EUBFE Released Early COVID-19 Early Impact Assessment

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EUBFE conducted a survey to assess the early impacts of the COVID-19 pandemic on its member companies in Ethiopia. Key findings of the survey indicate that eventhough the on set of the virus was late in Ethiopia, witht the first case reported in mid-march, its impact was sharp and significant to many. Moreover, data indicated that at this early level estimation, many companies expect to recover from its impact in around a year's time. Concerns over safety and security were also flagged. To read the full report please follow the link below.

The Ethiopian Investment Commission Launched online portal to service investment permits and renewals

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The online portal intends to provide services including: request for new investment permit certificate, request for commercial registration certificate, application for expansion of existing investment permit or existing business license, application to renew investment permit and replace the investment permit certificate.

In addition, application for tax holiday incentive support of eligible projects, application for duty-free incentive support qualified projects were among the other services mentioned.

For more information please visit the web portal at https://www.invest-ethiopia.com/

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EUBFE took part in the annual summit of EU Chambers in Brussels

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As a member of global alliance of EU Chambers called European Business Organizations Worldwide Network (EBOWWN), the EUBFE attended a general assembly meeting at the EU Commission from June 17-19, 2019.

In his opening remark, Mr. Eric Mamer, Director of DG for Internal Market, Industry, Entrepreneurship and SMEs (DG GROW) of the European Commission highlighted the key contributions European Chambers make to expanding EU companies’ reach to third markets. Moreover, the US-China trade war has also brought into about a potential paradigm shift on global trade focus on developing EU industrial policy that would support the internationalization of EU companies. Free Trade Agreements with various EU partners is also gaining traction as a result.

The three-day intensive meeting saw election of new board members for EBOWWN, bilateral meetings with DG for International Cooperation and Development (DG DEVCO), DG for Energy (DG ENER), European External Action Service (EEAS) as well as Business Europe and Eurochambers. The discussion focused on EU’s position on internalization of EU businesses, funding plans on the new MFF in this connection as well as possibilities for cooperation on sustainable energy investments with Africa. Two visits at the EU parliament also saw delegates from EBOWWN discussing with representatives of parliamentarians and commissioners on the state of affairs of the ever-expanding network of EU chambers and how to cooperate further for maximum impact for companies who’ve invested outside the EU. EBOIMG 2714IMG 2732

Public-Private Dialogue between foreign businesses and Ethiopian government is in its final stage of preparation

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The development of the second public-private dialogue (PPD2) has seen two key issues distilled for discussion with the relevant high-level Ethiopian authorities; taxation& auditing and logistics & clearance. EUBFE, which co-chairs the technical team comprising of foreign business associations tasked at developing the issues for PPD, has worked tirelessly to collect, analyze and finally present the final list of challenges to the Ethiopian Investment Commission for approval. As soon as date for the high-level PPD is decided, members shall be informed. It is to be recalled that the previous PPD deliberated on Forex and Business Visa issues with the National Bank of Ethiopia and the Immigration and Nationality Affairs Authority, resulting in a the introduction of numerous forex management directives and the launch of e-visa.

EUBFE represented EU businesses in Ethiopia at a global summit of EU Chambers in Brussels

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EUBFE took part in an annual summit of global European Chambers of commerce hosted by the European Commission’s Directorate for Internal Market, Industry, Entrepreneurship and SMEs (DG-GROW). The three days summit brought together more than 30 Eurochambers from around the globe with EUBFE among the three active Eurochambers in Africa to attend.

Two days of the summit were dedicated to discussions with representatives of the various European Commission’s directorates and representatives of the EU parliamentarians regarding improved collaboration between EU chambers and EU trade negotiations, future plan of the commission and potential for collaboration and other pertinent developments that are relevant to EU businesses operating outside the EU economic zone.

The concluding date saw general assembly meeting of European Business Organizations Worldwide network (EBOWWN), to which is a full member since 2017. The EBO Worldwide Network stands as the sole organization representing European business interests in markets outside the European Union. It represents a network active in over 35 key markets that serves European multinationals, as well as micro, small, medium and large enterprises. European chambers of commerce and European business associations within the EBO Worldwide Network work on a daily basis with European Union delegations across the globe in the shared interest of supporting European companies.

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Where does EU investment size stand in Ethiopia? Draft report presented following general assembly meeting and networking of EUBFE

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On April 13, 2018 EUBFE members held their first annual meeting which was followed by thematic networking.

The event saw an annual activity and financial report of 2017 and plans for 2018 by the executive director, Mr. Nahom F. Abraham. External audit report was part of the report by the executive director. The general assembly ratified both planning for 2018 and audit report.

Following the general assembly meeting, a presentation on the findings of the EU business mapping study conducted in collaboration between EU delegation and EUBFE was made by Mr. Carl Daspect, economic attaché at the EUD-Ethiopia.

In his presentation Mr. Carl indicated that the goal of this joint study is to periodically measure the level of EU investments in Ethiopia so that the joint work of EUD and EUBFE in the dialogue with Ethiopian authorities can be facilitated and more targeted. In addition to the EU business mapping study, two sectoral analyses (pharmaceutical and logistics) were developed and made available to EUBFE members.

Despite significant challenges in availability and reliability of data as well as disparities in definitions and standards of FDI, the draft report was able to depict a picture of EU investment size, employment trends, nature of ownership and geographical coverage. To this end, the report found that the EU block investment stands third in terms of FDI stock position, behind Chinese and Turkish investment, with an FDI stock of approximately 310 mln USD. 70% of EU investments are in the manufacturing sector, a priority sector of the Ethiopian government, creating more than twenty thousand permanent and close to thirty thousand temporary job opportunity. About 60% of EU investments are in Addis Ababa with the Oromia region accounting for about 27%. Unlike other FDI, EU investments were found to account to about 50% joint investment form, indicating willingness and interest of EU companies to collaborate with local ones. Following comments and suggestions by participants, Mr. Daspect reiterated that the final draft shall incorporate the suggestions made during the event with the refined report made available soon.

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Consultative Workshop on Local Sourcing Held

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EUBFE held consultative workshop with member companies' on August 18, 2022 with sourcing and procurement experts on challenges and potentials for local sourcing. The outcome of this consultative workshop will be used to develop a policy brief that would present the potential for linkage between local manufacturers with European FDI. It will also present the exiting bottlenecks that hampered the backward linkage with a view of recommending potential solutions and policy interventions. In addition to the active consultation that helped in garnering helpful qualitative data, a survey will be disseminated to capture the quantitative potential for local sourcing.

EUBFE together with the EU Delegation to Ethiopia Hosted Members of European Parliament

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Together with the EU Delegation to Ethiopia, the EU business forum and its member companies hosted members of the parliament of the European Union led by Mr. David McAllister. On the occasion, the head of delegation of the EU delegation to Ethiopia, Ambassador Roland Kobia, appreciated the perseverance of the European business community that has remained committed to contributing to the enhancement of the business climate. Board chairman of EUBFE, Mr. Ben Depraetere, thanked the members of the parliament for taking the time to engage with the business community and share opinions that would strengthen the economic partnership between Europe and Ethiopia. He also shared copies of the Business Climate Report 2021 that depicts the perception of European investors in Ethiopia, including summaries of policy interventions that would contribute to the ease of doing business.

AGM and thematic networking held

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The EUBFE ratified several motions and elected new board members on the occasion of its annual general assembly of 2022. The AGM was hosted by Heineken breweries in their new headquarters. The executive director of EUBFE presented annual activity and audit report for FY 2021 as well as plans for 2022. 

Two motions were also presented for ratification were- the amendment of membership rules and a motion to change EUBFE's name to European Chamber in Ethiopia. The executive director and the board chairman explained to the general assembly on the background of the need for such motions. Both also responded to queries from members. After a brief deliberation, the two motions were unanimously endorsed by the general assembly. The third agenda was the election of new board members that would replace the one who served for the previous two years. Representatives of BASF Vegetable Seeds, TotalEnergies, Unilever, Heineken, Neumann Kaffe Gruppe, Krones-Ethiopia, Varnero Construction, Ethiopia-Netherlands Business Association and French Business Club came forward to take up the responsibility at the board of EUBFE. All were unanimously elected to the board.

The last session of the afternoon was a presentation by a member law firm-BonellieErede- on the new investment incentive regulation vis-a-vis the old one. Following Q&A the day was concluded with a cocktail reception. The full content of the legal review that was presented at the thematic networking can be accessed below.

New Investment Incentives Regulation Summary by BonelliErede

EUBFE was elected to the board of European Business Organization Worldwide Network

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On the conclusion of the annual summit of European Chambers in third countires, held under the umbrella of the EBOWWN (European Business Organisations Worldwide Network), EUBFE was elected to the board of management to serve the network for the coming two years representing Africa-based European chambers. The summit which took place in Brussels from June 06-10 2022 via the support of European Commission's DG GROW (Directorate General for Internal Market, Industry, Entrepreneurship and SMEs), saw European chambers engage with various Directorate Generals of the commission on pertinent issues faced by European companies in third markets. The first two days were dedicated for African EBOs (European Business Organisations), whereby the eleven chambers exchanged best practices and pledged to create a strong African chapter that can engage with external partners in a structured manner.
 
From 16-18 June, the various EBOs from  across the globe met and discussed with DG Trade, DG INTPA, DG , Business Europe, EuroChamber and DG CLIMA. The discussions with the various representatives of the commission informed the ensuing key steps of the network as well as create clarity on the depth of European businesses represented by this network. The last day of the summit was dedicated to AGM of EBOWWN members where the outgoing board presented its activity and financial reports, followiing which new board was elected. EUBFE was elected to lead the African voice given its stature and experience both in-country as well as on regional matters.

EUBFE Launched Its Maiden Business Climate Report and Signed MoU with Ministry of Finance

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On April 6, 2022 EUBFE launched its maiden “Business Climate Report-2021” in the presence of high-level officials including H.E. State Minister of Finance H.E. Mrs. Semereta Sewasew, H.E.Mrs. Lelise Neme-EIC commissioner, H.E. Ambassador Roland Kobia-EU Ambassador to Ethiopia and H.E. Kassahun Gofe, State Minister of the Ministry of Trade and Regional Integration. 

 

The report was developed in response to the need to bolster public-private dialogue between the FDI community and the public sector with evidence-based input that would, in turn foster constructive and sustainable partnership. The report's findings will be used as the foundation for further analyses and studies that will inform ensuing PPDs between the FDI community and the government. Preparation to this end has been completed, with relevant resources already mobilized. The EUBFE business climate report is based on a survey of more than 80 European businesses with operations in Ethiopia, conducted in mid-2021. It was commissioned and managed by EUBFE, and supported by the two bilateral member associations; the French Business Association in Ethiopia (CAFE) and Ethiopia-Netherlands Business Association (ENLBA).

The report provides an up-to-date assessment of the Ethiopian business environment and investment climate by the international business community, with clear evidence on what the active international business community think about their Ethiopian investments as of mid-2021, and how they view prospects for future investment. The cooperation of government ministries and agencies was commendable throughout the study, with pertinent data extended to the experts in a timely fashion. The key challenges identified were in the areas of tax, customs, delay in the renewal of licenses, access to foreign exchange, unpredictability of the business climate. With the support of the EU, further studies and analyses will be made on these findings to develop clear policy recommendations. 

 

A Memorandum of Understanding (MOU) between the Ministry of Finance and EUBFE (including its member associations CAFE, and ENLBA) was also signed during the launch ceremony. The MoU will pave the way for a structured dialogue between the European FDI community and the ministry. Mrs. Semerata Sewasew signed the MoU on behalf of the Ministry of Finance. 

 

A panel discussion was held following the MoU signing ceremony, ENLBA and CAFÉ presidents as well as the EU Ambassador and EIC deputy commissioner-Ato Temesgen Tilahun, exchanged views on the finding of the report and related issues on ways of improving the business climate. The evening concluded with a cocktail reception an informal networking session. 

 
You my access the full content of the report via the link below.

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On April 6, 2022 EUBFE launched its maiden “Business Climate Report-2021” in the presence of high-level officials including H.E. State Minister of Finance H.E. Mrs. Semereta Sewasew, H.E.Mrs. Lelise Neme-EIC commissioner, H.E. Ambassador Roland Kobia-EU Ambassador to Ethiopia and H.E. Kassahun Gofe, State Minister of the Ministry of Trade and Regional Integration. 

The report was developed in response to the need to bolster public-private dialogue between the FDI community and the public sector with evidence-based input that would, in turn foster constructive and sustainable partnership. The report's findings will be used as the foundation for further analyses and studies that will inform ensuing PPDs between the FDI community and the government. Preparation to this end has been completed, with relevant resources already mobilized. The EUBFE business climate report is based on a survey of more than 80 European businesses with operations in Ethiopia, conducted in mid-2021. It was commissioned and managed by EUBFE, and supported by the two bilateral member associations; the French Business Association in Ethiopia (CAFE) and Ethiopia-Netherlands Business Association (ENLBA).

The report provides an up-to-date assessment of the Ethiopian business environment and investment climate by the international business community, with clear evidence on what the active international business community think about their Ethiopian investments as of mid-2021, and how they view prospects for future investment. The cooperation of government ministries and agencies was commendable throughout the study, with pertinent data extended to the experts in a timely fashion. The key challenges identified were in the areas of tax, customs, delay in the renewal of licenses, access to foreign exchange, unpredictability of the business climate. With the support of the EU, further studies and analyses will be made on these findings to develop clear policy recommendations. 

A Memorandum of Understanding (MOU) between the Ministry of Finance and EUBFE (including its member associations CAFE, and ENLBA) was also signed during the launch ceremony. The MoU will pave the way for a structured dialogue between the European FDI community and the ministry. Mrs. Semerata Sewasew signed the MoU on behalf of the Ministry of Finance. 

A panel discussion was held following the MoU signing ceremony, ENLBA and CAFÉ presidents as well as the EU Ambassador and EIC deputy commissioner-Ato Temesgen Tilahun, exchanged views on the finding of the report and related issues on ways of improving the business climate. The evening concluded with a cocktail reception an informal networking session. 

 

You my access the full content of the report via the link below.

EUBFE Business Climate Report-2021

 

EUBFE Business Climate Study Report 2021 Validation Sessions Held

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As part of its strategic goal of supporting its advocacy engagement with empirical studies, the EUBFE commissioned its maiden business climate report in the middle of 2021. The draft report was presented to its members as well as government stakeholders on two separate sessions.

The validation session with member companies took place on the 21st of October in virtual setting. The consultants made a presentation of summary of the key findings, preceded by welcome and opening remarks from Nahom F. Abraham, the executive director of EUBFE, and Mr. Ben Depraetere, board chairman. Member companies who took part in the session provided key input into the report with suggestions and questions that would help in further enriching the report to reflect their perceptions and views.

The second validation session was held on November 02 2021, in the presence of key government ministries and commissions. Representatives of ministries of Finance, Trade, Revenues, Innovation and technology were in attendance. Moreover, the National Bank and the customs commission were also in attendance. The guest of honor at the session was the deputy commission of the Ethiopian Investment Commission, Mr. Temesgen Tilahun. He appreciated the efforts of EUBFE in it endeavor of working in tandem with the government in continuously improving the business climate. Ms. Sanne Willems, team leader at the EU Delegation in Ethiopia, also underscored the importance of public-private partnership and the EU’s readiness to support the country’s drive towards creating conducive environment of the private sector in general. The comments and suggestions garnered at the session, including those from the first session will be incorporated into the draft report. It is, tentatively planned that the report will be officially launched by early December 2021.

Joint Workshop between EUBFE and Ethiopian Customs Commission Delivered

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A joint workshop organized in collaboration with the Ethiopian Customs Commission was held on April 15, 2021 The basis of this workshop is the list of specific issues that were submitted by the EU Business Forum to the commission, following a mini survey disseminated amongst members. Some 40 logistics managers and staff members from EUBFE member companies took part. From the Customs Commission’s side, a number of directors including Mrs. Abeba Kiros- Director, Strategic Partnership Directorate, Ato Endashaw Temesgen -Director, Import goods procedure and support directorate as well as Mrs. Gennet Abreham - Director, Manufacturer and Export Trade Procedure and Support took the podium to lead the Q&A session.

The objectives of the workshop were
• to present the key systems that are instituted that would enable swift release of goods, within the 10/15 days deadline
• to discuss on the issues and challenges submitted by member companies, including but not limited to o repetitive inspections, rejection of transaction values, LC extension related challenges, duty free imports privilege rejection, lack of clarity on investment on logistics sector, missing HS codes on single window and consolidation of goods

Based on the queries raised by participants, the panelists as well as the other invited guests from ECC provided detailed explanation upon the return of participants from health break. The explanations were made by the panelists as well as Ato Habtamu Tilahun from Legal Directorate, Mr. Behailu Bedasso (lead valuation expert) from Valuation Directorate, Ato Sebsbie Fekade from ESW (team coordinator), Mr. Zewdu Tsehay from transit and warehouse directorate (lead expert) and Ato G/Egziabher G/Tsadik (deputy manager) from Kality Customs branch.

A summary of the responses is as below.

  • Price valuation is tolerated if it falls between 5-10% of ECVS. Regardless, the ECVS is being updated to reflect current prices and add new commodities; it is now at a pilot stage
  • Companies need to supply complete documents to enable ECC assessors make informed decision. In this regard, for ECC to be convinced of transaction value, sales contract needs to be submitted on top of LC and commercial invoices.
  • Price valuation remains a contentious area.
  • The first 4-6 digits of HS code are usually the same globally and the remaining will differ according to country context. Transiters should have the ability to navigate this.
  • The Ethiopian Single Window system (ESW) is currently serving the business community. Some 16 companies, mainly banks and insurance companies operate within this framework. Training is being provided to the business community on ESW on a continuous bases and based on needs experts will be happy to extend one to EUBFE members.
  • In situations where system failure happens in partner organizations, like Ministry of Agriculture, the ESW secretariat will be happy to intervene to support business in clearing their commodities on time.
  • The 10/15 days deadline kicks in on the day T-1 is validated. This means the day the shipment arrives in its designated warehouse, be it in Modjo, airport or even ECC certified duty-free warehouses.
  • Pre arrival clearance is indeed actively applied although some transiters do not seem to use this opportunity. However, it is one area that is targeted for improvement since it lacks harmonization across branches and does not meet international standard.
  • ECC is committed to developing the capacity of its staff. It also takes note that some of the challenges are rooted in absence of the right skills. ECC is open to partner with stakeholders including the private sector to this end.
  • The issue of expanding the privileges being an AEO to other government agencies has been tabled for consideration at the prime minister’s office. In this manner, law abiding companies will have significant benefits.

Joint Workshop between EUBFE and Ministry of Revenues Held

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A joint workshop organized in collaboration with the Ministry of Revenues was held on January 29, 2021 at the BestWesten Plus Hotel in Addis Ababa. The workshop focused on Auditing, tax compliance and related issues. It attracted more than 40 finance managers, drawn from member European companies. 

This workshop falls within the memorandum of understanding signed between EUBFE and the ministry to bolster relationship between member companies and the ministry. A small survey was conducted at the end of 2020, that brought some problematic areas in the tax administration that gave rise to the design and the delivery of this workshop.

Hence, the major objectives of the workshop were

  • enable participants grasp the basics of risk-based audit
  • to equip participants on basic assumptions taken into consideration on frequency of audit
  • exchange experiences on audit work between European companies and auditors of MoR and identify areas that require better collaboration

The Ministry of Revenues was represented by five directors;

  1. Ato Kebede Lidetu- Director, Risk and Compliance
  2. Ato Birhanu Kebede-Director, Tax Audit Management
  3. Ato Sisay Gezu-Director Tax Fraud Investigation
  4. Wro. Abaynesh Abate- Directress, Tax Debt Management
  5. Ato Dereje Meonnen- Director Filing and Return Processing

All the directors made a brief presentation on the major tasks of their respective directorates and the challenges encountered in expediting their responsibilities. 

The discussion that ensued addressed concerns raised by participants in the areas of VAT fund delay, frequency of audit, withholding tax, capacity of auditors and related tax administration concerns.

Follow this link to download the full content of the workshop: https://eubfe.eu/images/Minutes-_Workshop_on_Audit_and_Tax_Compliance_29.01.21.pdf 

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