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THE FINE LINE
 

 

People in the administration of the EPRDF government, the highest order as it appears, are in a tug of war with major importers of basic commodities, gossip disclosed. For sometime now, they have been playing a cat and mouse game with an obvious distinction between who represents which animal.

The Revolutionary Democrats are unable to come to terms with the impact of their macroeconomic policies on fuelling the economy, thus facing the inevitable curse of inflation. Instead, they find it convenient to put the blame on a couple of powerful businessmen for causing all the malaise in the market, gossip noticed.

They have written a new hymn justifying the chaos in the economy by claiming it is due to market imperfection, gossip observed. By this they mean a couple of importers control the whole supply chain from import to wholesale and retail.

Partly, they could be right, for some are pitiless in their business conduct. They would not mind paying or bulldozing their way to market dominance, even if it means bankrupting a new entrant to the market.

Consider one of the seven major edible oil importers who once manoeuvred the countryís quality standards authority to block a new competitor from importing oil, all in the name of sub-standard products, only to turn around and buy the same product at a substantially decreased price.

Such are stories that reached the ears of the highest order in the administration, prompting the whole mess that is now in the market, claimed gossip.

The importers are no fools, either. Recently, they held meetings with the ministers in charge of the nationís trade. When the authorities offered to buy their stock, neither to cost nor profit margin, they had to confess what they would lose as their declared procurement costs were much lower than the amount they really paid, gossip disclosed.

Little did they seem to realise such a disclosure in itself is criminal; it is called under invoicing.

Sick and tired of playing hide and seek, the administration has decided to buy edible oil in bulk from the suppliers of the importers to keep the latter at bay in the market. The importers are now laughing at the administration because it spent 1,400 dollars per ton, a price much higher than the amount they paid, claimed gossip.

This hikes up the price to 23.80 Br per litre FOB; add all the costs built in along the way to the retail market and it is unlikely they will offer it for less than 30 Br per litre.

With the administration capping the price of a litre of palm oil at 24.50 Br, its officials will have the tough choice between either buckling under the policy or subsidising the difference by stressing the budget more, gossip anticipated.

The manner in which the palm oil is purchased from Malaysia can potentially become controversial, gossip claimed. The administration is spending close to 17 million dollars on 12,500tn of palm oil to be distributed by the state owned enterprise in charge of merchandise trading.

This company is to be supplied with the oil by a company based in London, Agrimpex Co Ltd, whose accounts is with the Swiss UBS, gossip revealed. The company is owned by the Phillipas family, with Mr P.G. in charge, according to gossip.

This was not the first time for the Phillipas family to be awarded procurement contracts without competitive bidding. Since 2008, wheat imports worth six billion Birr had been supplied to Ethiopia by this company.

Why this company is always awarded such lucrative procurement contracts designed to provide welfare to the Ethiopian poor is a subject of quiet controversy between those on Lorenzo Tazaz Street and their counterparts on King George VI Street, gossip disclosed.

Someone owes the Ethiopian taxpayers an explanation, claimed gossip.

 
 
 
 
 
   
 
 
 

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