Ethiopia Among Few Economies Seen Growing Faster Than China in 2018

Ethiopia is among the 17 economies which are projected to grow faster than China in Purchasing Power Parity (PPP) terms this year, according to projections in the Global Economy Watch published by international professional services firm PriceWaterhouseCoopers (PwC). The other countries include India, Ghana, and the Philippines. The PwC analysis added that eight of the ten fastest growing countries in 2018 could be in Africa.

According to PwC, China, the world’s largest economy in PPP terms, could grow by 6 to 7 percent in 2018, slower than previously, but in line with expectations. The global economy is set to grow by almost 4.0 percent this year in PPP terms, adding an extra 5 trillion USD to global output at current values. The main engines of the global economy — the United States, emerging Asia and the Eurozone — are expected to contribute almost 70 percent of economic growth in 2018, compared with their post-2000 average of around 60 percent.

The United Nations had in its world economic prospects report launched early last month stated that the world economy is expected to remain stable in 2018 and 2019, maintaining the growth rate of 3.0 percent in 2017.

http://www.malaysiandigest.com/business/715888-ethiopia-among-few-economies-seen-growing-faster-than-china-in-ppp-terms-in-2018-says-pwc.html

Ethiopia-Djibouti railway begins commercial operations

The Chinese-built 756-km electrified rail project connecting Ethiopia to Djibouti officially started commercial operations on 1 January with a ceremony held in Addis Ababa.

Contracted by two Chinese companies, the first 320 km of the rail project from Sebeta to Mieso was carried out by the China Rail Engineering Corporation (CREC), while the remaining 436 km from Mieso to Djibouti port section was built by the China Civil Engineering Construction Corporation (CCECC). Speaking on the occasion, Ahmed Shide, Ethiopian Minister of Transport, hailed the standard gauge project as a milestone in China-Africa cooperation.

In addition to further enhancing economic ties as well as the people-to-people links between Ethiopia and Djibouti, it will have a significant contribution to the ongoing development efforts of building a new Ethiopia, said the minister. Emphasizing on its huge significance and importance, Tan Jian, Chinese Ambassador to Ethiopia, noted that the project would contribute to the industrialization and diversification of the Ethiopian economy, and also towards the country’s growth and transformation plan. The ambassador has reiterated China’s commitment to further cooperating and closely working with Ethiopia and Djibouti to the railway’s smooth operation. The Addis Ababa-Djibouti railway project has been carried out with an investment of 4 billion U.S. dollars, and China’s Exim Bank has provided a loan.

Speaking on his part, Djibouti Ambassador to Ethiopia, Mohamed Idriss Farah, said the railway project would have a significant contribution to the economic integration between Djibouti and Ethiopia. “This is an important corridor, important railways between Djibouti and Ethiopia; we are working for our economic integration between our two countries. And this project was part of the economic integration, but not only economic integration but also connecting the peoples of Djibouti and Ethiopia,” said the ambassador.

The railway provides both passenger and freight services between Addis Ababa and Djibouti.

http://www.xinhuanet.com/english/2018-01/01/c_136865306.htm

Ethiopia, World Bank sign $470mln financing agreement

On 20 December 2017, Ethiopia and the World Bank today signed a financing agreement amounting 470 million US dollars. The agreement was signed between Dr. Abrham Tekeste, Ethiopian Minister of Finance and Economic Cooperation and Carolyn Turk, World Bank Country Director for Ethiopia.

According to the agreement, 300 million US dollars of the total funding will be utilized to support the government of Ethiopia in its continued efforts to improve the provision of quality education nationwide. Over the past decade, Ethiopia has made positive strides in the education sector, and has significantly improved the quality of teaching and learning conditions in 40,000 primary and secondary schools across the country, the bank said. The remaining 170 million US dollars will be used to boost the contribution of the livestock and fisheries sectors to Ethiopia’s economy. The project will be principally implemented in 58 Woredas (districts) in Amhara, Benishangul-Gumuz, Gambella, Oromia, SNNPR, and Tigray regional states with crosscutting activities of the project having a national coverage.

Carolyn Turk, World Bank country director for Ethiopia, Sudan, and South Sudan said the project will help 1.2 million farm households who largely depend on livestock-keeping and fishing, with the skills and tools they need to considerably increase the volume and quality of their produce.

Ethiopia signs $4 billion deal to build 1,000 MW-geothermal power plants

Ethiopia has signed an agreement to build two geothermal power plants at a combined cost of $4 billion, to be run by the country’s first privately-owned utility. The Corbetti and Tulu Moye plants will produce a combined 1,000 MW of power upon completion in eight years time in the volcanically-active Rift Valley south of the capital Addis Ababa. Ethiopia is eager to meet rising energy demand from its industries as well as becoming the continent’s biggest exporter of energy.

“No doubt the success of this effort will have a significant impact in the country’s future economic well-being,” said Azeb Asnake, chief executive of state-run Ethiopian Electric Power (EEP). The project’s equity investors include the Paris-based asset manager Meridiam, as well as the Africa Renewable Energy Fund and InfraCo Africa – funds that focus on infrastructure. As Ethiopia’s first privately-owned utility, the project will be operated by the developers for a period of 25 years. In an economy traditionally dominated by state spending, the government has suggested that the nascent sector could be a model for increased private investment.

“Going forward, the government recognises the added value to be gained by working in partnership with the private sector, specifically in sharing with it the burden of investment for large-scale power generation,” said Seleshi Bekele, minister of water, irrigation and electricity.

Under a new 2015-2020 development plan, Addis Ababa wants to raise power generation to 17,346 MW from a current capacity of just over 4,300 MW from hydropower, wind and geothermal sources. It has an array of projects under construction, including the $4.1 billion Grand Renaissance Dam along its share of the Nile river that will churn out 6,000 MW at full capacity upon completion within the next 10 years.

Read the full article here

IMF Chief Says Ethiopia Doing Well in Terms of Economic Growth

On 13 December 2017, International Monetary Fund (IMF) Managing Director, Christine Lagarde, arrived in Ethiopia for a historic three-day visit, touring new industrial parks and meeting with government officials. This is the first time in the IMF’s 72-year history that a managing director paid a visit to the Ethiopian capital, as a demonstration of Ethiopia’s growing recognition as an economic hub of Africa.

“We had a very productive discussion about the performance of the Ethiopian economy which is doing very well in terms of growth”, Mrs. Lagarde told journalists following her discussion with President of Ethiopia Mulatu Teshome at the national palace. The Managing Director visited the country to witness for herself the economic development that the country has registered in the past two decades. “I’m very proud to come and visit. I really had a better understanding of the economic development model which has been implemented in Ethiopia” added the Managing Director.

Lagarde also appreciated Ethiopia for hosting 850,000 refugees, which is among the largest refugee population in the world. The IMF head said the work that the country is conducting to bring peace and stability to the Horn of Africa particularly Somali and South Sudan is commendable. During the discussion, President Mulatu who explained about the implementation of country’s pro-poor and inclusive development policy praised IMF for its support to Ethiopia’s economic development. He expressed hope that the visit of the Managing Director will help to further strengthen Ethiopia’s relation with the IMF, according to a high-level official who attended the meeting.

EU Extends 10.5 million Euros for Energy Development in Ethiopia

European Union Support to Energizing Development in Ethiopia Project with EUR10, 500,000 was launched in Addis Ababa on 12 December 2017.

During the launching of the project, Water, Irrigation and Electricity State Minister Dr. Frehiwot Woldehanna said adequate, reliable and affordable energy access is a critical enabler in realizing every country’s development and transforming economic prosperity as well as the wellbeing of all its citizens.

He added that the role of energy in improving quality of life through improved health care, improved education and economic opportunities cannot be over emphasized.

The energy provision program launched will include rural and deep rural areas by scaling up connectivity.

The State Minister pointed out that the country will use all renewable energy sources to generate electric power that has less environmental impact to reach to every corner of the country.

GIZ Ethiopia Country Director, Dr. Mathias Rompel said the European Union acknowledges the commitment of Ethiopia to use renewable energy sources.

According to the Country Director, Germany is working with the government of Ethiopia to bring energy transformation in the country from fossil fuels to sustainable energy development.

The European Union Support to Energizing Development in Ethiopia Project will provide a model for work with the private sector, he added.

It will provide modern energy services to individual household, institutions and small and medium size enterprises in Ethiopia, Rompel explained.

This is one of the best performance and outcome based programs in the energy sector, the Country Director said.

EU Infrastructure Team Leader, Giorgia Favero said the project is a solid starting point to support the energy sector in Ethiopia by the European Union.

She stressed that EU is committed to support the solar energy sector in Ethiopia to address energy to the rural community in Ethiopia.

Favero added that EU plans to do a lot in the dynamism of renewable energy development in Ethiopia.

EU Trust Fund for Africa: new actions worth €38.05 million to support refugees and foster stability in Ethiopia

Prime Minister H.E. Hailemariam Desalegn and EU Commission President Mr. Jean-Claude Juncker

On 12 December 2017, the European Commission announced 13 new actions worth €174.4 million under the EU Emergency Trust Fund for Africa to support refugees and host communities in the Horn of Africa region.

At this occasion, Commissioner for International Cooperation and Development Neven Mimica said: “The European Union stands by refugees and local populations in the Horn of Africa. With today’s new actions worth €174.4 million, we are stepping up our support – to protect vulnerable migrants, to create economic opportunities on the ground and to foster stability in the region.” The Trust Fund was established in 2015 in order to address the root causes of irregular migration and forced displacement. A total of 13 new actions have been approved today, each of them tailored to the specific needs on the ground.

In Ethiopia, three new projects will focus on creating employment opportunities and providing energy access to refugees and local populations (total of €38.05 million).

  • The programme “Leather Initiative for Sustainable Employment Creation (LISEC) in Ethiopia” (EU Trust Fund contribution: €15 million ) aims at creating greater economic and decent employment opportunities, especially for young men and women through the development of the Ethiopian leather industry and the Modjo leather industrial park. This programme proposes a new vision towards inclusive and sustainable industrial development that protects the environment and supports social inclusion. The programme will be implemented by the United Nations Industrial Development Organization (UNIDO), the Industrial Parks Development Corporation (IPDC) and by a partnership of national and international non-governmental organisations.
  • The programme “Stimulating economic opportunities and job creation for refugees and host communities in Ethiopia in support of the Comprehensive Refugee Response Framework (CRRF) in Ethiopia” (EU Trust Fund contribution: €20 million ) aims at supporting the implementation of the Comprehensive Refugee Response Framework (CRRF) to shift from a ‘care and maintenance’ or camp-based model of refugee assistance to an approach, which emphasises refugee self-reliance, refugee mobility in-country and the integration of refugees into regional and national development processes. The programme will be implemented by UNHCR, the World Bank and organisations with experience in private sector development.
  • The programme “Shire Alliance: Energy Access for Host Communities and Refugees in Ethiopia” (EU Trust Fund contribution: €3.05 million ) aims atimproving the living conditions in host and refugee communities by creating livelihood opportunities, enhancing local capacity building and improving access to energy services. The beneficiaries are around 40 000 members of the host and refugee communities in and around Adi-Harush, Mai Aini and Hitsats refugee camps. The programme will be implemented by the Spanish Agency for International Cooperation and Development (AECID).