If ratified by half and more than half of the signatory countries, AfCFTA will become one of the world’s largest trading blocs by creating a single market of up to 1.2 billion people and a collective Gross Domestic Product (GDP) of more than 2 trillion US dollars.

The trade pact is expected to spur economic growth, industrialization, improve infrastructure development and business diversification in the Continent.

“The agreement helps Ethiopia to attract more foreign direct investment  (FDI),”  Dr Berihu Assefa, a Senior Associate Researcher at the  Ethiopian Development Research Institute (EDRI) told APA on Friday.

The AfCFTA would also have significant importance for Ethiopia’s ongoing economic transformation, the researcher added.

Zemedeneh Nigatu, Chairman of the US-based Fairfax Africa Fund, on his part noted that the agreement boosts the global competitiveness of Ethiopia’s manufacturing sector.

“It will bring immediate benefit for Ethiopia in the years to come once the country starts to add values on its agricultural products,” he added

Intra-African trade makes up only 16 percent of total trade in the continent, which is much more less than compared to other regions, such as Europe, which currently stands at 60 percent.

The continental free trade area, which is among the top priorities in the AU Agenda 2063, aims at tackling non-tariff barriers which hamper trade between African countries, such as long delays at the border.

The agreement commits countries to removing tariffs on 90 percent of goods.

Source: APA

Ethiopa’s Netsanet Gudeta broke Kenya’s dominance in the World Half Marathon Championships by smashing the women’s only race world record in Valencia, Spain on Saturday.

Kenyan women had swept the medals at the previous two championships but Gudeta pushed on alone from 15 kilometers to win in a time of one hour, six minutes and 11 seconds.

The 27-year-old finished a comfortable 43 seconds ahead of Kenyan Joyciline Jepkosgei, who holds the overall world record of 1:04:51. Jepkosgei’s compatriot Pauline Kamulu came third.

 

Over two months into its commercial operation, the Ethiopia-Djibouti railway has brought much cheer and optimism to Ethiopian passengers.

Alemu Mersha, a young businessman travelling from Addis Ababa to Ethiopia’s second largest city Dire Dawa, is one of the passengers aboard the train on Sunday, which he said is an “advantageous way to do business.”

The 756-km railway, which officially commenced its commercial operations for both passenger and freight services between the two countries in January, connects landlocked Ethiopia to its neighbouring Red Sea nation of Djibouti.

According to Mersha, the business is not as usual since the railway commenced its operations, both in terms of its affordability and time efficiency.

“There were times that I had to travel via airplane from Addis Ababa to Dire Dawa and vice versa whenever I had tasks at hand to accomplish within a short period of time,” said Mersha, complaining about the huge amount of money spent on the journeys.

The Ethiopia-Djibouti railway currently charges less than 25 U.S. dollars for a two-way passenger service from Addis Ababa to Dire Dawa, while an airplane service costs at least 130 U.S. dollars.

Alemayehu Leyew, another passenger who is experiencing his first rail travel to Djibouti with his wife for recreation purpose, said the rail travel is much more comfortable than he previously thought.

“This is my first time to use a rail service for transportation,” he said. “It feels great and it’s also comfortable.”

Leyew also urged to scale up the railway to connect other parts of the East African country.

“We need to scale up the rail transportation service into every corner of the country so as to speed up our country’s modernization process,” Leyew said.

Saliya Mehamed, an Ethiopian captain at the Ethiopia-Djibouti railway transportation service, told Xinhua on Sunday that the feedback from the passengers is “very positive so far.”

“Our customers are very happy and the number of customers is increasing very much,” she said.

The railway, contracted by two Chinese companies China Railway Group (CREC) and China Civil Engineering Construction Corporation (CCECC), is currently managed by a consortium of Chinese companies for a period of six years.

Wang Tao, Human Resource Department Head at the Ethiopia-Djibouti Standard Gauge Rail Transport share-company, told Xinhua that enabling local professionals to take over the railway transportation system is underway.

According to Wang, the railway service will be completely managed by locals within the coming few years as the knowledge transfer procedure is effectively underway.

Ethiopian professionals who are taking part in the knowledge transfer also said both theoretical and practical training are helping them become the pioneer rail transportation professionals in the East African country’s recent history.

“We are so glad to take this opportunity because it’s a new system for us,” said Saliya Mehamed, who envisaged to become a rail captain in the near future.

Ethiopia has also recently commended the electrified railway’s freight services, which has the capacity of transporting 106 containers in a single route.

According to the share-company, the railway has transported over 2,000 containers of commodities from the port to central Ethiopia during its first two months of operations.

According to Tilahun Kassa, director of Ethiopia-Djibouti Standard Gauge Rail Transport company, the linkage between the Djibouti port and Ethiopia’s Modjo dry port has shown early achievements and is expected to further expand Ethiopia’s export and international trading.

Source: Xinhua

Ethiopia is the second largest refugee-hosting country in Africa. It is also fast becoming the most progressive on the continent in responding to forced displacement. If properly implemented, Ethiopia’s version of the Comprehensive Refugee Response Framework – which combines development and humanitarian aid – will benefit both refugees and host communities.

Ethiopia hosts over 900 000 refugees, 75% of them originating from South Sudan and Somalia. The rest come from Eritrea, Sudan and 15 other countries. In 2017, 110 000 new arrivals were registered. If the current trend continues, the refugee population will cross the 1 million mark in 2018.

Drivers of forced displacement range from conflict in South Sudan to ongoing economic deprivation and open-ended military service in Eritrea as well as conflict and conflict-induced food insecurity in Somalia.

Ethiopia’s commitment to protect refugees is further strengthened by its nine pledges made at the Summit on Refugees and Migrants hosted by the United Nations General Assembly in September 2016. The summit’s New York Declaration on Refugees and Migrants is considered a milestone for global solidarity on refugees’ protection. It sets out key elements of the Comprehensive Refugee Response Framework (CRRF) and lays the groundwork for the Global Compact on Refugees.

Ethiopia’s pledges include, among others, providing work permits to qualifying refugees, facilitating local integration where feasible, and earmarking a percentage of jobs within industrial parks to refugees.

Ethiopia’s nomination as a roll-out country for the comprehensive framework in February 2017 and its subsequent launch of the framework in November 2017 attest to the government’s seriousness about the pledges. The framework serves as a vehicle to implement the pledges and envisions bringing durable solutions to refugees and supporting host communities through combining humanitarian aid and development.

To date, the framework has been rolled out in eight countries and ‘situations’ globally: Ethiopia, Uganda, Djibouti, the Somalia situation, Mexico, Honduras, Guatemala and Costa Rica.   While all refugees in Ethiopia stand to benefit from the CRRF, the option of local integration applies to those who have been in the country for 20 or more years and have limited prospects for return and/or third-country resettlement. This arrangement may benefit up to 40 000 mainly Somalian and South Sudanese refugees.

The Ethiopian government has already made progress in implementing the comprehensive framework. First, civil registration of refugees, including birth, marriage, divorce and death, started in October 2017. This has provided retroactive registration rights to the approximately 70 000 refugee children born in the country over the past 10 years.

Second, the Biometric Information Management System, a countrywide refugee registration infrastructure, was initiated in 2017. The system records information on refugees’ education and professional skills as well as profiles of their family members. Both civil registration and the new biometric system will enable refugees to access CRRF opportunities.

Third, Ethiopia is constructing $500 million worth of industrial parks through funding from the European Union (EU), the United Kingdom and other sources. Once completed, the parks are expected to create up to 100 000 jobs, of which 30% will be available to refugees. This supports the government’s effort to address youth unemployment.

The CRRF is not just about improving the lives of refugees. Social infrastructure including schools and health centres that will be built for refugees will also benefit the host communities.

Further, the comprehensive framework will enhance Ethiopia’s negotiation power with its European partners as the planned integration of refugees is in line with EU’s goal of keeping refugees in first-asylum countries.

Ethiopia is a source of migrants itself. Located in the Horn of Africa – the epicentre of migration within and out of Africa – it is a transit country for refugees and migrants. Ethiopia is one of the European Commission’s 16 ‘priority’ countries that is working to reduce migrant/refugee numbers in return for various ‘incentives’ like development aid and trade.

Although progress on the comprehensive framework has been good, implementation challenges are anticipated. Despite significant economic development over the past decade, Ethiopia is still one of the poorest countries in the world. Thousands of Ethiopians leave the country in search of better economic prospects. This means the refugee integration and job creation components of the CRRF may not be viewed positively by the local population.

Also, the integration of South Sudanese refugees, in particular, needs to be done with caution. Almost 85% of the 408 494 South Sudanese refugees in Ethiopia are living in refugee camps in the Gambella Region. Here the two major ethnic groups – Anuak and Nuer – have been competing for political influence and power for years. As of April 2017, the refugee population surpassed that of the host community. The government’s decision to relocate newly arriving refugees to the neighbouring Benishangul-Gumuz region last year indicates that it is working to address these ethnic and political dynamics in the region.

The comprehensive framework is a win-win solution for both refugees and host communities. If properly implemented, refugees will be given the opportunity they need to unleash their potential and be productive members of the host community. Similarly, host communities will benefit from the skills and contributions of refugees.

The international community can contribute through a one-time investment to help refugees become self-reliant, after which they may not have to worry about providing humanitarian aid every year.

Tsion Tadesse Abebe, Senior Researcher, Migration, ISS Addis Ababa

https://issafrica.org/iss-today/mutual-benefits-of-ethiopias-refugee-policy 

Ethiopia has earned $68.5 million in revenue from the export of textiles and garments over the last eight months of the current Ethiopian fiscal year, which began on July 8, 2017.Ethiopia’s government sees the textile and clothing supply chain as one of the country’s key targets for growth and aims to generate $30 billion from the export of garment and textile by the year 2025.

Revenue this time has seen a 23.1 percent increase compared to revenue earned in the same period last year, but is 50 percent below the target, Bantihun Gessesse, Ethiopian Textile Industry Development Institute communications affairs director, told APA in an interview on Wednesday.

According to Gessesse, $12.6 million of the revenue was secured by 58 local companies, whilst foreign-owned companies generated the balance.

Managerial and technical limitations, inadequate supply of inputs, failure to meet international criteria and a shortage of skilled manpower were among the limitations attributable to unsatisfactory export performance in the sector, he added.

Ethiopia’s government wants to diversify exports from agricultural products to strategic sectors like textile and garment manufacturing, through opening more than ten industrial parks in different parts of the country.

Ethiopia’s long history in textiles began in 1939 when the first garment factory was established. Based on Ethiopian country data, in the last five to six years, the textile and apparels industry has grown at an average of 51 percent, and more than 65 international textile investment projects have been licensed for foreign investors, during this period.

In 2016, Ethiopia was second in terms of attracting foreign direct investment in the textiles and garments industry, next to Vietnam.

Last year, the government inaugurated three textile and apparel industrial parks, as part of its efforts to become Africa’s manufacturing hub through attracting export-oriented foreign companies.

Source: APA

In Ethiopia, policymakers are trying to make their nation’s economic development more sustainable. One of the challenges they face is that traditional economic accounting does not adequately consider nature’s contributions to a country’s economy. Ethiopia’s forests cover about 14.7 percent of the country’s land area, with woodland and shrubland accounting for another 44.7 percent. But the value of these ecosystems to the national economy is not well understood.

For example, Ethiopia’s System of National Accounts is used to calculate Gross Domestic Product (GDP), but it’s uncertain whether this system fully captures the income that forests produce. Official statistics from the Ministry of Finance and Economic Cooperation show the forestry sector’s contribution to be about 3.8 percent of gross domestic product or GDP.

But a UN Environment report concludes that forests generated economic benefits in the form of cash and in-kind income equivalent to 12.86 percent of GDP in 2012 and 2013. In 2014, the Government of Ethiopia requested the UN Programme on Reducing Emissions from Deforestation and Forest Degradation (through UN Environment) to support the country in assessing the contribution of forest ecosystems to national income in the context of the national REDD+ process.

UN Environment’s resulting report assessed – for the first time – the economic contributions of Ethiopia’s forests.

Main findings

Forests generated economic benefits in the form of cash and in-kind income equivalent to 12.86 percent of GDP in 2012 and 2013; of this, 6.09 percent of GDP is attributed to forest industries. This means that forest income has been undervalued by about 38 percent, because official statistics show the sector’s contribution to be 3.8 percent (2015).

The contribution of forest ecosystems (including carbon sequestration, crop pollination, conservation of agricultural soils and control of water discharge to streams and rivers) to other sectors, particularly agriculture, is valued at 6.77 percent of GDP. The fodder livestock farmers obtain freely (by allowing their animals to graze on forest land) was worth about 3.5 percent of GDP. Wood fuel’s value added is estimated at about 4.5 percent of GDP.

Ethiopia’s Green Economy Strategy

The Government of Ethiopia launched a Climate Resilient and Green Economy Strategy in 2011, with the goal of achieving middle-income status for the country by 2025 while following a carbon-neutral growth path. REDD+ implementation is one of the pillars of the Strategy. The Strategy recognizes that deforestation and forest degradation must be reversed if the country is to meet its development goals. Wood fuel accounts for more than 80 percent of household energy supply in Ethiopia and is particularly important in rural areas.

How the study can help policymakers

The study’s findings can help strengthen the national REDD+ process in Ethiopia by, among other things, enabling the relevant government agencies to better understand the extent to which Ethiopia’s forests underpin the economy, thereby building support across different ministries for REDD+ implementation.

The findings could provide the basis for updating Ethiopia’s System of National Accounts with a more accurate account of forest-derived benefits in GDP, particularly the subsistence or in-kind income derived from forests, such as fodder for livestock, wood fuel and roundwood.

The results and recommendations could be incorporated in the REDD+ National Strategy and potentially also be reflected in Ethiopia’s Growth and Transformation Plan 2 (GTP2) or any subsequent products and reports based on GTP2.

UN Environment’s economic valuation study has made the “invisible visible” by highlighting how forests contribute not only to the value added of the forestry sector but also other non-forest industries, both in cash and in-kind income. Implementing the Climate Resilient and Green Economy Strategy, therefore, makes economic sense. In doing so, Ethiopia can safeguard its natural capital, including its forests – valuable resources on which the economy depends to a considerable extent.

https://www.unenvironment.org/news-and-stories/story/ethiopias-forests-undervalued-resource 

The World Bank agreed on a $600 million loan and grant for Ethiopia on Tuesday to pay for roads and other infrastructure in urban areas.

The Washington-based bank said the funds would “help strengthen the capacity and performance of local urban governments, expand sustainable urban infrastructure and services, as well as promote local economic development.”

Ethiopia’s urban population is growing by 3.8 percent annually on average, one of the fastest rates in sub-Saharan Africa, and that is presenting challenges to infrastructure, services and jobs, the bank said.

“To successfully manage urbanization … cities are likely to require fiscal transfers for the foreseeable future. This program will help cities to realize their revenue potential,” Abebaw Alemayehu, the World Bank’s team leader for the project, said in a statement.

The program will also support projects in 73 towns and benefit more than 6.6 million people, he said.

Under a 2015-2020 development plan, Ethiopia plans to set up thousands of “rural development centers” in a bid to ease the influx of people to its capital, Addis Ababa.

Earlier this month, the World Bank also approved a $375 million loan to Ethiopia to fund a national electrification project.

https://www.voanews.com/a/ethiopia-signs-loan-grant-deal-with-world-bank/4307441.html