Ethiopian Airline Capitalizes on the Growing China – Africa Relations

A pic that I took in 2014 on arrival from DC

Note: A translated version of this article into Mandarin was published on the July issue of The Eminence magazine. You can find the link is at the bottom.

Ethiopia’s private investment ranks as one of the lowest in the world, while its public investment is one of the highest. Despite continuous criticism by international institutions for lack of private investment, the Ethiopian government takes pride in its course and economic achievements. Though the complaints are not without their merits, the government has the numbers to prove why its strategy is working.

Ethiopia has been one of the fastest growing economies in the world for over a decade now. The state owned Ethiopian Airline (ET) often referred as Ethiopian in short, leads the way of proving state owned companies and enterprises could be profitable. In recent years, Ethiopian generated more profit than the rest of African airlines combined.

Winning award after award at the international level, Ethiopian does not look it will slow down anytime soon. Considering its ambitious “Vision 2025” growth plan, ET looks well placed to outperform and lead the continent’s airline industry for years to come.

Under its 15 year Vision 2025 plan, Ethiopian aims to become a world class African airline with more than 140 fleet. The additional 60 aircraft fleet will help ET transport over 22 million passengers world wide and meet its 15-year targeted goal. According to ET staff, the airline hopes to reach 146 destinations by 2025 and earn up to $10 billion in revenue and $1 billion dollars in profit.

Reaching those ambitious goals will not come easy to ET, but a closer look into ET’s past five years record proves, it can accomplish its 15-year ambitious growth plan. The next few years will see Ethiopian add dozens of ultra-modern fleet to its collection; including A350-300 Airbus and Boeing 787 Dreamliner planes. The airline has already started taking huge infrastructure expansions projects to accommodate its ever-growing services and meet ever-increasing demand.

Among ET’s mega projects are a USD 7 million worth Light Aircraft Maintenance Hangar project to be financed by the airline itself; a USD 92 million worth Wide Body Maintenance Hangar to be financed by EX-Im bank of China and a cargo terminal with an annual capacity of 1.2 million tons, which will be one of the largest cargo terminals in the world. The construction of the cargo terminal is expected to be completed in the next four years and is estimated to cost USD 150 million. 

China’s increasing presence and influence in Africa has transpired to more than trade and investment. The growing interconnectedness between China and African countries has been a topic of passionate debates for many years. China’s intentions and its long-term plans are both derided and embraced at the same time.

Ethiopia is one among many that has embraced a lot of the Chinese developmental state policies and models. There is no surprise then, to see one of Ethiopia’s most successful state owned company leading the way in tending and catering to its Chinese customers. It was six years ago that ET hired its first Chinese cabin crew. Now, in addition to continuing to recruit Chinese flight attendants, ET has added in-flight announcement services and various writings in Mandarin (Chinese) to exceed its growing Chinese customer satisfaction. The infusion of Chinese culture in Ethiopian is beyond the airline and its airport terminals. Here in Addis, new Chinese authentic restaurants and gift shops can be seen sprouting in various corners of the city.

In hindsight, the USD 200 million worth African Union (AU) building that was built and give to Africa countries as a gift was just a drop in the ocean compared to the amount of money and resources China and the Chinese are committing themselves for the continent. Looking at the recently inaugurated building of the Chinese Mission to the AU building in the center of Addis, there is no doubt that the Chinese are here to stay.

Forwards thinking companies and organizations are positioning themselves to tap into the Chinese market; and ET seems to be doing exactly that. Ethiopian discloses that, although currently approximately 70% of ET passengers are transiting within the Africa continent, at the rate at which the trade relations is increasing between China and African countries, it is strategically aligning itself to win and retain Chinese customers.    

http://www.theeminencemagazine.com/index.php/component/k2/item/662-2015-07-30-07-43-08

You might also find this interesting http://afkinsider.com/102462/ethiopian-airlines-make-more-profit-than-all-other-african-carriers-combined/#sthash.3CdrD4m5.dpuf

Cheers,

Daniel 

Three Years After Meles

Meles was a transformational leader for Ethiopia. But his influence reached far beyond Ethiopia’s

boarders. He was a leader who deeply cared about the poor and less fortunate. Always showing signs of brilliance at whatever corner and whatever topic he turns out to be. He was an outlier amongst his peers with superior knowledge and deep understanding of local and international sociopolitical issues. Ethiopians will forever be grateful for all the sacrifices he made and for inspiring them to put their country back onto its glorious past.

His shortcomings, perhaps two things: first, having died in office, not being able to really call it quit and prove his opponents and naysayers he was not clinging to power, but rather trying to push this agenda and that agenda forward for the betterment of his people. I suspect in the grand scheme of things, he probably believed he had plenty of time. Unfortunately the unexpected death came too soon.

Second, failing to include strong willed people who don’t necessarily fully agree with his politics or policies; people who have their own vision on how Ethiopia should develop. The lack of ‘team of rivals’ in key posts and in his circle if you will. I assume he took a calculated risk of surrounding himself with a lot of Yes Men in favor of developmental expediency. Because, it was clear to him what was needed to be done and he needed people to do what he asks of them; minimizing and shortening the long zigzag path that a true democratic process often requires to reach a decision point.

This in hindsight however, in the absence of a visionary leader, has left us with a lot of Yes Men, who lack vision and a sense of clear direction; aside from their constant empty rhetoric of staying the course and implementing Meles’ policies to reach his goal of Ethiopia achieving middle income country. But, they have excelled at one thing for sure, labeling anyone who questions their ineptitude and lack of commitment as detractors of the grand vision. Thus far no one has been able to reframe that defensive argument and tell the Yes Men, no that isn’t so in a manner that resonates with the masses.

Three years without Meles Zenawi, Ethiopia is certainly still making a lot of positive progress, but not as much as it should. I say this because with some changes and genuine commitment, we could achieve so much more than what we are currently achieving both on the economic and democratic fronts. Ethiopia’s biggest problem is the lack of leadership and good governance.

One of the best things Meles did was telling us time and again that our country is poor and accepting that very fact and taking that understanding to heart was the foundation of it all. There is nothing more moving and captivating than watching Meles discuss about poverty such as in this video.
https://www.youtube.com/watch?v=T17u05ENHnw 

Let me finish by quoting one of the things he said, while speaking to thousands of people gathered at the Millenium Hall.  

“የሚሰሩ እጆች ይዘን

የሚያስብ ጭንቅላት ይዘን

የወጣቱ መንፈስ ይዘን

ስንዴ የምንለምንበት ግዜ መቆም ኣለበት!”

ጠቅላይ ሚንስተር መለስ ዜናዊ።

May his soul rest in peace.  

Cheers,

Daniel