Entrepreneurs in Ethiopia

A few cases and some conclusions

Christmas roses from Ethiopia

Desa Plants

The flowers and plants you buy come probably from Ethiopia.

Desa Plants is a Belgian company, employing 750 Ethiopians.

Produces cuttings of more than 400 varieties, including geraniums, lavender, herbs, dahlias and chrysanthemums.

Cuttings because they are much smaller than plants and transport by plane is much cheaper.

Most of the cuttings produced in Ethiopia go to Belgium where they are rooted and then spread throughout Europe.

Also shipments directly from Ethiopia to Canada, USA, Turkey, Japan and South Africa.

The economy is global.

Activities that require a lot of technology -> where the technology is available.

Activities that require a lot of manpower, -> where manpower is available on

favorable terms.

First Asia, Eastern Europe, China…

…now more and more: Africa!

The African lion

Producers move from Kenia to Ethiopia.

Ethiopia: good conditions of soil, water, temperature, stable government.

Clear rules and regulations (quite rigorous, lack of flexibility: due to the long years of communist rule?)

Ethiopia creates favorable conditions to attract foreign investors.

Many Chinese investments in all fields: they see opportunities and do not hesitate.

The government invests in facilities: industrial sites, roads, railways, airports, import and export facilities.

Agriculture is important

Horticulture is important for employment in Ethiopia.

Ethiopian Airlines bought new special cargo aircrafts.

14 flights per week from Addis to Liege with mainly flowers, fruits and cuttings.

The government made some 3 million hectares available for foreign agricultural and horticultural enterprises, (3 million hectares = the area of the whole of Belgium).

Horticulture is an intensive sector: much production in a small area, with lots of manpower.

Corporate Social Responsibility

CSR is important for Desa Plants

The wages are much higher than the average.

These wages are adjusted annually based on inflation.

Many additional services: transport with buses, meals, pension, insurance and coverage of medical expenses.

The company provides electricity and water in the village of Ejersa.

The local school receives support and Desa Plants supports education about AIDS and family planning.

Together with employees and local community, Desa Plants takes care of reforestation in the area.

The government is working with multi-year plans to create a modern state & health is an important component.

The population of Ethiopia is growing very fast.

Official figures speak of about 90 million inhabitants.

The average life expectancy is 55 years.

Far more than the 45 of three decades ago, and the number continues to rise.

But obviously this can be better.

Gondar University Hospital

After the end of the communist reign of Mengistu in 1991, the government of Meles Zenawi addresses all areas of public services -including healthcare - systematically.

Many medical problems in Ethiopia are a legacy of the past.

Infections and illnesses caused by poor hygiene and poor diet.

The policy in the area of health is based on three principles:

1. prevention; 2. democratization 3. accessibility.

To make health care affordable for all, payment is differentiated in function of income.

Those who have much, pay more, those who have little, pay a symbolic amount. Free is not a good system that has been long learned here.

Health care is important

3 step system of facilities

Huge but very systematic investments in medical facilities.

3 grades in 1st level: 1. In every village: a health post for basic medical aid.

2. Higher up the scale: the health center (one for 25.000 inhabitants).

3. If necessary, the patient is referred to a Primary Hospital (one for 100.000 inhabitants). These three features together form the Primary Health Care.

On the 2nd level is a General Hospital (one for 1,5 million inhabitants).

The 3d and final level in the system, the Reference Hospital (Specialized Hospital, 1 for 5 million inhabitants).

Gondar University Hospital: a 3d level Hospital.

Qualified staff is important

Until recently, the best staff moved abroad.

Medical staff is available.

Many universities were built where doctors, nurses and other medical staff graduate.

A few decades ago, Ethiopia had 2 universities, now 33!

Many of the staff have little experience, inevitable in a rapidly growing sector: there are too few people with experience to guide the many newcomers in daily practice.

Another problem is that many doctors pay more attention to their private practice because there they earn much more.

Since 1954. 2003: more than medical: University of Gondar.

The idea of education coupled with trainings in the 3 level system = model for the organization of health care in Ethiopia.

Gondar University Hospital is a specialized hospital or referral hospital, as UZ Leuven Gasthuisberg in Belgium.

Patients of general hospitals in the region are referred to here for specialized treatments.

Interesting for the students: particular pathologies.

5.000 students, including 2.000 doctors.

500 beds in to our standards poorly equipped wards, spread over a large area (logistical problems).

New building with 1.000 additional beds is being finished.

Gondar: oldest medical school in Ethiopia

The first impression of Westerners is one of horror: it looks unsanitary, poorly organized, overcrowded wards, central kitchen is a nightmare, the non-medical services almost non-existent...

Many patients come directly to Gondar, skipping intermediate steps. (also in Belgium).

There is a lack of medicines and functioning medical equipment.

There is especially a lack of logistics to run a hospital: technical personnel, material for cleaning the rooms, maintenance, plumbing, electricity, computers…

If you compare the situation with hospitals in DR Congo, then it is fantastic: they achieved a lot with limited financial resources.

The doctors are properly trained and performing at level.

ZNA will collaborate: improve logistics & exchange of students.

Horror or congratulations?

The entire budget of the University of Gondar, of which UH Gondar is a part, is 40 million euros.

The whole hospital budget is 1,7 million euros.

That's hallucinatory little compared to a hospital in Belgium.

A medium hospital as Sint Jan Hospital in Bruges has an annual turnover of 400 million.

This is 200 times more than Gondar University Hospital that is much larger.

Annual budget for maintenance: 63.000 euros.

For maintenance of all equipment 40.000 euros.

Congratulations!

Ethiopia is still seen as a land of hunger and misery.

1984 images of famine: imprinted in the West.

A lot has changed: the country now has much to offer.

A lot of well educated students graduated.

Until 2011 Bogale Abey Mesfin was a typical Ethiopian youth: young, university graduate, newly married.

Worked as a tour guide for foreign tourists: seasonal and irregular income.

Served as a deacon in the Coptic church.

... and was looking out for interesting opportunity.

Land of enterprising people

“I want no tip, I want advice”

Bogale wanted to start his own business and had clear ideas about it.

He mailed three well-developed business plans to Belgium.

The most realistic plan was the purchase of a van of high quality for tourists.

Bogale wanted to offer tourists: air conditioning, soft drinks onboard, tires and bodywork in good condition, always neatly cleaned...

He got a loan, realized his dream and it worked out well.

He soon employed five people.

A man with a dream

Early in 2012 the Ethiopian tour operator Dynasty Ethiopia Tours was born through another loan.

In collaboration with Entrepreneurs for Entrepreneurs & Davidsfonds, Dynasty Ethiopia Tours organizes 2 tours a year.

Individual travelers and other groups followed.

Travelers are impressed by the tourist highlights.

Ancient Axum, the churches and castles of Gondar, the scenery of the Simien Mountains, the 3.2 million year old Lucy in Addis Ababa and the monolithic churches in Lalibela.

On top of that: visits to local businesses, humanitarian projects and contacts with ordinary Ethiopians.

That makes the program unique and a great success.

Dynasty Ethiopia Tours has since bought two comfortable buses to transport passengers.

Tourism is progressing swiftly and there is need for reliable tour operators.

Dynasty Ethiopia Tours

Bogale has much more plans: a hotel, terrain vehicles, biking and hiking...

Maybe it is better to focus.

Difference in entrepreneurial attitude: strict in the west, more lose in the south.

Difficult to get exact information.

Problem of exchange rates: loans in dollars, earnings in local currency.

But without a chance: no starter!

Conclusion: it is like the stock market: there are risks, but chances of nice (financial or mental) return.

So this is important for small investors in Ethiopia:

• diversification

• money you don’t need

• projects you understand.

SWOT analysis

Promotes sustainable economic growth in developing countries.

Supports entrepreneurship at local level or develops basic conditions required for local entrepreneurship to flourish.

Members are both NGOs and private companies.

Brings Belgian companies, entrepreneurs and dynamic persons into contact with economic initiatives in the South.

Believes that individuals and groups have the will and power to develop themselves.

By developing economy entrepreneurs create prosperity for themselves and for the society in which they operate.

Entrepreneurs for Entrepreneurs

Entrepreneurs for Entrepreneurs works with NGOs that have programs aimed at stimulating the local economy in the South.

This includes projects ameliorating the basic conditions required for economic development (education, healthcare, basic needs such as water, etc.).

Entrepreneurs for Entrepreneurs contacts companies and entrepreneurs in Belgium.

Suggests financial support for these NGO projects.

The aim is to achieve sustainable, long-term cooperation between these companies and the projects.

Support for NGO projects

Entrepreneurs for Entrepreneurs offers entrepreneurs and entrepreneurial individuals in Belgium the opportunity to support directly entrepreneurial people in the South.

2 ways of doing this:

• Exchange of expertise

• Financial support through a loan or shareholding

Entrepreneurs for Entrepreneurs has a large portfolio of entrepreneurial business plans in the South.

These are presented to interested entrepreneurial investors in Belgium.

Entrepreneurs for Entrepreneurs is the matchmaker and provides professional support.

Business-for Business (B2B) projects