Industrialists blast gov’t for equal ground

Capital Ethiopia By Muluken Yewondwossen 

During the closed forum that was held on Wednesday, local industrialists claim that government is not providing equal treatments for the Ethiopian investors on FDIs, Capital learnt.

Sources revealed that at the meeting held at Sheraton Addis on Wednesday, May 5, local manufacturers have expressed their disappointment on the behavior of the government which is seen to give different privileges for foreign investors that are not accessible for Ethiopians.

Investors who attended the meeting aired out their frustration blasting the government by expressing that the unfair treatment has cornered them out from the competition whilst leaving the industry sector to blossom for the foreign investors.

The closed session which was held under the title ‘Dialogue Forum between the Public and Manufacturing Industry Sector Actors’ geared to engage the likes of Adanech Abebe, Deputy Mayor of Addis Ababa, Debele Kabeta, Commissioner of Customs Commission, and Jantar Abay, Deputy Mayor of Addis Ababa attended.

Sources told Capital that, Adanech did not attend the event because of other urgent matters.

Local manufacturers including prominent and huge investors were major attendees who expressed their grievance on the handlings of the government.

One of the participants told Capital that the investors have appreciated the government’s latest way to provide investment lands for those with real needs than the previous malfunction practice, “Otherwise, most participants expressed their complaints stating that they not equally seen in comparison with other foreign investors.”

Investors raised the issue that the tax authority is penalizing them by comparing invoices with foreign investors. “The over invoice issue is the new threat that aggravates us to express our concern for the government.

Foreign investors are coming with the exaggerated invoice (over invoice), while the actual price of the given product might be lower by half,” one local investor told Capital about the issue and explained that foreign investors are using them over invoice for illicit foreign currency flow, exaggerating the production cost that leads them to hide tax.

“However, traditionally the tax authority is using the higher invoice value as a benchmark to calculate levy and based on that it is penalizing local investors extra sum on their imports,” a participant told Capital.

The other issue that was raised at the discussion that was only attended by local investors was that foreign manufacturers are openly selling their products without a receipt, “while no one accused them,” participants said.

They added that the foreign investors have no issue about access to foreign currency that the National Bank of Ethiopia (NBE) is implementing a directive to access foreign currency on suppliers’ credit, while local investors are in trouble.

For over three years now, NBE has revised the suppliers’ credit directive and introduces a scheme that only FDIs to access goods on credit. Recently, Eyob Tekalgne, State Minister of Finance, told the media that the government evaluated the gap that excluded local industrialists from access materials and inputs on suppliers’ credit. He expressed that the directive has revised to include local investors but it is so far yet to be applied for the neglected.

At the forum, local investors argued that they have to be treated in the same way as other investors and asked the government officials to level the completion grand for all actors.

“The foreign investors should pay the tax equally that we are paying,” participants claimed at the forum according to sources. “Give us the privilege that NBE gives for others,” they added.

Regarding the tax issue one of the participants told Capital that the government should compare the income tax settle between the local investors and foreigners “despite there are huge and many foreign investors in the country you may not see much of them on the higher taxpayers list that the government recognizes every year,” he says, adding, “rather than not paying required duties they are accessing several incentives and relief.”

“The comments given by investors at the forum were accompanied by shouting and applause of participants, which shows me how much the local investor is in depressive condition,” one of the prominent investors who attended the event told Capital.

Sources said that despite participants expressing their anger and claims at the event, satisfactory promises or responses were not given from the stage.