NATIONAL DAY CELEBRATION AT GTU

Presented by : Oakbrook Business School

ETHIOPIA

Ethiopia, in the Horn of Africa, is a rugged, landlocked country split by the

Great Rift Valley. With archaeological finds dating back more than 3

million years, it’s a place of ancient culture..

Capital: Addis Ababa

President: Mulatu Teshome

Prime minister: Hailemariam Desalegn

Speaker: Abadula Gemeda

Government: Federal republic, Parliamentary republic

Total Population: 96,958,732

Official Language: Amarigna

90 Other Languages Spoken: Oromigna, Tigrigna Somaligna Guaragigna,Sidamigna, Hadiyigna, others. English is a major foreign language taught inschools.

Business Language(s): English

Majority population: Christians(62.8%) & Muslims (33.9%)

1 Ethiopian Birr= 3.13 Indian Rupee

• The current constitution of Ethiopia was promulgated by the TransitionalGovernment in 1994.

• The Federal Democratic Republic of Ethiopia was established on August 24,1995, after successful elections took place in May 1995. This completed afour-year transition from a Marxist, military regime established in 1974 to ademocracy.

• Hailemariam Desalegn was appointed Prime Minister in Sept. 2012, afterMeles Zenawi (former Prime Minister) passed away.

• The government of Ethiopia is structured in the form of a federalparliamentary republic, whereby the Prime Minister is the Head ofgovernment. Executive power is exercised by the governmentwhile legislative power is vested in the Parliament.

• There are two dominant religions: The Ethiopian Orthodox Church (Christian)and Islam.

• Ethiopia has a diverse mix of ethnic and linguistic backgrounds. It is a countrywith more than 80 different ethnic groups each with its own language,culture, custom and tradition.

• The Ethiopian national dish is called wat. It is a hot spicy stew accompaniedby injera (traditional large spongy pancake made of teff flour and water).

• The favourite drink of many Ethiopians is bunna (coffee). Bunna is drunk inEthiopia in a unique and traditional way known as a "coffee ceremony".

• The most important festivals of The Orthodox Tewahedo Church areEnkutatash (New Year), Meskel (Finding of the True Cross), Ledet(Christmas), Timket (Epiphany) and Fasika (Easter). Islam is also an importantreligion in Ethiopia and the main festivals areRamadan, Eid ul-Fitr and Eid-ul-Adha.

• The Ethiopian traditional costume is made of woven cotton. Ethiopian men and women wear this traditional costume called gabbi or Netella

• Ethiopian tribes: Surma, Suri people in their tradionaldresses.

• A dance group of Ethiopia – Performing in their traditional attires

• A female dancer from Ethiopia performs a traditional Ethiopian dance

• Harar Tribe women in traditional outfits

• Ethiopia expect real GDP growth to average 6.3% a year in 2016-20,although a sharp slowdown is likely in 2016 because of the impact ofdrought on the dominant agricultural sector.

• The Gross Domestic Product (GDP) in Ethiopia was worth 55.61 billion USdollars in 2014. The GDP value of Ethiopia represents 0.09 percent of theworld economy..

Ethiopia main imports are:

Foodstuffs, textile, machinery and fuel

Ethiopia main trading partners are:

China (18 % ), Saudi Arabia (13 %), United States (9 %) Russia and India.

Ethiopia main exports are :

gold (21 %) and coffee (19 %)

Ethiopia main export partner is :

Switzerland (21 %) mainly for export of gold.

• Education Industry

• Mining Industry

• Fertilizers Industry

• Textile industry

• Gems and jewels industry

• Sugar Industry

15/03/16

As Ethiopia's economy is based on agriculture, which accounts for 47.7% of GDP and 85% of total employment, so the main focus was only on primary education till now.

• 67 % of females and 52 % of males had never attended school

• About four in every ten females (39 %) and half of all males (49 %) haveonly some primary education, while 2%of females and 3% of malescompleted primary education and did not attend secondary school.

Country/State Rate

India 80%

Ethiopia 49.1%

Gujarat 79.33%

• In Ethiopia Education between the ages of 7 to 13 is free and

compulsory.

• Support systems for female students

• Exercising leadership: students are encouraged to exercise leadership

through serving as class monitors responsible for ensuring good conduct in

class. Two monitors per class are elected; one of which is female.

• girls’ clubs had been established in all schools covered by the study. The

clubs are mandated to create awareness on the value of educating girls in

schools and in the community.

• Lack of infrastructure – including physical, financial, and human resources;inadequate capital funds to support all that they want to do.

• Underdeveloped campus life and facilities.

• Declining enrolment from the mid-to late-1990s, followed by unevenpatterns of growth.

• Inadequate resources for recruitment, retention, advising, and marketing –all the things needed to recruit and retain students

• Increasing demand of specific skills due to Ethiopia's growing industrialsector :

Jobs in Ethiopia's growing industrial sector requires command of Englishand computer-related high-tech literacy. Moreover Agriculture sector isalso adopting new technologies.

With the low level of basic education and considerable high illiteracy ratesin farming communities Ethiopia is struggling to match with this industryspecific demands.

Vocational Training Programs :There are many diverse kinds of vocational trainingprograms, certifications, and diploma programs, and correspondingly large number ofschools and organizations that offer them.

3 ways : I) To establish institute @ Ethiopia with campus, facilities , etc.

ii) To send Indian trained teachers across to train people @ Ethiopia

iii) Invite Ethiopian students @ Gujarat VTP Campus

Internet-based vocational training programs are great ways to gain new skills andenhance your career. These courses usually qualify you for vocational or technicalcertification or membership in a union.

Smart Goals’ with a future vision 'Education for All' is a major Project of the EducationDepartment with its Continuous Education and Literacy Policies geared to promoteLiteracy, reduce drop out rates, Focus on Girl Education, Teachers’ Training and a seriesof other Initiatives being implemented.

Government schemes like Bal Pravesh and Nirogi Bal is also made a part of the KanyaKelavani campaign. Government ensures ‘Literacy 100% in rural areas as it encouragesBal Pravesh (Child Admissions) by providing Admission forms and enrolling over525,000 girls in the state in Kanya Kelavani drive. The Ministers, beauracrats and otherGovernment officials motivate, encourage and inspire the parents to enroll theirchildren for Education as it is a prime factor to combat poverty.

• The Ethiopian mining industry is governed by the Modern Mining Act(proclamation) effected in 2010. The enshrinement in law of a mining codedemonstrates the Ethiopian government's support for the mining industry andgovernment policies are favorable towards mining companies.

• The federal government in Ethiopia has been collecting royalty amount 48.5Million Birr (4.4 Million USD) from the large scale production of gold every yearfor the last three years.

• Excellent opportunities are available in Ethiopia for mineral prospecting anddevelopment

• Gold reserves are expected to be identified in at least seven regions of Ethiopia.The country apart from gold reserves is blessed with good deposits of tantalum,platinum, nickel, potash and soda ash.

Gold Feldspar

Tantalum Salt

Soda ash Cement

Potash Gypsum

Coal Clay

Nickel Shale

Platinum Dolomite

The mining service sector in Ethiopia is actively contributing to raiseemployment opportunity by developing their skills.

The terms of the Modern Mining Act are as follows:

• 5% government free-carried interest in mining projects

• Corporate tax of 35% with negotiable breaks and holidays

• Royalty of 8% at the discretion of the Minister

• Exemption from customs duties, carry forward on losses for 10 years

• The Ethiopian Mining Proclamation states that the government requests 5%free equity shares with every licensed mining company operating in thecountry, as well as 35% income tax and 8% royalties.

Conducive circumstance for investment, abundant resources, political stabilityand economic growth are the major reasons that catch the attention of moreinvestors to Ethiopia. Gujarat can capitalize on these opportunities and canventure in to some kind of partnership with Ethiopia.

Indian Company To Invest $116m In Ethiopia’s Delbi Coal Mine

• Mumbai-based miner, May Flower Mining Enterprise Ltd is set to invest $116million in Ethiopia’s Delbi Mining S.C.’s coal mine over a three-year period.

• The Delbi coal mine is located in Oromia regional state, Jimma Zone, 400 kmfrom Ethiopia’s capital, Addis Ababa while its mining concession covers a 39.2square kilometer lot with an estimated coal deposit of 11.4 billion tonnes.

• May Flower will import mining machinery, mining experts as well as therequired finance for exploration and mining works.

• A joint management team comprising officials drawn from both companies willalso be set up.

Fertilizer Industry

15/03/16

Fertilizer @ Ethiopia

• Ethiopia is agriculture based country. In Ethiopia 47.7% people depends onagriculture.

• In Ethiopia no fertilizer manufacturing company is operating.

• The demand of fertilizer is estimated to show a significant rise as a result ofthe new extension approach that the Government is undertaking. Concernshave been raised about the constant reliance on the imported fertilizer forsustainability of the country’s agricultural development.

• Every year Ethiopia spends $103.3 million as fertilizer import expenses.

• The Government is helping the use of indigenous nutrient resources, bothorganic and inorganic to sustain and improve soil fertility and decrease thecountry’s dependence on fertilizer imports. For long-term sustainability ofthe Government has disembarked on a number of projects and possibilitystudies for connected nutrient supplies projects aimed at reducing relianceon imported chemical fertilizers.

Latest Developments

• The first wide-ranging fertilizer policy was introduced in the year 1993 by TGE (Transactional Government).

• Ethiopian government has decided to establish five fertilizer manufacturing plant in year 2017-18.

• The Ethiopian industry ministry recently announced intentions to spend $2.8 billion for setting up new fertiliser factories 300 kilometres west of Addis Ababa.

• The plants are expected to come into operation in three years and have the capacity to manufacture 300,000 tons of fertiliser each year.

Opportunity for India w.r.t. Ethiopian Fertilizer Industry

• India is also agriculture based country.

• We have many fertilizer manufacturing company in India.

• It means that India has experience and expertise in fertilizer manufacturing.

• Ethiopian government has beneficiary for the manufacturing of fertilizer.

• In Ethiopia favorable for establish fertilizer plant– Government have decide for manufacturing plant

– Cheap labor cost

– Easy available of raw material (Nitrogen, Calcium, phosphorous, Ammonia, etc.)

– Cheap land

So good opportunity for India to establish fertilizer manufacturing plant in Ethiopia.

• Ethiopia's textile manufacturing industry grasps both medium and large

public and also the private enterprises.

• Their important activities are spinning, fabric formulation, dyeing, finishing

and sewing.

• The Ethiopian textile industry is fourth largest manufacturing industry, after

food processing, beverage and leather industry.

• The Ethiopian textile sector mainly yields 100% cotton textiles

• In the fiscal year 2014-15, the contribution of textile industry to GDP was

1.35% with the growth rate of 10.30%

1 Cotton fabric

2 Nylon fabric

3 Acrylic fiber yarn

4 Cotton Yarn

5 Blanket (wool)

6 Blanket (cotton waste)

7 Bed Sheet

8 Carpet

9 Gunny Sack

10 Sewing thread

• Swedish clothing retailer H&M wants to set up his first shop in Ethiopia,

since production costs there are much less than in the Far East.

• A five year Growth & Transformation plan (GTP) has been set up for the

textile sector which targets improving capacity and making full utilization

of existing factories and new & expansion investments.

• Kanoria Africa Textiles, a subsidiary of Kanoria Chemicals & Ltd. has set up

an integrated plant at Bishoffu in Ethiopia to manufacture denim fabric.

Factors favorable for Textile Industry

• Abundant Cotton Resources

• Abundant cheap labor resource

• Support through policy and incentives

• Increased Domestic Demand

• Easy access to international market

Areas of Concern

• Poor Law and order

• Poor Infrastructure

• Insufficient Logistics support

• Unskilled labour

• Ethiopia yields good quality of cotton and it has advantage of favourable climate,

soil and availability of cheap land. However, the Labour is often exploited as the

textile sector there is still largely unorganised.

• Ethiopia lacks in secondary processing units like printing units. where Indian

textile units can come handy.

• Brands like Arvind Mills, Reliance Industries belonging to Gujarat keep

improving their technology on regular basis in order to increase their

production. Such big firms entering Ethiopia can help to enhance the ongoing

traditional textile industry with their experience and expertise by developing

state of the art facilities and providing proper skills to the local people of Ethiopia

working in the textile industry.

• Mining is important to the economy of Ethiopia as a diversification from agriculture. Currently, mining comprises only 1% of GDP.

• Gold, gemstones (diamonds and sapphires), and industrial minerals are important commodities for the country's export-oriented growth strategy

• Mining for gold is a key development sector in the country. Gold export, which was just US$5 million in 2001, has recorded a large increase to US$602 million in 2012.

• In 2010, about 1,500 kg of opal was produced at Wegel Tena. Besides opal, the country also produces gemstones that include tourmaline, amethyst, garnet, sapphire, aquamarine, ruby, topaz, peridot and emerald.

• Ethiopia is a significant exporter of gold and the country’s largest gold mine is Lega Dembiin the Sidamo province. Midroc Gold, a company that operated Lega Dembi, produced about 3,100 kg/yr of gold. Despite plans of closing this mine in 2013, Midroc Gold further continued to proceed with underground mining at Lega Dembi in order to extend the operations of this mine untill 2021. Through this mine, Midroc Gold planned to produce about 100 kg/yr of gold from 2012 to 2019.

•Ethiopia’s main concern for the future is to increase its exports of industrials minerals and metals. Experts feel that exploitation of Ethiopia’s gold reserves will increase exports and in turn improve the country’s economic growth rate.

•Ethiopia’s economy thus depends exclusively on the increase in exports and more foreign investments, which will help reduce the country’s dependency on imports and boost its mineral and mining sectors.

•The first foreign company to have received the licence to extract gold from western Ethiopia is a British company called Nyota Minerals. The government also hopes to increase the exports of sapphires, diamonds, potash and other industrial minerals and base metals.

•To give a boost to the five-year Growth and Transformation Plan (GTP) for the mining sector launched by the government, incentives are proposed to be offered in terms of tax reduction from the present level of 35% to 25%. During 2013, a draft document has been placed before the House of Peoples’ Representatives for approval so that the sector becomes more competitive vis-à-vis those offered by neighbouring countries.

•The legal and fiscal environment instituted by the government permits a free market driven economy allowing both foreign and local companies to participate in the mining development of the country, in a transparent manner that would help boost the economy of the country. Licenses have been granted to investigate and assess the mining potential but also for its exploitation

•The license stipulates that every mining company should allocate 5% free equity shares apart from 8% royalties and 35% income tax. The initial validity of the lease is for 25 years extendable for further ten-year period.

•A recent survey increased estimates of gold resources to 500 tonnes. The government says production could rise to 40 tonnes a year from just over four tonnes last year, earning the country around $1.7bn (£1.1bn) at current prices. This could dramatically boost development and reduce dependency on imports.

•Companies from America, Canada, China, Guyana, Italy, Norway and South Africa are operating within Ethiopia, and intensive exploration programs are being conducted for precious stones such as diamonds, sapphires and other gemstones.

• The legal and fiscal environment instituted by the government permits a free market driven economy allowing both foreign and local companies to participate in the mining development of the country, in a transparent manner that would help boost the economy of the country.[clarification needed] Licenses have been granted to investigate and assess the mining potential but also for its exploitation

• The license stipulates that every mining company should allocate 5% free equity shares apart from 8% royalties and 35% income tax. The initial validity of the lease is for 25 years extendable for further ten-year period.

• A recent survey increased estimates of gold resources to 500 tonnes. The government says production could rise to 40 tonnes a year from just over four tonnes last year, earning the country around $1.7bn (£1.1bn) at current prices. This could dramatically boost development and reduce dependency on imports.

• Companies from America, Canada, China, Guyana, Italy, Norway and South Africa are operating within Ethiopia, and intensive exploration programs are being conducted for precious stones such as diamonds, sapphires and other gemstones.

•India is deemed to be the hub of the global jewellery market because of its low costs and availability of high-skilled labour

•India is home to world’s largest diamond cluster i.e., Gujarat, since approximately 85% of the world’s diamond (57% by value) are cut and polished in Gujarat.

•Mumbai is an important export-import centre for gems and jewelry and Surat is an important centre for processing diamonds.

•Apart from Surat, Ahmadabad and Rajkot are the other major gems and jewellery clusters in Gujarat of which, Rajkot is also famous for its exclusive hand made gold and silver jewellery. •During April-November 2015, India imported 80.5 million carats of rough diamonds worth US$ 8.65 billion and overall imported US$ 15.02 billion worth of gems and jewellery. During the same period India exported 22.52 million carats of polished diamonds worth US$ 13.586 billion and had total net exports worth US$ 21.46 billion, thus continuing to be a net earner of foreign exchange in the gems and jewellery sector.

•Jewellery major Joyalukkas plans to invest Rs 1,500 crore (US$ 225.28 million) on setting up 20 stores in India and 10 overseas. The new stores, which will come up almost in a year’s time, will add to the Thrissur-headquartered company's existing 95 outlets.

•The Reserve Bank of India (RBI) has liberalised gold import norms. With this, star and premier export houses can import the commodity.

•India Bullion and Jewellers Association (IBJA) has signed an pact with the Bombay Stock Exchange (BSE) for setting up India’s first bullion exchange through a Special Purpose Vehicle (SPV), wherein IBJA and its constituents will hold 70 per cent and BSE will hold 30 per cent stake.

•India has signed a Memorandum of Understanding (MoU) with Russia to source data on diamond trade between the two countries. India is the top global processor of diamonds, while Russia is the largest rough diamond producer

Ethiopia’s sugar industry is earmarked by availability of natural and human

resources together with favorable climate for cane production.

Ethiopia’s domestic sugar consumption is considerably higher (1.26 times) than

its production. Therefore, the country imports about 1,52,000 metric tonnes

(MT) of sugar per year to meet domestic demand.

Ethiopia also wants to reduce import dependency and generate surplus sugar

for export.

Ethiopia’s sugar corporation is handling all sugarcane and sugar production. The

main purpose of the corporation is to grow sugarcane, sugar and sugar

products and to look after all feasibility studies, design preparation, technology

selection, negotiation, erection of new sugar development and expansion

projects.

• Major sugar producing countries are brazil, India, E.U. (European Union),China, Thailand, U.S. (Unites states of America), Mexico, Pakistan., Australia,Russia. India share in the world production of sugar was 17% in 2014-15

• India was the second largest producer of sugar in the world after brazil in2014-15. While the Sugar production in India in the same year was 250.46lakh tonnes and in Ethiopia it was 3,30,000 metric tonnes.

• In 2014-15 India was the 4th largest exporter of sugar having a share of 3.37%in total global export. There was no export of sugar in Ethiopia

Ethiopia makes great sugar cane, and it has advantage of favourable climate,

soil and availability of cheap land and labour while Gujarat has great

machinery tools, high-technology. With this combination there is great

potential of business between the two states for the sugar industry.

Majority people demand sugar products for good health and not for taste. In

India, particularly in the neighbouring states of Gujarat, sulphur- free sugar

is produced. With the help of cheap labor and Land in Ethiopia, and

Gujarat’s Technology, there is great potential for producing sulphur- free

sugar which can be a potential competitor in the international markets.

With special emphasis on R&D in India in the agriculture sector, better

quality sugarcane seeds at cheaper price can be made available. The

favorable conditions in Ethiopia can be combined for agricultural

development.

Thank

You