Ethiopia has been luring Foreign Direct Investment over the last two decades. The practical investment policies and strategies have been attracting global companies. With some revisions of the policies, Ethiopia has set to transform its investment sector to higher level using the ongoing change as a ripe moment. Hence, foreign companies like DAL Group are ready to use the golden chance being offered by Ethiopian government. The Ethiopian Herald has made an inclusive interview with Head of Strategy of DAL Group.
Herald: Would you tell us about yourself please?
Sam Bodely-Scott: My name is Sam Bodely-Scott and I’m Head of Strategy at DAL Foods Company based in Khartoum, Sudan.
Herald: On what areas does DAL Foods focus? Bodely-Scott:DAL mainly focuses on food and beverage sectors. It is a collection of 16 companies. Our company plans to be a giant regional company that aims at going beyond the perimeter of Sudan to seek opportunities elsewhere. We are the largest Food and Agriculture Company in Sudan. We are importing food and beverage products fulfilling the local demands. Thus, our contribution in maximizing foreign currency earnings is massive.
Herald: How do you evaluate your business experience so far?
Bodely-Scott: We believe that we have developed expertise in building high quality businesses in quite difficult places. So, when we look regionally in Ethiopia, Eritrea, Chad and other neighboring countries, we think we can use the expertise we built in Sudan to start business regionally. This would be our focus for us for the next two and three years. We have shown our excellence in Sudan. The very important thing is now Sudan is in a peaceful political transition. If new politics unfold, Sudan will come out from cold in terms of international relations, banking system, investment, trade and other sectors. This is a good time for Sudan particularly for companies like ours.
Herald: How do you assess your involvement in investment here in Ethiopia?
Bodely-Scott: We have a sister company named African Lakes based in Addis Ababa. It has proven a very successful company. It is a machineryimporting company. It imports generators and other heavy machineries. We started investment in Ethiopia in 2012 with around 290 million USD. Now our capital has reached 3 billion USD. The Ethiopian government has been offering incentives to encourage investors. We are among the beneficiaries of the incentive packages and we are happy to invest in Ethiopia.
Herald: In which sector would your new investment engage in Ethiopia? What will be the opportunity you desire to get and what will be the advantages you aimed at offering for local people?
Bodely-Scott: Our real focus is the dairy industry. We have skills and expertise in a number of food categories. But if you start your business in different countries, there will be lots of opportunities. The whole supply chain will be in the dairy farm and dairy cooperatives. There will be an opportunity for dairy farmers because they will provide their products for us. We will help dairy farmers to run better business and to increase the yields through offering trainings. We will help them to protect the health of their cattle. So, they will improve their profitability. Taking all these together, we intend to establish milk collection centers, raw material stores and factories. We will also start the distribution fleet and all the marketing programs. We propose to create market for small retailers as well.
Herald: What initiated you to invest in Ethiopia?
Bodely-Scott: Many issues have prompted us to seek investment opportunities in Ethiopia. Among them are new market, abundant raw materials, workable bureaucracy, young demographic base, suitable climate, accountable and transparent regulatory environment and new way of doing things. The historic relations between Ethiopia and Sudan will be taken as additional motivational factor that initiated us to invest in Ethiopia. Since we are highly professionals in the business, we will be successful by minimizing the amount of risk.
That is it. If you start in an industry you are a past master in, if you build distribution systems and factories, then you know how to build them because you know them elsewhere. If you are dealing with products, if you are dealing with consumers, you understand clearly how to minimize your risks. So, our strategy is very good in Sudan so far. That is why we are attracted to expand such successful businesses toward countries like Ethiopia.
Herald: Where will be the location of your dairy business?
Bodely-Scott: It would not be known exactly where it would be located at this stage. We are discussing with the investment authorities, regional governments and other concerned bodies as to where we are going to locate it. We hope that it will be located where raw materials and trained human power are available.
Herald: when will you start operation?
Bodely-Scott: It is a pending question for us securing the right land and where we will locate the farms and factories. We will start it after we passed all these processes. The IFC international funding council which financial backer of the project is happy to provide us the finance we need. So it would be a question of finalizing where we locate the farms and factories. So when the foreign investment commission and other bodies in Ethiopia give approval, the business will begin.The business we are ready to start in Ethiopia will cost us multimillion dollar.
Herald: What would you want to add to the existing Ethiopian dairy industry sector?
Bodely-Scott: I think in one word ‘‘quality’’. I think one of the ways we have succeeded in Sudan is we have put quality dairy products into the market. Since we are the largest dairy company in Sudan with more than 80 percent market share, we can transfer our skill; experience and knowledge to Ethiopians. We are ready to take the whole diary sector to a higher level. We produce dairy products meeting international quality. We know it costs money; it needs the right temperature and right retailor. So we know ensuring quality is a winning formula when we come to dairy. We make sure that the dairy product is produced at the right time and distributed in the right way. We are sure that we can win in competitive advantage in the market because of our quality products.
Herald: What are the challenges you are facing in Ethiopia?
Bodely-Scott: I think the challenges are related with banking transactions, challenges with funds, challenges with work permit of the expertise. I hope these challenges will be resolved as soon as possible. Another major area of our business is grain millet. What makes our company preferable is we have developed some quite sophisticated manufacturing processes for small grains like millet and sorghum. So we would get an opportunity of millet Teff in Ethiopia as well.
Herald: What could you say at last?
Bodely-Scott: Ethiopia has untapped natural resources which are vital for investment. With reform being implemented, it has huge chance of becoming an investment and trade hub. But the challenges I have raised especially the problem related with banking transaction should be solved. If so, Ethiopia will realize its development goals and aspirations. The prosperity of Ethiopia would have positive influence in the Horn African region.
The Ethiopian Herald Sunday Edition May 26/2019
BY TSEGAY HAGOS
