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Dollar Crunch: Ethiopian and Eritrean Airlines

Gedab News learned of a recurring issue between Ethiopian and Eritrean civil aviation departments over the payments of balances. According to our source, “Eritrea’s bills are now past due since it has not paid for Ticket sales it owes to the Ethiopian Airlines.”

On July 18, 2018, Ethiopian airlines restarted its flights to Eritrea after an interruption of over 20 years. Currently, the airlines operates several daily flights between Asmara and Addis Ababa.

In the last 25 years, Eritrea has started many airline companies that soon failed and stopped operating. The Eritrean civil aviation has always had similar payment issues with almost all the airlines that operated into Eritrea, including Egyptair, Lufthansa, Yemenia, Saudi Airlines, Qatar Airlines, and others. They all operated for a brief period and discontinued flying to Eritrea.

Last summer, Eritrean Airlines, which started flying to Addis Ababa using a leased aircraft, discontinued its flights to Addis Ababa over similar payment of balance problems. All previous attempts by the ruling party of Eritrea to establish an airline has failed. Also, several private enterprises also failed due to interferences by the government.

Eritrea is short on hard currency and faces difficulties in meeting its financial obligation to many of its financiers and trading partners.

Last month, after the visit of the manager of Ethiopian Airline’s to Asmara, the airlines stopped selling tickets in Nakfa, the Eritrean currency, which now no airline accepts for purchasing tickets.

In order to resolve its hard currency crunch, Eritrea is pursuing its desire to tie the Ethiopian and Eritrean currencies and peg it to the US dollar. At the moment, the Ethiopian Birr is trading at about 30 to 1US$ dollar while the Eritrea Nakfa trades at 18 to 1US$.

Eritrea continued using the Ethiopian Birr after its independence in 1991, but in November 1997 it issued its own currency, the Nakfa. However, differences in reimbursement of balance of payments ,and reconciliation of financial issues, were building below the surface. The launch of the Eritrean Nakfa is believed to be one of the main reasons that led to the violent 1998-2000 border war. Immediately after Eritrea introduced the Nakfa, Ethiopia decided that the traditional cash trading  should be conducted through “letter of Credit”. Eritrea had strongly objected to that and tension continued until the war was triggered.

In 2018*, after Isaias Afwerki and Abiy Ahmed signed an agreement, they decided to open the border between the two countries and resume trading relations. However, so far trade and immigration through the border between the two countries is haphazardly conducted; the  border is unpredictably open or closed from Eritrea’s side. Often time, the government doesn’t provide clarifications.

* Corrected

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  • mokie berhe

    Salam all. What a joke is this UN ECA -23rd session of its Intergovernmental Committee of Senior Officials and Experts (ICSOE)- which is now taking place in Asmara. Trump should simply cut off funding to the ECA. Maybe we can ask key ECA participants for their views on prisons and conditions of detention in Africa with special focus on children

  • mokie berhe

    Salam All. Common guys. You can do better than this! Really, what do such articles achieve? Who cares to hear about a 1-stallion national airline (with crappy food) operation in the discussion mix with Africa’s largest commercial carrier? We’ve known for decades about the faulty and clouded economic policies of the regime. And, most know that the border between Eritrea and Tigray, has -rather predictably- been closed as a result of the TPLF’s intransigent attitude and attempt to dump fake money and light weapons into Eritrea. Incredible, how it is simply impossible for some to criticize or to hold the TPLF accountable for its bad actions, while they chase straw fights against the PIA/PFDJ regime. Need to hit where it hurts! Focus on key issues such as: 1) Refugee exodus to include large numbers recently coming across Afar way, 2) Ridiculous economic/real estate assets held by some PFDJ members such as Saleh Omar -Eritrean Ambassador to South Africa-, 3) Do a shame game on members of keys Eritrean Embassies…

    By the way you erroneously state that ‘In 1998, after Isaias Afwerki and Abiy Ahmed signed an agreement’.

    • Brhan

      Hello Mokie , come down, it is news,,,when it comes to news there is no criterion , you have to present it as is…that is the bitter sweet of news,
      You are right about the 4 points, but , events create news not the vice versa, in another words the points need not news but for example feature article, investigative story ..these are some of ABC of journalism , in case you have not encountered

      • mokie berhe

        Salam Brhan. A common denominator in all the articles attacking PMAA? None wish to mention even once, the TPLF whom all know, is behind the gauntlet of PMAA’s opposition.

    • bardavidi

      Mokie……WOW…….Impressive…..How long have you been advocating for Isaiases policy of do everything wrong and Blame everything on Woyane policy……..Not being able to come up with hard-currency has a lot to do with internal Financial Mismanagement of the crook and his stooges Irresponsibility than anything else………A secret admirer of DIA and his version of the Truth…..???……..Selah

      • mokie berhe

        Salam Bardavi. Yes, I have relentlessly criticized TPLF, often criticized and PIA/PFDJ regime and not once voiced support for the PIA/PFDJ regime. And you? You have never criticized the TPLF and more than 75% of your posts seem to be religiously inspired. WOW…

        • bardavidi

          When you are Dacing to His song, you are supporting him directly……..Why does he Lack Finances….Woyane……Why is Sawa still going…..Woyane……..Why is the Diaspora Opposing …..Of course……..Woyane……..Why Political prisoners …..Woyane………..That is the only song in his Album…………Someone has to help him sing it or Dance to its Rythym………….Selah

  • mokie berhe

    Salam All. Research from a few years ago, found that 87 percent of the time a dictator dies in office. And, then when s/he does, things usually don’t really change. Unfortunately, many have now resigned themselves to the cruel waiting game process, thinking that whatever comes next, cannot be worse wishing to forget that death of a dictator is usually remarkably inconsequential. Time is getting close for ‘Burn, baby, burn! Fan the flames of discontent! Total resistance! VIVA LA HUELGA! No Justice, No Peace! PFDJ inner circle properties/holdings could be targeted. You gonna use that last match you have to light that Ideal unfiltered cigarette or yours?

  • iSem

    Hi AT;
    MZ and IA signed the blood bath in 1998, AA and IA did not sign the peace agreement.
    Minor but I thought would point it out. This shows your wish the peach should have been signed. the ware could have stopped (not started) by a stoke of the cheapest pen, ‘dawwat”

    • Saleh Johar

      iSem,
      It is just “agreement” no mention of “peace”. You are using daawat 🙂

      • iSem

        hi Saleh:
        I used daawat deliberately to invoke the jarikkan tesmi;-)

        • Berhe Y

          Hi iSem,

          Asmarinos have no idea what you are talking about:)

          Only those people from hagereseb or spend a lot of time outside bloko Asmara, like keren, adi qeyiH, mendefera gele mele understand.

          When you can biCha jerri can why would anyone use Harbi? It’s easy to clean, easy to carry, easy to store, and easy to secure.

          Or may be the jerri can was readily available because of the food aid and all when I grew up, I didn’t see Harbi all together. And I do consider that I know a little more than the average Asmarino because where I grew up, but harbi didn’t made to edaga eKli:).

          Berhe

          • iSem

            Hi BY:
            I will address your one important point ONLY
            You cannot see harbi in highlands. OK

          • Amanuel Hidrat

            Selam Sem,

            Let me interject in to your discussion.
            ሓርቢ = ለቆታ
            The only difference is their application in the service of the society. Otherwise, they are the same.

          • መሃንድስ-ምዕባለ

            Hi Emma/Semere/Berhe,
            How about explaining it this way?
            The material is the same: goat skin but what you store in it is the difference.
            Harbi is when you fill it with some kind of liquid (it keeps is cold and that’s why it is used mostly in hotter regions of Eritrea) while Leqota is with some grains.

          • Saleh Johar

            Good explanation Mehandisna,
            If you notice, Harbi is soft and always kept wet. Leqota is a bit coarse and dry

          • Haile S.

            ሰላም ብጾት፡

            ተወሳኺ ፍልልይ፥ ሓርቢ (ንእሽተይ) ንመዓረ-ጨባ ዝሕዝ፡ ደልሚ (ዓቢ) ማይ ዝሕዙ ኮይኖም፡ ፈሳሲ ንኽሕዙ ዝተላደዩ እዮም። መጎጎ ይላደ፡ ጀበና ይላደ፡ ከምኡ’ውን ሓርቢን ደልሚን። ብተወሳኺ እቲ ኣእጋር ዝነበረ ኩርንዓት ናይ ሓርብን ደልሚን ንኸየፍስስ ብድርብ ዝተሰፍየ እዩ። ሎቖታ ዋህዮ ዝኣመሳሰሉ ግና ንቑጽ ዝሕዙ ስለዝኾኑ ምልዳይን ግድን ደራሪብካ ምስፋይን ዘድልዮም ኣይኮኑን።
            ሰመረ፡ ኣዝማሪኖ ዲኻ? እዞም ኣዝማሪኖ ኢና፡ ዘይንፈልጣ ትግርኛ እንተመጺኣ፡ ትግርኛ ኣይኮነትን ኢና ንብል። እዛ ብበያን ሓውና ሒሕ ተብሎ ዘላ መዝገበ-ቃላት እንተትህልወካ፡ ሓርቢ ትግርኛ ኣይኮነን ኣይምበልካን።
            በያን፡ ኣነ መጽሓፍ ኣይሸይጥን እየ። መለበሚ ኣይኽላእካ መለበሚ ኣይግበርካ። Sorry!

          • iSem

            Hi ሓው /ዓርኪ Haile S.
            this comment is perfect, detailed, educational
            And ብጾት does not go with it 🙂

          • Haile S.

            ሰላም ሰመረ፡
            ሓቕኻ። ሸተት ኢሉኒ እዩ እምበር፡ ሓንቲ ካብ እቶም ዕግርግር ዘምጹኡለይ፡ ኣብዮት ዝወረሶም ቃላት እያ።

          • Aklil

            Selam Amanuel,
            ለቖታ and not ሎቆታ 🙂

          • Berhe Y

            Hi iSem,

            Asmarino wanna be. It’s the only place I knew, where else could I be. Off course there are lots of places (that asmarino brag) about that I didn’t venture (may be because I left young, or I was too conservative) but I know Asmara wushTan wiShaTiean. And I think it’s the best city in the world, and primarily for its weather and add to that the many other aspects of the city.

            I agree about the chemicals but in relative terms, may be not that bad compared all the other problems people have to make ends meet. I think you are confusing them with those bermil (the blue containers) they use for swa and water, which are probably used for chemicals.

            Thank you Emma. iSem is surprised why I didn’t know Harbi:), I know Leqota. May be one is for EKli Nd the other is for Tesmi, Meaar.

            Berhe

          • iSem

            Hi BY;
            I am not surprised at all. It is Gadi’s fault. harbi is not Tigriniya and Leqota is little different that harbi, not only in its usage.
            Saleh Tigriniayzed the word “harb” to harbi. The high lands use etro for water
            no wonder you also know Toronto wishtan wusahtiane, your skills from teh biggest cosmopolitan in the word prepared you for this, me think

          • Berhe Y

            Hi iSem,

            ayweSanin…but for sure better than you:).

            BTW, my whole comment to SGJ was not really to dwell on Harbi and it’s meaning..What I was alluding is, most people (I am assuming including me) may not be familiar with the meaning of TeHaz Harbi Tesmi…and it may not register right away with the intended message (to isolate and target those who are supporting the regime while the country is being destroyed).

            Personally I learned a new term and like I said it’s fitting but it will require everyone (who is not familiar) to listen SGH vlog.

            Berhe

          • Saleh Johar

            ISem,
            the surroundings of where I grew up, Tgrinya and Tigrayit morph and create another dialect. For example, where can you hear, Chebel nesaaka except in our region? Or, mt shekiEyya, or etta koberit, or fraray teTeliqe? And poor Berhe Yeman is struggling with Harbi 🙂

            But one for you, Etro is used to carry water when the water stream is close by and usually girls fetch water in Etro on their back. Harbi requires a bit of traveling, wells are far apart (nab may zelewo kidu, as Isaias would put it) And that requires an animal to carry it. Imagine Etro on the back of a camel or a donkey.

          • iSem

            Hi Saleh:
            Harbi is more functional, it does not break, it is bigger as poor donkery carries it and also women fetch the water but they do not walk and do not carry and do not even load it, their job is to fill it.
            I have fond memories about harbi, not its water but its social part when it leaves the house with a donkey and a girl to where water is
            Etro is more suited at the house for storage
            I hope i have shortned the discussion because “kerfkuwo”*
            * please do not complain about its spelling, there is no spelling in tigryayit, better than “mingugay”
            🙂

          • Berhe Y

            Hi Saleh and iSem,

            iSem is Harbi same as Jirba/ Girba? That’s what I thought it was called the one you put on donkey to carry water.

            Berhe

          • Saleh Johar

            No Berhe,
            Gorbachev is made of canvas, tenda material, harbi and lqota are made of goatskin.