Month: June 2019

A business gathering was held in January 27, 2019 at Pyramid Hotels and Resorts, Debrezeit with the intention of having a cluster based joint corporate social responsibility projects in Debrezeit Cluster Farms at P. The CSR projects will be executed principally by the commercial farms in partnership with Ethiopian Horticulture Producer Exporters Association (EHPEA) and the responsible public partner from Oromia regional state; Oromia Investment Commission.  Community demand driven interventions will be the main focus which could directly contribute to the enhancement of livelihoods  of the surrounding communities and contribute to the image building in that respective cluster. As a result of the gathering, a CSR joint committee for the cluster was formed.  The Committee will be responsible in the identification, selection and implementation of the projects and will have thorough participatory assessment on the culture and need of the community and will have a commendation based on the outcomes.

Debrezeit Cluster farms are a business oriented private organizations engaged in the production and export of Cut roses, Fruit and Vegetable and Herbs to the international market. The companies strives to create safe and healthy working environment for their employees and committed to contribute for improving the living standard and health and wellbeing of their employees and their surrounding communities. In line with this, the companies create public private partnership among the farms, EHPEA and Oromia Investment Commission to initiate joint CSR projects through procedural and financial contribution with active participation of the target community.

One of Ethiopian Horticulture Producer Exporters Association member farm, Herburg Roses PLC celebrated its 13^th anniversary of operating in Ethiopia since 2006G.C. Herburg is a Netherland origin company operating on flower business for over 40 years.  With its excellent experience in growing roses it opened the first nursery out of Holland in Ziway, Ethiopia located about 163 km east from the capital.

Currently, Herburg Roses has 40 hectares of greenhouse rose production exporting to UK market about 2million stems on weekly bases.

On this colourful celebration of anniversary, representative of Batu City Administration Mayor Mr. Tula stated that the horticulture sector created a huge job opportunity for the community and foreign currency earning to the country. He also urged on his speech; that his administration, pertinent stakeholders and community leaders shall support the sector development.

Mr. Huub van der Burg, owner and managing director of Herburg Roses, received the highest traditional gift from the community leaders (Aba Gedaa) for their contribution on supplying drinking water in collaboration with its neighbouring companies AQ Rose, Braam Flowers and Ziway Roses PLC for Desta Abijata and Ouda Ashura farmers union.

Derba Flowers and Mullo Farm are located next to Derba village at 70 km drive north west from Addis Ababa. With over 350 hectares of land, only 45 hectares are used for floriculture and the other 85% is managed as nature reserve. Both companies are involved in the production of high quality Hypericum Coco- and Veronica Pico flowers which are exported to a large number of customers all over the world.

Besides the conservation of nature, the farms strive to have a good balance between flower production and community engagement. These efforts have enabled the farms to be the first in the Ethiopian flower sector to become certified with Rainforest Alliance. The organization decided to go for the unusual choice of Rainforest Alliance, next to Code of Practice Silver level, because most of the USA based customers intend to comply with this specific standard.

In addition, Derba Flowers and Mullo Farm have recently joined hands with Midroc (a local cement factory) to provide the neighbouring area of the farms with a new borehole. The old borehole was broken due to an unfortunate event and the companies sat around the table with the community to find a solution to resolve the issue. In the end both companies agreed for Midroc to take up the installation work and for Derba Flowers and Mullo Farm to make sure all required material, such as piping, electricity and a pump will be donated.

Meanwhile, leading up to finalizing the installation of the new borehole, Derba Flowers has been giving trucks of water to the community to make sure people continued to have access to clean drinking water. This project has improved the well-being of the people in Derba village and helped to strengthen the relationship of the farms with the community.

For the third year in a row, foreign direct investment (FDI) is down all over the world, but not in Africa.

Global money is banking on African growth, reduced barriers to cross-border trade and affordable access to commodities.

From 2017 to 2018, global FDI fell from $1.5 trillion to $1.3 trillion, according to an analysis by the United Nations Conference on Trade and Development (UNCTAD). The conference released its 2019 World Investment Report this week, showing that global FDI not only hit its lowest level since the global financial crisis, but has also been on the decline for three consecutive years.

One region defied this trend: Africa. In 2018, roughly $46bn worth of FDI flowed into Africa, an 11 percent increase compared to 2017. This is significant for the continent because when a company or an individual makes an FDI, they are said to be establishing a long-term business interest in a foreign country. The expectation is that they will not only invest money, but also time, and soft assets (i.e. technology, expertise  and training).

Why Africa?

The African Continental Free Trade Agreement (AfCFTA) was signed into law in May and allows 52 African countries to buy and sell goods without tariffs, which will make them less expensive and therefore more appealing to African consumers. “The AfCFTA agreement will bolster regional cooperation,” Mukhisa Kituyi, secretary-general of UNCTAD said. “Along with upbeat growth prospects, this bodes well for FDI flows to the continent.”

Commodities are the other big draw for global investors. According to UNCTAD, global money is now investing in African commodities such as gold in order to profit from expected price increases.

Sources of capital

In 2017, France was the top foreign investor in Africa, followed by the Netherlands, the United Kingdom, and the United States.

Critically, UNCTAD’s data shows that from 2013 to 2017, Chinese FDI in Africa grew 65 percent, only topped by the Netherlands, for which FDI was up more than 200 percent.

Different regions, different investments

Not all 55 countries on the continent benefited equally from FDI in 2018.

Investments in northern Africa jumped seven percent, or $14bn from the previous year. This increase in FDI helped to offset less investment in Egypt, which was down eight percent.

Despite the decline in FDI for Egypt, UNCTAD data shows that the country was still the largest recipient of FDI continent-wide.

Ethiopia brought in $3.3bn worth of FDI and was the top destination in East Africa. Kenya, another East African country, received $1.6bn worth of FDI. These investments were mainly in manufacturing, hospitality, chemicals, and the oil and gas sector.

“Many East African nations have become more open to investment,” James Zhan, the director of UNCTAD’s Investment and Enterprise Division and the author of the report, told Al Jazeera. Mauritius, for example, is now more welcome to outside investment.”

Zhan says Mauritius, an island nation, has a new framework in place to attract outside investment.

“The [Mauritian] government is quite clear. They are shifting their priorities and have a strategy,” he said. “Now, they are continuing to build the island as a business hub and offering more business services to East African countries.”

Developed nations see a decline

A new tax law that went into effect in the US in 2018 has encouraged corporations to pull their cash out of other developed markets such as Western Europe, according to UNCTAD. This has led to a loss of $557bn or 25 percent of FDI, the lowest level in 15 years.

Despite ongoing trade tensions between the US and China, FDI is expected to recover this year in developed economies as the effects of the US tax law wear off.

The joint program by USAID, MASHAV of Israel and the Ministry of Agriculture of Ethiopia has introduced over 2,000 farmers with an avocado variety – Hass – imported from Israeli. The program over the past four years has managed to export Hass from Ethiopia and find the results encouraging and worth expanding, according to Wale Getaneh, Deputy coordinator of the project. “The reason we focused on avocado over the last four years is because the international market for it is rapidly growing that Ethiopia has suitable weather for growing avocado,” Mr. Wale told NewBusinessEthiopia.com. He stated that after familiarizing a few thousands of smallholder farmers with the avocado variety imported from Israel and teaching them how they can grow, the project has been exporting Hass avocado to the Netherlands by collecting from the farmers.“We started by exporting two tons of avocado four years ago. After we get good feedbacks from the importers, we decided to increase the volume annually including many smallholder farmers into the project,” he says.

The following year the export volume has increased to eight tons and then exported 14 tons the next year. Wale says they have exported a kilogram of avocado for $3.6, $4 and $5.7, consecutively.“When we exported the 14 tons, we made a trial by exporting eight tons using vessel to see the feasibility of the business for the private sector in the future. But the trial was not easy because of the not much developed logistics sector of Ethiopia, which includes waiting long to freezing container. But the avocados we exported using the vessels finally reached Rotterdam on the 36th day. It was encouraging and the feedback from the client was also very good,” he says, advising the private sector to move into growing avocado for export market.

Avocado VS coffee 

Wale also suggests that the government should consider good incentives for investors who come to invest in avocado production and export. This is because it has a potential to generate huge hard currency for the country even more than what the country is currently getting from coffee export.

“If well invested in, avocado can take over coffee in a short time in terms generating hard currency for Ethiopia,” Wale says, indicating that Ethiopia should learn from successful horticulture development experiences of Israel and the Netherlands.

Comparing with coffee, he says that one can plant up 2,600 coffee seedlings per hectare with output of 10 to 12 quintals per hectare. But by planting 416 seedlings of avocado per hectare with up to 20 tons per hectare, Ethiopia can get more export earnings as compared to what it is getting from one hectare of coffee.

He states that in China the price for a kilogram of avocado may reach up to $17, while in California, which is also avocado growing area, a single avocado may be sold up to $2.

The global demand projection of avocado for the coming 20 years is estimated to continuously grow.

Launched in 2005, USAID-MASHAV-Ministry of Agriculture, has been working with smallholder farmers in Tigray, Amhara, South and Oromia regions showing the farmers how to grow Hass avocado variety for international market. The United States Agency for International Development (USAID) has been taking care of the funding part, while the Israeli international development agency – MASHAV – has been dealing with the technical part of the project Ethiopia’s ministry of agriculture is the implementing agency.

Over the last four years the project has managed to increase the number of smallholder farmers who are growing Hass avocado to around 2,600. In the coming September the project expects to export up to 100 tons of Hass avocado collecting from these smallholder farmers.

From establishing modern avocado and other horticulture seedlings producing nurseries, to distributing them to smallholder farmers in the four regions, the project has been registering good results, according to Wale.

If it continuously gets water avocado seedling may start giving fruit after two years. But preparing the seedling can also take one year. Currently the three nurseries established by the project are supplying avocado seedlings to the smallholder farmers.

The nurseries have a total capacity of supplying 305,000 avocado seedlings. “At the moment we don’t have shortage of seedlings. We are only waiting for the private sector to come and invest,” Wale says.

In addition to the imported rough cover Hass avocado variety, currently there are about half a dozen local avocado varieties in Ethiopia

Tinaw Business Share Company (S.Co) is one of the prominent Ethiopian owned farm engaged in the production and export of cut roses to the international market since 2006. The farm located at the Southern Nations, Nationalities and Peoples’ Regional State (SNNPRS), Guraghe Zone, Ezha Sub-District , Zigba-Botto Village, which is 170 Km from Addis Ababa.

Currently, the Company produces different flower varieties for exports to The Netherlands and other countries having a certification of MPS-A, MPS-SQ and ETI  and gearing up toward a Gold certification from EHPEA.

Tinaw Business S.C is engaged on potable water project, committed to provide Safe drinking water to the local community around flower farm, which is expected to benefit more than 3,250 communities

The three-day expo brought together more than 180 national and international companies in the flower value chain, held in Nairobi, Kenya. IFTEX Expo Kenya is a great platform for interaction among Kenyan flower grower, international flower exporters and buyers.

EHPEA participated at this expo representing its member farms by displaying different varieties of members produce such as Roses, Carnation, Hypericum, Alstroemeria, Gypsophylia, Statics and Veronica in a 21msq pavilion. A B2B meetings with buyers, input suppliers, and investors conducted.

On the expo EHPEA promoted the ample investment opportunities of horticulture sector in Ethiopia. Ethiopia’s Extraordinary and Plenipotentiary Ambassador to the Republic of Kenya, Meles Alem, has also paid a visit to EHPEA’s stand.

The value of Kenya’s flower exports is projected to grow 20 percent in 2019 as compared to 2018, the industry said on Wednesday.

Clement Tulezi, CEO Kenya Flower Council (KFC), told journalists in Nairobi that in 2018 export earnings from cut flowers hit approximately 113.2 billion Kenyan shillings (1.1 billion U.S. dollars), which was a 38 percent increase from the previous year.

“There is currently an oversupply of flowers in the international market but the earnings of the Kenya floriculture sector exports is still expected to expand by 20 percent in 2019,” Tulezi said during the opening ceremony of the eighth edition of the International Flower Trade Expo (IFTEX).

The three-day expo brought together more than 180 national and international companies in the flower value chain.

According to KFC, Kenya is the world’s fourth largest exporter of cut flowers and accounts for around 40 percent of all cut flower imports into the European Union.

Tulezi said that Kenya’s flower sector is keen to diversify its overseas markets and is looking forward to expanding into more markets including China, Japan, India, Australia, Canada, United States and Eastern Europe.

Tulezi added that Kenya is prioritizing sustainability in the flower industry in order to reduce the environmental impact of the sector’s production.

ET-Highland Flora PLC said undertaking liquid waste water management properly is instrumental in reusing water and curbing environmental pollution. The company has been investing hugely in liquid and solid waste water management.

The liquid waste water management project being undertaken by the company has been hailed as exemplary by EHPEA staff members who visited the farm these past two weeks. It is also doing very well with regard to turning solid waste into compost. The farm has managed to fully develop twenty hectares of land.

Farm Manager Emebet Tesfaye said as flower farm takes huge water the company has given due attention to investing particularly in liquid waste water management. “We are relying on consultants’ advice and we are on the way to reuse treated water for irrigation purpose. Liquid waste treatment also helps us in carrying our social responsibility of developing the farm while protecting and conserving the environment.”

The Farm’s liquid waste treatment process encompasses sedimentation tank, primary holding tank, vertical flow bed, gravel bed hydroponics as well as six-layer ponds.
According to Company Production Department Head Urge Batu, the farm is currently growing 16 varieties of rose. In parallel, it is replacing old varieties with new ones in accordance with breeders and present market demands.

Urge indicated that the company is taking massive action towards enhancing productivity and maintaining quality of products through maintaining greenhouses sanitation.
The farm was established in 2005 and went fully operational in 2006.

Ethio Agri-ceft/Agri Flower Holeta is one of the pioneers of horticulture investments in the country. It is well-known for its diverse rose varieties and a good track record of engaging in local communities developmental activities.

Last week, by the time EHPEA staff visited the farm, workers were busy preparing bissu – the most popular rose variety needed in Europe on the occasion of Mother’s Day celebration. To meet the insatiable demand for bissu on the event about 7,000 bunches (having ten stems in each bunch) were readied to be supplied to France and Poland market for the May 26^th event.

Reliance on hydrogen peroxide is common in many farms to protect flowers from bacteria and fungus. Instead of mild chemicals Ethio Agri-Ceft Holeta has already specialized in using ‘endod’ — phytolacca dodecandra in lieu of aluminum sulphate and sodium hypochlorite – which are known to have residue and a distinctive smell respectively. However, endod has been proved to be environment friendly. Thus, Agri Flower Holeta sprays in greenhouse to protect flowers from infestation.

The company is garnering a lot from endod particularly in maintaining cleanliness of the compound. Through maintaining greenhouse sanitation, it is helping the farm in fighting unpleasant smell.

The company started operation 15 years ago. It has now 463 employees and managed to utilize 28.5 hectares of land set aside for it at inception. In terms of quality produce and price at market, now the company is among the best performers in the horticulture industry. It operates on 27 greenhouses having 0.45-2 hectares.

As regards corporate social responsibility Company Manager Leul Debas remarked: “We have been taking part in various developmental activities in Holeta city administration. Though we need additional 10 hectares of land for expansion in the short-term, we have the capacity to develop 25 hectares beyond the present undertaking.”

As part of CSR activities the company has so far constructed 4.4-kms of asphalt road and covered about 75% of community policing station built in the vicinity of the farm. Workers in the farm have smartly curved out wooden rooms to take rest, dine or refresh whenever they finish off their daily activities.