Q and A3 Nov 2021 09:45
Q and A section Kefi website
Current situation in Ethiopia?
Q. It is hard to differentiate fact from fiction based on media reports. But it would be great to know the Company’s take on the situation is in Ethiopia and indeed whether Harry and the other expatriates are working there safely. I just don’t see how financial close happens under these circumstances. It would be great to hear the Company’s view.
A: KEFI is apolitical and our comments are merely trying to be as objective as possible:
Ethiopia is 80 tribes, with 80 languages or dialects. And Ethiopian political rivalry is literally fierce. It mostly replaces tribal warfare but not always.
Ethiopia is clearly struggling with the introduction of more democracy as from 2018 and some factions are fiercely unhappy. But it is difficult to see Ethiopia going backwards democratically. It was a record turnout in at the elections in June this year, with a higher percentage of eligible voters actually voting than one gets in the UK or USA.
The conflict is about “fair” representation at the leadership table Federally and also as regards Regional vs Federal rights. The conflict does not have the semblance of rebels trying to set up a coup to impose autocratic control. That era has passed in Ethiopia.
And whether there are changes of Government leadership teams now or in the future, Ethiopia will get itself back onto a growth path and, in that context, the development of Tulu Kapi will still rank as an important national and regional priority
In so far as Company personnel safety is concerned, we have clearly spelt out red line markers in our policies which trigger various responses, none of which have been triggered. The Chairman, Managing Director and others are in Ethiopia.
The State of Emergency that was declared on the evening of 2 November imposes more control and monitoring, which we think will more easily and tightly protect public safety.
And as regards financial closing of the Tulu Kapi Project:
Our syndicate is in place and lives in Africa where conflict is not unusual in many countries. And the syndicate knows Ethiopia specifically
We think it is fair to say that the syndicate were pleased to see how TKGM handled the recent abduction and its quiet disciplined management at the same time as intense negotiations with various Government agencies over various finance-related agreements and the concurrent licence tenure pressures
We all prepare for financial close subject to the normal conditions for project finance, including that security/safety is independently assessed as satisfactory.
The day-to-day ebb-and-flow of military conflict is beyond the Company’s capacity to analyse or comment on. But no-one in our circles in Ethiopia wants or expects the “Tigray-based conflicts” to persist much longer.
In the Company’s view the climax of the current conflict is on cue for resolution in this Q4 of 2021. That might seem a brave statement to make but it has been our view
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