Salaam salaam from BA! This is the Rorshok Ethiopia Update from the 28th of November twenty twenty-four. A quick summary of what's going down in Ethiopia.

We’ll start this episode with concerning news about ethnic violence. Late last week, a video made the rounds on social media showing the beheading of a seventeen-year-old in the North Shoa zone of the Oromia region in the center of the country.

Residents said the members of the popular movement Fano were behind this horrible act. They added that the murder was part of a broad conflict that Fano is involved in against the federal government and the Oromo Liberation Army. They also said the victim was an ethnic Oromo and that violence has increased in the area with seven civilians murdered in the past month, explaining that government forces along with the rebel forces are responsible for these casualties. Media outlets estimate that the zone has seen forty-three casualties in the past four months.

The government is currently in a protracted fight against both Fano and the Oromo Liberation Army.

Speaking of government forces, the National Defense Force held discussions on Tuesday the 26th with Kenya’s Defense Force in the capital, Addis. Berhanu Jula, Ethiopia’s Chief of Staff of the Forces, led the discussions, which aimed at strengthening the two countries’ cooperation in the military sector. He added that the two nations are preparing to sign a memorandum of understanding to enable joint efforts in defense and security in the region.

Recall that the neighbors have jointly fought against the terrorist group Al-Shabab, and that the heads of the forces of the two countries are meeting up for the second time this year.

Still in Addis, the government is busy trying to stimulate the private sector. The latest of these efforts is a legal framework to support and regulate startups. Reports came out over the weekend, stating that the draft startup bill has entered its final stages and that the government has released the draft for public consultations.

Under the new bill, certain designated startups that fulfill the requirements under the law will be eligible for government grants administered through the Ministry of Tech and Innovation. Startups will only be eligible for government funds if they have been operating for less than five years, and own the product or service the startup will provide, among other requirements. The bill will also help the government get something in return - up to a thirty percent stake in the startups - via the executive’s sovereign fund, the Ethiopian Investment Holdings.

In news from the Parliament, on Tuesday the 26th, the House of People’s Representatives approved an additional, very high budget, which is over five hundred and fifty billion birr (that is, over four and a half billion US dollars), almost half of the budget approved at the beginning of the fiscal year. The government representative who presented the budget said that the added amount will be used to repay debts and subsidize social spending.

Some members expressed concern over the government’s plans to raise money through increasing taxes, pressuring taxpayers. One member criticized the allocation stating that it would have been better spent on large capital projects.

The next day, the International Monetary Fund (or IMF) released a statement announcing that Ethiopia is set to receive two hundred and fifty million US dollars from the fund as part of the four-year deal that the government and the Fund reached a few months ago.

This announcement follows an IMF staff two-week stay in Addis, evaluating the implementation of new government policies. These financing deals from the IMF result from the government’s decision to implement a market-based foreign currency exchange system, which the executive says is part of the homegrown economic reform program.

The government is also dealing with the issue of a statutory minimum wage, which has been debated for a while. At the forefront of this debate is the Trade Union Confederation. It looks like it will keep debating this issue for longer because government sources have informed media outlets that the executive will not fix a minimum wage because a feasibility study has indicated that it would have a lot of disadvantages that far outweigh its benefits. A source told outlets that because most of the workforce is currently employed at very low salary rates, fixing the minimum wage would trigger a massive unemployment problem in the country.

The leader of the Union Confederation was dismayed hearing this development and said that the government didn’t involve the Confederation when conducting the study.

Another controversial issue within the government that came up this week was the National Electoral Board’s overspending during the previous chairwoman’s tenure. Meseret Damte, the Auditor General, told the parliament that the board had unduly spent money installing a security fence and renovating the home of the former chairwoman, and misused funds on allowances for employees. She also criticized how the board unnecessarily turned contract-based workers into full-time employees.

The current chairwoman defended the expenditures, stating that the fence was necessary because there were security concerns during the previous election. She also countered allegations that funds were misused for unimportant allowances, saying that the work the employees were engaged in required the stated amount in allowances.

On another note, members of the media and civic societies are leaving the country in droves because of pressures from the government. The Ethiopian Human Rights Defenders Center released a statement on Tuesday the 26th, stating that intensified intimidation and threats have forced leaders of civil society organizations to flee the country.

The Center dropped some names of leaders who left in its report, such as the former program director at the Center for Advancement of Rights and Democracy, a center the government suspended from operating in the country, citing lack of political neutrality and engagement against national interest.

Amnesty International condemned the government crackdown in the civil society space via a statement it released on Tuesday the 26th.

Ever since Safaricom’s entry into the Ethiopian market, the telecom company has struggled to gain traction. The company says this is the government’s fault for failing to create a competitive environment between Safaricom and state-owned Ethio Telecom. The executives said Ethio Telecom is charging its customers extra when they want to call a phone that uses Safaricom’s services, reducing its appeal. They met with government representatives and called on the executive to stop favoring its own company.

One of the company’s execs tried to demonstrate Ethio Telecom’s chokehold on the market by stating that Safaricom, which has a mobile money solution of its own, pays its taxes using Ethio Telecom’s Telebirr app because the company has exclusive deals with the tax authority among other public and private institutions.

Still, foreign companies like Safaricom are happy that the government decided to use a floating foreign exchange system. However, this development has allowed certain parties to abuse it. The National Bank of Ethiopia, which regulates the finance sector, said that it knows that finance institutions are engaged in illegal foreign exchange activities and that it has issued warnings. Though specifics weren’t revealed, the Bank’s governor said that, after a two-week-long on-site investigation, the Bank had found illegal activities at certain commercial banks.

Let’s end this episode with news from the entertainment scene. The Capital’s Culture, Arts and Tourism Bureau announced early this week that it has plans to digitize the country’s first-ever color film, Aster. Bureau representatives said this effort will boost the country’s film industry and preserve this landmark production for further viewing. Aster was produced back in nineteen eighty-three, in a 35mm motion picture, with a production team composed entirely of Ethiopians.

Aaand that’s it for this week! Thank you for joining us!

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