firms needed help with infighting, delays, and poor-quality work. In contrast, the Chinese firms completed projects on time and with reasonable quality. As a result, the construction of significant infrastructure projects in Ethiopia, from industrial parks to government buildings, has increasingly been dominated by foreign contractors, especially Chinese ones. This reliance on foreign firms highlights the shortcomings of the local construction sector in Ethiopia, which has yet to demonstrate the expertise and reliability required for such large-scale, high-profile projects. However, this has its dents on the economy as the country spends meagre foreign currency on contractors, writes EBR’s Samuel Getachew.

Will Trade Liberalization, Local Production Uplift Consumers or Overwhelm Domestic Businesses?

The recent policy change in Ethiopia regarding industrial parks and trade liberalisation presents opportunities and challenges for businesses and consumers in the country. By allowing companies in the industrial parks to sell up to 50% of their produce locally and opening retail/wholesale sectors to foreign participation, policymakers aim to boost domestic production, increase competition, and stabilise market prices amidst persistent inflationary pressures. However, the implementation and impact of these measures remain to be seen. EBR’s Eden Teshome has spoken to key stakeholders – manufacturers and consumers – to understand how these policy shifts will likely reshape Ethiopia’s economic landscape.

The Evolution of Corporate Governance in Ethiopian Banks

Recently, the National Bank of Ethiopia (NBE) has issued a series of directives about the banking industry. These include directives such as “Requirements for Persons with Significant Influence in a Bank” and “Bank Corporate Governance.” One area that gained attention for reform is bank corporate governance. Deficient corporate governance practices in the banking industry have required repeated NBE interventions. In the past year alone, the controversies around Nib Bank and Amhara Bank and the subsequent NBE interventions indicate the situation.

The National Bank of Ethiopia’s (NBE) latest report reveals encouraging progress in the fight against inflation. In April 2024, the country witnessed a significant decrease in inflation rates compared to previous years. Year-on-year inflation fell to 23.3%, marking a substantial ten percentage point decline from the prior year. While food inflation remains relatively high at 27.0%, non-food inflation has experienced a remarkable drop to 18.0%. Many attribute the decline to the slowdown in money supply growth. The report suggests that inflationary pressures will continue moderating, with a projected year-on-year inflation rate of approximately 20% by June 2024. These developments signal positive strides in Ethiopia’s efforts to achieve macroeconomic stability, EBR’s Eden Teshome reports.

The National Bank of Ethiopia (NBE) has issued a new directive aimed at regulating the investment activities of banks operating in the country. The “Limitation on Investment of Banks Directive No. SBB/92/2024” sets clear guidelines and restrictions on the types of investments banks can make.

The directive is intended to ensure sound and prudent practices in bank investment activities, promote diversification, and manage risk exposure. It also seeks to encourage bank investment in capital market service providers while ring-fencing banking business from capital market operations.

Dashen Bank, one of Ethiopia’s biggest private bank, has reported a profit of ETB 6.6 billion in the 2023/24 fiscal year, further solidifying its position as a dominant player in the country’s banking sector next to Awash Bank.

Established in 1995, Dashen Bank has grown to become a formidable institution, leveraging its innovative approach and expertise to drive consistent growth. According to the bank’s financial statements, Dashen Bank recorded a pre-tax profit of ETB 5 billion in the last fiscal year, representing a 31.9% increase compared to the previous year.

Awash Bank, Ethiopia’s private commercial bank, has announced a substantial increase in its profits for the 2023/24 fiscal year. According to the bank’s financial statements, Awash Bank reported a pre-tax profit of ETB 14 billion, representing a 42.85% increase from the previous year’s figure of ETB 9.8 billion.

The bank’s total assets also reached a new high, growing to ETB 224 billion as of June 30, 2023, up from ETB 95.6 billion recorded at the end of June 2020. Additionally, Awash Bank’s paid-up capital saw a significant increase of 42.85%, rising from ETB 10.2 billion to ETB 14.6 billion during the same period.

Finding Inspiration in Heritage

Afewerk Mengesha Captures Ethiopia’s Essence through Art

Beyond BMI Unveiling the Best Tools for Healthy Weight Management

From Reliance to Resilience

Ethiopia’s Import Substitution Strategy Fuels Economic Growth

Beyond Efficiency

The Cost of Ethiopia’s Reliance on Foreign Contractors

Ethiopia’s Economic Tightrope Walk

Will Trade Liberalization, Local Production Uplift Consumers or Overwhelm Domestic Businesses?

From Shareholder Power to Depositor Protection

The Evolution of Corporate Governance in Ethiopian Banks

From Crisis to Control Ethiopia’s Inflation Story

National Bank of Ethiopia Issues New Directive to Limit Bank Investments

Dashen Bank Reports Profit of ETB 6.6 Billion

Ethiopia’s Awash Bank Reports Remarkable ETB 14 Billion Profit Amid Credit Cap Challenges