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
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
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,
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
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
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.