Sunday, April 14, 2024
BusinessEthiopia's porous borders fuel illegal camel trade, costs billions in lost export...

Ethiopia’s porous borders fuel illegal camel trade, costs billions in lost export revenue

Camel caravans are illegally carrying away Ethiopia’s economic fortunes, costing the nation billions in lost export revenues. As droughts shrink herds, thousands of camels slip across borders for informal trade. While Ethiopia’s vast camel wealth could bolster its struggling economy, many dodged inspectors to avoid taxes before being sold in neighboring countries.

During the first nine months of the current fiscal year, camel exports fell significantly year-over-year due to low camel inspection and certification rates.

Statistics show Ethiopia earned USD 57.73 million exporting 10,434 tons of meat during the first seven months of the year, mainly goat meat. The United Arab Emirates and Saudi Arabia import most Ethiopian meat, while Somalia, Somaliland, and Djibouti import camel milk. Ethiopia could export 300,000 tons annually, earning up to USD 1.5 billion. But illegal trade continues to erode formal revenues.

Lack of oversight allows many healthy animals to slip across porous borders, resulting in dollars that could bolster the struggling national economy fetched instead by foreign buyers.

Most camels exported to Somalia originate from Ethiopia.

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Despite exporting 4,726 tons of live camels in 2017 alone – worth an estimated USD 6.48 million – the sector saw exports drop by 18 percent that year compared to 2016, according to Selina Wamucii, a private entity tracking agricultural statistics and logistics.

Between 2015 and 2017, live camel exports plummeted by nearly 75 percent, the data shows.  Yet there were few outward signs of this heavy decline within the once lucrative live camel export market. 

Ethiopia’s camel export revenue jumped from just USD 1.4 million in 2020 to nearly USD 2.8 million in 2021– a staggering 95.79 percent increase.

Industry sources, however, indicate that the volume has significantly decreased this year due to the prevalence of contraband trade.

State Minister of Agriculture Fikru Regassa cited droughts and underweighting camels, making them unfit for export. But illegal cross-border trade is a major constraint. The Deputy Director for Livestock Regulatory at the Ethiopian Agricultural Authority Hamid Jemal says droughts made camels hard to find for exporters. Formal exports slowed due to rampant illegal trade.

The State Minister stressed that meat byproduct exports have narrowed, posing future challenges. Ethiopia lacks satisfying incomes from its livestock potential and earns little foreign currency from exports.

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Video from Enat Bank Youtube Channel.

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