Sunday, 10 August 2014 20:41

Newsletter 41

  • WB commits USD 5 bln to boost electricity generation in six African countries
  • Huajian Group to build its own industry zone
  • Japan considering introduction of advanced kaizen in Ethiopia

WB commits USD 5 bln to boost electricity generation in six African countries

The World Bank Group on Wednesday committed USD 5 billion in new technical and financial support for energy projects in six African countries-- Ethiopia, Ghana, Kenya, Liberia, Nigeria, and Tanzania—which have partnered with President Barack Obama’s Power Africa initiative.


Making the announcement on the second day of the 1st US-Africa Summit, President of the World Bank Group, Jim Yong Kim (PhD), said the new financial commitment was urgently needed to generate more electricity for the people of Africa, 600 million of whom have no access to electricity despite the fact that Africa possesses some of the world’s largest hydropower, geothermal, wind and solar potential, as well as significant oil and natural gas reserves.


“We think that the US Power Africa initiative will play an extremely important role in achieving the goal of providing electricity for Africa. So today I'm very pleased to announce that the World Bank Group, following President Obama's lead, will partner with Power Africa by committing USD 5 billion in direct financing, investment guarantees, and advisory services for project preparation in Power Africa's six initial partner countries, Ethiopia, Ghana, Kenya, Liberia, Nigeria, and Tanzania. The US government and the World Bank Group are working now on specific tasks and milestones which could help to achieve one quarter of Power Africa's goal of generating 10,000 megawatts of new power in Sub Saharan Africa,” Kim said. Africa’s power crisis forces families and communities to spend significant amounts of their income on costly and unhealthy forms of energy such as diesel generators or wood for indoor cooking fires. Africa has vast hydropower potential but uses just 8 percent of this untapped water force. In comparison, Western Europe uses 85 percent of its available hydropower potential, which has contributed to their economic development and industrialization.

Source, Reporter Newsletter 09 August 2014



Huajian Group to build its own industry zone

The Chinese shoe company, which has already heavily invested in Ethiopia at the Eastern Industrial Zone in Dukem town of the Special Zone of the Oromia Regional State, Huajian Group, is now set to invest USD 2.2 billion on an industrial zone of its own located around Lebu area in the South Western outskirts of Addis Ababa.

The Reporter learnt from the Ministry of Industry that the company has applied and secured a license in addition to acquiring a plot for the construction of    an industrial zone of its own which is expected to kick-start next year. The project is expected to cost some USD 2.2 billion and make the company an industrial zone operator apart from being one of biggest shoemakers in world.

The group already received 138 hectares plot of land in the Lebu locality for the construction of the planned industrial zone.

The zone is expected to house some 45 textile and garment, leather and leather products, chemical and pharmaceuticals, agro-processing and metal engineering factories. According to sources, all of the shades in the industry zone is reserved for companies which have affiliation with the Huajian Group. Back home, Huajian is known to own and operate huge industrial zones in three districts. 

According to the tentative plan, the construction and population of the industrial zone will go in harmony with the country's Growth and Transformation Plan II, currently under preparation. The plan shows that the construction as well as the population of the shades will happen in phases where by the end of the first year (2015/16) three leather processing plants are expected to go operational in the zone. The three plants are also projected to employ some 3,000 workers.

In the second phase, which commences by 2016/17, the number of companies will grow to six with additional three companies in textile and garment joining the industrial zone.  All in all, at end of the GTP II and also at the last phase of the development of the zone the number of companies is expected to reach 45: ten in textile and garment, ten in leather and leather products, ten in agro-proccesing, another ten in mental engineering and five in chemical and pharmaceuticals will be housed in the industrial zone. By the time all 45 become fully operational, some 30,000 workers are expected to find employment there. 

By the end of the development phase, the industrial zone will require 53 megawatt of power supply and 15,555 metric cube of water supply per day.     

Huajian is also planing to generate 250 million dollars annually in export revenue for the country.

Eastern Industry Zone, which is owned and operated by a Chinese company, is the first and one of the few industry zones in Ethiopia where Huajian had setup shop when it first came to Ethiopia. The government of Ethiopia has placed a lot of hopes in the so called industrial and economic zones to transform the country's agriculture based economy to that of industrialized one. 

Convinced by the commitment and the industrial strategy of the government, the World Bank Group provided USD 250 million few weeks ago for the expansion of the Bole/Lemi Industry Zone which is being developed by the ministry.  The government also envisages to expand industrial and economic zones to Kombolcha and Dire Dawa of the Amhara Regional State and Dire Dawa City Council, respectively. The Reporter's sources also disclosed that Chinese companies are showing strong interest in the Dire Dawa Industrial Zone project.

Source, The Report Newsletter26 July 2014 Written by  Yohannes Anberbir

Japan considering introduction of advanced kaizen in Ethiopia

The philosophy for continuous improvements of quality and productivity, kaizen, made Ethiopia the third generation implementer,

after Japan and Singapore, and it is getting new heights as Japan, the sponsoring nation, might consider Ethiopia to advance in kaizen for the next, more complex phase. 

Kaizen was introduced in Ethiopia in 2009 following the enquires of the late Prime Minister Meles Zenawi, which has been in practice from 2012 onwards, is planned to continue for some five years beginning early 2015, according to Tanaka Akihisa, director of he private sector division at the Japan International Cooperation Agency (JICA). He told The Reporter that the next phase of kaizen will see more advanced techniques that will assist the improvements of the manufacturing subsector. “Ethiopians have absorbed kaizen very fast. So we have successful results and for the next phase we will introduce the next advanced kaizen in Ethiopia,” he said. 

Ethiopia, since 2012, has made improvements in terms of cost reducing production systems and avoiding rejects, according to Akihisa. The improvements and the enthusiasm from the Ethiopian side in practicing kaizen prompted Japan to boost its management philosophy. The recently aired advertisement via CNN is one that can be mentioned. CNN aired how kaizen is making changes in Ethiopia’s manufacturing sector.  

Getahun Tadesse, director general of Ethiopian Kaizen Institute (EKI) told reporters on Friday at his office that the second phase of kaizen implementation would give priorities to the manufacturing, logistics and construction sectors. The export and import substituting commodities will have the upper hand of the Japanese kaizen in the production and quality spectrums. Akihisa cornered that following the evaluation results of kaizen implementation, his government is looking at Ethiopia to obtain the advanced stage, which giant companies like Toyota and the likes have implemented. 

Both Akihisa and Getahun signed a terminal evaluation document on Friday agreeing on recent developments. According JICA reports, 250 companies have been trained for kaizen and some 30 companies according to EKI have attained some 37 percent improvements in the production activities.  So far, some 33 thousand management staff and workers are reported attending kaizen trainings and capacity building programs.

Gethaun said that the 33 universities and Technical and Vocational Education and Training (TVETs) institutions are among the targeted ones in the second phase implementation of kaizen. Monetary terms remain undisclosed but as part of official development assistance to Ethiopia, the government of Japan is looking at Ethiopia to champion over some African counties way longer associated with kaizen than Ethiopia in the past. Currently, in addition to establishing a kaizen institute, Mekelle University has initiated a curriculum and master’s level training and in the future the long serving Addis Ababa University (AAU) will include doctoral degree programs specializing in kaizen.

Source, The Reporter Newsletter 02 August 2014 Written by  Berhanu Fekade

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