Ethiopia : USAID Helping Ruling Party’s Company

Amid a growing concern over foreign aid abuse by Ethiopian authorities, Jason McLure for Bloomberg News reports, the USAID is helping bolster one of  TPLF owned textile comapnies. The Obama administration thus far has failed to appoint ambassador to Ethiopia at this critical time in Ethiopian history.

Obama’s well-wishers still believe that is a sign of Ethiopia’s dimishing importance as a regional ally. Yet, the US government continues to support the ethno-rasicst regime in Addis Ababa. It is imperative that the American people know that their tax money is being used to prop-up dictatorial regimes like the Ethiopian government.

Nov. 25 (Bloomberg) — Ethiopia’s main opposition party criticized a U.S. aid program for helping a textile plant with ties to the country’s ruling party win a multimillion dollar contract from an American company.

The program, known as the AGOA Plus project, is designed to help link African manufacturers to American buyers in order to take advantage of preferential tariff treatment under the African Growth and Opportunity Act. The so-called AGOA program, started by the U.S. government in 2000, allows about 6,500 products from Africa to enter the U.S. free of duties or quotas.

On Nov. 19, the U.S. Agency for International Development– funded AGOA Plus said it brokered a contract worth as much as $30 million annually between Jackson, Mississippi-based Atlas Manufacturing Group and Almeda Textile. Almeda is part of a group of companies that was founded and is controlled by members of Ethiopia’s ruling party.

“The American government is using public money to support a dictatorial government,” Beyene Petros, an opposition lawmaker from the Forum for Democratic Dialogue, said in a phone interview on Nov. 23. “This is simply crazy. I don’t know who is advising them or why they are doing this.”

As part of the deal, Almeda will produce restaurant uniforms and other garments for Atlas, which specializes in importing textiles to the U.S. from African countries eligible under AGOA. Ethiopian textile exports under AGOA were $18 million in 2008, lagging countries such as Lesotho, which exported $340 million in goods under the trade pact.

Economic Development

Michael Gonzales, a spokesman for the U.S. Embassy in Ethiopia, said the goal of the project was to foster economic development, not help political parties. In matching U.S. buyers with Ethiopian manufacturers, it didn’t provide American companies with information about the ownership of Ethiopian factories, Gonzales said in a phone interview yesterday.

The U.S. works with the Ethiopian Textile and Garment Manufacturers Association, Gonzales said.

“Almeda is a member of this association,” he said. “Almeda is one of relatively few Ethiopian factories with the capacity to fill an order of this volume.”

Razvan Ionele, general manager of Almeda, said in an e- mailed response to questions that the deal would consolidate the image that Ethiopia is a possible sourcing location for producing textiles. He declined to comment on the company’s ties to Ethiopia’s ruling party.

James Langford, chairman of Atlas Manufacturing, declined to comment, when contacted via e-mail yesterday.


Foreign aid to Ethiopia has emerged as an issue ahead of national elections scheduled for May, which the opposition has warned may not be free and fair. Earlier this month, the Forum for Democratic Dialogue said its members had been denied access to a food aid program funded by the U.S., the U.K. and the World Bank as well as Ethiopian government jobs funded by foreign donors. The government has denied the allegations, and the American and British governments have said they are probing the claims.

Almeda, located in the northern city of Adwa, the birthplace of Ethiopian Prime Minister Meles Zenawi, is owned by the Endowment Fund for the Rehabilitation of Tigray, or Effort, one of Ethiopia’s largest business groups. It comprises more than a dozen companies established by former guerrillas from Meles’s Tigray Peoples Liberation Front that seized power from the Communist Derg government in 1991.

Effort’s CEO, Abadi Zemu, is a senior official in the TPLF, which has ruled Ethiopia for the past 18-years in an alliance of pro-Meles parties known as the Ethiopian Peoples Revolutionary Democratic Front. Effort’s deputy chief executive, Azeb Mesfin, is Meles’s wife.


Last year, the World Bank’s Ethiopia country director said the finances of Ethiopia’s endowment businesses were opaque and a bank report this year called on policy makers to ensure that endowment firms are managed at arms-length to the government.

Effort is using the profit from Almeda and its other businesses for economic development and projects like schools and housing in Ethiopia’s ethnic Tigray region and not for political purposes, said Abadi.

“The initial money of course was from the TPLF,” he said in phone interview yesterday from the northern city of Mekelle. “But since then the ruling party cannot make any claim on its resources.”

Addis Alemayehu, the director of the AGOA Plus project, said his organization had been working on the deal for 18 months and said its intent was to create jobs.

“For me, you go to the factory and you look at the 2,000 to 3,000 Ethiopians working, that’s all I care about,” he said in a phone interview on Nov. 23 in Addis Ababa. “There’s always going to be a negative side when it comes to deals like this.”

To contact the reporter on this story: Jason McLure in Addis Ababa via Johannesburg at pmrichardson@bloomberg.net.

Source : Bloomberg News

Around the Web :

US, UK concerned over Ethiopia's alleged aid abuse Sudan Tribune

ETHIOPIA: Gov't rejects politicized food aid claims IRINnews.org

Ethiopia: Oxfam calls for radical shake-up of aid system to break cycle of ... AllAfrica.com



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