Page 1 - Print Version Volume 22 - Number 1126

Volume 22 No. 1126, SUNDAY, November 28, 2021 Content Matters

Roads Authority T e n ( 1 0 ) b i r r o n ly
Lifts Embargo
Central Bank Spurns Insurer
on Tsehay Outcries Over DBE Bonds
Insurance
Following 4.7m Private insurers account for 72pc of industry capital
Br Settlement
By BERSABEH GEBRE Regulators at the National introduced the bonds industry under liquidity
The ERA debarred 12 Bank of Ethiopia (NBE) hoping to finance public pressure, leaders of the
FORTUNE STAFF WRITER issued a directive three projects launched by the Association of Ethiopian
financial institutions months ago, binding government. Backed by the Insurers (AEI), chaired by
The central bank has rejected insurance companies to state, the bonds can be used Yared Molla, CEO of Nyala
earlier this year pleas from the insurance spend a minimum of 15pc as collateral. Insurance, pleaded earlier
industry to ease demands of their net income in buying this month to review the
By BERSABEH GEBRE on firms to invest in bonds the bonds. The authorities Claiming the mandatory
issued by the Development investment would put the (Continued on PAGE 5)
FORTUNE STAFF WRITER Bank of Ethiopia (DBE).

The Ethiopian Roads Authority SUNDAY MARKETS OFFER RESPITE
(ERA) has lifted a ban on Tsehay
Insurance S.C. preventing it from Sunday has become a sought-after market day for Photo by: Sawrawork Tafari
issuing advance payment and residents of Addis Abeba. If they venture into the
performance guarantee bonds for areas of Mexico, Megenagna, Qality, Jemo or Piassa, consumers, an issue the city administration is attempting
contractors ERA hires. they are bound to run into lively marketplaces where to address. City officials hope to continue the markets,
food staples can be bought at much lower prices than offered encouraged by the excitement from both consumers and
The move comes after the at regular retailers. They could buy quantities of potato for traders. They want to add 10 more locations to the list and
insurance firm paid a settlement half the price, or onions for two-thirds and a bag of spaghetti make grocery shopping a Sunday ritual. They plan to set
of 4.7 million Br to the Authority 20pc cheaper than other stores. This is no small respite for them up in permanent places where the markets can be
for an advance payment guarantee consumers in an economy where annual food inflation hit more accessible.
bond it had issued to Akir 40.7pc last month. Economists that closely follow the market see the initiative
Construction more than seven There are 148 cooperatives in the capital, with many selling as an encouraging start to stabilise prices. But they concede
years ago. The construction at these markets owing to the joint initiative by Addis Abeba’s inflation is much more an issue of productivity than caused by
company was incorporated in Trade Bureau and Cooperative Agency. Consumers have dysfunctional supply chains. The more produce available, the
2004 with Awetahegn Kiros as a responded with enthusiasm and do not seem to miss the less likely they are to be manipulated by intermediaries, they
major shareholder. A significant intermediaries that connect them to the producers. Supply argue. Relieved consumers, meanwhile, want city officials to
player in the construction industry chain problems are one of the factors driving prices up for continue installing more of the weekend markets. please
for two decades, Akir was awarded see the full agenda on page 2.
a contract to construct a 59Km road
from Sembo to Shola Gebeya in the
Amhara Regional State in 2014. The
project was initially projected to
cost 663 million Br, scheduled to
be completed in three years.

Tsehay issued an advance payment
guarantee bond for the contractor.
These bonds cover from 10pc to
20pc of the project cost in value
and are designed to protect project
owners from default risks by the
contractor.

The start of construction awarded
to Akir Construction was delayed by
two years. Its managers had blamed
disputes over the right of way by
residents, forcing the Authority to
extend the deadline to 2019. As the
project progressed, the value of the

(Continued on PAGE 5)

Deposits (2019/20) Dashen (53.5b Br) BoA (47.6b Br) NIB (33.7b Br) Hibret (34.7b Br) Awash (74.3b Br) LIB (26.1b Br) BIB (13.9b Br)