Sunday, July 21, 2024
BusinessExport earnings drift farther from 2022 high

Export earnings drift farther from 2022 high

Yet another poor quarterly export performance signals the momentum leading up to the record earnings in 2022 has all but dissipated, as a report from the Ministry of Trade and Regional Integration reveals a more than 40 percent shortfall in expected revenues.

The first three months of the fiscal year saw merchandise valued at USD 820 million shipped abroad, far short of the USD 1.37 billion expected by the federal government.

It is an even poorer performance than the worst-performing quarter of last year; a full 16 percent lower than the revenues from the same period last year; and marks a significant turn from the glory days of 2021/22, when quarterly export revenues averaged more than USD one billion.

Senior officials at the Trade Ministry want to see USD 5.1 billion in revenues on the books come July, but the more than half a billion USD shortfall in the opening quarter casts a serious shadow of doubt on the aspirations.

Agricultural commodities accounted for close to 80 percent of the revenues between July and September 2023, with manufacturing and mining trailing at approximately 10 and eight percent, respectively.

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The mining sector brought in USD 63 million in the first quarter, 10 percent of the total mining export revenues reported in 2021/22.

Gold accounted for most of the earnings as close to a thousand kilograms, from both artisanal and corporate miners, was shipped abroad. It is less than half of the volume government officials hoped to see exported.

Million Mathewos, a State Minister for Mines, erroneously told the state-run Ethiopian Press Agency in a recent interview that first-quarter export revenues had met 56 percent of the Ministry’s target, despite the actual figure being closer to 35 percent.

Still, the State Minister blamed contraband trade, security concerns, and a lack of foreign currency for inputs for the underperformance.

The Ministry of Mines targets half a billion USD in mining export revenues this year (notably less than the more than USD 600 billion recorded in 2021/22).

Other government offices have similarly optimistic targets, despite facing the same problems pressing State Minister Million and his colleagues.

A report from the Trade Ministry reveals that revenues from oilseed and khat exports have been affected by security problems, supply shortages, illegal trade, and extortion on trade routes.

Officials at the Ethiopian Coffee and Tea Authority did not respond to inquiries from The Reporter for comment on the first-quarter performance of the country’s most valuable export commodity.

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