Having a run-in with the government
According to local media reports, the American soft drink Coca-Cola has become a symbol of Ethiopia’s deepening financial troubles. On 28 March, the beverage started flowing again after a pause of two weeks. The East African Bottling Share Company (EABSC), Coca-Cola’s local bottler only restarted distributing the soft drink after it had received sufficient foreign exchange to import crown corks from Kenya.
Incidentally, Coca-Cola’s rival Pepsi did not experience any hick-ups in its production. Pepsi, in fact, did its best to cover all the market demand while Coca-Cola was not available.
That immediately gave rise to speculation that Coca-Cola was made to feel the iron fist of the powers-that-be. Drinking Coke is seen by many as a political anti-government statement. The Pepsi bottler, allegedly, is owned by a conglomerate with close government ties.
With its foreign exchange reserves at a critical low and Ethiopia’s next general elections only a year away, Ethiopian authorities have had to give priority to buying necessities like wheat and fuel rather than crown corks with their preciously little foreign exchange.
At least that is one of the reasons given for the low flow of foreign exchange.
However, during the last week of March the government suspended the licenses of the country’s six largest coffee exporters and confiscated 17,000 tons of coffee beans, Ethiopian media said. The action came days after Prime Minister Meles Zenawi said exporters were stockpiling coffee at a time when prices are low. He called the practice ‘illegal’, and said the government would sell the beans.
At the moment, the country’s breweries are still operating. But they worry if in the future they will continue to receive the foreign exchange they need to buy raw materials and spare parts.
France’s Groupe Castel is Ethiopia’s major brewer with two plants. There are also four state-owned breweries and, not to forget, a brewpub in Addis Ababa’s Beer Garden Inn. Recently, a new brewery went on stream in the capital.
