The Ethiopian government halted military-run Metals & Engineering Corp.’s (METEC) role in the Tana Beles II Sugar Development Project because of poor performance and delay, says Ethiopian Sugar Corporation spokesman

By Nizar Manek (Bloomberg) |

Ethiopia’s government plans to hire foreign companies to help develop the country’s sugar industry, after canceling a military-industrial conglomerate’s contract on a key project.

Prime Minister Abiy Ahmed, in office since April 2, has signaled he plans to reduce “favoritism” toward the security forces when awarding contracts and ensure development projects are “more inclusive for the people.” The state-run Ethiopia Sugar Corp. is looking for a new contractor to develop Tana Beles II in Ethiopia’s Amhara region, which has been hit by protests over the past two years by residents who say they’re being excluded from economic power.

“We’re looking for foreign contractor for Tana Beles II,” Sugar Corp. spokesman Gashaw Aychiluhim said by phone Tuesday from the capital, Addis Ababa. The government halted military-run Metals & Engineering Corp.’s (METEC) role in the project “because of poor performance and delay,” he said.

METEC Marketing and Sales Director Shegaw Mulugeta directed a request for comment to Director-General Kinfe Dagnew’s assistant. The assistant, Sisay Zaid, and Metec’s head of public relations, Michael Desta, each didn’t respond to six calls and two text messages seeking comment. Addis Fortune, a closely held newspaper, reported at the weekend that Kinfe tendered his resignation from METEC.

METEC: Largest Army

METEC is run by the Ethiopian military, one of Africa’s largest armies, and has been involved in projects including the $6.4 billion Grand Ethiopian Renaissance Dam and a fertilizer complex in the Oromia region. Officers connected with the rebel movement that overthrew Ethiopia’s junta in 1991 have dominated senior government positions for the past quarter century.

Abiy succeeded Hailemariam Desalegn, who quit as prime minister in February after failing to end protests in the Amhara and Oromia regions that began in 2015 amid demands for greater economic inclusivity. He signaled on Sunday that the government plans to reduce the military’s role in the economy.

“The security forces have to be freed from any type of favoritism and serve the people according to the constitution,” Abiy said in a speech broadcast on state television.

METEC has signed contracts for 10 sugar projects in Ethiopia, Gashaw said. Of those, the company has agreements to construct Tana Beles I and Omo-Kuraz I in southern Ethiopia, he said.

Continue reading this story at Bloomberg
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