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Mon 27 Feb 2012 05:47 PM

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Saudi billionaire eyes $3.4bn Ethiopia projects

Mohammed Al Amoudi's Derba Group plans to invest in seven industrial projects

Saudi billionaire eyes $3.4bn Ethiopia projects
Saudi billionaire Mohammad Al Amoudi

Derba Group, an amalgam of three Ethiopian companies owned by Saudi billionaire Mohammed Al Amoudi, said it plans to invest 59bn birr ($3.4bn) in seven industrial projects over the next five years.

The company, formed last month, has already invested 12bn birr of a planned 71bn birr in agriculture and cement in the Horn of Africa country, CEO Haile Assegide said on Monday by phone from Derba Midroc Cement’s plant near Chancho, about 70km northwest of Addis Ababa, the capital.

“The balance will be invested in the next five-year period,” said Haile. Derba’s cement, steel, agriculture and transport operations may generate annual revenue of 41bn birr and create more than 370,000 jobs, he said.

Ethiopian-born Al Amoudi is ranked by Forbes magazine as the world’s 63rd-richest person and was worth $12.3bn in March.

The 66-year-old is close to the Saudi royal family and his construction company, Midroc, built the $30bn underground oil storage facility in the kingdom in the late 1980s, according to the magazine.

Al Amoudi’s Saudi Star Agricultural Development Plc, which is primarily growing rice to export to Saudi Arabia, has leased 10,000 hectares of land in Ethiopia’s western Gambella region where it plans to build two rice mill factories, Haile said.

The company is also in the “process of leasing an additional 290,000 hectares,” he said, without providing further details.

Investment in Saudi Star is projected to be 52bn birr, of which 3.5bn has already been spent on agricultural machinery, construction and consulting, according to Haile, a former works and urban development minister.

Annual foreign currency earnings from crops, which will also include sugar beet and cereals, may reach 17.3bn birr, he said.

Derba Midroc Cement, Ethiopia’s largest producer of the building material, was inaugurated by Prime Minister Meles Zenawi this month. The factory will make Ethiopia “self-sufficient” in cement, according to Haile.

The five other projects targeted for investment are Derba Transport, Maya PP Bag, Derba Lime and Chemicals, Toussa Steel Mill and Dashen Cement, he said. The government will earn more than 6bn birr a year from “value-added tax alone” from the seven projects, said Haile.

The group’s other interests include gold mining, trading, construction and cable-manufacturing operations.

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