The National Bank of Ethiopia (NBE) has ordered a ban on issuing letters of credit for the import of close to 40 selected goods. These include all fuel-consuming automobiles, alcoholic drinks, and cosmetics products, among many others. The decision is seen by few as a proactive move to encourage local manufacturing and exports, while others have taken it as a reactive measure in response to the nation’s dire shortage of forex reserves. Some go as far as claiming the move is an official admission of the beginning of the end for the Ethiopian economy. Regardless of which side is right, the impact of the prohibition on consumers has been rough. Prices for the embargoed commodities are only climbing as importers scramble to find new, and more expensive, ways to ship them into the country. EBR’s Eden Teshome looks into the government’s decision and what it means for the consumer.

The Ethiopian-Chinese partnership has developed substantially over the past three decades. Ethiopia is a central hub for China’s Belt and Road Initiative, adopted by the Chinese government in 2013 to invest in nearly 150 countries as part of the centerpiece of Xi Jinping’s foreign policy. Over 300,000 Chinese immigrants are thought to be living in Ethiopia, creating a niche market for Chinese food. The phenomenon has led to the thriving Rwanda Market, where dozens of stores cater to their customers with a focus on Chinese ingredients. More and more Chinese restaurants are springing up throughout Addis Ababa as well, offering a new kind of cuisine to an increasingly curious
Due to the nations’ economic cooperation, Over 300,000 Chinese immigrants are thought to be living in Ethiopia, creating a niche market for the consumption of Chinese food and turning the former Rwanda Market into the only urban food market in Addis Ababa that focuses on Chinese items. Due to the close economic ties with China and other Asian nations, in addition to the open-air China market, many restaurants have sprung up throughout Addis Ababa offering a variety of Chinese dishes to fellow Chinese expatriates as well as a growing number of Far East Asian cuisine fans, altering the city’s food landscape, writes EBR’s Bamlak Fekadu.

The history of duty-free privileges dates back as far back as 1986, when they were applied to petroleum extraction investments, and 1993 when they were applied to the mining sector. Recently, Ethiopia has adopted a new investment incentive regulation, Number 517/2022, which was approved by the Council of Ministers in May and was published in the Federal Negarit Gazette in July. The incentive regulation has repealed the investment incentives provided under a 2012 Council of Ministers regulation. However, directives issued prior to the enactment of the new incentive regulation will remain under enforcement until replaced by new ones to be issued by the Ministry of Finance . In this article, EBR’s Bamlak Fekadu reviews the new incentive regulation.

The administration of Abiy Ahmed (Ph.D.), has been undertaking wide-ranging legal reforms as part of its pledged economic liberalization and modernization process. Legislation has been devised or amended to regulate exchange rates, interest rates, demonetization, transaction limits, a loan freeze, and capital thresholds, among others, over the past couple of years. Among the reforms was also a revision of the half-a-century-old Commercial Code that many saw as overdue. However, changes to foreclosure laws in the new Code have left banking executives uneasy, writes EBR’s Bamlak Fekadu.

Urban financing – the process of allocating financial resources to support urban development projects – includes the mobilization of public and private funds to finance infrastructure, housing, and economic development initiatives in cities. The major source of revenue for almost all cities and towns in Ethiopia has been the state’s coffers. Fiscal centralization and a lack of financial autonomy have been hindering efforts at revenue collection, while corruption, inefficient infrastructure, and a lack of political commitment have made matters more difficult. Although there have been recent improvements, much remains to be desired in the collection of local revenues, writes EBR’s Addisu Deresse.

The Lucrative Business Taking Workplace Aesthetics to New Heights

Fiberglass has become nearly ubiquitous over the past century as the strong, lightweight material finds use in the manufacture of everything from boats to buildings and pipes. Though a bit late to the scene, businesses in Addis Ababa are catching on to the profitability and demand involved with fiberglass. From importers and processors to schools that teach their students how to fashion versatile material into marketable products, there is a new wave of activity in the fiberglass line of business. In addition to the lucrative profit margins, fiberglass offers fresh aesthetics to homes and offices, writes EBR’s Eden Teshome.

The new tax regulation on the import of electric vehicles (EVs) in September made them much more attractive to consumers and perhaps traders also. Value-added tax, excise tax, and surtax were completely removed while customs duties were dramatically reduced even to the point of zero duty for completely disassembled vehicles. The tax reform’s goal is to implement a transportation system that protects public health and the environment, properly uses renewable energy sources, reduces forex outlays for fuel, and makes electric vehicles available to the general public at affordable prices. For Ethiopians and industry observers who have been shocked by the continued surge of prices in the car market, the new proclamation may serve beyond its stated goals. In this article, EBR’s Eden Teshome, looks into the impact of the new proclamation in terms of stabilizing the overall car market.

The export sector in Ethiopia has been under scrutiny for poor performance for decades. As Ethiopia has not been a manufacturing hub as such, the criticism has been downplayed. Despite the number of investors who are seemingly interested in the export business, the country has also been struggling to export value-added items including its flagship coffee. Looking at the exponentially increasing number of exporters that joined the line of business in the last five years, one may think new entrants are helping the country’s success in global trade. Unfortunately, exporters are increasingly in the business to support their imports. And there are even more controversial activities in the field. Though the number of exporters and Dollars earned has shown significant increases, practices in the export sector are full of malpractice that that are hurting the Ethiopian economy, writes Selome Getachew.