Making it in Ethiopia

Leaving everything behind in pursuit of a dream.

[makingitinethiopia-blog]

Starting a business here is insane.

Disclaimer: I’ve been pretty bad about posting updates for a while now (partly due to time, partly due to terrible connections) but here goes:

The first bit of advice that I would give to anyone looking to register a business in Ethiopia is:

Pay someone to do it for you.*

*but make sure that person knows what they're doing.

I wish I could say the process is worth doing on your own but if you haven’t done it before and don’t have some of the prerequisites, expect it to take at least a month or more just for the registration alone.  Among some of the exciting things you’ll experience if you try to do it yourself:

Being redirected from office to office (sometimes even within the same ministry) at least 50 times.

Being given completely wrong information by government clerks who are not aware of the laws they operate under and appear to be doing this for the second or third time in their lives (even the ones that have worked there for years)

 Fighting through large mobs of people in the Ministry of Trade and kifle ketemas (sub-city administration offices) to get your documents looked at by a clerk who will find any and every excuse NOT to process your documents.

 Having to make up tradenames for your business on the spot in the Ministry of Trade as most logical words are either taken or not allowed for some reason.

  Being told that your newly-made-up tradename cannot be registered to you because it is an “adjective” (even if it is actually a noun).  If you can prove that it is a noun, expect the govt. official to continue to refuse logic and/or redefine the word himself as he does not want to lose face (he will also proclaim himself to be the official English dictionary, true story)

Making upwards of 10 trips to the kifle ketema (for some types of business structures) and waiting 1-2 hours on average.

In short, it is one of the most complicated, frustrating, soul-sucking things you will ever do.

Once it’s completed, you’ll get to enjoy the following perks:

The fun task of having to report your earnings each month to the tax authority (in person) and zero out your mandatory POS register every day (even sometimes on Saturdays even if you’re not open)

The chaos of having to renew your business every year (with mobs of other people) and pretty much repeat the same process over again.

The uncertainty of not knowing whether or not you actually registered it all properly (since even the govt. employees you speak to won’t really know the whole process either)

Registering as a business does have its benefits though:

You can deduct any VAT that you pay on business purchases from your tax liabilities (including your office rent)

You can sign up for an unlimited broadband connection from Ethio Telecom as they are currently only available for registered businesses (expect to have to wait a month or so though)

 The well-deserved vacation you’ll need after finishing the process

Thanks to @danfowler for bugging me about updating this blog!

[makingitinethiopia-blog]

The process of moving to Addis

I can't believe it's been almost a month since my last post but now that I have a decent connection (I'm mooching off of the Intercontinental Hotel's wifi at the moment) It's time for some updates.

The three weeks of travelling to Turkey and Poland were incredible (pics on Flickr here) but moving to Addis is not without it's challenges and I'll go into a few here:

Housing

I never would have believed it myself but the price of Addis real estate for a decent place is borderline absurd and good places are VERY difficult to find.  Even with my family members helping out, it took almost two weeks to even find a place.   Much of the new real estate in Addis is located in CMC (east of the airport) and Gerji (north east of the airport) rush hour traffic in those areas (particularly CMC) is not to be trifled with however. The market works through brokers with their own networks and their own knowledge of available real estate.  Commission is typically half a month's rent on a 6-month lease and a full month's rent on a 1 yr lease (expect to pay 6 months rent up-front in many cases)

Brokers are good in the sense that you can talk to someone, tell them what you want, and they can help you search but BE CAREFUL when more than one broker gets involved.  Our situation took a turn for the worse when it came to distribute the commission and it's not an experience I'd wish on anyone.

Of course, getting a place to live is one thing but in some cases, getting it fit to live in is a different story.  We happened to find an apartment that had just been completed and, thinking that brand new was a good thing, were surprised to find that the plumbing almost needed to be redone.  Workmanship in some of the new places is quite shoddy (and the imported fixtures and parts are often of poor quality) so befriend a handyman quickly.

Furniture

Now that you've got a place, it's time to furnish it!  Some of the most frequently recommended places to get furniture are in Piassa so start there:

Mosvold: One of the oldest furniture and appliance stores in Addis if not the country.  It once was government-owned but is now privatized and has several floors of appliances and furniture including mattresses, beds, electric stoves, camping equipment, etc.

Dire Electronics: Very reasonably priced appliances including washing machines

3F: Domestically produced mattresses that are reasonably priced, couches and other furniture are not as good a deal however.

Waryt: Also known for their domestically produced mattresses

Neoset (in Kazanchis): Very nice furniture, very high prices

Phone/Internet

Ethio Telecom is only provider in the country (state-owned monopoly) so you don't have to do a lot of searching on that front.  Their GSM voice network operates on the 900 MHz frequency and their 3G service runs on 2100 MHz (so make sure your phone is compatible) iPhones and most higher-end Android phones will work.

I'm impressed with the speeds of the 3G service however the cost of being impressed adds up (currently the rate is 0.6 birr/megabyte).  It doesn't sound like much at first but if you plan on browsing, tweeting, IMing, etc. it will add up.  Most good hotels will have wifi you can use (which is where I am now) but once you get settled into a place, you'll want a more permanent connection.

Ethio Telecom offers CDMA "broadband" which costs almost half as much as 3G but is slower (especially during the day) and they offer an ADSL connection in some areas.  There are data caps on most plans but you can get unlimited data at a price (in some cases, unlimited costs 10x as much)

Ways to get more info before arriving

There is a large expatriate community in Ethiopia and it helps to get in touch with people that are already there before you get here.  Some of the most popular ways that expats communicate are through Google Groups like OddsnSodsnAddisAbeba and Addis-Diplo-List are the most popular and you can subscribe to handy daily or weekly email digests.  Websites like Internations and Expat-Blog also have some handy info but in my experience they're not as frequently updated as the Google Groups.

Steps to setting up a business in Ethiopia is coming up next

For those of you interested in learning more about the steps to starting a business in Ethiopia (specifically a PLC, Private Limited Company), you can look forward to my next post.

[makingitinethiopia-blog]

- The sun setting over the Bosphorus on our first night in Istanbul before heading to Poland.

I've got several hundred pics to go through but you can find some older ones of mine on Flickr.  So far we've got a few more nights in Poland, then back to Istanbul for a few days and finally Addis.

[makingitinethiopia-blog]

See you later USA

I'm standing in my (almost) empty apartment writing this and it's amazing to think that in two weeks, I will be a young Ethiopian-American professional living in Addis Ababa, Ethiopia full-time.

I left a well-paying, promising and stable career in the US with the one of the largest financial institutions in the world, convinced my girlfriend to come with me (who is not Ethiopian by the way and blogs here as well), bought two one-way tickets, and sold almost everything we own in pursuit of an Ethiopian-American dream.  

I'll be starting a social enterprise that brings tourists closer to the communities they visit by making them direct investors in the development of those countries.  I'll be launching it in Ethiopia first and with any luck, you'll be seeing it rolled out in other developing countries also.  More on that later, it's about time for me to go.

Here's the plan (with some stops along the way for visiting family):

Washington DC -> Istanbul, Turkey

Istanbul, Turkey -> Warsaw, Poland

Warsaw, Poland -> Istanbul, Turkey

Istanbul, Turkey -> Addis Ababa, Ethiopia

Let's make it happen.