Ethiopia secures $680 million cracking contraband network

Ethiopia secures $680 million cracking contraband network


Customs Commission of Ethiopia has secured 23.52 billion birr (about $680 million at current exchange rate) by capturing goods from people engaged in illegal trading (contraband traders).

The income is generated during the last 11 months of the current Ethiopian budget year, which will be concluded July 7, 2020, according to Debele Kabeta, Commissioner of Ethiopian Customs Commission, who spoke with the state daily Amharic, Addis Zemen newspaper. Ahead of the reform the maximum amount the Commission was collecting was around 80 million birr, while currently 380 million birr is being collected every day, according to Commissioner Debele.

He stated that during the years before the reform, which started two years ago, Ethiopia was losing around 13 billion birr (about $376 million) tariff revenue every year because the system was deliberately sabotaged to benefit few individuals / certain group. The Commissioner indicated that customs tariff deliberately dropped to zero just for the sake of benefiting few groups. Such theft was purposely designed and supported by regulations and working procedures so that those selected group can benefit, according to Commissioner Debele.

He further noted that the organized theft had networks going as far as Djibouti. After the reform the Customs Commission of Ethiopia has managed crack the network of the people engaged in illegal trade and managed to boost the revenue of the country collecting customs tariff properly.

From the budget year 2008/9 to 2016/7 Ethiopia has collected a total of 547 birr (about $15.6 billion at current exchange rate) tax from imported goods. During these years, the country has given duty free import privilege of worth 595 billion birr (about $17.2 billion) to investors engaged in certain businesses. Meanwhile, the incentives were abused and not used for the intended purpose and manipulated by people engaged in illegal trade, according to Commissioner Debele.

One of the individuals engaged in such contraband trade 10,000 metric steel was imported duty free with a pretext that the person is building a five star hotel in a place where people do not live at all. In addition, the purchasing prices of many goods are also decreased to favour the illegal traders pay small amount of tax after importing these commodities.