Coffee exporters in Ethiopia, Africa’s biggest producer, are stockpiling beans in anticipation of a further devaluation of the national currency, the Ethiopian Commodity Exchange said.

The stockpiling has contributed to a decline in export revenue that has been exacerbated by a poor harvest, falling world prices and a ban on Ethiopian beans in Japan, Eleni GabreMedhin, chief executive officer of the exchange, said in an interview on March 27 from the capital, Addis Ababa.

“There is the expectation that the currency will be further devalued,” she said. “That and other factors are contributing to a decline in exports.”

Ethiopia’s government closed warehouses and suspended the business licenses of six of the country’s largest coffee exporters last week after accusing them of “hoarding” coffee and illegally selling export-grade coffee on the domestic market. The government is considering selling the brokers’ coffee itself, according to the Agriculture Ministry.

The Horn of Africa country devalued the birr by 10 percent in January. Both Prime Minister dictator Meles Zenawi and Trade Minister Girma Birru have said the government may further devalue the currency, which traded at 11.1025 per dollar on March 27, according to the National Bank of Ethiopia.

Alemayehu Kebede, a spokesman for the central bank, said he was unaware of any discussions taking place about a possible devaluation of the currency.

“These are simply expectations and rumors,” he said by phone today from Addis Ababa.

Hard Currency Shortage

Ethiopia has experienced shortages of hard currency over the past year, with the country’s reserves falling to as little as $850 million, enough to cover just one month of imports, Meles said in a speech to parliament March 19.

Japan banned coffee imports from Ethiopia last year after finding high-levels of pesticide residue in a shipment. Japan was Ethiopia’s third-largest coffee export market, accounting for 20 percent of shipments, according to the Trade Ministry.

Coffee production in the country also fell about 15 percent last year due to drought and disease, GabreMedhin said.

The global recession has cut world coffee prices and slowed demand for Ethiopia’s arabica beans, which command a premium at Starbucks and other retailers because of their quality, she said. Arabica-coffee futures for May delivery fell 1.5 cents, or 1.3 percent, to $1.1585 a pound on ICE Futures U.S. in New York on March 27. The price has dropped 19 percent over the past 12 months.

Ethiopian shipments have dropped more than 10 percent to 76,674 metric tons in the first eight months of the country’s fiscal year, compared with the same period a year earlier, according to the Trade Ministry.

The country has earned $221.7 million from coffee exports over the period, short of a government target of $446.7 million. Last year, the government also blamed rising food prices on hoarding by traders.

– By Jason McLure | Bloomberg

ADDIS ABABA, Ethiopia (Sudan Tribune) -The national airline of Ethiopia will launch new flight to Malabo, the capital of Equatorial Guinea in central Africa within three months, a press released said today.

Ethiopian Airlines is the fourth largest airline in Africa by passengers and destinations. However since 2005 the airline implements a plan aiming to strengthen its position in Africa and world by becoming the Africa’s World Class Airline.

The firm said it would launch three weekly fights to Malabo on Tuesday, Thursday and Sunday, starting for the next June. The fights will connect the Equatorial Guinea with most major cities in Middle East and Asia.

“This new service is being launched in line with Ethiopian firm commitment to connect Africa with the rest of the world” said Ethiopian Airline Vice President Commercial, Busera Awel.

In line with its growth strategy, the Ethiopian Airline announced also it will increase its flights to Riyadh the capital of Saudi Arabia. Starting with incoming June, the airline will launch three fights weekly to the Riyadh.

For these fights to Riyadh the airline plans to attract passengers from the different African countries including Nigeria, South Africa, Kenya and Tanzania.

TOKYO (AFP) – Japan gave its military the green light on Friday to shoot down any incoming North Korean rocket, with tensions high ahead of a planned launch that the US and allies say will be an illegal missile test.

Japanese and US warships have already deployed ahead of the April 4-8 window, when the secretive North has said it will launch a communications satellite.

Pyongyang has said any move to shoot it down would be an act of war.

But South Korea, Japan and the United States have all warned the North that any launch would be unacceptable, amid fears the regime is actually intending to test a long-range missile that could reach North America.

The security council in Japan, where pacificism has been official policy since the end of World War II, decided ahead of time to shoot down any incoming missile that could hit its territory rather than wait until a launch.

“The security council this morning decided to issue a destruction order in advance,” said Defence Minister Yasukazu Hamada.

“We will do our best to handle any flying object from North Korea.”

The North said Thursday that even referring a launch to the United Nations would ruin the long-running and erratic six-nation nuclear disarmament talks, during which North Korea has already tested one missile and an atomic bomb.

US National Intelligence Director Dennis Blair said the North wanted to show it had the technology to launch an intercontinental ballistic missile.

The North is believed to be preparing to test a Taepodong-2 that could hit Alaska.

“North Korea is attempting to demonstrate an ICBM capability through a space launch,” Blair said. “That’s what they are up to.”

Pyongyang has reportedly already put a rocket onto one of its launch pads, raising the stakes in a delicate diplomatic stand-off that has come just two months into the new US administration of President Barack Obama.

Enigmatic North Korean leader Kim Jong-Il was reported to have suffered a stroke in August, and some analysts speculate he is trying to demonstrate he remains firmly in control of the country.

Though a recent photo showed him looking thin, the North’s official media have reported more than three times as many public appearances by Kim so far this year than over the same period in the previous year.

The six-nation talks — grouping North and South Korea, the United States, China, Russia and Japan — have offered the North aid and security guarantees in exchange for dismantling its nuclear programme.

North Korea said Thursday that bringing any launch to the United Nations would be a “hostile action” that would end the negotiations.

The United States, which says the launch would violate a UN Security Council resolution, has vowed to do so.

“The six-party talks will become non-existent,” a spokesman for the North’s foreign ministry told official media.

Senior US, Japanese and South Korean negotiators were to meet in Washington later Friday to discuss the situation. Japan’s order for a shoot-down is the first since the nation revised its defence law in 2005.

Asked whether Japan was capable of such an intercept, Defence Minister Hamada said: “We have obviously prepared to be able to do it. I have no doubt we can do it.”

Lake Turkana’s clear waters emerge like a glassy screen, breaking through the rugged rocks and dry earth that precede its approach.

This most northerly of Kenya’s lakes, on the border with Ethiopia, formerly known as Lake Rudolf and referred to as the ‘Jade Sea’, brings life to its dry surroundings like an oasis in the desert.

But Lake Turkana, slightly salty and alkaline and abounding in 40 fish species, faces a severe threat from across the border in Ethiopia.

The row with Uganda over the tiny Migingo Island in Lake Victoria is nothing compared to the environmental catastrophe staring at Lake Turkana.

Ethiopia is midway through construction of a dam upstream on River Omo, which is Lake Turkana’s main tributary, giving it 80 per cent of its water. The other rivers, Turkwel and Kerio are seasonal and can barely sustain the lake’s water level.

Local and international impact reports have indicated the Turkana could start drying up once the huge dam, owned by Ethiopian Electric Power Corporation (EEPCO), cuts off the river to fill up a capacity of 11 billion cubic meters of water.

Big danger

The giant project poses a greater danger to 300,000 people around the lake in Turkana Central and Turkana North.

Its aquatic life, including the Nile perch, which they largely depend on for food and cash, could die out as salinity increases with the lowering of water level.

Similarly, a lake-dependent forest, one of the last pristine dry land forests in Africa, would also be in grave danger.

The tragedy looks real as the Gilgel Gibe III hydroelectric dam project is being built with the knowledge of the Kenya Government, which hopes to benefit from surplus power projected to be generated.

Irked by government indifference to the looming danger, residents, led by an NGO, Friends of Lake Turkana (FLT), recently demonstrated at Kalokol in Turkana North to drive their point home.

Ms Ikal Angelei, FLT chairperson, explained the realities of the endangered lake, saying it would never be the same again once the dam closes off its main water source.

“Nobody can touch the Nile from Alexandria (Egypt) down to its source at Jinja (Uganda). Egypt can even go to war if the river is interrupted. Why is our Government allowing this violation to our right,” Angelei said.

Turkana politicians led by Mr Christopher Nakuleu, an East African Legislative Assembly MP, said in a joint statement that the Turkana, Rendile, Dassanch, Elmolo and Gabbra, who depend on the lake for food and water, would be affected.

“It is recognised that any interference with the Lake Turkana ecosystem could be catastrophic, but no effort has been made to avert disaster,” says Pius Ewoton, the Executive Director of Arid Lands Integrated Programme.

He says since the start of the dam project on River Omo in 2006, the water levels have dropped by eight metres.

Mr Ewoton says Kenyan and Ethiopia’s governments approved the programme in total disregard of Environmental Impact Assessment (EIA) reports.

Since August 2006, Kenya has been negotiating with Ethiopia for a power supply deal.

Ethiopia has a total power demand of about 400 MW against a production capacity of more than 1,875 MW.

Already, a memorandum of understanding, which also involves KenGen, has been signed with the Ethiopian Electric Power Corporation.

Feasibility studies

While the African Development Bank has provided Sh68 million for the project’s feasibility study, EEPCO needs Sh51 billion to export power to Kenya. Djibouti and Sudan will also benefit. Project designing is under way. It will take another three years to complete interconnection.

The Turkana leaders said while a power purchase agreement outlining the terms of electricity sale was reportedly signed between Ethiopia and Kenya in 2006, there are no bilateral agreements on the use of the Omo-Turkana waterway and the dam’s downstream effects to Kenya.

The leaders claim that an EIA submitted to donors for funding of the damming project was ‘incredibly sloppy’.

“Shockingly, it does not even mention that RiverOmo supplies 80 per cent of Lake Turkana waters. It suggests that the dam will regulate the natural flooding cycle of the Omo, eliminating the seasonal floods critical to downstream farmers,” said Nakuleu.

The leaders are now urging President Kibaki to intervene and save the Turkana ecosystem and way of life.

During a visit to the area two weeks ago, Fisheries Minister Paul Otuoma said the Government was holding talks with Ethiopia on the matter. He said a Kenyan delegation had visited the neighbouring country and held negotiations.

The Ethiopian authorities, quoted by the BBC, maintain they are building the Gilgel Gibe III hydroelectricity dam — the second largest in sub-Saharan Africa — to solve a regional energy crisis.

(By Osinde Obare, Isaiah Lucheli and Vincent Bartoo | The Standard)

RICHMOND, Virginia (AP) – Ethiopians Tilahun Regassa and Amane Gemeda have won the Ukrop’s Monument Avenue 10K race in Richmond.

The 19-year-old Regassa won the men’s race Saturday in 28:21. He finished 13 seconds ahead of Alene Reta of Ethiopia.

The 26-year-old Gemeda won the women’s event in 32:37, finishing nearly a minute ahead of former Virginia Commonwealth University runner Maria-Elene Calle.

More than 32,000 runners signed up for the 10th anniversary running of the Monument Avenue 10K.

ADDIS ABABA, ETHIOPIA (Addis Fortune) — A high-level Ethiopian government delegation led by Girma Birru, minister of Trade and Industry (MoTI) left for India last Friday to discuss sugar development projects the latter finances after the Indian financer released the fund for the project, knowledgeable sources disclosed.

The delegation will meet senior officials of the Indian government and authorities at the Export and Import (Exim) Bank of India about the commencement of the construction of the Tendaho Sugar Factory in Tendaho area of the Afar Regional State, and the expansion works on Fincha and Wenji – two of the three existing sugar factories in Ethiopia.

Progress on both the expansion and the brand new sugar development projects has, for a long time, been stalled due to controversy between Indian companies that competed to be contractors for the construction and machineries installation of the projects.

Girma led the delegation to India following an invitation from the Indian government, the sources said.

The frequently delayed sugar development projects are expected to takeoff as Exim Bank has agreed to release the funds.

The long delay besieged the projects as Uttam, the Delhi-based sugar plant machinery manufacturing company, which has a subcontract for Tendaho Sugar Factory, has been in dispute with Overseas Infrastructure Alliance (OIA), an Indian private company that had won the Engineering, Procurement and Construction (EPC) for it, and subsequently took the case to the Bombay High Court.

The dispute arose because OIA requested a 15pc administration cost from the subcontract winners, and wanted to receive all the incentives the Indian government provides to its export companies.

Finally, through the intervention of the Indian Government, the conflict between the two companies was resolved.

The state-owned Exim Bank of India provided 640 million dollars in soft loan at an interest rate of 1.75pc, in accordance with the agreement signed by the two governments, which requires that 85pc of the construction work be done by Indian firms.

Tendaho and Fincha Sugar factories signed an EPC contract with OIA on January 10, 2008. Overseas should have begun construction within 36 days of the agreement. Even after a year, however, nothing has yet been started on.

Girma had become well known among the interested Indian firms, the media and authorities and business who closely observed the issue, for the frequent warnings he has given the Indian companies that the project should commence as per the terms of agreement signed. However, the warnings did not seem to achieve much until such time that the dispute between the two Indian companies was resolved following the intervention of the Indian government.

The Ethiopian government floated an international tender in October 2006 for the construction of the new Tendaho Sugar Factory in Tendaho area of Afar and for the expansion works on Fincha and Wenji.

These projects require about 15 billion Br, though that figure has climbed to 17 billion Br due to inflation, of which the amount to be spent on factory construction and machineries installation was secured from the government of India.

More than 20 Indian companies had contended in the October 2006 tender and OIA was awarded the EPC for Tendaho and Fincha, while Uttam won that for Wenji’s.

Separate parts of the factories (four to six packages) were listed for companies specializing in the specific parts to contend for each, and those who won two or more of the tenders would be awarded the EPC contract. The EPC contractors were expected to then sign sub-contract agreements with them.

Though Uttam’s accusation is only in relation to the Tendaho project, the Wenji and Fincha projects were also stuck because the charge led to the suspension of funding of the projects by Exim.

Tendaho, which cultivates 64,000hct of land alone, shares eight billion Birr of the total projected cost.

The Tendaho dam, the largest dam constructed by the state-owned Ethiopian Water Workers Enterprise (WWCE), has a capacity to hold 1.8 billion cubic metres of water. When completed, the Tendaho factory will have the capacity to crush 26,000tn of sugar cane, the largest capacity in Africa.

Fincha also envisages upgrading its production capacity from one million to 2.7 million quintals a year. The difference is what the three sugar factories under expansion are currently producing.

Fincha would undertake the expansion on Fincha River and on Amertineshi Dam, which is under construction by the Ethiopian Electric Power Corporation (EEPCo). It is expected to develop 5,000hct of land.

(By Amanyehun Redda, Addis Fortune)