Ethiopia completes third round water filling of the Great Ethiopian Renaissance Dam

Ethiopia completes third round water filling of the Great Ethiopian Renaissance Dam It has been announced that the third round of water filling of the Great Ethiopian Renaissance Dam has been completed and water has started to flow on top of the dam. Following the completion of the 3rd round of water filling of the dam, senior government officials including Prime Minister Abiy Ahmed and Deputy Prime Minister Demeke Mekonen were present at the site. It is recalled that the first and second water filling of the dam took place in the last two winters. The completion of the 3rd round of water filling of the dam was announced yesterday, August 5/2014. It is after the announcement that the second power generation turbine has started working. The dam’s 2nd turbine, Unit 9, which started generating power yesterday, is said to have the capacity to generate 270 megawatts of electricity. August 2022 The commissioned unit 10 turbine with a capacity of 270 megawatts. According to this, the two turbines have a total capacity of generating 540 megawatts of electricity. The dam’s construction manager, Engineer Kefle Horo, said that 95 percent of the construction of the dam’s civil works has been completed. They stated that construction and installation of electromechanical works increased to 61 percent and water transmission metal works reached 73 percent. The general manager said that the total construction work of the dam has reached 83.3 percent in his speech at a ceremony held to start the power generation of the dam’s second power generation turbine. When the construction is completed, the Renaissance Dam is expected to be the largest electricity-generating dam in Africa, with a height of 145 meters. Its length is 1.8 kilometers. The Great Renaissance Dam, which is said to generate more than five thousand megawatts of electricity at a cost of more than five billion dollars, is expected to supply electricity to neighboring countries beyond Ethiopia. The foundation stone of the construction was laid on April 2, 2003. The Great Ethiopian Renaissance Dam is being built in Guba District, Benishangul Gumuz Region, where Ethiopia borders Sudan to the west. Tags GERD Great Ethiopian Renaissance Dam

Impact of the Russia-Ukraine war on Ethiopia

Impact of the Russia-Ukraine war on Ethiopia By- Seneshaw Tamru and Tewodros Makonnen Gebrewolde The conflict in Ukraine and the subsequent sanctions against Russia triggered price increases of key commodities with far-reaching impacts on welfare, production, and economic growth for developing countries, including Ethiopia. Economic sanctions were imposed on Russia by the US and EU to deter Russia from further escalating the war with Ukraine. The ongoing conflict has caused severe supply disruptions, resulting in sharp price increases for commodities of which Russia and Ukraine are large global suppliers as well as their close substitutes. Prices of essential commodities like grain, petroleum, and fertiliser have consequently surged significantly. This, in turn, can severely affect welfare in terms of higher food and energy prices and can also undermine productive capacity as essential inputs for agricultural and non-agricultural production become more expensive. To estimate the extent of the impact, we simulate the impact of price increases for key commodities on production, employment, and household welfare in Ethiopia. Rising prices of key commodities and imports Ethiopia, along with the rest of the world, experienced a sharp rise in prices of key commodities with the onset of the war in Ukraine (figure 1). The 12-month moving average price of crude brent petroleum in June 2022 increased by 64% from June 2021 while the price of wheat increased by 48%, with edible oil prices increasing by roughly 49% in the same period. Similarly, given that Russia is the biggest exporter of nitrogen-based fertiliser, the second and third most important global supplier of potassium and phosphate respectively, the Russia-Ukraine war has impeded supply and led to global increases in their prices. Figure 1 Note: From January 2022 (before the onset of the war) to June 2022 (about four months after the war started), petroleum, wheat, and fertiliser prices rose by 21.6%, 22.1%, and 29% (source: Indexmundi.com). Such significant global commodity price shocks especially affect developing countries that are net food and oil importers. Ethiopia, for instance (as of 2021), imports close to US$ 3 billion worth of petroleum products, accounting for a fifth of total merchandise imports and equivalent in monetary value to the country’s total merchandise exports. The country also imports close to US$ 2 billion worth of fertilisers, accounting for almost the entire domestic supply of this commodity. Wheat imports total around US$ 400 million per year (depending on exchange rate and purchase price) and account for about a quarter of total domestic consumption of this product. Additional imports of significance are metal and edible oils. In total, the monetary import value of these commodities accounts for a third of total merchandise imports and is equivalent to twice the value of Ethiopia’s merchandise exports. This shows how significant these commodities are to the balance of payments and the strain price increases would cause on agricultural production and food consumption. Persistent global price increases may lead to either further balance of payments deficits or a decline in essential commodity imports for the next fiscal year. The timing of this shock is further exacerbating, as even though Ethiopia was on the path to recovery from COVID-19, it was simultaneously reeling under the effect of an internal conflict in its northern and western parts since November 2020. Simulating the impact of the war on key economic sectors and commodities On top of the direct impact on the import bill, the crisis also affects production and consumption. We use a Computable General Equilibrium (CGE) model to simulate the effects on production and consumption employing a recursive Dynamic Stochastic Computable General Equilibrium (DSCGE) model developed by the International Food Policy Research Institute (IFPRI). For our analysis, we simulate the direct and indirect effects of the Russia-Ukraine war on the Ethiopian economy as a shock from increased international prices for five key import items/groups (wheat, edible oil, metal and metal products, fertiliser, and petroleum) relative to a pre-war shock. To do so, we set up two simulation scenarios. The first is a business-as-usual (BAU) reference scenario using the growth rate of the last two years before the Ukrainian crisis. This scenario implicitly contains the impact of COVID-19 and other natural and human-made crises during the period. The second scenario is the Russia-Ukraine war induced global shock scenario that reflects current global prices of the five import item groups considered in the analysis. The overall findings, hence, compare the Russia-Ukraine war shock scenario with the BAU scenario. Services sector would be most affected by higher input prices From the simulation, petroleum prices would increase by 86% compared to their value in 2021-22. Similarly, prices of wheat, edible oil, DAP fertilizer, and metal products would increase by 100%, 11%, 108%, and 82% respectively. Figure 2 below portrays the potential impacts on the major economic sectors – agriculture, industry, and services. Results show that the services sector would be the hardest hit amid the ongoing Russia-Ukraine crisis followed by the agriculture sector. The services sector is the prime user of fuel through transport services and this has considerable implications for other sectors like wholesale and retail trading. The services sector is also negatively affected by the real-estate sub-sector that could be impacted by the higher prices of metal and metal products. The effect on agriculture could be through a direct fertilizer price increment or an indirect price effect through higher transportation costs (fuel). The industry sector would be moderately affected probably through a direct impact on construction materials like metal and metal products. Figure 2 Note: The services sector would experience the largest impact (-10%) from the war (source: authors’ estimates from CGE modelling) Rural poor households would be the worst hit For the income distribution impact of the price shocks, the rich and middle-income groups in both urban and rural areas would generally be more negatively affected by the crisis. The rural rich and middle-income households are potentially partially compensated by the increased prices of the agricultural goods they produce but not sufficiently. This could be due to a strong cross-price elasticity between wheat and the other major cereals (for example, maize, teff, sorghum) which show similar price changes. While the urban rich households see the largest decrease in incomes, the rural poor suffer more than their urban counterparts as they have lower levels of savings and less capacity to absorb price increases, since their basic necessities take up a larger share of their household budget. Figure 3 Note: The ‘urban rich’ would experience the largest reduction in income (-26.8%), while incomes of the ‘urban poor’ would be least affected (-4.2%). The ‘rural poor’ would also be more negatively affected than their urban counterparts owing to their smaller savings and lesser ability to absorb price increases (source: authors’ estimates from CGE modeling). Falling GDP and the employment rate for unskilled labor Figure 4 below shows the effect of the shock on the overall economy proxied by GDP which would fall by as much as 7.6% as compared to the BAU scenario. Given the contribution of the services and agriculture sectors to the overall economy in Ethiopia, it is not surprising that the effect on the overall economy is driven by the proportionally large negative impact on the services and agriculture sectors. For example, in 2021, the two sectors together accounted for more than 72% of the GDP: services (39.6%) and agriculture (32.5%). The figure also looks at employment changes for unskilled labor that, according to the latest Ethiopian Social Accounting Matrix (SAM), account for about 78% of the labor force. In line with the considerably larger proportion of unskilled labor in the overall labor force, it is likely that the bulk of adjustment falls on the unskilled labor in the severely affected sectors-i.e., services and agriculture. Accordingly, as portrayed in the figure, the magnitude of employment loss would be significant at about 18%, therefore necessitating the consideration of mitigation measures. Figure 4 Note: The negative impact on GDP could exceed 7%, while impacts on unskilled employment would be disproportionately large (source: authors’ estimates from CGE modelling) Mitigating the impacts of global commodity shocks The global shocks resulting from the Russia-Ukraine war will have severe consequences. Keeping in mind the magnitude of the shock and the fact that Ethiopia has no market power to affect prices, Ethiopia cannot be insulated from global commodity shocks. However, there are potential measures that can be taken to reduce the negative impacts of the shock and identify opportunities to use the crisis to expand other exports and stimulate domestic production through import substitution. Targeted lifting of fuel subsidies In light of the rising import costs, efficient use of imported commodities like fuel will have to be encouraged. The fuel subsidy for all fuel users was fiscally challenging, prompting the government to lift the subsidy starting July 2022. The removal of the subsidy is expected to raise all transportation costs with ripple effects throughout the economy. The government has, however, already started the commendable process of differentiated subsidies targeting only vehicles that provide public transport services. For energy more broadly, Ethiopia’s heavy reliance on hydropower would mute the impact of the oil price shock. In fact, the shock may further whet the appetite of other countries in the region to tap into Ethiopia’s hydropower potential. Potential for import substitution and increased local production Fertilizer: A similar measure would be to replace imported nitrogen-based fertilizers with local substitutes like animal waste and compost. The government has already started encouraging farmers and households to prepare compost from the waste of vegetables and fruits. It is also important to secure supply commitments given the cut-offs from Ukraine and Russia. Again, the government was successful in renegotiating a major fertilizer contract, albeit with likely reductions in imported fertilizer. Edible oils: While the major cooking oil consumed by Ethiopians, particularly the poor is palm oil, there is scope for substitution for domestic production and further work on this sub-sector is forthcoming. More generally, the implicit pressure on imports of other commodities including processed food could present an opportunity to reenergize domestic agro-processing capacity servicing the middle- and higher-income urban consumers. This would help reinforce reforms anticipated under the emerging revised industrial policy. Metals: The major use of imports is construction. The shock in prices will likely negatively affect development projects by increasing their overall cost. This would require phasing of development projects to focus on the completion of the highest priority ones. Opportunities for commodity export growth Most of the attention has rightly focused on key imported commodities. However, at the same time, the Ukraine-Russia crisis may also open up opportunities for exports of commodities that have been cut off from Russia and Ukraine’s supplies and where Ethiopia can position itself as an alternative supplier. One such example may be gold and other minerals for which Russia and Ukraine are also important global suppliers. For instance, amid recent reforms like the raising of the gold price premium from 29% to 35% in addition to a reduction (from 500 grams to 50 grams) in the requisite quantity to access this premium, gold exports have increased substantially. Gold is now Ethiopia’s most important export commodity. In addition, there has recently been increased momentum to exploit Ethiopia’s iron ore. Nonetheless, despite best efforts at macroeconomic management, the shocks will take their toll in the short- to medium-term and feed into domestic inflation more widely. The poor will be particularly vulnerable, even if the percentage impact on their incomes is lower than that of middle- and high-income groups. It will, therefore, be critical to assess targeted subsidies (such as certain types of cooking oil and transport) as well as leverage the existing rural and urban safety net programs to help them weather the crisis.

New Ethiopian Airlines chief aims for near-doubling of fleet under 2035 roadmap

New Ethiopian Airlines chief aims for near-doubling of fleet under 2035 roadmap Recently appointed Ethiopian Airlines chief executive Mesfin Tasew has embraced the ‘Vision 2035’ roadmap introduced by his predecessor Tewolde GebreMariam in 2019, as he aims to keep the carrier on an aggressive growth path. Speaking during July’s Farnborough air show, Tasew says the roadmap is “tailored around fast, profitable, sustainable growth” and will involve a near-doubling of the carrier’s current fleet – covering both passenger and cargo aircraft. “Today, Ethiopian Airlines operates around 135 aircraft and by 2035 we would like to expand this fleet to more than 250 aircraft,” he states. The Addis Ababa-based operator has 35 aircraft on order, meaning it will need to place significant orders for “more latest-technology, highly efficient aircraft” in the coming years, Tasew says. The currently on-order aircraft include 22 Boeing 737 Max jets – Ethiopian having finally brought its four examples back into service earlier this year. By early August, it had taken delivery of three further Max aircraft, bringing its fleet to seven, and it expects to receive the remaining 22 over the next four years, Tasew states. “When we reintroduced them, customers did not notice that they were flying on the 737 Max,” Tasew says of the passenger response to the type returning following the fatal crash of an Ethiopian example in 2019. “The reliability of the aircraft has been very good,” he adds of the type’s few months back in service. Of Ethiopian’s other outstanding aircraft orders, four of six Airbus A350s have now been upgraded from the -900 to -1000 variant, while it also has two Boeing 787-9s to come, and five 777 freighters. Indeed, freighters are big part of Tasew’s thinking as he adopts a “grand cargo expansion” strategy as part of the 2035 roadmap. In August, Tasew says, Ethiopian will be adding its first Boeing 767-300 freighter, which it has converted at its own facility, augmenting a cargo fleet that currently features nine 777Fs and four converted 737 freighters. “We plan to convert two more 767 aircraft and add them to our cargo operation,” he states. At Farnborough, meanwhile, Ethiopian signed a tentative agreement to purchase two Dash 8-400 freighter conversion kits from De Havilland Canada, while Tasew says Ethiopian “plans to acquire more 737 freighter aircraft”. It is also weighing up its options regarding larger freighters. Despite signing a memorandum of understanding for five Boeing 777-8 freighters in March, Tasew says the carrier is still “evaluating new-generation cargo aircraft, particularly the 777X freighter in comparison with the A350 freighter”. Beyond fleet investments, Ethiopian’s Vision 2035 strategy also involves “investments in infrastructure in the areas of MRO and airport facilities”, Tasew says, noting that Ethiopian manages its own Addis Ababa hub. Furthermore, “we will have major development strategies in the areas of human resource and systems”, he says, adding that Ethiopian “recently added sustainability as part of our pillars to support our growth”. Equity partnerships will also continue to be important, Tasew says, “We would like to assist small African airlines to develop and to grow,” he states, citing the carrier’s recently announced tie-up with the government of the Democratic Republic of Congo to launch Air Congo, in which it will hold a 49% stake. Aside from that April announcement, Ethiopian also has a stake in the recently launched Zambia Airways and a longer-standing interest in Malawi Airlines. But Togo-based ASKY Airlines remains the largest airline in which Ethiopian has an equity interest. Leading that carrier was Tasew’s previous job – and it is a business he is particularly proud of. “This airline has been growing to become… the biggest airline in west and central Africa,” he says. “Even last year, in 2021, it made a remarkable profit when most of the industry was making heavy losses.” Tags ethiopian airlines ethiopian airlines china

Ethiopian Airlines orders Africa’s first A350-1000

Ethiopian Airlines orders Africa’s first A350-1000 Addis Ababa, Ethiopia 28 July 2022 – Ethiopian Airlines Group, the flag carrier of Ethiopia, Africa’s largest airline group, has upsized four of its A350-900 on order to the largest variant of the A350 Family, the A350-1000, becoming Africa’s first customer for the aircraft. Ethiopian Airlines has already ordered 22 A350-900s, of which 16 aircraft have been delivered. With the A350-1000 upsizing, Ethiopian Airlines’ backlog consists of four A350-1000s and two A350-900s. Ethiopian Airlines Group CEO Mr. Mesfin Tasew said, “We are delighted over the upsizing of the A350-900 on order to the largest variant, A350-1000, that helps us stay ahead of the curve in technology. We are the technology leaders in the continent introducing the latest technology and fuel-efficient fleet into Africa. The A350-1000 is the best fit for our dense routes, and we believe that the upsizing will be instrumental in satisfying the increasing demand of customers in our vast global network across five continents. We will continue on keeping ourselves abreast of aviation technology advancements to enhance our service and fulfil customers’ demand.” ”We are proud of our strong partnership with Ethiopian Airlines – the first airline in Africa to order and operate the A350-900. In another first, Ethiopian Airlines is once again leading the way in Africa’s aviation sector by introducing the A350-1000, the largest version of the world’s most efficient and technologically advanced passenger aircraft.” said Mikail Houari, President, Airbus Africa and Middle East. “The A350-900 has delivered extraordinary capability, fuel efficiency, and operational reliability of 99.5 percent together with unbeatable operational flexibility and efficiency, from short to ultra-long-range operations.” The A350-1000 will increase the East African carrier’s capacity and it will be an addition to its modern wide-body fleet. The airline will benefit from a flexible, high-value Family leveraging Airbus’ unprecedented level of commonality and same type rating. The Airbus A350’s clean-sheet design features state-of-the-art aerodynamics, a carbon-fibre fuselage and wings, plus the most fuel-efficient Rolls-Royce Trent XWB engines. Together, these latest technologies translate into unrivalled levels of operational efficiency and sustainability for Ethiopian Airlines, with a 25% reduction in fuel-burn and CO2 emissions compared to previous generation twin-aisle aircraft. By the end of June 2022, the A350 Family had received 940 orders from 52 customers, making it the reference large widebody family for the next decades. @Airbus @Ethiopianairlines #A350-900 #A350-1000 Tags ethiopian airlines

The total assets of the Commercial Bank of Ethiopia reached 1.2 trillion birr

The total assets of the Commercial Bank of Ethiopia reached 1.2 trillion birr Abe Sano, the bank’s president, announced that the total assets of the Commercial Bank of Ethiopia have reached 1.2 trillion birr. It is understood from the report submitted by the president of the bank that the Commercial Bank of Ethiopia, which is conducting the evaluation of the performance of the work plan for the 2014 (2021/22) fiscal year, has generally achieved a performance that is above or close to the plan. Mr. Abe Sano stated that the bank collected 154.9 billion birr in additional deposits in the fiscal year 2014 (2021/22), bringing the total deposits to 890.1 billion birr. He said that the bank made a profit of 27.5 billion birr in the fiscal year, which is 16.3 percent of the plan and 43.9 percent more than the same period last year. Mr. Abe explained that the bank has given 179.2 billion birr in loans to various sectors of the economy. Abe said that 2.6 billion dollars have been obtained from various sectors regarding the acquisition of foreign currency, and 7.7 billion dollars have been paid by the bank to various income items and others that have been given attention by the government. In an effort to extend the bank’s services to all sections of the society, 124 new branches were opened in the fiscal year, and the total number of branches of the bank reached 1824. Abe stated in his report that 35 percent of the accounting activities performed in the fiscal year were done through digital banking services in the bank’s efforts to reduce cash circulation by increasing the customer’s use of technology-assisted services. Mr. Abe, who stated that 2.9 million new accounts have been opened in the fiscal year, added that the total number of depositors of the bank has reached 35.9 million, according to the information we received from the bank. The Chairman of the Board of Directors of the Commercial Bank of Ethiopia Ato Teklewold Atnafu said that the bank has achieved encouraging results in various international and national challenges. Tags CBE cbe birr commercial bank of Ethiopia ethiopian news

Ethio Telecom earned 61.3 billion birr in the current fiscal year.

Ethio Telecom earned 61.3 billion birr in the current fiscal year. Ethio Telecom earned 61.3 billion birr in the current fiscal year.Mrs. Frehiwot Tamru stated that Ethio Telecom earned 61.3 billion birr in the fiscal year 2022. The CEO of Ethio Telecom said that the revenue compared to the plan is 87.6% and compared to the same period of last year, it is an increase of 8.5%. It is said that one of the reasons why the income was lower compared to the plan was that 3 thousand 473 mobile stations were unable to provide services due to the security problem in various parts of the country and the northern part of our country. However, in terms of the challenges faced, the performance is very encouraging, Mrs. Frehiwot said. Voice services account for 51 percent of the revenue, data and internet account for 27 percent, international revenue accounts for 10 percent, value-added services account for 5.7 percent, and other services account for 6.6 percent. The CEO said that Ethio Telecom has achieved 146.6 million US dollars or 82.3% of the plan from foreign exchange generating services. Ethio Telecom has reached 66.59 million customers, 64.5 million mobile voice customers, 506.8 thousand fixed broadband customers, 885.3 thousand landline customers, and 26.1 million data internet customers. Ms. Frehiwot mentioned that the company generated 18.8 billion birr in tax, 500 million birr in dividends and was consistently awarded as the highest tax payer in the last three years. They mentioned that the company has contributed 422.6 million birr in kind and services in order to fulfill its social responsibility, and 16.5 million birr has been provided in financial and material support to the economically disadvantaged sections of the society. Regarding the company’s performance, the CEO of Ethio Telecom Ms. Frehiwot Tamru said that from today, July 28 to August 2, 2022, from 6:01 am to 12:00 pm, 15 GB data, 45 minutes voice, 100 messages and 10 minutes international They announced a call gift. Tags ethiotelecom telebirr

Ethiopia and Kenya signed an agreement on the sale of electricity

Ethiopia and Kenya signed an agreement on the sale of electricity Ethiopia and Kenya have signed an electricity sales agreement today. The agreement was signed by the Minister of State for Finance, Dr. Ayob Tekelani and the President of Kenya, Uhuru Kenyatta. According to Dr. Ayob in his social media page, the agreement allows Ethiopia to sell 200 megawatts of electricity to Kenya. He also pointed out that Ethiopia will work to increase the electricity sales to Kenya to 400 megawatts. Tags ethiopia business news ethiopia news ethiopian news

Ignore  BBC’s  Report  on  Debt  Crisis:  Borrow  from  the  West  Like  There  is  No  Tomorrow

Ignore  BBC’s  Report  on  Debt  Crisis:  Borrow  from  the  West  Like  There  is  No  Tomorrow Yonas  Biru,  PhD This  is  a  back  of  the  envelop  analysis  on  international  debt  to  show  BBC’s analysis of Ethiopia’s debt crisis  is  rubbish.  Our  intellectuals  are  better  advised  to  spend  their  energy  in  making  sure the  loans  in  question  are  used  properly  rather  than  doing  their  #NoMore  አቶቶ ቡቱቶ on  US  and European  streets. Ethiopia  should   borrow  from  Western   countries,   the   World  Bank   and  IMF   like   there  is   no tomorrow.  These  are  loans  that  come  without  collateral.  Countries  such  as  Ethiopia  get  a  near zero interest rate loans with a five-year grace period and 30-year term. PM Abiy was right to say “Borrowing  from  the  IMF  and  the  World  Bank  is  like  borrowing  from  one’s  mother.”  The  only loan  we  should  worry  about  is  from  China. Why  Ethiopia  Needs  to  be  Wary  of  Taking  Additional  Loans  from  China When  it  comes  to  development  loans,  China  uses  a  pawnshop  strategy.  Pawnshops  make  money from  desperate  individuals  who  turn  over  custody  of  their  valued  possessions  such  as  wedding rings  and  computers  with  valuable  data  as  collateral for  the  loan.  China  follows  the  same  strategy except for the fact that its borrowers are nations rather than individuals. Its collaterals come in the form  of  geopolitical  seaports,  flagship  national  airports,  oil  fields  and  strategic  rare  earth  mining projects. Once  it  traps  vulnerable  nations,  China  takes  advantage  of  Africa’s  economic  woes,  seeking  new collaterals as a condition to restructure debts at risk of defaulting. When Zambia owing China over $6  billion  had  difficulty  servicing  its  payment,  China  wanted  the  nation’s  mining  assets  as  new collateral  to  restructure  its  loans.  As  Financial  Times  noted,  the  Zambian  government  was  “alleged to have diverted donor funds meant for social sector spending to make debt repayments.” China’s  debt-trap  strategy  has  four  signature  schemes  that  makes  it  different  from  other  bilateral or  multilateral  loans  that  developing  countries  rely  on. First,  it’s  loans  to  developing  countries  are  kept  confidential.  They  are  neither  reported  to  nor recorded  by  international  institutions  such  as  the International  Monetary  Fund  (IMF);  the World Bank;  or  the  Paris  Club,  an  organization  of  creditor  nations. Second,  China’s  preferred  clients are countries with rampant  corruption.  A study by the Brookings Institution  shows  that  of  the  50  most  indebted  countries  to  China,  25  are  from  Sub  Saharan  Africa (SSA).  A  closer  look  at  the  data  indicates,  of  the  25  SSA  countries,  23  are  listed  in  the  top  half  of Transparency International’s corruption ranking, including South Sudan, the Republic of the Sudan and  Angola,  ranked  second,  forth,  and  fifth  most  corrupt  nations  in  the  world,  respectively. Third, data  from  the  IMF  shows  China’s  loans  are  geared  toward  countries  that  have  historically been  vulnerable  to  debt  crises.  Of  the  50  countries  in  the  Brookings’  above-noted  list,  a  large majority of them were countries who suffered debt crisis in the 1990s and received international debt  forgiveness. Fourth,  Chinese  loans  are  based  on  market  rates  with  short  payment  periods,  leading  to  larger annual  repayments  and  resultant  defaults.  By  contrast,  traditional  loans  by  institutions  such  as  the World  Bank,  IMF,  and  members  of  the  Paris  Club  carry  near  zero  interest  rates  and  are  further buttressed  with  generous  grace  periods  and  long  payment  plans  of  up  to  30  years  to  make  them easier  to  service. This  is  what  happens  when  you  borrow  from  the  West/World  Bank/IMF. They  lend  you knowing  full  well  that  you  will  not  be  able  to  pay  it  back.  Then  they  lend  you more, so you can service your outstanding loans. If you still cannot pay it, they will lend you once again.  That  is  when  it  gets  interesting.  Self-anointed  members  of  the  West’s  moral  police,  who see  themselves  as  the  conscious  of  the  West,  start  to  speak  up  against  international  debt  burden on   poor   countries.   They   use   pictures   of   starving   African   children   and   shame   the   West   for demanding   debt   payments.   We   are   talking   about   Liberals,   Millennials,   Gen   Zs,   International Development  NGOs,  and  Religious  Activists.  Sometimes  even  communist  leftovers  sneak  in  as  a moral  voice.  They  start  making  noise  calling  for  debt  forgiveness or  debt  restructuring. Debt  forgiveness  and  debt  restructuring  allows  nations  facing  financial  problems  to  eliminate, reduce  and/or  renegotiate  their  delinquent  debts  to  improve  their  credit  worthiness  so  they  can continue  to  borrow  more. That  is  when  the  West  and  the  World  Bank  and  IMF  come  with  more generous  loans with  near  zero  interest  rates,  five-year  grace  period  and  30-year  term  loans.  As long  as  Liberals,  Millennials,  Gen  Zs,  Religious  Activists  and  Communist  Leftovers  exist,  the  cycle will  repeat  itself. The good thing for countries such as Ethiopia is that Gen Zs are even more liberal than Millennials. Trust  me  I  know  this  firsthand.  My  youngest  is  a  member  of  the  Gen  Z  generation.  She  makes her  older  siblings (Millennials  and  high-octane  liberals)  look  like  Trump  supporters. In  conclusion,  we  should  not  prepare  complicated  economic  tables  and  graphs  to  link  debt  with economic stagnation and being dependent on Western nations.  Just keep on borrowing until they stop  lending  you.  Do  not  complicate  a  very  simple  thing.  Take  all  the  loan  they  give  you  and  file for  a  new  loan  the  next  day.  Spend  your  energy  to  make  sure  the  loan  money  is  used  for development.

Ethiopia records more remittances from diaspora

Ethiopia records more remittances from diaspora Ethiopian diaspora remittances reached 4.2 billion U.S. dollars during the Ethiopian 2021/2022 fiscal year that ended on July 7, said authorities. Mohammed Idris, the deputy director of the Ethiopian Diaspora Agency, said Friday that the remittances recorded during the past fiscal year exceeded the target set for the period by 200 million U.S. dollars.The Ethiopian diaspora remitted 3.6 billion U.S. dollars in the 2020/2021 fiscal year. Idris said his agency was also able to attract investments from 1,800 members of the Ethiopian diaspora during the 2021/2022 fiscal year, reported state media outlet Ethiopia News Agency (ENA). The deputy director also said members of the Ethiopian diaspora contributed 28 million U.S. dollars worth of assistance to rehabilitate parts of the country hit by both manmade and natural calamities during the just concluded fiscal year. Ethiopia Diaspora Agency is a government entity that aims to boost the diaspora’s role by creating a community that is Ethiopia’s pride and partner in development. There are about 3 million plus people of Ethiopian origin globally, mainly residing in Southern Africa and Middle Eastern, European. and North American countries. (ANI/Xinhua) Tags commercial bank of Ethiopia