Salaam salaam from BA! This is the Rorshok Ethiopia Update from the 21st of August twenty twenty-five. A quick summary of what's going down in Ethiopia.

Let’s start off with news that civil servants in Ethiopia will be happy to hear. The Civil Service Commission announced on Monday the 18th that the government has decided to increase their wages to at least six thousand birr, which is around forty US dollars, while the highest earners will get thirty-nine thousand birr (around two hundred and sixty US dollars). The Commission said the government will allocate an additional hundred and sixty billion birr, which is over a billion US dollars, to pay for the salary raise.

The Commission also addressed concerns of potential price hikes that businesses may make in light of this development. The Commissioner said the government will take strong measures against those who try to take advantage of the pay raise by charging unreasonable prices.

On another note, last Friday the 15th, The Ministry of Finance said it was planning to increase the value-added tax (VAT) rate from fifteen to seventeen point five percent, when it revealed a report indicating that Ethiopia’s VAT rate was lower compared with the sub-Saharan Africa average. The document also pointed out that a slight increase could mean major jumps in revenue.

However, despite the potential benefits to the government, the Ministry said on Tuesday the 19th that it has ultimately decided against the increase because it fears that it would be more burdensome to those who are paying and could encourage them to evade taxes.

The Ministry of Health revealed a new directive regulating the financing of health facilities. According to the directive, whenever foreign nationals get treated at government medical centers, they will have to pay double the amount Ethiopians pay.

This rule will not apply to refugees, as the Ministry said it will strike an agreement with humanitarian organizations to determine how much they’ll pay for healthcare. The directive also says that the government medical centers will receive annual budgetary support from the government, even if they have collected enough revenue to continue operations.

Meanwhile, The Federal Prison Commission told the media this week that the Ministry of Justice has given the green light to allow detainees to participate in the dialogue that the National Dialogue Commission is coordinating. The dialogue is about numerous broad issues that are points of disagreement among citizens, such as historical and political narrative, regions’ boundaries and other unaddressed concerns.

The Prison Commission’s head said he has talked with representatives from the Dialogue Commission but he doesn’t know the procedural details and will begin the process as soon as his office receives further instructions. The Dialogue Commission said it has plans to organize these discussions in regional prisons in addition to federal prisons in order to ensure the process’s inclusivity.

In unrelated news, teachers who are taking training that the Ministry of Education organized at universities, aiming to improve the quality of education, are not happy with the transportation allowances they’re receiving. Teachers from all over the country have reported that not only is the allowance amount not enough but also that some of them aren’t even receiving the amount promised at all.

They have also expressed their dissatisfaction with the food the universities are providing, citing health concerns. However, the universities’ representatives said they’ve made the payments.

Still in education, the Amhara region’s education bureau said it plans on seeing over seven million students registered and in class in less than a month, despite the conflict and instability in the region.

Residents in unsafe parts of the region said this week that the insecurity does not allow students to get back to school. They added that schools have been closed for nearly two years following the conflict between federal forces and the popular youth movement Fano. They also said that unless the parties of the conflict agree to stop fighting, parents will not feel safe sending their kids to school.

The Ethiopian Electric Utility said in its annual report that despite efforts to increase accessibility of electric power, it has fallen short of its goals and needs additional financing to expand its reach. Parliament only approved about forty percent of the additional funding the Utility had asked for.

According to its CEO, at the beginning of the previous fiscal year, the Utility shot for six hundred thousand new customers but had to settle for just around five hundred thousand as it was short-handed. He also responded to questions about electric bills being significantly more expensive, saying the Utility’s prices are still fair and take into account the people’s financial capabilities. He added that prices are considered low in global terms, even after the increases it made earlier this year.

More news on power accessibility, as on Wednesday the 13th the Ministry of Water and Energy made an agreement with the International Solar Alliance to develop solar power. There are plans to slowly make the use of solar panels mandatory across the country. According to an official from the Ministry, the government devised this plan to exploit the potential the country has in generating power from the sun.

The deal is set to complement a project that was inaugurated eight months ago and that generates two hundred megawatts of solar power.

Hotels in the capital are worried about the Addis Ababa Finance Bureau’s recent decision to stop governmental offices from holding training and assemblies at hotels. The city’s hotel owners' association told the media that these government reservations make up a good part of the revenue for some of the hotels in the capital and this decision will reduce their profits.

The city’s finance bureau chief said the decision was made to reduce government spending, and the move was part of its efforts to balance the city’s budget, since the capital has a significant budget deficit. He added that the capital is hosting more national and international conferences, which he hopes will compensate for the decline in hotels’ revenues that this move will cause.

In Ethiopia, all vehicles are required by law to have third-party insurance. However, according to a recent study from the Office of the Federal Auditor General, only two-thirds of the almost one and a half million vehicles in the country have it.

Third-party insurance allows the damages that a vehicle causes to another to be compensated more easily. However, many vehicles are at risk of not being compensated through this framework because the owners of over four hundred thousand vehicles haven’t bought a third-party insurance policy.

Compliance is a major issue in the southern parts of the country, especially in the Sidama region, where tens of thousands of motorbikes don’t have insurance and only about a quarter have licenses.

Speaking of vehicles, a letter from the Ministry of Transport sent to the Customs Commission surfaced over the weekend, saying that Sino-Truck, a Chinese heavy-duty truck, cannot be imported until the manufacturer fixes the truck’s technical issues.

Even though this came to light just this week, the Ministry sent this letter almost three months ago, and since then, it has been illegal to import these vehicles. The Ministry also said recently that despite the ban, some people have tried to illegally import these vehicles using fake seals and signatures to make it seem as if the Ministry gave permission.

The Ministry added that since there won’t be exceptional cases, the Customs Commission should follow up and monitor any requests to import these trucks and take measures against perpetrators.

Let’s end this episode with a controversy involving the Commercial Bank of Ethiopia. The bank’s management commissioned a new logo design, which burned over six hundred million birr (around four million US dollars). The logo was supposed to be unveiled soon and was mounted on the bank’s headquarters, covered up. However, top government officials, including the PM, shut down the project.

Media outlets have reported that PM Abiy didn’t like the removal of the Amharic letters in the redesign, which are present in the current logo.

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

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