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Investor prosecuted in Ethiopia

No Comments · Investing in Ethiopia

By Rover Hakegna

The other day I call one of my good friends who is a foreign investor in Ethiopia. It was quit obvious that something was wrong, he sound very upset. I never heard him upset before, so I asked what was wrong. He answered that he was being prosecuted for being late with renewal of his Ethiopian ID.

I asked him if it wasn’t his own mistake. He said: Yes it is my mistake to be late, but this is an automatic process if you have an investment permit. I renewed my investment license in time. I spend much of my time waiting in offices, at shops, to be permitted, to pay my bills, etc. in Ethiopia and here I am been prosecuted for things that great big loses in my company. I feel like I am part of a Kafka roman.
How can you complain that someone smells a little bad if you stink like rotten egg?

We met some weeks after and I asked him to explain what exactly has happened.
He explained:

Wednesday: I went to the immigration office to have my investor id renewed. I felt out the application document, that isn’t used for anything because all my data is already in their database. After some waiting, I went in to the people that process the immigration application. One of them said that I was late and I have to be punished. She said go to Office number xxx.

After I have visited 4 offices for a signature the fifth office was locked and I had to wait for half-hour. Sometime you can find the people from the missing offices in the local café, but here I just waited.
Latter, I met the guy and he informed me that I have to meet in court the next day at 10. I asked why I had to go to court for being late in the country that is late with anything? He didn’t answer. I asked where the court was and he said in his office. 

Thursday: There was a big line in front of the office and I waited for 1:50 hours. The reason I was called in was to fill out a piece of paper that took 5 minutes to fill out. It would be much easier to do that the day before and saved me for a lot of time.

I was asked to meet in court the next day in the morning at around 9. He refused to tell me where it was in English and I had to call one of my employ so he could translate. How can you employ people in the immigration office that can’t talk or refuse to talk English?

Friday: I went and waited until 11.30 where the court goes for weekend. I asked why I was called in to wait and what I have to do now. They told me to come back at 9 Monday.

Friday: I asked to talk to someone so I didn’t have to wait for nothing. One person told me to write an application in Amharic to speed my case up. I asked why, I can wait to receive my punishment? They said that I just have to write an application.

I went outside to a little tent where a lady wrote me an application for 1 USD. I delivered it and was asked to come back Thursday.

Thursday: I wait from 8.30 to 11.30 where I am presented in court. I am asked to place myself against the wall and be quiet. The judge asked me if I plea guilty, I said yes and tried to explain that I find it a bit comic that I am being prosecuted for being late when I have been waiting for offices so many time including this office. The judge stopped me and threatened me with an even longer trail, if I am not quiet and just plea guilty. I plea guilty and was charged to pay 1000 birr (100 USD).

(Will I am paying a tourist don’t have so mush birr and is asked to pay 20% more if he want to pay in dollar. I exchange for him.) NC

While I have been waiting I have learned that the fines are something the judges decide upon unknown reasons. Two other foreigners that was trailed for the same have been fined 500 birr (50USD), 800 birr (80USD) and then me 1000 birr (100USD).

Now it is time to get the receipt stamped, but the person that stamps the receipt isn’t in the office and no one expect him to come back. Therefore I went together with some others to a different court 15 minutes away. 

I asked the person that stamps the receipt where to go next and she pointed towards the sky. I do the same and think, just what I needed, I have to go to god to have my paper stamped, but she read my thought and said ‘no no’ and laughing. She said that I have to go to the immigration.

Monday: I went to the immigration but after around 5 offices the person that seeing my paper has gone half an hour early to lunch.

Then I got out to my car and found that there was someone that has drove into my car. Out of the 200 people that stand and try to sell you things and try to get you to exchange dollars, none have seen anything.

Wednesday: I returned and finished the last 4 offices. The officer that told me that I have to be punished with delight in her voice, tried to find something wrong in my files, with more than 25 signatures. When she didn’t find anything she says, ‘Now you can learn not to be late’. I was thinking, but didn’t say that it is her and the people that have made this procedure that need to learn how costly it is. I didn’t say anything, because I don’t think she will understand. Instead I asked if it wasn’t a good idea to write a warning to people. She says that there is one outside at the gate. On my way out I looked but couldn’t find any warning.

Some days later I pickup my ID in 10 minutes.

I asked my investor friend who is also an economist to estimate the cost of this procedure.

An Investor like him earns around 10 000 USD a month and a company has similar other expenses. Therefore 25 workings days cost 20 000 USD. The procedure took 8 half days or four whole days. That adds up to 6400 USD. Other companies in Ethiopia also earn money on an export company, as a rule of thumb that is approximately two times more.
So the cost of this is 19200 USD (3*6400) without counting the lost business opportunity will waiting for being punished.

This was the story of one of my friends. I hope it made you think, like it made me think.
 
Do you think Ethiopia can afford to have costly procedures like this?

Do you think keeping people waiting is a significant reason that Ethiopia is poor?

Do you have other examples on procedures that are unnecessarily long?

How do you think our Ethiopian system can be improved?

Have you tried the same procedure in the immigration?

Feel free to express your opinion.

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