I j u i •( C' ^ No*" / ./ < i/i ' V, p.- J : ETHIOPIA COMMERCIAL AND ECONOMIC SURVEY f t *• ^ 'K By I J. LODERPARK ; AMERICAN VICE CONSUL, ADEN, ARABIA Trade Information Bulletin No. 476 Vo : Vj- : ,. r i /■V ■ ' ■ '-.5 , ^ -0 " : ■■■. i ' i 'H ' / A ,47*»' ■ A ^ ^ UNIT ED STATES *^^‘PARTMENT OF COMMERCE BUREAU OF FOREIGN AND DOMESTIC COMMERCE Trade Information Bulletin No. 476 Price, 10 Cents FOREWORD The increased international interest recently shown in the Empire of Ethiopia, formerly known as Abyssinia, warrants a review of con¬ ditions in that little known country of approximately 10,000,000 inhabitants—a region which is one of the few productive portions of the African continent in which no modern development projects have been undertaken during recent years, although some are under consideration. The country’s situation as a sovereign nation places it, however, in a somewhat different relation to foreign capital from that of its neighboring areas that are parts of the colonial systems of European powers. Although the political independence of Ethiopia has been recog¬ nized by Great Britain, France, and Italy since 1906, and that coun¬ try under its Regent, Ras Taffari Makonnen, has been a member of the League of Nations since 1923, nevertheless the modern economic developments there have been largely accomplished by foreign enterprise. The country’s resources remain still largely unexploited and the industrial development is negligible. Although there are reported to be rich resources of rubber, coal, copper, silver, sulphur, potash, mica, gold, and iron, only the last four have so far been extracted commercially, and these only to a slight extent. Ethiopia may be said to represent, therefore, an almost virgin field for productive effort, and with its increasing economic development and augmented purchasing power, it represents, as well, a new and promising market for the products of the industrial world. Julius Klein, Director Bureau of Foreign and Dcnnestic Gorwmerce. May, 1927. ETHIOPIA: COMMERCIAL AND ECONOMIC SURVEY INTRODUCTION Ethiopia, formerly loiown as Abyssinia, is an inland empire sepa¬ rated from the west coast of the Red Sea and the Gulf of Aden by the Italian colony of Eritrea and French and British Somaliland, and from the Indian Ocean by Italian Somaliland. It is bounded by Kenya Colony on the south and by the Anglo-Egyptian Sudan on the west. It is made up of several ancient kingdoms and formerly independent or semi-independent political entities, which constitute in part the modern provincial divisions. The nominal ruler is the Empress Waizeru Zauditu, crowned in 1916, but the actual govern¬ ment is largely in the hands of her son, the regent, Ras Taffari. In 1923 Ethiopia was admitted to membership in the League of Nations. Since 1906, when a special agreement was signed between them, Great Britain, France, and Italy have recognized the independ¬ ence and integrity of the country, at the same time guaranteeing not to intervene in Ethiopian internal affairs, nor to act so that indus¬ trial concessions granted in the interest of any one of them might injure the others. Of the country’s estimated population of about 10,000,000, only about one-third are Ethiopians, a Christian people of Hamitic origin with a Semitic admixture. More than half the total population are Gallas, pastoral and agricultural people, some of whom are Chris¬ tian, some Mohammedan, and some pagan. Somalis inhabit the Somaliland Plateau in the southeast; Falashas, of Jewish religion, comprise an important part of the population in the northeast; and a considerable number of negroes inhabit the southwest districts. The capital and seat of government, Addis Ababa, has a popula¬ tion of about 65,000, of whom perhaps 1,000 are foreign residents, chiefly British Indians, Arabs, Greeks, and Armenians. The only other important towns are the walled city of Harrar and the former railroad terminus, Diredawa. Each of these has a population of from 30,000 to 40,000. Addis Ababa and Harrar are the only cities having schools, in all of which the teaching is done by the clergy. Recently, a new school has been opened in the capital with French professors for the sons of noblemen, a few of whom are sent to Egj^pt for further instruction. Addis Ababa is connected with Harrar, Jibuti (French Somali¬ land) and Massawa (Eritrea) by telegraph, and by telej^hone with a dozen Abyssinian towns, including Gambeila, the western trading station leased to the Sudan Government; Sharada in the southwest; and Derra in the north. The country’s few miles of metaled roads are also in the vicinity of the capital, all other roads being scarcely more than tracks or caravan routes. In addition to the products discussed below, Ethiopia is reported to have forests rich in rubber and other valuable trees. Coal, copper, silver, and sulphur have also been found but have not as yet been exploited. 45624—27 ( 1 ) 2 INDUSTRIAL AND AGRICULTURAL PRODUCTION The character of Ethiopia’s import trade indicates that the native people in their present stage of economic development are incapable of producing even their bare necessities. The exported products, moreover, are only those of a pastoral and crudely agricultural Coun¬ try. For example, much of the coffee is wild. Hides and skins are the casual by-products of animals raised primarily for food, and would be wasted for the most part if there did not happen to be a foreign 3 demand for them. Wax is gathered from wild honeycombs and ivory is obtained from wild animals killed mainly for that valuable material. Grain, of course, is cultivated, but in a primitive manner. Under the heading “ Miscellaneous ” in the tables given below are included various other agricultural products, such as potatoes, beans, and other vegetables. Civet production might properly be called an industry, since it is achieved by organized breeding farms of civet cats. Gums, again, such as gum arabic, gum tragacanth, and myrrh, are obtained by the usual simple process of tapping the trees of the countryside. Ethiopia can not, therefore, be called an industrial country, except in the most strictly limited sense of the word, despite its reputation for having potentialities of such an amazing extent that it might well become one of the most productive countries in the world. Not only are its exports those of a pastoral rather than an industrial com¬ munity, but there is not even any organized system of production of any of these export commodities. COFFEE GROWING The production of coffee is the unique example of an increasing effort to cultivate this commodity. The output for 1924 was three times as great as the average for the preceding 14 years. Coffee culture is especially noteworthy in the Province of Harrar, the quality of that product being very similar to Mocha, or Arabian cof¬ fee. It is exported both via the Sudan and the French railway. Its prices keep level with those prevailing in Aden, which represent the prices obtainable abroad. So far as the American consumer is con¬ cerned, Abyssinian coffee is the same as Arabian, such names as “ Harrari,” “Abyssinian Longberry,” being merely names in com¬ mon use in the trade. The Ethiopians are not great coffee drinkers, and are willing to export most of the coffee produced in their country. Wild coffee without any but the most casual attention will grow in the country in abundance, and if cultivated by the most approved methods may one day be produced in enormous quantities and become an important rather than an incidental part of the world’s coffee supply. HIDE AND SKIN INDUSTRY The hides and skins of Ethiopia are the best obtainable, excepting those from the blackbird sheep of Arabia. The quality, depending largely as it does upon pasturage and water, has every opportunity in Abyssinia to be the best. Most of the Abyssinian hides and skins appearing on the Aden market are of the “butcher” grade, i. e., taken from animals killed for food. The increase in 1924 over pre¬ vious years was sufficient to show a general improvement in pastur¬ age, rainfall, and prosperity in Abyssinia. Recent unofficial reports indicate that 1925 was the best year on record for Ethiopia’s hide and skin output, exceeding the metric tonnage of 1924 (7,642 tons) by at least 30 per cent. Prices are still too high for American buyers, but this is owing to active competition for good skins in Europe and America and to the dependence of the Abyssinian trade upon Aden, the center of activity. 4 GRAIN PRODUCTION Abyssinian inillett (diirra), wheat, and barley have been exported in important quantities only since 1915 to supply Red Sea and east African ports. It was only the existence of war conditions that brought about the exportation of this most abundant of Abys¬ sinian field crops, since prior to 1915 the export was restricted by the Government. It was. apparently, between 1910 and 1915 that this restriction was in force, because 768 tons were exported via Jibuti alone in 1910, one third of that quantity in 1911, none in 1912 and 1913, and 79 in 1914. Exports have varied greatly since 1915, and here again 1924 was a record year (1,579 metric tons having been shipped via Jibuti). Exports via Jibuti were supplemented by those into and through the Sudan in unknown but certainly less quantities. WAX COLLECTING Although much of the beesAvax of Ethiopia is the result of bee¬ keeping, it is believed that more than half of the loiOAvn output is from wild hives. The wax is shipped to Aden in large blocks weigh¬ ing from 50 to 100 pounds each, ready for further export. The quality of the Avax is A’ery good and found generally acceptable in the United States. IVORY HUNTING lAmry, because of its rarity and great value, is listed as a separate item, since Ethiopia is distinctiA^e for its steady and rather large production of the substance. It is obtained manily by Ethiopians,, who are very proud of their proAvess and skill in hunting wild animals, including those bearing ivory. As shoAvn in the tables below, ivory production varies from year to year, the pre-war and postwar production being about equal, although there has been a falling off in recent years. It seems that there is a scarcity of large tusks, only those weighing up to 50 pounds being available for export. These are not nearly so A^aluable as the larger ones, owing to the holloAv half, Avhich severely limits the available ivory in the tusk. It is not the gross weight of ivory but the net weight of solid ivory that gives it value. MINING INDUSTRIES Deposits of iron exist in several parts of Ethiopia but have been used by the natives only for the manufacture of more or less primi¬ tive tools and weapons—spears, kniA^es, hatchets, etc. Placer gold mining and washing is carried on by the natives in some of the eastern districts, Avhere gold is found in several of the riA^er beds. Exports average in value about $200,000 a year, but it is reported that if the quartz deposits said to exist in the country were exploited, production would reach much larger proportions. Since 1911 the concession for the exploitation of extensive depos¬ its of potash salts in northeastern Ethiopia, near Eritrea, has been held by an Italian company. A certain amount of development and exportation, chiefly to Italy, has been carried on by this company. Concessions are held by an American company for the exploita¬ tion of mica mines in four sections of Ethiopia: In Laka and Walloga in the west; in the country of the Ogaden near Somaliland; in the 5 vicinity of Harar; and in the vicinity of Anssa near French Somali¬ land. Mining has been begun in the section between Harar and Jijiga, where the mica is reported to be of excellent quality, and exportation was begun in 1923. The deposits are abundant, but the exploitation has so far been somewhat handicapped by difficulties of transportation, since the mines are separated from the nearest railway point, Diredawa, by about 100 miles of very rough country. The possibility of an alternative export route, however, has been suggested, through British Somaliland to the port of Berbera, for which only 40 miles of new road would have to be constructed. DEMAND FOR FOREIGN PRODUCTS It is evident from the import figures that the principal needs of Ethiopia from abroad are, in order of importance, salt, cotton goods, kerosene, sugar, empty bags, hardware, wines, and glassware. The Austrian Maria Theresa dollars are imported in great numbers, but are not mentioned separately. They will be dealt with under a separate heading. SALT Salt takes the lead, because of the extreme dearth of it in Ethiopia. There are certain occurrences of natural rock salt in the country, but these are few, while the quality is poor and there are no means of refining it. Ethiopia, being completely landlocked, can not produce salt from sea w^ater and must depend mainly upon foreign sources. Salt, as a result, is so precious that it is used as money throughout Ethiopia. The production of salt bars of convenient sizes for money has become an industry, in the hands of a small group of Greeks, who are said to be making a substantial profit. The bars are about 12 inches long, slightly tapered at both ends, are molded in hard crys¬ talline masses and protected from chipping by a binding of thongs. The values of the bars of salt correspond with equivalents in Maria Theresa dollars. TEXTILES Cotton goods, still known as “American!,” in spite of the fact that the lower priced Japanese products have captured the Ethiopian market from the Americans who dominated it several years ago, form the second most important item. Imports of 4,438 metric tons in 1924 (no other measurement is available) indicate a recovery of the market from a postwar decrease. The imports of this com¬ modity have not varied much from an annual average of about 4,000 metric tons, and were not affected by the war. KEROSENE American kerosene, once dominant, lost prestige when, about four years ago, British brands were introduced at cut prices. The Ameri¬ can is still regarded as the best in quality, but its price has been maintained at a proportionately high level. Lately, however, Ameri¬ can marketers have altered their policy, and are now endeavoring to recover the lost Red Sea markets, including Ethiopia. They are fairly certain of success, because their kerosene is famous for its uniform quality, and a very small reduction in price has enabled American kerosene again to compete with the British product. 6 JUTE BAGS Empty bags made of jute, imported for the most part from India, are constantly in demand for animal transportation. The year 1924 was the record year since figures have been compiled, its total imports of bags being 434 tons, against the next highest total of 264 tons in 1922. The use of bags is universal in Ethiopia, as they are constantly required for packing merchandise on every Ijeast of burden. > HARDWARE Hardware is imported chiefly from Germany and Austria. This heading includes lanterns, locks, hinges, bolts, nails, and every¬ thing in common use that is made from iron, copper, and brass. The cheapest only of each kind of hardware is sold in Ethioj^ia. There is no apparent requirement for anything fine or elaborate in this category, even the best buildings of the natives being most crudely constructed. It is an open market for American hardware, and the cheaper American manufactures should figure prominently, if actively promoted. Consumption at present is small, although the 1924 imports had not been equaled since 1914. The market could probably be developed to much greater importance if personally studied by an American representative of hardware manufacturers. Two hundred tons of metal ware in a year is not a large consump¬ tion for 10,000,000 people. GLASSWARE Closely allied to hardware is glassware, including tumblers, table¬ ware in general, lamp globes, bottles, window glass, etc. The in¬ creased demand for glassware in Ethiopia is startling. Imports dropped from 123 tons in 1914 to 45 tons in 1915, with smaller pur¬ chases during and after the war. The year 1924 marks a very substantial recovery, which gives promise of further increases as time goes on. Most of the glassware in Ethiopia is sold at retail in the bazaars of the larger cities. The venders spread their wares on the ground, with or without a roof or a shop, and distribution to the surrounding country is accomplished by the purchasers, who travel from afar to the marts on regular market days. The leading arti¬ cles of glassware required in Ethiopia are tumblers and lantern glass. No person is permitted out at night without some kind of light. Very little glassware is obtainable in the market and the prices are rather high. There is a good opportunity for American glassware. SUGAR Sugar is a constant requirement, being imported mostly from Java. It is not produced in the country, yet imports for the whole country, as seen below, amounted to only 494 metric tons in 1924—a total rarely equaled in any previous year. WINES AND LIQUORS Wines and liquors, beer, and rectified alcohol are universal re¬ quirements in Ethiopia, but most of the foreign-made beverages are much too expensive for the natives, who are obliged to content them¬ selves with two staple homemade drinks, namely, “tej,” a mild. 7 diluted form of beer which is made from honey in nearly every household, and a white liquor of great potency made from raisin skins. Hence most of the imported beverages are consumed by foreigners in Ethiopia. FOREIGN TRADE Ethiopia's foreign trade has never been nearly so great as the reputed wealth of the country would seem to justify. The balance of trade has long been unfavorable, and changed for the first time in 1924, when exports exceeded imports by 5,192 metric tons. The recurrent import surplus is attributable to the lack of productive industry in the country. Although no assertion can be ventured regarding future commercial developments, it is an undoubted fact that with a little effort to exploit the soil in a modern manner and to develop the country’s untouched resources an export surplus could be established and the total volume of trade considerably increased. The tables of imports, exports, and prices included in the present report are believed to be the first definite statements yet obtainable. They cover the total trade of Ethiopia via the port of Jibuti since 1910 and via the Anglo-Egyptian Sudan for the years 1922 to 1924, inclusive. The accuracy of the figures can not be guaranteed but they are useful for purposes of comparison and are considered to represent a very close estimate of the country’s trade. Although caravans carry on a large trade with the interior, the chief route for Ethiopian foreign commerce is the Franco-Ethiopian Railway from the capital to the French Red Sea port of Jibuti. TRADE VIA JIBUTI The tables given below show the exports and imports via Jibuti since 1910. As stated above, these figures are not official statistics, but since they are from a reliable source they may be relied upon as having a very fair degree of accuracy. In considering them, how¬ ever, it should be remembered that they do not cover all Ethiopian trade, but only that carried on through the port of Jibuti. The more detailed commodity tables for the years 1923 and 1924 similarly cover only the trade through Jibuti. Tonnages of Principax. Imports Into Abyssinia via the Franco-Ethiopian Railway Since 1910 [In metric tons] Year Salt Kero¬ sene Wines Liq¬ uors Sugar Beer Al¬ cohol Glass¬ ware Hard¬ ware Bags, empty Cot¬ ton goods All other items Total iftin 1 484 4Qn 117 350 2,976 22,844 28, 261 iftn 1 Qlfi 585 947 604 3,649 30,358 37,362 1019. * 1 Qfifi 580 875 477 4,219 12,071 19,678 fiQ4 8fi7 857 1 ,138 4,735 33, 763 43,464 1914_ 4 ', 702 755 109 603 110 127 123 408 233 6,117 1,773 15,060 1915. 7,202 1,306 102 240 439 56 33 45 74 245 4,642 3, 048 17,432 1916_ 7,524 ■311 59 125 494 9 8 16 153 233 3,994 1,674 14, 580 1917. 14, 087 698 49 64 180 9 11 41 191 3, 572 113 20, 022 1918. 13,886 38 47 140 346 14 6 13 14 207 4,116 1,942 20, 769 1919. 9,117 299 77 104 109 4 66 4 17 115 3,586 1,735 15,233 1920. 12,841 453 282 265 322 64 1 72 110 191 3,336 3,421 21,358 1921. 5,900 308 65 55 256 23 5 33 98 220 2, 543 2,029 11, 535 1922_ 7,899 1,183 67 44 338 46 21 43 118 264 2,505 1,753 14,281 1923. 15 ', 801 412 84 84 323 45 5 73 173 226 3,381 2, 359 22, 966 1924_ 8;i57 657 147 82 494 61 12 131 199 434 4,438 3, 881 18, 693 7 8 Tonnages of Principal, Exports from Ethiopia via the Franco-Ethiopian Railway Since 1910 [In metric tons] Year Coffee Hides Wax Grain Ivory All other items Total 1910... 3,766 2, 810 422 768 64 867 7,687 1911...... 3,043 434 233 69 4,747 8,520 1912... 3,541 3,115 408 51 309 7,424 1913... 4,446 4,105 637 51 585 9,824 1914.. 3,455 4,301 234 79 14 280 8,363 1915.... 4,807 4,673 355 828 4 217 10,884 1916____ 4,206 3,193 355 173 22 1,062 9, 011 1917... 4,744 6,743 392 617 6 1,663 14,165 1918... 3,253 8,217 185 505 1 3,107 15,268 1919.. 3,307 8,346 369 764 20 1,990 14,796 1920.. 2,993 4,671 226 1,415 26 1,865 11,196 1921...... 4,027 2, 229 166 1,417 24 2,497 10,360 1922..... 6,630 3, 740 277 725 12 2,106 13,490 1923.... 5,517 6,902 220 742 11 2,191 15,583 1924.. 12,043 7, 642 335 1,677 17 2,271 23,886 Imports into Ethiopia, by Articles, 1923 and 1924 [In metric tons] Item 1923 1924 Item 1923 1924 Cotton piece goods _ 2,513 3,332 Rice__ 89 98 Cotton * piece goods, other Grain. 23 35 kinds_ 868 1,106 Tinware___ 173 199 Kerosene oil_'... 412 657 Glassware_ 73 131 Salt _ 15,801 8,157 Bags, empty_ 226 434 Sugar_ '323 '494 Tobacco.'.. 12 20 Soap___ 192 242 Incense__ 206 230 Rectified alcohol_ 5 12 ''Articles by post..__ 49 72 Beer_ 45 61 All other items_ 1,734 3,090 84 147 Liquor_ 84 82 Total_ 22,966 18,693 Dates. 54 94 Exports from Ethopia, by Articles, 1923 and 1924 [In metric tons] Item 1923 1924 Item 1923 1924 Butter.... 279 3,770 1,747 61 220 11 6,902 742 801 46 163 7,390 4,653 160 335 17 7,642 1,577 664 26 Charcoal____ 86 382 142 36 2 177 179 15, 583 61 483 141 21 1 248 273 23,855 Harrar coffee. Abyssinian coflee (wild). Coflee husk__ Beans, dried.. Flour.. Drugs____ . Wax.. Gum, myrrh... Ivory_ Articles by post... . Skins and hides.. Grains. Seeds. All other items. Total_ . Potatoes... In addition to the preceding export estimates, via Jibuti, an addi¬ tional table is here given, summarizing the exports of hides (and skins), coffee, and wax by the same route, for 1922, 1923, and 1924. A comparison will show a small but fairly uniform difference. These discrepancies should not raise doubts as to the authenticity of either set of tables, but rather tends to give them mutual support, since the figures given below were obtained from a different source. 9 Item 1922 1923 1924 Hides........... Kilos 3,804,406 6,469, 645 259, 226 Kilos 7,533,008 5,811,187 226,762 Kilos 8 ,686,399 11,590,040 306, 277 Collee__________ Wax___ TRADE WITH THE INTERIOR The chief foreign routes of Ethiopia, in addition to the Franco- Ethiopian Eailway, are as follows: (1) West, through Gambeila, the trading station leased by Ethiopia to the Sudan Government, to Khartum by the White Nile; northw^est through Gallabat by caravan to Singa, between Eoseires and Sennar on the Blue Nile, and by river to Khartum; Avest to Eoseires and by the Blue Nile Eiver to Khartum; (2) south, through the frontier station of Moyale across Kenya Colony to Nairobi and the port of Mombasa; (3) south, by the Juba Eiver through Lugh and across Italian Somaliland to the port of Mogdishu; (4) east, through the country of the Ogaden tribes near the Somaliland frontier to the ports of Bulhar and Ber- bera; (5) north, through Gondar and across Eritrea to the port of Massawa; northeast through Aussa to the port of Assab. The greatest volume of inland trade is carried on with and through the Anglo-Egyptian Sudan, chiefly via the trading station at Gam¬ beila, leased to the Sudan Government. In comparing this trade with that from the coast, the difficulties of transit should be remembered. In order to use the tributaries of the White Nile and Blue Nile, goods must be packed over rough country, often for hundreds of miles, to very near the western frontier of Ethiopia, before they can be placed on river boats which connect with Sudan railways or with Khartum by water. The through water route is, moreover, interrupted by cascades and rapids, with the result that the Sudan railways are used for most of the transportation. If Khartum were connected with Abyssinian cen¬ ters of production by rail extensions, the whole matter would be simplified. The Sudan route for Ethiopian trade is complex in its ramifica¬ tions, and what figures are available can not be guaranteed to cover all goods passing through that country to or from Ethiopia. Unlike the figures for Jibuti trade, moreover, which are in metric tons, the records for the remainder of the known Ethiopian trade are kept in money values. EXPORTS VIA THE SUDAN In the following tables, the exports are grouped under three head¬ ings—namely, coffee, wax, and “various”—the total being given in Egyptian pounds. From this it is possible to arrive at a rough esti¬ mate of the number of hundredweights of these products shipped from Abyssinia via the Sudan. Coffee is by far the most important item. Allowing coffee to be worth, at current Aden export prices, about $20 per hundredweight, and counting the Egyptian pound to be about $5, it is found that in 1922, in round numbers, 50,000 hun¬ dredweight; in 1923, 37,700 hundredweight; and in 1924, 56,000 10 hundredweight of Ethiopian coffee passed into and through the Sudan. The quantity of wax for those years was relatively small, and can not so easily be calculated, since prices are not so uniform as in the case of coffee. The “ various ” items include small quantities of all the exports listed in preceding tables of exports. IMPORTS VIA THE SUDAN The imports from and through the Sudan are seen in the following tables to include salt, Sudan products, cotton and silk fabrics, and various,” meaning general manufactures from Europe. Textiles are dominant in this case, a value of about $250,000 having been im¬ ported from the Sudan in 1922, $300,000 in 1923, and $360,000 in 1924. An item of this importance and apparent growth is not to be over¬ looked. It is clear, also, that the bulk of the textile imports into Ethiopia, via the Sudan, are from Manchester. Thus, in spite of the French railway monopoly to the east, the British are gaining head¬ way, without railways in Ethiopia, from the west. The salt and Sudanese products referred to in the table below, seem to have steadily fallen off in quantity. Salt, of course, comes from the Bed Sea coast, but Sudanese products are expected to increase when the present British cotton-growing campaign in the Sudan gets into itS' full stride. Ethiopian Exports to and Across the Sudan, and Imports From and Across THE SUD.A.N ^ Item 1922 1923 1924 EXPORTS Coffee.......... £E207,176 711' 37, 239 £E151,018 2,784 31,558 £E225,505 2,562 33, 547 Wax...... ... ... Various items....... Total_____ ... . . ... . . 245,126 185,360 261, 614 IMPORTS Salt and Sudanese products........ 16,460 49, 518 17,479 13,259 60,369 26, 005 9,836 73,734 27,093 Cottons, silks, etc....... Various items________ Total_____ 83,457 99,633 110,663 I The average exchange rates for the Egyptian pound for the above years were: 1922, $4.54; 1923, $4.69; 1924, $4.53. In 1926, however, the pound was above par ($4,943) and was quoted locally in the Sudan at $5.02. ETHIOPIAN CURRENCY The Austrian thaler or dollar is the currency of Ethiopia. Al¬ though there are about 2,000,000 Menelik dollars in circulation, these are rapidly disappearing, being transmuted into ornaments and hoarded by those who are able to accumulate wealth. The British Bank of Ethiopia issues bank notes for silver dollars supposed to be in its vaults as guarantee, but the average native is suspicious of banks and paper money and will have nothing but the copied Aus¬ trian dollar of 1789. These dollars are still manufactured by Austrian mints and are bought and sold like any other article of merchandise. They are treated as money only in Ethiopia, Yemen, Hadramaut, Shehr, and the Arabian Persian Gulf area. There is 11 in Aden an English agent for the Austrian manufacturers of the dollars, who is responsible for their distribution. In 1924 the total imports of Maria Theresa dollars were 5,499,036, worth at the current exchange rate (which varies but little) of $0.54, exactly $2,969,480. This figure exceeds all records, imports having steadily increased since the war-time scarcity of silver. For some years—and certainly since 1918—the Maria Theresa dollars sent to Ethiopia have not been permitted to leave the country. This prohibition of reexportation is strictly enforced, although it is said that some smuggling is practiced. It is said that the coins are smuggled out of the country regularly in the sacks of grain sent by caravan, in soap, and even under the coal in the locomotive tenders of the Franco-Ethiopian Railway. A person leaving Abyssinia is allowed to_ carry with him the sum of five Maria Theresa dollars only. Smuggling, however, does not account for the amazing disappear¬ ance of the imported dollars from circulation. There are probably not more than 6,000,000 or 7,000,000 of the coins in circulation at present, which is not much more than the imports in a single year. This disappearance is called “ the mystery of Ethiopia,” even by those who import and distribute the dollars and who would ordinarily be expected to know the ultimate fate of the merchandise they handle. The favorite theory is that each Ethiopian is his own banker, gather¬ ing his wealth in tangible silver and hoarding it in the earth from which it came. There are in Ethiopia at present probably more than 50,000,000 of the Austrian dollars. TRANSPORTATION PROBLEMS Transportation in Ethiopia is largely carried on by pack horses, mules, donkeys, and camels. The single railroad, about 495 miles in length and connecting Addis Ababa with the coast at Jibuti, is a monopoly in the hands of the Franco-Ethiopian Railway Co., formed in 1896. Over this road two trains a week are run in each direction. The cost and difficulty of transportation via the Sudan has already been touched upon. It is for this reason that the Franco-Ethiopian Railway authorities are able to exact the high freight charges for all merchandise carried on their road. In 1925 the owners of the rail¬ way made a sweeping increase of 30 per cent in freight rates from Addis Ababa to Jibuti, the rates being made payable on a gold basis, which further increased the cost of shipment. This move created no little consternation among Ethiopian exporters of goat and sheep skins, since it was upon them that almost the whole burden fell. Even at the old rates the cost of railway transport of skins from Addis Ababa to Jibuti alone considerably exceeded ocean freight charges for the same skins from Jibuti to New York. Buyers of skins at Jibuti and Aden can not exceed the price limits fixed by their European and American clients, and naturally refuse to be con¬ cerned with the cost of delivery to the ports. In the opinion of the leaders of the skin trade the result of the increased freight rates will be the defeat of the very end it was calculated to effect—i. e., the increase of railroad revenues—since the overland transport will nec¬ essarily, they say, be diverted to other carriers and even to other ports. 12 The effects of hi^h railroad freight rates are felt not only in the export skin trade, but in various import lines as well. American kerosene, for example, which is sold in Aden for 61^ rupees per case of 8 imperial gallons, can not be sold at a profit in Addis Ababa for less than 14 rupees. Another case in point was a shipment of 1.5 cases of naphthalene, the cost of which loaded on the train in the port of Jibuti, French Somaliland, was a little more than doubled when unloaded in Addis Ababa, just 500 miles distant. The same difficulty applies to everything shipped into Abyssinia on this railroad from Jibuti. CONCLUSION In spite of this seemingly prohibitive restraint on Ethiopian for¬ eign trade, the steady growth of trade since the war is apparent, a fact which points to the conclusion that a very little competition in transport facilities would materially reduce costs. Improved trans¬ portation of merchandise is essential to the commercial, industrial, and agricultural progress of Ethiopia. In all probability, therefore, the establishment of new trade out¬ lets by railroad to the Italian port of Massawa, in Eritrea, or by a good road from the Harrar region by Hogeisa to the port of Berbera, in British Somaliland, would react to the advantage of the whole countiy. Improved road construction, which is already being reflected in increased automobile imports through the port of Aden, will also inevitably hasten the country’s general economic develop¬ ment. u.tj. UOVlflltNMENT 1‘IUNTINU OFIJ’ICl!;; 1927 ; \ ‘ -'VV ' • 'I- ■' ■ ^ :v, ; ? '>,^ . • ‘iff:. '‘*: ■ > * ';»«\! ,.i •-'^a >f 1 . . ■ l^.t . |> • ^/v. '■*^^: -.^v, ; .' ;>■ V .' .vU iV,,v‘'i' ' I . ■' v>'’i!/tJ..:;;M':; ■ \w •'‘\ jj;'):{• n'l.wA • S,T. .vr :! 1 ■•It.' ••' ■’ ' ' 'lPi^Vw:o-?«i»;-it;'.v...■!«♦':■*. ("•;:‘^ . ./ U'- it . . H v- •*}’, '.f¥‘ ;V'iv ; , ■h- > vn^ii :ly ^rt'H " ' •■' .,*»■ c M-W;. th'. •✓:'* ■"■ ' '■ ■<* - : '.'■ ’ ' -C'> v'/if'.^, .••.K'lttJWr.ii*. ;’. ■ : ^ i '-' Mr. -i iA ui. 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