Amhara National Regional State Parks Development and Protection Authority

Project Proposal

Development of Alternative Livelihoods for the Population of the Simen Mountains National Park, Ethiopia

Prepared in cooperation with the

ANRS Bureau for Culture and Tourism

and the

ANRS Agency for the Promotion of Micro and Small Trade and Industry Enterprises
November 2006

Contents
Table of Contents Project Data Sheet Executive Budget Acronyms 2 4 5 6

1.
1.1. 1.2. 1.3. 1.3.1. 1.3.2. 1.3.3. 1.3.4. 1.4. 1.5.

History and Background

The Simen Mountains National Park and its History Institutional Framework and Management Structure Current Problems Deforestation Cultivation Livestock Grazing Human Population and Livestock The Park Population Conclusion

7
8 10 10 10 11 11 12 13 14

2.
2.1. 2.1.1. 2.1.2. 2.2. 2.2.1. 2.2.2. 2.2.3. 2.3. 2.3.1. 2.3.2. 2.3.3.

Socio-Economic Situation
The Alternative Livelihood Options Study Socio-Economic Survey Investigation of the Business Environment in the Simen Mountains Region General Economic Assessment Macro-economic and Socio-political Context of Amhara State Regional Policies and Strategies Characteristics of the Simen Mountains Region An Alternative Livelihoods Strategy Remove the Park Population Establish New Businesses Increase Cash Flow

16
17 17 18 19 19 21 22 26 26 26 27

3.
3.1. 3.2. 3.3. 3.3.1. 3.3.2. 3.4. 3.4.1. 3.4.2. 3.4.3. 3.4.4.

Project Rationale
Justification Objectives Benefiting Groups and Benefiting Area Benefiting Groups Benefiting Area Approach and Methodology Creating Incentives Business Development Participatory Approach Gender

29
30 30 30 30 31 31 31 31 33 33

4.
4.1. 4.4.1. 4.4.2. 4.4.3. 4.2. 4.2.1.

Project Components
Project Coordination Unit Personnel Buildings Vehicles An Overview of Business Options in the Simen Mountains Region Producing Sector

35
36 36 38 40 44 48

4.2.1.1. 4.2.1.2. 4.2.1.3. 4.2.1.4. 4.2.1.5. 4.2.1.6. 4.2.2. 4.2.2.1. 4.2.2.2. 4.2.2.3. 4.2.3. 4.2.3.1.-3. 4.2.3.4. 4.2.3.5. 4.2.3.6. 4.2.3.7. 4.2.3.8. 4.2.3.9. 4.2.3.10. 4.2.3.11. 4.2.3.12. 4.2.3.13. 4.2.3.14. 4.2.3.15. 4.2.3.16. 4.2.3.17. 4.2.3.18. 4.2.4. 4.2.4.1. 4.2.4.2. 4.3.

Poultry Farms Sisal Plantation Honey Farm Apple Plantations Fruit Plantation Vegetable Farm Processing Sector Cotton Weaving Cooperative Basketry Cooperative Leatherworks Cooperative Trade and Services Sector Supermarkets for Household Items, Food & Drugs and Mixed Supermarket Fruit & Vegetable Stores Bakery Shop for Printed Matter, Office, Computer and Photo Supplies Arts and Crafts Shops Wholesale and Transport Company Construction Workers Cooperative Shower Houses Laundry Local Tour Operator in Debark Hotel in Mekane Berkhan Tourist Caf in Debark Roadside Caf in Limalimo Cultural Night Bars Traditional Music and Dance Group Simen Mountains Museum Financing Sector Simen Mountains Trust Fund Simen Mountains Soft Loans Program Park Population Removals

48 55 60 68 74 80 87 87 92 96 101 101 113 117 122 127 132 139 143 147 152 157 164 169 174 179 182 182 187 191 196

5.
5.1. 5.1.1. 5.1.2. 5.1.3. 5.2. 5.3. 5.4.

Project Implementation
Risks and Assumptions General Economic Development Acceptance Business Risks Project Management Monitoring and Evaluation Time and Activity Plan

198
199 199 199 199 200 200 201

6.
6.1. 6.2. 6.3. 6.4. 6.5. 6.6. 6.7. 6.8.

Appendices
Map of the Simen Mountains National Park and Region Map of Simen Mountains National Park and Villages Simen Mountains Region Population Figures (by Kebele) Costs of Vehicles Costs of Printed Matter Costs of Trainings By-Laws of the Grant Program By-Laws of the Soft Loans Program

202
203 204 205 206 207 208 209 214

Project Data Sheet

Submitting and Implementing Agency Amhara National Regional State Parks Development and Protection Authority P.O. Box 1317 Bahr Dar Ethiopia Tel +251 (582) 22-10-50 Fax +251 (582) 22-18-34 E-mail: padpa@ethionet.et Contact: Mr. Mulugeta Woubshet, General Manager Development of Alternative Livelihoods for the Population of the Simen Mountains National Park, Ethiopia North Gondar Zone, Amhara National Regional State, Ethiopia USD 8.708,708 The 586 households residing in Simen Mountains National Park Five Years The impoverished and rapidly growing population living in extremely remote areas of the Simen Mountains National Park is engaged in unsustainable livelihoods such as overgrazing of livestock, ploughing steep slopes and cutting of native forests for firewood. Because of their location in the park, they have no possibility to either expand the land they are using, to increase productivity or to introduce technical infrastructure. At the same time, UNESCO has mandated a significant and sustainable reduction of their number in order to remove the Park from the List of World Heritage in Danger. Thus the only long-term option for the park population is to relocate to areas outside the Park. In addition to addressing the problems of the Simen Mountains National Park itself, the newly-established businesses and related financing schemes will greatly improve the wider Simen Mountain Regions food security, cash flow, economic infrastructure and attractiveness for tourism, and will thus boost its general economic development. The overall aim of the project is to contribute to the re-building and safeguarding of the integrity of the Simen Mountains National Park. It plans to achieve this by creating pull factors attracting the parks resident population to remove to locations outside the park. The project will establish altogether 29 different private businesses and cooperatives (43 companies) through which all 586 households living in the Park can find sustainable alternative livelihoods. In addition, the project will provide for the park populations removal and new housing. The project will provide all investments, including necessary trainings, as well as start-up assistances where necessary due to the nature of the business. Furthermore, the project will provide continuing technical assistance to the fledgling businesses throughout its five-year duration. In addition, the general purchasing power in the area will be increased through the establishment of Grant and Small Loans Programs for the general population of the Simen Mountains Region. The grants and loans will be given only for activities which will contribute to the objectives of the Park and its Buffer Zone.

Name of Project Location Project Budget Beneficiaries Project Duration Problems Addressed

Project Summary

Executive Budget
Costs Totals

1. Project Coordination Unit

1.1. 1.2. 1.3. 1.4. 1.5. Personnel Buildings Office Travel Accommodation Sub-Total Project Coordination Unit 1.389.950 181.142 260.830 72.000 53.513 1.957.435

2. Business Investments
2.1. 2.1.1. 2.1.2. 2.1.3. 2.1.4. 2.1.5. 2.1.6. 2.2. 2.2.1. 2.2.2. 2.2.3. 2.3. 2.3.1. 2.3.2. 2.3.3. 2.3.4. 2.3.5. 2.3.6. 2.3.7. 2.3.8. 2.3.9. 2.3.10. 2.3.11. 2.3.12. 2.3.13. 2.3.14. 2.3.15. 2.3.16. 2.3.17. 2.3.18. 2.4. 2.4.1. 2.4.2. Production of Raw Materials Poultry Farms (3) Sisal Plantation Honey Farm Apple Plantations (2) Fruit Plantation Vegetable Farm Production of Processed Goods Cotton Weaving Cooperative Basketry Cooperative Leatherworks Cooperative Trade and Services Supermarket for Household Items (2) Supermarket for Food & Drugs Mixed Supermarket (2) Fruit & Vegetable Stores (3) Bakery Store for Office and Photo Supplies Arts and Crafts Shops (2) Wholesale + Transport Company Construction Workers Cooperative Shower Houses (5) Laundry in Debark Tour Operator in Debark Hotel in Mekhane Berkhan Tourist Caf in Debark Roadside Caf in Limalimo Cultural Night Bars (3) Traditional Music and Dance Group Simen Mountains Museum Financing Instruments Simen Mountains Trust Fund Soft Loans Program Sub-Total Business Development 1.007.403 234.951 346.631 536.878 342.207 309.168 71.431 30.454 46.757 65.168 35.520 68.546 85.332 53.807 30.046 88.284 170.474 19.125 164.155 20.079 100.772 89.998 49.304 29.686 171.114 35.793 54.792 106.166 266.223 4.630.264

3. Park Population Removals

3.1. Transport 586 households 3.2. New Housing 586 households Sub-Total Housing for Removing Households 71.118 1.635.190 1.706.308

Intermediate Total 4. Contingency

4.1. General Contingency Fund 5% of Total

8.294.007

414.701

Grand Total (USD)

8.708.708

Acronyms
ANRS AProMSTIE asl BoARD BoCult BoFED CSA EPLAUA EGS ETB GDP IDP IUCN PaDPA SMBS SMNP SWC TLU UNCDF UNDP UNESCO USD Amhara National Regional State Agency for the Promotion of Micro and Small Trade and Industry Enterprises above sea level Bureau of Agriculture and Rural Development Bureau of Culture and Tourism Bureau of Finance and Economic Development Central Statistics Authority Environmental Protection Land Administration and Use Authority Employment Generation Scheme Ethiopian Birr Gross Domestic Product Integrated Development Project (of the Austrian Development Agency) International Union for the Conservation of Nature Parks Development and Protection Authority Simen Mountains Baseline Study Simen Mountains National Park Soil and Water Conservation Tropical Livestock Unit United Nations Capital Development Fund United Nations Development Program United Nations Educational, Scientific and Cultural Organization United States Dollar

1. History and Background

1.1.

History of the Simen Mountains National Park

The Simen Mountains National Park (SMNP), which is part of the high mountain massif of northern Ethiopia with altitudes ranging from 1.900m to 4.543m asl, covers an area of 205 km and experiences temperatures between -5 C t o +18 C. The scenery is highly spectacular, composed of a vast undulating plateau dissected by deep vertical cliffs and forested rocky valleys, and dominated by the rugged peaks of the Simen Mountains, including the highest peak in Ethiopia, Ras Dejen (4,624 m), situated to the east of the park. The park is home to a number of threatened and endemic species. Of the 21 large mammal species that can be found in the park, three are locally endemic (Walia ibex) or endemic to Ethiopia (Ethiopian wolf and Gelada baboon) these are the flagship species of SMNP. The Walia ibex (Capra walie) and the Ethiopian wolf (Canis simensis; also called Simen fox) are considered critically endangered and endangered, respectively (IUCN 2006 Red List). The Walia ibex can only be found in the Simen Mountains, where its current population is estimated at 623 individuals (November 2005). The Ethiopian wolf is the rarest canid in the world, with a total population estimated at less than 500 animals (IUCN 2006 Red List). A census carried out in 2005 estimated the population in the Simen Mountains at 78 animals. Other large mammal species include the Anubis baboon, Hamadryas baboon, klipspringer, leopard and golden jackal. The mountains are also home to 5 small mammal species and 16 bird species endemic to Eritrea and/or Ethiopia as well as an important population of the rare lammergeyer. The Simen Mountains are part of the Afro-alpine centre of plant diversity and are characterized by a high but yet unquantified level of plant endemism. The SMNP was one of the first properties inscribed on the World Heritage List in 1978. The property was inscribed on the basis of its importance for biodiversity (criterion iv) and its exceptional natural beauty (criterion iii). At the time of its creation in 1969, a number of villages and important tracts of land used by the local communities were included within the boundaries of SMNP. This situation had not changed at the time of inscription of the park on the World Heritage List. In fact, the nomination document mentions that 80% of the parks territory was subjected to human use, in particular livestock grazing, agriculture and human settlement, leaving only 20% undisturbed and available for the Walia ibex. It further specifies that the plateau was over-run by domestic livestock, resulting in erosion and reduction of the habitat available for the Ethiopian wolf. It points out that the central area of the park around the village of Gich had been under excessive agricultural cultivation for a long time, leading to erosion, and that agriculture was expanding into the middle terraces, leading to deforestation of the giant heath vegetation and further reduction of the habitat available for the Walia ibex. The nomination explains that the provincial government planned the resettlement of the human inhabitants and an extension of SMNP to include more critical habitat of the Walia ibex. At the time of World Heritage nomination, the population of Walia ibex was estimated at 250 animals in the park, and a further 50 animals outside the park, while the population of Ethiopian wolf was estimated at only 20 remaining individuals. Shortly after the inscription of the park in the World Heritage List, the political conflict in the country escalated in a civil war and in 1983, the Ethiopian government (the State Party) reported that park staff was forced to abandon the property, which was occupied by rebels. There is evidence that the Walia ibex was heavily poached during this period and that part of its population moved into less poached areas to the east of the park. In 1991, at the end of the conflict, the State Party submitted a report on the state of conservation of the property, noting that while all park infrastructure had been destroyed

during the conflict, the natural resources and values of the property had not been significantly affected. Following reports on the deterioration of the Walia ibex population, UNESCO fielded a monitoring mission in November 1996. The mission noted the decline in populations of the flagship species Ethiopian wolf and Walia ibex, the continued human pressure on the park, with 60% of the park subjected to human use, over 4,500 people living in the park and a further 30,000 living in its immediate vicinity, the increased use of the remaining wildlife habitats by livestock, the expansion of agricultural fields in the park and the on-going construction of the Debark Mekhane Berkhan road through the property. On the basis of this report, the World Heritage Committee at its 20th session (Merida, 1996) decided to inscribe the property on the List of World Heritage in Danger. The inscription on the Danger List more or less coincided with a transfer in 1997 of the responsibility for the management of the site from the national level to the Amhara National Regional State Government. In 2000 the regional authorities organized a fact-finding mission in which high level officials of the Amhara Regional State Government, representatives from different government agencies and local administrations as well as experts of the Centre for Development and Environment of the University of Berne participated, to study the threats to the property and develop recommendations to address these threats. The recommendations included the creation of a steering committee to co-ordinate the conservation efforts by the different levels of administration, the realignment of the road, the realignment of park boundaries by excluding villages situated on the edge of the park and at the same time including further key habitats of Walia ibex and Ethiopian wolf, the relocation of 4 villages in the park (Gich, Islam Debir, Adarmaz and Muchila) and the development of a project to support sustainable development activities in the buffer zone. In October 2000, during a UNESCO workshop on The Role of World Heritage in Danger listing in promoting international cooperation for the conservation or World Natural Heritage organized in the framework of the World Conservation Congress in Amman, a representative of the State Party presented a paper justifying opposition to the Danger listing and requesting a monitoring mission to the property. This mission took place in April 2001 and concluded that although the Amhara Regional State Government was demonstrating a commitment to address the threats to the values and integrity of the World Heritage property, and that the situation with regard to the management of the park was improving, the results on the ground were not yet sufficient to consider the property out of danger. Upon recommendation of the mission, the World Heritage Committee adopted the following benchmarks, largely based on the recommendations of the 2000 high level mission, to guide a removal of the property from the List of World Heritage in Danger: (1) Realignment of the parks boundary to exclude the villages along the boundary; (2) Extension of the park to include at least Mesarerya and Lemalino Wildlife Reserves; (3) Significant and sustainable reduction in the human population density within the park, especially within the core area; (4) Effective conservation within the extended national park of a larger population of Walia ibex and Ethiopian wolf. Since 2001, the State Party has provided regular reports on the state of conservation of the property and progress towards achieving the above mentioned benchmarks. In February 2005, the State Party report announced that considerable progress was achieved towards 3 of the 4 benchmarks but that it was unable to achieve the benchmark referring to the reduction of the human occupation within the property. As a result of the ensuing considerations, the State Party requested international assistance from UNESCOs World Heritage Fund for developing a strategy for alternative livelihood options for the population outside of the park.

1.2.

Institutional Framework and Management Structure

In 1997, the responsibility for the management of SMNP was transferred by the Ethiopian Government from the Ethiopian Wildlife Conservation Organization to the Amhara Regional National State. Subsequently, the Amhara Regional Government established the semi-autonomous institution known as the Parks Development and Protection Authority (PaDPA), which took over the management of SMNP from the Bureau of Agriculture. The new arrangement affords the park to interact with grassroot stakeholders including neighbouring communities (Kebeles) and districts (Woredas). It has to a large degree brought in shared decision-making on park management issues. Park budgets for both development and running costs are now provided by the Amhara Regional Government. A major international donor to SMNP has been the Austrian Government, through the joint Austrian-Ethiopian Integrated Development Project (IDP), which has given substantial financial assistance to support the park and local communities. The above has streamlined administrative bureaucracy as the park warden and other park staff have a direct link with decision-makers, and there is now an improved decisionmaking process through streamlined and structured accountability and ownership among the stakeholders at all levels (from the Amhara Regional National State President to the Head of PaDPA, from PaDPA to the park warden and other park staff). This is enhanced by regulations enacted in January 2001 that attribute roles and responsibilities between PaDPA and the Amhara Bureau of Agriculture. The regulations emphasize an integrated development planning and management approach involving the neighbouring communities, districts, park administration, the Amhara Bureau of Agriculture and other stakeholders. This approach, if put into good practice, could promote a dialogue leading to the harmonious coexistence of SMNP and its neighbouring communities. However, although important progress was made, there is still a long way to achieving the objective of preserving the natural resources and values of SMNP while promoting sustainable livelihoods for the neighbouring communities, mainly because of the long history of people in the park and the still high dependence of local communities on park resources.

1.3.

Current Problems

The main impacts of the villages inside the park are related to the intensive use of its natural resources, in particular deforestation from cutting of firewood, and soil degradation from cultivation and grazing, all exacerbated by a dramatic increase in human population. 1.3.1. Deforestation In the past, deforestation has resulted in a serious degradation of natural resources in and around SMNP, leaving the area susceptible to soil erosion by water and wind. Extensive areas both within and outside SMNP are almost devoid of native woody vegetation. The degradation and its ecological impacts have forced both the Walia ibex and Ethiopian wolf to vacate some of their original ranges and to move further up into the less disturbed highlands. It seems that the spatial distribution and area coverage of forests has not changed since 1994. What has continued unchanged, however, is the overuse, especially of the highland Erica / Hypericum forests. To tackle the issue of deforestation, a ban was imposed by the National Park on felling Erica trees, and plantations of fast growing species, mainly Eucalyptus, have been put in place in the villages in and around the park.

10

Because of this, in theory, local communities are apparently no longer dependent on the native woody vegetation for fuel wood. Nevertheless, there is still some deforestation for fuel wood - in spite of heavy punishment such as imprisonment if caught -, as villagers prefer to sell the Eucalyptus as construction wood instead of using it for their fuel needs. 1.3.2. Cultivation Cultivation inside the park remains a serious concern. This form of land use is incompatible with the conservation objectives of the park and therefore will have to be phased out in the future. For the moment the park authorities are enforcing a ban on further extensions of the areas cultivated in the park, and this seems to be well respected. However, as villages in the park depend on the cultivated land for their livelihoods, it will be difficult to phase out cultivation in the short term. Soil degradation has been identified as a major problem on cultivation land inside and around the SMNP. Based on the SMBS findings it was concluded that soil erosion not only leads to diminishing soil depth and physical alteration of the soil, but also to selective removal of specific nutriments, thereby causing chemical degradation and loss of soil productivity. It was also estimated that soil erosion rates in some areas are 20 times higher than annual soil formation rates. Of special concern are highland areas where fallow cycles are a maximum of 1 year far too short for soil regeneration. Discussions held with farmers in 1994 revealed that they were aware of the problem and also had some knowledge on possible solutions. When asked why they do not construct stone or earth bunds, their usual answer was that they are too poor to do it on their own, but they would nevertheless start to construct soil and water conservation (SWC) structures in the future. Ten years later, the answers are the same and the amount of SWC structures has increased only to a very limited degree. 1.3.3. Livestock Grazing Livestock grazing is probably the most damaging resource use in the park, given the extensive area that is used for grazing, and the current overstocking. There are no recent reliable data available about the number of livestock in the park and their impact. The 1996 survey work in SMNP estimates that of the 900ha of Afro-alpine vegetation in the park (before the current and proposed extensions), 25% are heavily overgrazed and 60% are heavily grazed, leaving only 15% in a more or less natural status. Overgrazing is resulting in a deterioration of the quality of the grazing lands with an increase of unpalatable grasses. This has negative consequences for the vegetation cover and composition, and for soil preservation. Livestock is in direct competition with Walia ibex for grazing areas, confining the Walia ibex to the steeper and less accessible areas, and is also impacting on small mammal populations, which are the major food source for the Ethiopian wolf. Contact between wildlife and livestock are also increasing the risk for transmission of diseases. Of particular concern is the pressure on the grassland between 3.600m and 3.800m asl (timberline, above the climatic limit for barley cultivation) and about 4.200m. This grassland is intensely used as grazing area. A survey of the Gich plateau conducted in 1996 concludes that totally eroded and heavily overgrazed areas have doubled between 1973 and 1996. Observations made by Prof. Bernhard Nievergelt in November 2004 suggest that the area of heavy grazing or serious overgrazing has again increased since then. Instead of a mix of short and long grass, in large areas only short grass types exist anymore. Only in the most distant areas (Set Derek, Imet Gogo, Inatye), still a less disturbed vegetation pattern can be found although even these areas are used for grazing. If this grassland area should in future again serve as a habitat for herbivores such as Walya or Klipspringer or carnivores depending on grass rats, such as the

11

Ethiopian Wolf, then far-reaching measures excluding domestic animals from considerable areas must be considered. Soil erosion rates were estimated by the SMBS team to be around 85 t/ha*year in highland villages and 65 t/ha*year in lowland villages. It must be expected that no major change has taken place during the last ten years. This would mean that in the highlands the soil depth was reduced by almost 8 cm and in the lowlands by 5 cm. Considering the low soil formation rates of 3-12 t/ha* year, depending on altitude, the destructive process of soil erosion becomes even more apparent. Although the use of manure and compost is promoted, and more artificial fertilizer is available than 10 years ago, soil productivity still declines, as soil erosion continues almost uncontrolled, nutrient mining takes place unchecked, manure is collected as a substitute for fuel wood, and fallow periods are shortened. It is alarming to see how little investments in soil conservation and soil productivity improvements have been made in some areas, despite available technologies and the general awareness regarding the seriousness of the problem within parts of the administration. On the other hand, in some villages considerable efforts have been undertaken with regard to initiating SWC. Besides offering various technologies, currently used approaches for SWC implementation are awareness creation, mass mobilisation, or activities within the Employment Generation Scheme (EGS). Furthermore, more flexibility is envisaged by considering small-scale site-specific needs of the land and the land users before recommending SWC measures to be implemented. 1.3.4. Human Population and Livestock Especially for highland villages, where crop production reaches its limits because of altitude and land degradation, relying more on livestock for securing the household income becomes a strategy of growing importance. Although many people recognize that the grazing land on the Gich plateau is heavily overgrazed, they nevertheless aspire to increase their herd size. During a count on one evening of all animals returning to Gich from the Saha Imet Gogo area, a total of 1,200 animals - cattle, equines, sheep has been counted, equalling roughly 600 Tropical Livestock Units (TLU), representing about 60% of the total livestock number reported for Gich. The grasslands not including forests, which are also used for grazing, or the cropland stretching from Gidr Got to Imet Gogo covers about 9 km. With the total livestock number of Gich estimated at 1,000 TLU, the number of TLU is more than 1 per ha. For highland areas, a maximum stocking density of only 0,5 TLU is recommended. Overstocking on the Gich plateau is thus a very serious problem. For the village of Gich, the annual population growth rate between 1994 and 2004 is calculated at 2% - unchanged to the one calculated for the previous period from 1975 1994. An annual growth rate of 2% leads to a doubling of the population about every 35 years. As alternatives to farming are very few even the tourism sector offers only few additional income sources as it is not large or stable enough to fully rely on it it must be expected that the majority of the population will continue to depend on the agricultural sector, thus further aggravating land degradation and pressure on remaining wildlife habitats. With increasing numbers of households, the total number of livestock is likely to increase as well, although the number of animals per household is likely to decrease. The number of oxen, for example, in Gich has slightly decreased from 140 to 135, although the number of households has increased from 222 to about 320, reducing the average number of oxen per household from 0.63 to 0.49. As crop yields are nowhere sufficient anymore to sustain a household for one year, more animals have to be sold to meet

12

immediate household needs. Farmers reported that deficits have become so big that since recently more and more heifers and steers have to be sold to raise sufficient cash for meeting household demands. Socio-economic problems related to such a high human pressure on available natural resources become visible by the extremely high dependency of several villages on outside assistance. Taking the village of Argin as an example, in 2002/03 80kg of maize and wheat per household were distributed in a food-for-work campaign this would be about the amount a family of 6 would need in 1,5 months. Gich needs food aid for even 5-6 months. Such dependencies on outside assistance are very dramatic and a clear indicator of the unsustainability of the present livelihood.

1.4.

The Park Population

The issue of people living inside the park dates back to the time of its creation, as several villages and land used for agriculture and livestock grazing were included in the protected area. This problem remained unresolved at the time of the inscription of SMNP on the World Heritage List in 1978. In fact, the nomination mentions that the provincial authorities were committed to resettle the villages situated in the park to address this threat. This proposed resettlement has not been completed, however, because of the lack of alternative livelihood options and space elsewhere and, hence, the unwillingness of the villagers to move. There are no accurate estimates on how many people were included in the park at its creation in 1969. However it is clear that substantially more than half of the parks territory was under human use at the time of its inscription in the World Heritage List in 1978. One year later, 7 villages were relocated from the northern slopes of the escarpment, reducing the extent of human use to 33% of the park surface (4,000 ha for grazing and 2,000 ha for cultivation). This forced resettlement resulted in tensions between the local communities and the park management authorities. Based on a 1994 population census, the number of people living within the park was estimated at 11,000, whilst a 1996 IUCN report quotes 30,000 people living in the park area and depending on the use of its natural resources and 4,500 people living inside the park. The 1994 Simen Mountains Baseline Study conducted by the University of Berne concluded that 3,286 ha in the park were under cultivation. The realignment of the park boundary (see benchmark 1) resulted in the exclusion of numerous villages from the park and, thus, in an important reduction in the number of people living in the park. According to a rapid assessment carried out in October 2005, 582 households were found living in the park (amounting to 3.173 people), whilst 1.477 households living in its immediate vicinity are cultivating plots inside the park. The total area under cultivation in the park was estimated at 2.281 ha. This leaves however still a significant population inside the new park boundaries, most notably the village of Gich, which is situated in the middle of the core area and accounts for about half of the remaining households in the park. In 2003 the park authorities organized a number of meetings with village representatives to discuss voluntary resettlement to a site identified in the lowland, some 300 km away from the park in West Gondar. However, the inhabitants of Gich village categorically refused the proposed resettlement. A forced relocation would lead to renewed conflicts with the local communities and is difficult to defend because the villages were already established when the park was created.

13

1.5.

Conclusion

In view of all the factors and dynamics discussed above, two tendencies can be observed which exacerbate each other: A sharply declining resource base is available for a sharply increasing population. Few options remain. Increase of utilized land base Appropriating more land for production would allow to use the land more sustainably while maintaining the product output. However, this is impossible because of 1) the status of the land as a National Park and 2) the natural terrain. No additional land can be found which could be considered for agricultural purposes. Reduction of area under cultivation In order to return to a sustainable use of natural resources in the park, theoretically the population would have to reduce the land under cultivation and either appropriate more land for grazing or reduce the number of livestock. Because of the limited land base available, extreme poverty and food insecurity, however, to reduce the land under cultivation is possible only when increasing the number of livestock, which is not an option. Reduction of number of livestock To reduce the number of livestock is possible only by intensifying animal husbandry through additional feed and forage. However, firstly, the grasses or hay to provide such fodder are simply not available (on the contrary - the vegetation cover is declining), and secondly, a more intensified animal husbandry would require technical infrastructure incompatible with national park regulations. Reduction of population A significantly smaller number of people living inside the Park would open up opportunities for soil reclamation and conservation as well as for introducing sustainable ways of land use. However, even supposed that part of the present population would be willing to move away and greatest efforts would be taken to reduce soil degradation and pressure on the land, the continuing population dynamics will render all such efforts meaningless within a decade or so, and the problems would present themselves only with more urgency and less options for a way out. Any state policy trying to bring the population increase to a halt will take decades to succeed unless it will conflict with human rights, and in any case, a regulation limiting the number of people allowed to live in the Park would be next to impossible to enforce. More realistically, it must be expected that the situation of the park population will deteriorate dramatically over the next ten years, leading to sharpened conflicts with the administration of the park over the use of its natural resources. As a result, by logic there is no hope for the park population to continue their present way of life for any lengthier period of time. The only option through which a) the long-term livelihoods of the park population can be ensured, b) the degradation of the natural resources of the park can be halted or reversed and c) the population of the park can be significantly reduced (fulfilling the third benchmark set by UNESCO for its removal from the List of World Heritage in Danger) is to cooperate with the park population in their voluntary removal from the park, encouraged by providing them with new housing and alternative and acceptable livelihoods in the wider Simen Mountains Region.

14

The government of ANRS is well aware of this problem and has conducted a study to identify alternative livelihood options for the park population and, based on this, demonstrate concrete and realistic options on how to address this issue in the medium term. The approach and results of this study are explained in further detail in the following section and constitute the basis for this proposal.

This section has made extensive use of the following literature: Ludi, Eva 2005 Simen Mountains Study 2004. Intermediate Report on the 2004 Field Expedition to the Simen Mountains in Northern Ethiopia. Dialogue Series. Berne, NCCR North-South. Joint Monitoring Mission Report: Reactive Monitoring Mission to Simien Mountains National Park, Ethiopia, 10 17 May 2006. UNESCO / World Heritage Centre / IUCN. Paris / Gland

UNESCO / IUCN

15

2. Socio-Economic Situation

16

2.1.

The Alternative Livelihoods Options Study

2.1.1. Socio-Economic Survey In order to determine potentially viable business options for the population of the SMNP, an in-depth investigation was carried out by a team of three officials of PaDPA, the BoCulT and the BoSTIP on the general economic environment of the Simen Mountains Region as well as the capacities and priorities of the population of SMNP. The investigation included the following activities: 1. Reviewing secondary literature on the general economic situation, potentials and constraints of the Simen Mountains Region. 2. Assessing and reviewing the economic activities and the socio-economic characteristics, problems, needs, potentials, plans and priorities of SMNP residents in the small business sector. 3. Studying other projects presently being implemented in the region in order to draw inspirations, to avoid duplications and to build on existing achievements. 1. A number of secondary literature (existing plans, reports and studies) were reviewed which could provide an outlook and serve as basic, theoretical and practical guidelines for the study. The team studied the following relevant documents. Building on Progress: A Plan to Accelerate Sustainable Development and End Poverty (PASDEP); From 2005/06 - 2009/10); Federal Government of Ethiopia; Enterprise registration list of North Gondar Zone; from AProMSTIE; SMNP management plan Reconciling Conservation With Sustainable Development, Hans Hurni and Eva Ludi, 2000, University of Berne Project Proposal for Relief through Cash by Save the Children UK. The study of these documents was helpful to design the content, methodology and detailed schedules of the investigation before embarking to the field survey. They provided necessary data and information regarding demographic, socio-economic activities and potentials. Secondary information was collected first at regional level and then proceeded to Zone, Woreda, and Kebele levels with increasing detail. In addition to the literature, discussions were also held with the three Woreda Administrations, Kebele leaders & Development Workers, scouts of the SMNP and representatives of the Park communities in order to prepare the fieldwork. The main objective of these discussions and/or briefings was to obtain their views, to exchange ideas about the quality and success of the work, and to stress their critical role and responsibility for achieving the objectives of the study before sending enumerators to the target areas for implementing the field survey and collecting relevant information. 2. Primary data were obtained through a comprehensive field survey covering all Park households. They provided first hand information on the park populations characteristics, and social, economic, tourisms and natural features of the niches in which small scale business can flourish. The data were obtained through the following questionnaires: A. Woreda Questionnaire: to collect information from City and Woreda administrations, various sector offices, cooperatives, associations and private enterprises, related to the general characteristics and situations of the Woreda, existing and potential economic activities such as agriculture, irrigation, livestock, cottage industries, small enterprises and other employments, as well as facilities such as marketing and credit institutions. The Woreda Questionnaires were completed at the Woreda centers through discussions with responsible officials and by visiting various institutions.

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B. Kebele Questionnaire: developed to collect specific information from key informants of each targeted Kebele/village. The information to be collected includes Kebele-specific characteristics, potentials and priorities such as agricultural and non-agricultural functions and facilities. The Kebele questionnaires were completed through discussions with key informants from the Kebeles who were invited to the Woreda centers for discussions after consultation with Woreda officials. C. Household Questionnaire: A 17-page questionnaire including 50 questions (each with sub-questions) was designed to collect information from the 586 households within the SMNP. The questionnaire covers the following subjects: - General household characteristics - Agriculture - Off-/non-farming activities - Trainings - Saving and credits - Marketing - Food supply The household questionnaires were completed by a group of 13 data collectors dispatched to the villages in small groups for several days. D. Checklist for Focus Group: was used to discuss and collect information from various community members. The focus group discussions were facilitated by the study team members, and the major points of each local community which need attention were identified and analyzed. The focus groups consisted of 6 - 10 members of each Kebele. The field survey further helped to map the various villages and hamlets and provide reliable information about their location vs. the Park boundary. As a result of the survey, it was found that only 586 households remain inside the Park after its re-demarcation instead of 722 as previously assumed. 3. The two major projects implemented in the region were studied thoroughly: the SMNP Integrated Development Project (ADA) the North Gondar Zone Local Development Project (UNCDF) Several meetings held with representatives of these two projects, and the project documents studied in order to avoid a duplication of efforts and to create synergies as much as possible As a result, tourism development in the SMNP and the dairy sector were excluded from this proposal because extensive activities in this field are carried out by ADAs IDP. At the same time, it was found that there exists a good basis for the intensification of the agricultural sector since IDP is providing trainings and establishing demonstration projects in this field. The project proposal received further important information and inspirations from GTZs Sustainable Use of Natural Resources Project (SUN) in Amhara, and from the German Foundation for World Populations cooperation with Farm Africa. 2.1.2. Investigation of the Business Environment in the Simen Mountains Region In addition to determining the potentials of the Simen Mountains Region and the population of the SMNP, available information on the existing businesses and employments between Gondar and the Simen Mountains Region was collected and analyzed. The key questions to be investigated were the following: What is the number of businesses in the Simen Mountains Region? What are the kinds of businesses in the Simen Mountains Region? What are sizes of businesses in the Simen Mountains Region? How are the businesses distributed over the region? What kind of demands do they meet?

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The information providing the basis for this analysis was obtained through various methods: The list of registered and licensed enterprises of the Small Scale Trade and Industry Promotion Agency was evaluated. Town walks to identify and list existing shops were conducted in Debark, Adiarkay and partially in Gondar. An inventory of goods which can be bought in Debark was compiled. The answers to these questions were used to serve as a guideline and provide important clues for the selection and distribution of the new businesses which are proposed in this project in a way that they would have a maximum chance of success. Obviously it is only the customer who will finally decide about the success of a business. However, through identifying economic niches the project did its utmost to minimize entrepreneurial risks.

2.2.

General Economic Assessment

2.2.1. Macro-economic and Socio-political Context of Amhara State The Amhara National Regional State (ANRS) covers a total area of 161,828 km2, out of which 53% is covered by cultivated land, grazing land and woody vegetation. The average land holding of a household is 1 to 1.5 ha, usually divided in 3 to 4 plots. The region is characterized by a high rate of population growth. The total population of the region, which was about 14.2 million in 1994 (1988 E.C.), has grown to 17.7 million in 2000 (1994 E.C.). According to CSA (2002) the average annual growth rate of the region is 3% and 4.5% in rural and urban areas respectively, which is far beyond the carrying capacity of the economy. The North Gondar Zone stands first in terms of population size (estimated to be 2.9 million) in the Amhara region (CSA 2002). About 27% of the population lives under conditions of extreme food poverty with less than 1,650 calories per adult per day. Food poverty is 52% in rural areas, where the overwhelming proportion of the Ethiopian population lives (BoFED 2002). Food insecurity is a major phenomenon of rural areas in the region. The average annual per capita income of the region is 1.088 ETB. The socio-economic situation of the project Woredas indicate that the poverty has been intensifying over the years, and its causes and consequences are much beyond simple input - output relations in production and consumption. The agricultural sector cannot meet the food demands of the rapidly increasing population as a result of its low productivity. The population of cattle, sheep, equines and poultry is high in the region in general and in the highlands in particular. Farmers have large numbers of low productive animals, however - the numbers of livestock and the feed resources often do not match. The major source of feed is natural grazing in communal lands, teff, barley and wheat straw supplemented with crop residues. Poultry is kept at a low level for egg production, home consumption and as a source of household cash. The use of improved animals and feed is marginal in the region. Unsustainable use of natural resources in terms of deforestation, overgrazing and ploughing on steep slopes has caused soil erosion and land degradation, which are serious threats to agricultural productivity. The ever-growing population together with the traditional land management system exert heavy pressure on the existing natural resources. Though the region has a rich bio-diversity, the fragile nature of the ecosystem in general calls for urgent protection. There is a high rate of deforestation to meet the growing demand for fuel wood, construction and expansion for farming.

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Biomass is the main energy source of the households in the Amhara Region. A study undertaken by the Bureau of Agriculture and Rural Development (BoARD) in 56 Woredas of the Region in 2003 revealed that wood, dung, branches, leaves and twigs are the major traditional fuels (in this order of priority). From the total sampled households in the 56 Woredas only 0.2% have access to light from electricity. It is also known that about 93% of the households own open fire (three stone) stoves, which have recorded very low efficiency. Traditional enclosed and modern enclosed stove users were 3% and 0.2%, respectively. Only 20.7% of the households were found to be aware of the existence of improved stoves that could save fuel in the 56 Woredas. In the region, industry is found to be at a very low level of development and hence cannot complement the agricultural sector in output production and employment creation. The contribution of industry to GDP and employment opportunity is 21.3% and 4.7%, respectively (BoFED 2003). Economic diversification of the ANRS is crucial for development as the available farmland is insufficient to satisfy household income. As the population is increasing, it is necessary to develop non-farm income to absorb people who cannot make their livelihoods from farming. Economic diversification requires skill, capital and market among others, and yet, these resources are scarce as the region is characterized by low infrastructure development. The other important area of economic diversification is the emergence and strengthening of cooperatives. Most of the service cooperatives as well as urban saving and credit cooperatives were organized 25 years ago. However, the organisation of these cooperatives was not in line with the international principles of cooperative formation such as freedom of any external influence, internal autonomy etc. As a result, efforts are being made to restructure and register these cooperatives based on international cooperative principles. These cooperatives, which are being restructured, are diverse. They engage in different activities; the main being input supply and agricultural marketing. They play an important role in agricultural development through providing packages of inputs, marketing and credit services. Dairy processing and marketing, incense marketing and irrigation cooperatives are emerging in many parts of the region. The development and expansion of the road network is vital for technological infrastructure, market development and modernization. Despite the significant role of infrastructure in the development of the region, road construction and maintenance have been neglected for so long that the existing road network is far from satisfying the transport needs of the population. The total road network of the region is about 5,358 km, out of which 45% account for major roads and 55% are rural roads. The road density of the region per 1.000 people is 0,32 km2 and 33,07 km per 1.000 km2. Therefore the density and distribution of the all-weather roads network in Amhara National Regional State is inadequate as compared to both area and population. Women constitute half of the population and labour force with their three distinctively important roles (productive, reproductive and community), working 16-18 hours per day. However, they have low access to and control over resources and benefits, as well as little voice in decision-making within the household, the community and the society at large. As a result, they are maintaining a subordinate position in all aspects of life. A high illiteracy rate as well as a lack of physical infrastructure such as telecommunication, electricity, roads and means of transportation are the main constraints for communication between communities, organizations, and various levels of local and central government. The estimated literacy rate for ANRS is 17.7% with the urban population having better literacy rates than rural dwellers and males having better literacy rates than females.

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2.2.2. Regional Policies and Strategies Food Security Program

The objectives of the Amhara Region Food Security Programme Coordination Office are: Improve production and productivity of rural households Develop the contribution of the livestock sector in food security Expand and strengthen water harvesting and irrigation schemes Implement sustainable land-use practices Build human and institutional capacity Improve provision of adequate and potable water Promote and expand rural credit services Facilitate and expand rural market services Expand and strengthen off-farm employment opportunities Implement resettlement programme. Employment Generation Schemes (EGS) constitute also an important food security strategy in the region. They provide food assistance to the needy members of the population enabling communities to participate and benefit from development activities. They also provide income generation opportunities for families with food shortage while making communities less vulnerable to the effects of drought and famine by concentrating on mitigation measures, which include road construction, soil and water conservation, water harvesting techniques, tree planting and other associated operations. Environmental Protection

The Land Use Policy was issued in 2000 along with a proclamation to determine the administration and use of the rural lands in the region. In order to implement the regional conservation strategy and the land use policy, the region has established the Regional Environmental Protection, Land Administration and Use Authority (EPLAUA) with a principal objective of creating a conducive environment in which the use of rural lands could be appropriately managed and administered under the Federal and Regional Constitutions. Development of Micro and Small Enterprises

The ANRS places a very high priority on the development of Micro and Small Enterprises (MSE), as reflected in the fact that a separate Bureau (equivalent to a regional ministry) has been established in order to promote them. Priority sectors to be developed are o Agroindustry o Textile and Cottage Industries o Handicrafts o Construction In particular, the MSE development promotes trainings and the introduction of new technologies. Tourism Development Strategy

The ANRS has adopted a five-year Strategic Plan for Culture and Tourism (2005 - 2009) which lists the following six main fields of activities: o Capacity-building to increase the contribution of culture and tourism to the regional economy; o Provide a conducive environment for the development of cultural centers and sectors for protecting and promoting the culture and traditions of the region; o Improve the quality of tourist services and expand their coverage;

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o o o

Develop an information system for tourism and culture and improve the collection and analysis of data; Eliminate bad traditional habits through mobilizing the community; Mobilize communities to protect, manage and properly use cultural values, natural heritage and attractions.

Over the five years of the plan, the ANRS has allocated the amount of almost 90 Million ETB (ca. 10,58 Mio. USD) for its implementation. According to this plan, the Simen Mountains National Park and Region is one of the four major tourist areas of ANRS, with a fifth one to be developed. 2.2.3. Characteristics of the Simen Mountains Region North Gondar, one of the eleven zones of the ANRS, covers 62,020 km and is one of the largest zones in the region. The zone has 18 Woredas, with a significant area in high altitudes. The topography of the zone is mostly extremely rugged with deep gorges, very steep slopes, dissected plateaus and very dramatic escarpments that make the area significant as a tourist attraction. The Simen Mountains Region, located in the three Woredas of Debark, Adiarkay and Janamora, encompasses 17 Kebele Administrations (KA) (as per the new re-demarcation). The total population residing in the 17 Kebele is estimated to be about 16.964 households with a total population of 84.801, including the new park extension area (IDP, 2004). The population living inside the park, which was estimated to be about 5,000 (2002), has now increased by 22.5% in two years time. This indicates that the population of the area is growing alarmingly. The region can be differentiated into four distinctive geomorphic units (Hurni 1986): (a) the deeply incised lowland valleys below 2.000m asl, (b) the lowland terrace-like steps (roughly at 2.000m asl), which comprise the main cultivation and settlement belt in the area, (c) the steep escarpment between 2.000 and 4.000m asl, extending in a SW-NE direction, which forms the main wildlife habitat; and (d) the highland plains and valleys south of the escarpment, a densely settled and cultivated area. Agriculture and Animal Husbandry

A characteristic of the farming system in the Simen Mountains is the integration of livestock and crop cultivation. In order to meet all the different household needs, a household needs a balanced herd composition, including cattle, sheep or goats and transport animals. However, a growing number of households has no animals at all for Gich, a village in the center of the Park, the percentage of households without any animals is estimated at about 15%. The main criterion for wealth differentiation is the number of livestock, as during the land distribution land was distributed according to family size. In Wezahila, one of the four hamlets of Gich village, households are considered rich if they have 2 oxen, 2-4 cows, 3 horses, mules or donkeys and as many as 30 sheep. Poor households are those with at least a few sheep, some might even have a horse or a donkey. The very poor or destitute households are those without any animals. Often, such households are female-headed or are short on manpower/labour force. Households without any animals are in a downward spiral of impoverishment. They were forced to sell their livestock one by one in order to meet other household needs. Very often these poor households have to lease out their land to other farmers in return for 50% of the yield.

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For Wezahila, the distribution of oxen and equines (horses, mules, donkeys) is as follows: 10 households have 2 oxen (14.3%) 4 households have 4 equines (5.7%) 21 households have 1 ox (30%) 6 households have 3 equines (8.6%) 39 households have 0 ox (55.7%) 10 households have 2 equines (14.3%) 18 households have 1 equine (25.7%) 32 households have 0 equine (45.7%). This shows that in Wezahila the vast majority of households have less than two oxen and less than two equines, and about half of all households have no oxen or equine at all, indicating the level of poverty. Trade and Services

Number and distribution of businesses In the six Woredas of the target area, a total of 6796 business were registered in 2006. Table 1 shows that by far the highest number is found in Gondar with 5.205 businesses, representing 76% of all businesses in the region. The other Woredas are insignificant; only Debark and Adiarkay play a relative role due to their central role for wide geographic areas. Table 1: Number and distribution of small businesses in the Simen Mountains Region No. 1 2 3 4 5 6 Area Gondar Town Wegera Woreda Dabat Debark AdiArkai Janamora Total Number of businesses 5205 240 237 592 424 98 6796 Percentage 76 3.5 3.4 8.7 6.2 1.4

Diversity of businesses Table 2 shows that business activities in the region are concentrated on very few activities, with retail trade occupying 61 % of the total and dominating in each of the six Woredas. Service businesses constitute 33% of the total business activities whereas the number of entrepreneurs engaged in production or processing of raw materials is significantly low or negligible. Out of the 44 business activities listed under the retail trade category, the overwhelming majority of them specialize on four types of goods: consumables (including supermarkets) (40,52%), grain (13,93%), clothes (7,36%) and garments (4,0%). Table 2: Diversity of businesses in the Simen Mountains Region Target area Business category Retail Services Production trading and Processing 3036 1868 291 202 38 0 163 68 6 409 170 11 290 131 3 83 15 0 4183 2290 311 Not specified Total

Gondar town Wegera Dabat Debark Adiarkai Janamora Total

10 0 0 1 0 0 11

5205 240 237 591 424 98 6795

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Equally, in the service sector transport businesses (goods, taxis, public buses), hospitality (bars, cafes and restaurants), and grain mills take shares of 22,22%, 24,97% and 10,39% of the sector respectively. These three types of services amount to 58.12% of the total sector. In the production and processing sector, the market is again dominated by only two different types of businesses: furnitures and edible oils. The example of the town of Debark, which is the administrative and economic center for most of the Park population, exhibits a big and growing number of petty traders (small kiosks) and small shops or open-market stands with a very limited set of goods on offer. The selection of packed foods is limited to the cheapest and most common, and fruit are virtually unavailable. There are no shops for either office supplies or for electrical appliances. Technical services such as repairs or laundry are not available. Although Debark is the gateway to the SMNP, there are no facilities for tourists - no cultural facilities, arts and crafts shops, tour operators, and even no hotels of a minimal standard acceptable for international visitors. In contrast to the unequal distribution of types of businesses, there is a proportional representation of all businesses across the Woredas of the target area. Table 3: Percentage distribution of major business activities; by Woreda
Major business occupation types A. Retail Trade 1. Consumable item trader Small consumables Supermarkets 2. Grain trade 3. Ready-made clothes 4. Garments B. Service providers Transporters Bars Cafes and Restaurants Grinding Mills C. Production and Processing Furniture (incl. metal workshops) Edible oils Target area Gondar Wegera Dabat 42.26 33.47 8.79 11.17 10.8 5.83 26.82 11.4 10.49 7.87 69.07 11.68 31.19 31.19 0 30.2 0.5 6.44 0 13.6 2.63 42.11 0 0 31.29 16.56 14.72 20.25 3.07 6.75 1.47 27.94 20.59 25 50 33.3 Total Debark Adiarkay Janamora 35.45 28.12 7.33 16.87 6.85 6.85 3.53 18.82 17.06 11.76 81.82 0 42.07 37.24 37.59 24.83 3.07 6.75 0.76 3.82 16.79 22.14 0 0 31.19 31.19 0 30.2 0.5 6.44 0 6.67 6.67 60 0 0 40.52 32.49 8.03 13.94 8.94 6.67 22.23 13.49 11.48 10.39 68.49 23.15

Size of businesses The number and distribution of businesses alone do not provide sufficient information about the actual economic significance of those businesses. A more reliable picture only emerges when their size is taken into account, measured here by the amount of investment. Table 4 shows that the overwhelming majority of businesses - 5577 or 82,06% of 6796 - are in the range of very low investment costs (up to 10.000 ETB), and 4.000 businesses are even below 3.000 ETB, representing family-based micro-businesses characterized by selfemployment or employment of unpaid family or unskilled labour with no specific work relations. This makes very clear that the level of the private economy in the region is exceedingly low, mainly due to a lack of investment capital. For this reason, businesses which require a higher capital investment for buildings or machinery such as hotels, transport companies, intensive agriculture or processing, are underrepresented in the economy of the region. The lack of medium-sized businesses again explains why there is virtually no accumulation of capital and thus no reinvestment and no economic development in the region.

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Table 4: Capital investment for small businesses, by business categories

No. Investment cost (in ETB) 1 2 3 4 5 6 7 8 9 10 300 - 1000 1,001 3,000 3,001 5,000 5,001 10,000 10,001 20,000 20,001 50,000 50,001 100,000 100,001 500,000 500,001 and above Unstated budget Total Category Retail Services trade 388 109 2638 788 586 262 318 263 179 244 68 314 11 229 10 48 1 6 4 4 3041 1862 Production and processing 2 76 81 64 24 18 33 9 5 0 292 Total number Unspecified of businesses 1 500 3 3505 0 926 1 646 0 447 0 400 1 274 0 67 0 12 8 16 10 6796

Tourism

The Simen Mountains National Park has a huge but largely untapped tourism potential. Its spectacular landscape can be compared only to very few similar places in the world such as the Grand Canyon (USA), which has more than one million visitors per year. However, unlike such places it is virtually unknown in the world, and efforts must be made to establish the SMNP among the top natural destinations in the world. The SMNP also benefits from the fact that it is located on the Historic Route including other World Heritage Sites such as Gondar, Axum und Lalibela which are the prime tourist destinations of the country and visited by probably around 90% of all tourists coming to Ethiopia. Over the years, services provided to tourists in SMNP have been improved, and the number of people employed in the tourism sector has increased. Revenues to local people - guides, cooks, mule-owners, etc. are estimated for 2003/04 to be more than 500.000 ETB. Infrastructure development, however, has not kept pace with this growth. Hotel accommodation in Debark is still very limited and of low quality a high-standard lodge at the park boundary is under construction now and will be opened in the near future. There are no shops or restaurants/cafes catering particularly to the needs of tourists, and no facilities exist for public education, cultural events or entertainment of visitors either. In summary, there is practically no tourist infrastructure in Debark and the park itself, and thus the overall revenues from tourism remain very far below their potential. Table 5: Expected Number of Visitors of SMNP (according to PaDPA counts/estimates) Year 2002 2003 2004 2005 2006 2007 2008 2009 Visitors (real/expected) 3.489 3.769 5.074 6.090 7.359 10.000 14.000 18.800 per day (210 days season) 16,61 17,95 24,16 29,00 35,04 47,62 66,67 89,52

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Still, since 2000 tourist numbers have steadily increased. Although the annual growth rate has declined from around 40% (00/01 to 01/02) to 8% from 2002/03 to 2003/04, it has surged again since then and can be expected to grow further, especially since a growing number of tourists can now be observed also in the rainy season. Obviously, however, tourism development in the Simen Mountains National Park will also depend on general political and tourism development in Ethiopia as a whole. From this perspective, it is very encouraging that governments on both the national and the state levels place a high priority on this sector. Assuming that the maximum number of visitors which the park could sustain per day is no less than 200, there is a large potential of growth well beyond the year 2009. This implies an equally high potential of growth in tourist infrastructure such as hotels, transportation, shops, food supply and services.

2.3. An Alternative Livelihoods Strategy

The investigation of the economic environment of Amhara National Regional State in general and the Simen Mountains Region in particular, as elaborated above, leads to the adoption of the following Alternative Livelihoods Strategy for the population of the Simen Mountains National Park: 2.3.1. Remove the Park Population Acknowledging that present livelihoods in the Park are not sustainable in the long-term, and there are no alternative options within the Park, there is no alternative to attracting the population out of the Park by offering new livelihoods. This will be a be a process which will continue over a period of several years, starting with those villages and sectors of the population which are most willing to relocate (probably small villages and young men), creating positive examples and an effect of a pull factor on the less willing, and reducing the social cohesion of the villages until those who are unwilling to relocate will eventually realize that their numbers are too small to keep up viable villages. At the same time, the most senior elders and one of their children (with their core families) should be allowed to remain in the Park until the end of their lives. Children will have to move out when elders die. Since a significant number of the Park population is illiterate or has only insufficient basic education, additional efforts should be undertaken in order to improve their education in order to improve their job chances and thus facilitate out-migration. In some cases - such as possibly Limalimo - the population can possibly continue to live in their present village and only shift livelihoods from agriculture to types of income which do not involve land use. For a few families who are involved in Park activities and tourism, there may even be a necessity to continue to live inside the Park. It should be made sure, however, that such families will keep only a very small number of livestock for their own consumption. 2.3.2. Establish New Businesses A strategy for developing alternative livelihoods for the population of the Simen Mountains National Park must be based on the following facts and considerations: The economic life of the region is at an extremely low level. There is virtually no investment capital available.

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The purchasing power in the region is minimal, reduced to only the most essential goods. Outside the towns, the overwhelming majority of the population lives on a subsistence basis way below the line of absolute poverty. Businesses are mostly extremely small, and profit margins are so small that no capital can be accumulated for (re-)investment. As a result, there is an economic standstill unless for investments from outside the region. The Park population has a background and history of extremely remote mountain villagers living on a subsistence basis from animal husbandry and agriculture, supplemented by handicrafts and some tourism-related activities for household cash. A resettlement of the Park population as farmers based on household economies would require making available a total land area of about 586 ha, calculating that the minimum land base per household is 1 ha. This amount of land is not available in the region, and the Park population has consistently refused to resettle in the lowland areas further away from the region. For these reasons, only the following types of new livelihoods can be established: Agricultural plantations based on intensified land use and hired labour Labour-intensive processing of agricultural goods Small urban trade and service businesses Tourism-related goods and services enterprises Financing businesses. Such businesses must meet the following requirements: Goods produced and services offered must either be in the lowest price range or target the growing number of foreign visitors. Businesses must offer as much as possible jobs for unskilled and mostly illiterate labourers with a rural background. In the face of a shortage of land available, businesses must use only a minimum of land or significantly improve the lands productivity, or be of paramount importance for the development of the region as a whole. In addition, the newly-established businesses should have an innovative character and contribute to the general economic development of the region, in particular to the following: Intensification of land use (increasing productivity) Diversification of goods and services available in the region Tourism development Cultural life Increase attractiveness of urban livelihoods Creating synergies with other businesses in order to spur economic development. 2.3.3. Increase Cash Flow In order to raise the chances of success for the newly-established businesses, the general purchasing power in the region must be increased. For this purpose, it is vital that cash must be injected into the local economy. Since there is no capital available on the local level, it must be brought in from outside, and two sources of outside capital are tapped as part of this strategy which will directly increase local purchasing power: 1) The local expenditure of foreign tourists will be increased through offering new services (cafs, tour operator, laundry, night bar, print media) and an increase of Park entrance fees. 2) A Trust Fund and a Small Loans Program will be set up which will extend grants and loans to the local population and their organizations, using in part revenues from the Park operation. The funds obtained through these micro-financing institutions will be spent for welcome small investments and thus be fed into the local cash flow.

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Literature ANRS BoCulT 2005 Strategic Plan for Tourism and Culture. Amhara National Regional State Park Bureau of Culture and Tourism. Bahr Dar ANRS BoFED 2004 Rural Households Socio-Economic Baseline Survey of 50 Woredas in Amhara Region. Bureau of Finance and Economic Development. Bahr Dar ANRS PaDPA (n.d.) SImen Mountains National Park Integrated Development Project October 2005 March 2007 Amhara National Regional State Park Development and Protection Authority. Bahr Dar Hurni, H 1986 Management Plan Simen Mountains National Park and Surrounding Rural Area. Ministry of Agriculture, Natural Resources Conservation and Development Main Department, Wildlife Conservation Organization, UNESCO. Ethiopia

Hurni, H. and E. Ludi Reconciling Conservation with Sustainable Development. Centre for 2000 Development and Environment, Berne Ludi, Eva 2005 Simen Mountains Study 2004. Intermediate Report on the 2004 Field Expedition to the Simen Mountains in Northern Ethiopia. Dialogue Series. Berne, NCCR North-South.

UNDP UNCDF 2005 Local Development Project North Gondar Zone, Amhara National Regional State. Project Document. Addis Ababa

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3. Project Rationale

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3.1.

Justification

The impoverished but rapidly growing population living in extremely remote areas of the Simen Mountains National Park is engaged in unsustainable livelihoods such as overgrazing of livestock, ploughing steep slopes and cutting native forests for firewood. Because of their location in the park, they have no possibility to either expand the land they are using, to increase agricultural productivity or to introduce technical infrastructure. At the same time, UNESCO has mandated a significant and sustainable reduction of their number in order to remove the Park from the List of World Heritage in Danger. Thus the only long-term option for the park population is to relocate to areas outside the Park. Because villages which are now inside the Simen Mountains National Park have been in existence when the park was established, and at that time they had no opportunity to voice their opinion about being included in the park, both the Ethiopian government and the international community have an obligation to provide the park population with new acceptable and sustainable livelihood options outside the park. Such new livelihoods must be adapted to the past ways of life and capacities of the park population on the one hand, avoiding cultural shocks and an overstretching of their ability to cope, and must be feasible on the other hand within an economic environment characterized by extreme poverty, a lack of technical infrastructure and minimal purchasing power. The project represents a realistic, concrete and detailed blueprint for achieving this task which benefits not only the primary beneficiaries, but brings a leap in economic development to the Simen Mountains Region as a whole.

3.2.

Objectives

The overall aim of the project is to contribute to the re-building and safeguarding of the integrity of the Simen Mountains National Park. Specific aims of the project are: To create new acceptable, feasible and sustainable livelihoods for the park population through the establishment of private businesses and cooperatives; To provide new and acceptable housing for the park population in the locations of their new livelihoods; and thereby To attract people out of the park and thus pave the way for the rehabilitation of degraded areas; To contribute to fulfilling UNESCO benchmarks for removing the Simen Mountains National Park from the list of World Heritage in Danger, in particular benchmark 3; To obtain experiences and models which can be applied to the Buffer Zone of SMNP as well as to other Protected Areas in Ethiopia.

3.3.

Benefiting Groups and Benefiting Area

3.3.1. Benefiting Groups The people directly benefiting from the project will be the 586 household heads presently residing in Simen Mountains National Park. As each household has an estimated average number of 5,5 members, an additional number of 2.637 individuals will benefit from the project, bringing the total number of beneficiaries to 3.223.

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The table below lists the villages presently within the park and their respective numbers of households, thereby indicating the distribution of the beneficiaries. The figures are based on the Alternative Livelihoods Assessment Study of 2006 and differ somewhat from previous figures. This is because a detailed investigation on location has revealed that a number of households previously thought to reside inside the park actually live outside its boundaries. As mentioned above, the number of individuals has been estimated based on an average rate of 5,5 per household. Gott (Village) Limalimo Michibigny Kebero Megordemiya Kidan Mado Getabit Key Afer Gich Daliya Total Kebele (County) Households Individuals Debre 27 148,5 Adisghie Miligabssie 81 445,5 Adisghie Miligabssie 15 82,5 Adebabay Tsiyon 65 357,5 Argenjona 19 104,5 Argenjona 15 82,5 Argenjona 135 742,5 Abergina 360 1980,0 Agdamiya 4 22,0 586 3.223,0

The table indicates clearly that the village of Gich, being located in the center of the park and accounting for more than 60% of all park residents, is of crucial importance for the success of the project. 3.3.2. Benefiting Area The Simen Mountains National Park will benefit from the project through a far-reaching reduction of pressure from human use, thereby rebuilding its natural integrity, creating necessary preconditions for an expansion of critical wildlife habitat, and resulting in an increased attractiveness for tourists. Economically, the entire Simen Mountains Region, including the three Woredas of Debark, Adiarkay and Janamora will benefit from the project, and to a lesser extent also the Woredas of Dabat and Wogera to the south of that region.

3.4.

Approach and Methodology

3.4.1. Creating Incentives The project approach represents a marked shift from the resettlement practices which have been implemented in the country so far. Instead of simply relocating people, offering them new housing and small plots of land, and then essentially leaving them to their fate, the project pursues an approach of creating attractive and irresistible incentives for voluntary relocation, and turning the duty to provide for new livelihoods into an opportunity to make a systematic effort to promote private business and spur economic development, poverty alleviation and food security in the Simen Mountains Region as a whole. 3.4.2. Business Development In an economic environment which is characterized by widespread absolute poverty, extremely low purchasing power and a lack of capital and investment, the project, rather than just buying the population out through a compensation payment and then leave them without

31

economic perspectives, is taking a more productive approach by turning the duty of caring for individual households into an opportunity for economic development of the region. The project will provide new livelihoods for the entire population now residing in the park through creating new private businesses and cooperatives. This will contribute to the general development of the Simen Mountains Region essentially in two ways: (a) The project constitutes in essence a big public investment program - only that the jobs created will not be public jobs but private ones. Such a massive investment cannot but have considerable impact in boosting the regional economy. (b) On the demand side, not only will 586 households have a much bigger purchasing power than before, but the grant and Soft Loans programs will inject additional capital into the regional economy and increase cash flow and purchasing power. Through these two impacts, synergizing with improved technical infrastructure and growing tourism, it can be expected that primary accumulation of capital will be enhanced and a noticeable development leap will take place in the Simen Mountains Region. Improved food security and variety as well as a more efficient and diversified economic infrastructure will improve the regions attractiveness for tourism, and increasing numbers of tourists will in turn spur economic development. The proposal explicitly does not consider opportunity costs to be a significant criterion for this project since its main objective is to provide new livelihoods for a certain group of people and essential economic improvements for the region, not to maximize anyones profit. In selecting the businesses to be developed, next to economic feasibility, the proposal has been guided by the following considerations: Taking into account that a significant number of households living in the park have been unwilling to move far away, especially to the western lowlands, businesses have been designed in particular which can be located in the Simen Mountains Region. Attempts have been made to identify businesses which are related to the present ways of life of the Park population as well as indigenous skills and knowledge in order to increase the adaptability of the project. The potential and capacities of the target population must be considered to be very limited: most of them have a very low level of education, they are adjusted to an extremely remote high mountain environment with little exposure to the modern world, they are familiar with agriculture, livestock and tourism, and are used to livelihoods in the open air, but must be assumed to be unfit for office and urban livelihoods. The businesses selected reflect the extremely low purchasing power of the general population. Accordingly, items to be sold will be in the lowest price range. Only such businesses for which visitors will be a significant part of their customers are calculated to sell items in the medium and higher price ranges. In the absence of sufficiently detailed economic statistics for the three Woredas, and with a lack of resources, no market studies could be carried out for the various businesses proposed here. However, feasibility in most cases is obvious given the lack of existing businesses. In other cases it has been determined through qualitative surveys in Debark, Adiarkay and Gondar.

32

Businesses have been calculated to be on the smallest economy of scale and over 5 years. By principle investment costs will be provided as a grant and not as a credit. The proposal assumes that the population removing from the park will face serious difficulties in adjusting to the money economy and cannot be expected to handle large and longterm credits successfully. In addition, the muslims among them - more than half of their overall number - are forbidden to extend or accept credits for religious reasons. Moreover, profits in almost all cases are too low to allow any chance to repay credits in any reasonable period of time. Again in order to avoid the necessity of taking credits, investment costs also include a non-repayable first set of goods and a start-up assistance. Only in those cases where quite sizeable profits can be expected, the project shall make legal arrangements with the business owners to retain those profits in order to cover some of the admittedly substantial investment costs. The remaining profits should be paid into the Simen Mountains Trust Fund. Greatest possible scrutiny has been applied at making correct calculations and avoiding any non-essential costs, and at the same time improving general standards over existing levels in order to set positive examples by which the general population can appreciate the potentials and advantages of development.

3.4.3. Participatory Approach The project has been prepared using a participatory approach as much as this was possible under prevailing conditions (limited time and resources, but mainly extreme inaccessibility of the villages, and partly a reluctance to cooperate because of historically strained relationships). Participation has been achieved foremost through repeated village meetings and discussions with village leaders, as well as obtaining detailed information from the households through the questionnaire which has been described in section 2.2.1 of this proposal. This questionnaire specifically asks the park residents about their talents, preferred activities and ideas and plans for their future livelihoods. The individual businesses have been developed in consultation with a wide range of civil servants from various governmental agencies, state and private enterprises. In addition, the draft project proposal has been presented to, and accepted by, the local population on public meetings in the four villages primarily affected (Limalimo, Michibigny, Gich, Argenjona). Through the project staff (mainly the Human Resources & Training Manager and the Business Development Advisor) and close cooperation with local Kebele Development Agents and Woreda Agricultural Officers, the project will ensure that tailor-made solutions will be found as far as possible for each removing household in terms of their future employment and location of residence as well as the time and circumstances of their removal. 3.4.4. Gender The project fully takes gender issues into consideration by having made explicit efforts to create businesses which would provide job opportunities for women. A sizeable number of park households are women-led, meaning that in those cases women have to care for whole families.

33

Only very few of the jobs to be created would seem to be unfit for women, such as construction workers, truck drivers or guards. Businesses may be particularly fit for women which allow groups of them to come together, bringing their small children with them and organize child care and cooking in common and parallel to their work. Such businesses will primarily be handicrafts workshops, but also the poultry and vegetable farms. In addition, service and tourism-related jobs will be particularly well-suited for women, such as cafs and shops.

34

4. Project Components

35

4.1.

Project Coordination Unit

4.1.1. Personnel In this project proposal, only the main duties and responsibilities of each professional staff can be described. Elaborating full job descriptions and requirements of qualification will be the task of the implementing agency of the project. Project Coordinator

The Project Coordinator will be responsible for the setting up and overall implementation of the project. He will make sure that the deadlines of the Time and Action Plan will be met, and will lead consultations in cases where activities are not proceeding as planned. He will supervise personnel and budget, will keep contacts with donors and counterpart on the decision-making level, and will represent the project to the public. He has, in coordination with the relevant Ethiopian authorities, the final decision-making power in the allocation of any project resources. Since most of the project activities relate to the establishment of businesses and construction of the necessary buildings, and these tasks are expected to be completed after the second year of the project, the Project Coordinator will be hired only for two years. After this time, his duties will be taken over by the Business Development Advisor. Business Development Advisor

The Business Development Advisor will be responsible for the successful setting up of all businesses. He will cooperate with the Human Resources and Trainings Manager in order to select appropriate personnel for each business. After the businesses will have been set up, he will provide continuing supervision and advice for them in order to safeguard their successful operation, and will ensure sustainability. The Business Development Advisor will represent the Project Coordinator during times of his absence and will assume his role in one person when the original Project Coordinator will leave his post after two years. Human Resources & Training Manager

The Human Resources & Training Manager will be responsible, in cooperation with the Project Coordinator, for the selection and supervision of national project staff. He will select all leading personnel of the newly-established businesses, and together with them, will select their remaining personnel. He will also be responsible for organizing all trainings, selecting participants, and, together with the Business Development Advisor, will determine needs for further trainings as the businesses develop. Procurement Officers

The Procurement Officers will be responsible for purchasing all machinery, vehicles, equipment and furniture of both the project coordination unit and the newly-established businesses. Two or three persons may be hired for this purpose for a combined duration of three years, depending on the detailed Time and Action Plan.

36

Construction Supervisor

The Construction Supervisor will be responsible for overseeing the construction of all buildings and structures of the newly-established businesses. Supervision of the buildings of the project coordination unit will be the responsibility of the implementing architects. Lawyer

The Lawyer will be responsible for preparing all documents necessary for the legal establishment of all newly-established businesses as well as for obtaining all required permits for buildings and development. He will also prepare labour contracts for all employees of all newly-established businesses, and will provide to them continued legal advise. He will further ensure the legality of all the projects operations, and represent it in all legal matters and cases of legal dispute. Financial Administrator

The Financial Administrator will oversee the bookkeeper and all financial operations of the project. He will be responsible for the timely and correct submission of financial reports, and will cooperate with auditors. He will be responsible for making all payments upon authorization by the Project Coordinator, and will alert him in cases of any financial irregularities or overspending by project staff. External Consultants

Upon request of any of the professional project staff, the Project Coordinator can decide to hire external national or international consultants in order to cope with excess work or to fulfil special tasks which may arise during the project.

37

4.1.2. Buildings Since there are neither office rooms nor residence buildings or hotels available which have acceptable standards for any lengthier period of time, both an office complex and a guest house must be built for the project. There is sufficient presently unused space available for this within the compound of the Park Administration. The new buildings should fit in materials and style with the existing ones, and therefore the earlier architects have been requested to calculate the costs on that basis, with the parameters given below. Each office room and apartment/guest room will be equipped with a separate telephone line. Electricity can be produced through solar energy, thereby reducing running costs and taking precaution against power breakdowns. The compound also provides sufficient parking space for the project vehicles. To the right end of the table, a future use is suggested for each room after the finalization of the project. The guest house will be available for the frequently visiting PaDPA officials and can be a continuing source of income from rents from international scientists who work in the park. Office Building Project Use Office room for Project Coordinator Office room for Business Development Advisor / HR + Trainings Manager Office room for Secretary (with internal doors to P. Coord. and BD Advisor) Office room for three Procurement Officers Office room for Construction Supervisor / Lawyer Office room for Soft Loans Program Head / Debark Soft Loans Line Officer Office room for Financial Administrator / Bookkeeper Office room for External Consultants Two Toilets Months 24 60 / 12 60 24 / 12 24 / 24 60+ / 60+ 60 / 60 60 / 60 Potential Future Use __ Woreda Office for Culture and Tourism Woreda Office for Culture and Tourism Woreda Office for Culture and Tourism Guides Association Simen Mountains Trust Fund Soft Loans Program Scientific Projects / Volunteers Scientific Projects / Volunteers

sqm 15 15 15 25 15 15 15 15 10 150

Guest House Project Use User 2 Apartments (each 2 rooms, kitchen, bathroom, toilet, veranda) International Staff 2 Guest rooms with common kitchen, bathroom and toilet Ext. Consultants Months 60 / 24 60 / 60 Potential Future Use __ __ Visiting Politicians, Scientists Visiting Politicians, Volunteers

sqm 140 80 220 3

Parking 60 Parking lots or garages

38

PCU Office Furniture

Desk Desk File Ceiling Desk Chair Lamp Table Chairs Shelf Trunk lamp Curtains Wardrobe 1 1 1 1 4 1 1 1 1 1 1 1 1 1 1 2 1 1 1 1 1 1 1 1 3 3 3 0 3 3 3 2 1 1 1 1 1 1 1 4 1 1 1 1 1 1 1 1 1 1 1 1 1 2 1 1 1 1 1 1 1 1 1 1 1 0 4 1 1 1 1 1 0 0 0 0 0 0 0 1 1 0 2 2 2 1 4 2 1 1 1 1 13 13 13 5 23 12 10 9 8 7 Foot Mat Decoration 0 1 0 1 1 1 1 0 1 5 1 0 0 0 1 0 0 3

Project Coordinator Business Development Advisor HR + Training Manager Procurement Officers (3) Construction Supervisor Lawyer Financial Administrator / Cashier Bookkeeper Secretary Internal Auditor External Consultants Total amount

PCU Office Equipment

B/w PC printer 1 1 1 3 1 1 1 1 0 1 0 11 Col. printer Photocopy Scanner Telephone Fax Internet Safe Desk items Adapters 0 0 0 1 0 1 1 1 1 0 0 0 1 0 1 0 1 1 0 0 0 1 0 1 0 1 1 1 0 0 3 0 3 0 3 3 0 0 0 1 0 1 0 1 1 0 0 0 1 0 1 0 1 1 0 0 0 1 0 1 1 1 1 0 0 0 1 0 1 0 1 1 0 0 0 0 0 0 0 0 0 0 1 1 1 1 1 0 1 1 0 0 0 2 0 2 0 2 1 1 1 1 13 1 13 2 13 12

Project Coordinator Business Development Advisor HR + Training Manager Procurement Officers (3) Construction Supervisor Legal Advisor Financial Administrator / Cashier Bookkeeper Internal Auditor Secretary External Consultants Total amount

1 1 1 1 1 0 1 1 7

39

For General Use Generator Laptop Digital photo camera Bookkeeping Software Cleaning cart

1 2 1 1 1

4.1.3. Vehicles One 4WD Station Wagons and two Pick-up Trucks will be bought to be shared among project staff. It is assumed that in the first two years, regular travel will be required mostly by the Procurement Officers and the Construction Supervisor, while the Business Development Advisor, Human Resources & Training Manager and the Project Coordinator will not have daily travel. Thus, three vehicles should be sufficient for these purposes. In cases of extraordinary demand, a vehicle may be borrowed from the Park Administration. Two motorcycles will provide welcome and inexpensive additional mobility especially for short trips of national staff in Debark and its vicinity. Trucks will be rented in order to bring equipment and furniture for the offices and guest house from Gondar, Bahr Dar or Addis Ababa.

40

4.1. Project Coordination Unit Costs

No. of units 4.1.1. 4.1.1.1. 4.1.1.2. 4.1.1.3. 4.1.1.4. 4.1.1.5. 4.1.1.6. 4.1.1.7. 4.1.1.8. 4.1.1.9. 4.1.1.10. 4.1.1.11. 4.1.1.12. 4.1.1.13. 4.1.1.14. 4.1.1.15. 4.1.2. 4.1.2.1. 4.1.2.2. 4.1.3. 4.1.3.1. 4.1.3.2. 4.1.3.3. 4.1.3.4. 4.1.3.5. 4.1.4. 4.1.4.1. 4.1.4.2. 4.1.4.3. 4.1.4.4. 4.1.4.5. 4.1.5. 4.1.5.1. Personnel Project Coordinator (I) Business Development Advisor (I) HR + Trainings Manager (I) Procurement Officers (N) Construction Supervisor (N) Lawyer (N) Financial Administrator (N) Bookkeeper (N) External Auditor (N) Technician / IT Specialist Interpreter / Assistant (N) Secretary (N) Drivers (N) Cleaning Services (N) External Consultants (N) Sub-Total Personnel Buildings Office + Guest House Planning Office + Guest House Construction Sub-Total Buildings Office Furniture Equipment Office Operations Vehicles Vehicles Running Costs Sub-Total Office Equipment Travel PC International Travel BDA International Travel HR + Trainings Manager Intl. Travel Cargo Domestic Air Travel Sub-Total Travel Accommodations Guest House Furnishing Sub-Total Accommodation 24 MM 60 MM 12 MM 36 MM 24 MM 24 MM 60 MM 60 MM 5 MM 60 MM 50% 120 MM 60 MM 96 MM 60 MM 20 weeks Costs per unit 12.500 10.500 9.000 950 950 950 950 590 570 300 500 470 175 65 2.500 Costs per line 300.000 630.000 108.000 34.200 22.800 22.800 57.000 35.400 2.850 18.000 60.000 28.200 16.800 3.900 50.000 1.389.950 5.142 176.000 181.142 16.924 29.767 27.774 95.405 90.960 260.830 2.500 2.500 2.500 2.000 10.000 25.000 5.000 12.000 20.000 72.000 53.513 53.513 Total

1.389.950

lump sum lump sum

181.142

see details see details 60 months see details see details

260.830

4 10 2 6 lump sum

72.000

see details

53.513

Sub-Total Project Coordination Unit

1.957.435

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4.1.2.2. Office Furniture Item Desk L-shape 160+80x80x75 Desk armchair med. back, tilting Desk lamp Table 150 x 80 x 75 Chairs Shelf File Trunk Ceiling lamp Curtains Wardrobe Footmat Decoration Total Office Furniture (ETB) Total Office Furniture (USD)

Unit cost 3.881 1.270 400 1.218 600 1.700 2.383 80 300 400 30 500

No. of units 13 13 13 5 23 12 10 9 8 7 5 3

Total 50.453 16.510 5.200 6.090 13.800 20.400 23.830 720 2.400 2.800 150 1.500 143.853 16.924

4.1.2.3. Office Equipment Costs Item PC (incl. monitor, keyboard, mouse) B/w personal printer B/w office printer Colour printer Photocopy machine Scanner Telephone Fax machine Internet connection Safe Desk items Multiplug Generator Laptop Digital photo camera Bookkeeping software Cleaning cart Total Office Equipment (ETB) Total Office Equipment (USD)

Unit cost 9.586 3.393 6.785 6.210 13.490 6.900 230 3.150 184 6.843 1.000 40 15.500 14.144 9.369 30 1.553

No. of units 11 7 1 1 1 1 13 1 13 2 13 12 1 2 1 1 1

Total 105.446 23.751 6.785 6.210 13.490 6.900 2.990 3.150 2.392 13.686 13.000 480 15.500 28.288 9.369 30 1.553 253.020 29.767

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4.1.3.3. Office Operations PCU supplies Years 1 - 2 Years 3 - 5 Item Unit cost No. of units Costs No. of units Costs Printer toner 1.900 7 13.300 6 11.400 Xerox toner 210 2 420 1 210 Paper pack 40 100 4.000 50 2.000 Folders 10 50 500 20 200 Small items 100 13 1.300 6 600 Workshop materials 1.000 2 2.000 1 2.000 Sub-Total Office supplies 21.520 16.410 PCU running costs Telephone 3000/month 13 39.000 6 1.800 Electricity 250/month 13 3.250 6 1.500 Water 200/month 13 2.600 6 1.200 Small purchases 1.300 1.000 Maintenance & repair 10.000 5.000 Sub-Total Office Running Costs 56.150 10.500 Sub-Total Office Operations / year 77.670 26.910 Sub-Total Office Operations / year (USD) 9.138 3.166 Sub-Total Office Operations / 5 years 27.774

4.1.3.4. PCU Vehicles Type 4WD Station Wagon Pick-up Truck Motorcycle Truckloads from Gondar Truckloads from Bahr Dar Truckloads from Addis Ababa Total PCU Vehicles (USD) Qualifications used used 185ccm, used rental rental rental Unit Price 30.000 25.000 3.500 148 179 821 Number of Units 1 2 2 20 5 5 Total (USD) 30.000 50.000 7.000 2.960 895 4.550 95.405

4.1.3.5. Vehicles Running Costs (USD) Item Unit cost No. of units Cost 4WD Station Wagon 590/month 60 35.400 Pick-up Truck 590/month 60 35.400 Pick-up Truck 590/month 60 35.400 Motorcycle 50/month 60 3.000 Motorcycle 50/month 60 3.000 Sub-Total Vehicles Running Costs (USD) 112.200

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4.2.

An Overview of Business Options in the Simen Mountains Region

As the following tables show, altogether 29 different businesses are planned to be established in the Simen Mountains Region under this project. In some cases, the same type of business is suggested to be set up in several different places, raising the total number of companies to 43. All businesses descriptions below consist of three parts: a narrative part providing the description and justification of the business, an investment plan listing all investment costs, and a business plan showing incomes, income-related and running costs, taxes and profits. Obviously, all three parts relate to each other in that information given in one part is supported and explained by information in the other parts. All business plans have been made for a period of five years, i.e. the duration of the project. It is assumed that this duration is the time which must be allowed for the businesses to take off, and at the same time for which they will need continuing advice and technical support. It should be noted here that the two financing mechanisms suggested - the Simen Mountains Trust Fund and the Soft Loans Program -, in addition to their function of bringing capital into the region and increasing cash-flow, also constitute businesses in their own right since they will cover their costs (including salaries) from their incomes. Present margins of profit among the smaller businesses in the region do not allow making any savings for replacing outdated machinery, for making re-investments or for making new investments as the business may expand. This is considered to be one of the major obstacles for economic development in the region. For this reason, each business plan includes annual savings which shall allow replacing the entire machinery park, equipments and furniture after ten years or alternatively to make new investments. The savings therefore constitute a part of the business which is of paramount importance for the future development of both the business itself and the region as a whole, and must not be compromised under any circumstance. All calculations have been made in Ethiopian currency (Ethiopian Birr, ETB). Total investment costs, which will be provided by the project and therefore are relevant for the project budget, have also been converted into US Dollar. The exchange rate used is 8.5 ETB for 1 USD as opposed to the actual present rate of around 8.7 ETB for 1 USD. This has been done in order to safeguard the budget against possible future changes of the exchange rate. In case the present exchange rate will persist until the time of implementation of the project, the investment part of the project budget will decrease by about 0.27%. In addition to the businesses described in detail, a further four businesses have been identified which are considered to have a great economic potential but are too big in terms of capital investment and too complex to plan within the framework of this project. They should be mentioned here, however, in order to document that they have been considered, and it is recommended that the ANRS Government seek private investors for their realization: - A high-quality lodge in Chennek Such a lodge - possibly of lesser standard than the one in Buyit Ras - is considered to be essential for accommodating the expected increased number of tourists and for accessing the present and future extensions to the east of the Park. - A mineral water production in Limalimo Much the same as with honey, Limalimo can become a quality mark for water - which is more than plenty in this area. The water coming from the National Park will have to be processed and bottled in the lowland to the north outside the Park, possibly in Dib Bahir or Zerima.

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A two-star hotel in Debark A top priority in the absence of any facility meeting minimal requirements for international tourists in Debark. A wool/meat sheep farm in Janamora The introduction and propagation of wool/meat sheep is considered to be quite feasible in the region, as the example of the existing farm in Debre Birhan clearly shows. Once set up, it is almost certain to be economic. Its greatest advantage, however, is that it can become the single most influential factor in reducing sheep numbers on the highly overstocked pastures both inside and outside the Simen Mountains National Park and actually in the State of Amhara as a whole. As such, the introduction of wool/meat sheep may have a strategic importance for soil conservation and food security which will be justified no matter how high the investment costs.

The earlier two of these businesses will use resources of the National Park, and it is highly recommended that PaDPA and other authorities of the ANRS will use all their means available in order to make sure that investors will hire inhabitants of the Park as a top priority, even if additional funding might be required for their education and training.

45

An Overview of Business Options in the Simen Mountains Region

Jobs, Investments and Profits
Number of jobs Number of beneficiaries (family members) Low / no qualification jobs Medium / high qualification jobs Investment Costs each (USD) Investment per job (USD) 5-year Profits (each) (ETB) 5-year Profits (all) (ETB)

1. Production of Raw Materials 1.1. Poultry Farm (3) 1.2. Sisal Production 1.3. Honey Farm 1.4. Apple Plantations (2) 1.5. Fruit Plantation 1.6. Vegetable Farm 2. Production of Processed Goods 2.1. Cotton Weaving Cooperative 2.2. Basketry Cooperative 2.3. Leatherworks Cooperative 3. Trade and Services 3.1. Supermarkets (Household items) (2) 3.2. Supermarket (Packed food, drugstore) 3.3. Mixed Supermarket (2) 3.4. Fruit and Vegetable Stores (3) 3.5. Bakery (1/3) 3.6. Shop for office and photo supplies 3.7. Arts and Crafts Shops (2) 3.8. Wholesale and Transport Company 3.9. Construction Workers Cooperative 3.10. Shower Houses (5) 3.11. Laundry 3.12. Tour Operator in Debark 3.13. Hotel in Mekane Berkhan 3.14. Tourist Caf in Debark 3.15. Roadside Caf in Limalimo 3.16. Cultural Night Bars (3) 3.17. Music and Dance Group 3.18. Simen Mountains Museum 4. Financing 4.1. Simen Mountains Trust Fund 4.2. Soft Loan Program Total Jobs and Beneficiaries

66 29 27 102 105 113 24 11 16 8 4 8 12 8 4 6 15 40 20 6 8 17 10 8 36 12 4 2 4 725

363 159,5 148,5 567 440 621,5 132 55 88 44 22 44 66 44 22 33 82,5 220 110 33 44 99 55 44 198 66 22 11 22 3856

51 25 24 94 100 109 21 11 13 6 3 4 9 7 3 4 12 40 15 5 3 16 7 7 12 0 2 0 0 603

15 4 3 8 5 4 3 0 3 2 1 4 3 1 1 2 3 0 5 1 4 1 3 1 24 12 2 2 4 121

335.801 234.951 346.631 268.439 342.207 309.168 71.431 30.454 46.757 32.584 35.520 34.273 28.444 53.807 30.046 44.142 170.474 19.125 32.831 20.079 100.772 89.998 49.304 29.686 57.038 35.793 54.792

15.264 8.102 12.838 5.264 3.260 2.736 2.977 2.769 2.923 8.146 8.880 8.569 7.111 6.726 7.512 14.714 11.365 479 8.208 3.347 12.597 5.294 4.931 3.711 4.754 2.983 13.698

518.784 671.390 15.697 21.590 45.098 136.661 87.499 31.680 2.318.550 5.429 59.755 67.090 8.415 6.248 162.795 56.115 79.302 27.505 109.165 4.155 113.566 4.710 99.630 78.704 37.715 6.535 267.317 208.600 0

1.556.352 671.390 15.697 43.180 45.098 136.661 87.499 31.680 2.318.550 27.145 59.755 134.180 25.245 6.248 162.795 112.230 396.510 27.505 545.825 4.155 113.566 4.710 99.630 78.704 113.145 6.535 267.317 208.600 0 7.299.907 858.812

106.166 53.083 266.223 66.556 Total 5-year Profits (ETB) Total 5-year Profits (USD)

46

Locations
National Park businesses 1. Production of Raw Materials 1.1. Poultry Farm (3) 1.2. Sisal Production 1.3. Honey Farm (1/5) 1.4. Apple Plantations (2) 1.5. Fruit Plantations (1/5) 1.6. Vegetable Farm (1/5) 2. Production of Processed Goods 2.1. Cotton Weaving Cooperative 2.2. Basketry Cooperative 2.3. Leatherworks Cooperative 3. Trade and Services 3.1. Supermarkets (Household items) (2) 3.2. Supermarket (Packed food, drugstore) 3.3. Mixed Supermarkets (2) 3.4. Fruit and Vegetable Stores (3) 3.5. Bakery (1/3) 3.6. Store for office and photo supplies 3.7. Arts and Crafts Shops (2) 3.8. Wholesale and Transport Company 3.9. Construction Workers Cooperative 3.10. Shower Houses (5) 3.11. Laundry 3.12. Tour Operator in Debark 3.13. Hotel in Mekane Berkhan 3.14. Tourist Caf in Debark 3.15. Roadside Caf in Limalimo 3.16. Cultural Night Bars (3) 3.17. Music and Dance Group 3.18. Simen Mountains Museum 4. Financing 4.1. Simen Mountains Trust Fund 4.2. Soft Loan Program Total Businesses and Jobs by Location 1 8 2 1 1 1 1 27 24 12 4 2 2 363 1 12 jobs Debark businesses 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 jobs 22 29 19 51 10 29 24 11 16 4 4 4 6 4 3 15 40 4 6 8 10 1 4 1 1 4 4 1 1 2 4 4 2 1 3 Adiarkay businesses 1 jobs 22 3 1 4 76 2 42 3 51 1 1 19 21 1 21 Janamora businesses jobs Other Villages businesses jobs Gondar and vicinity businesses 1 jobs 22

17

1 10

1 126

1 7

1 122

58

46

47

4.2.1. Producing Sector

4.2.1.1. Poultry Farms
Although some rural households in the Simen Mountains Region as well as families in Debark keep chicken, only a minority of them do, and the growing number of urban households, hotels and tourists account for an increasing demand for both eggs and meat. In addition, there is a continuing traditional demand for chicken meat on the many religious holidays when it is not allowed for Ethiopian Christians to eat meat (chicken is not considered to fall under that category). Chicken meat can also contribute to reducing the dependency on sheep meat and thereby help to reduce the number of sheep and take pressure from the pastures. Since Avian influenza has not been recorded in Ethiopia so far, and the remoteness of the region provides some natural barrier, the risk of losses through this disease can be considered minimal. There is no commercial or state farm for chicken production in the entire North Gondar Zone, making this area a potential market of considerable scale. The fact that the supply of chicken does not meet the demand is reflected by the price of 20 ETB per head. Based on this situation, three poultry farms shall be established in the region: one on the outskirts of Debark, one in Adiarkay and one near Gondar. The farms shall produce both eggs and meat. Customers will be both businesses and individual households. Sales will be through delivery (to business customers) and on the open market, although this part of sales may be outsourced soon. Upon recommendation by the poultry farm of the Agricultural Research Institute of ANRS near Bahr Dar, the farms will work with chicken of the Rhode Island breed which combine all properties needed for the specific demands of the region: They are very productive both for eggs and meat, have a good growth and low mortality rate, and can be kept outside due to their low susceptibility to diseases. Again based on figures of the poultry farm near Bahr Dar, each hen is expected to produce 180 eggs per year. Eggs need 18 days until they produce embryos and another three days until they hatch. Mortality is about 10-15% for chicken and less than 1% per month for hens. 1 rooster is required for 8 hens. The parent stock of not more than 3,000 fowl must be replaced by a new F1 generation brought in from outside after every eight generations (F8) or four years. The farm operation will be started with a number of 6,000 hens of egg-laying age (5 months) Assuming that hens should not lay eggs for more than one year because their productivity declines after that time, reaching 17 months of age, these hens shall be sold for meat. Over the year, 6,000 hens will produce 1,080,000 eggs. From those eggs, 5.500 will be grown for 3 months in order to be sold, and another 8,663 (7,700 hens and 963 roosters) will be grown for 5 months in order to replace the original 6,000 hens and 750 roosters of the farm after one year. Out of the 8,663, 10% are expected to die, leaving 7,000 hens and 875 roosters for the second producing generation (F2). Furthermore, the farm will hatch 2,200

48

eggs to sell as 1-day old chicken (again 10% of them will die). These chicken will be sold for 3 ETB each and will generate a total income of 6,000 ETB. The remaining 1,063,637 of the 1,080,000 eggs can be sold. With a price of 0.30 ETB per egg, the income from eggs will be 319,091 ETB in year 1. In addition, with 5,000 chicken sold for 14 ETB each, there will be an income from the sale of chicken of 70.000 ETB. After a life span of 17 months (i.e. in year 2) all hens and breeding roosters are culled. From their sale an income of 94,500 ETB will be obtained which will add up to the total turnover of year 2. The turnover from eggs (319,091 ETB) plus the turnover from 3-months old hens and 1-day old chicken (76,000 ETB) will result in a turnover of 395.091 ETB for year 1. Alternatively, depending on demand, less eggs can be sold and more chicken grown for sale. In year two, the same procedure will be followed on an increased basis of 7,000 hens and 875 roosters. Likewise, the number of hens and roosters will gradually be increased every year. Constructions required for the farm will include one building each for offices, a laboratory, machinery, feed store, feed processing, breeding, hatching, six semi-open hen houses as well as residential houses and a shower / toilet house for 15 staff. Pecking grounds must be well-fenced in order to protect them from foxes and hyenas. In addition to the farm compound, land must be available for growing grass (hay) for covering the floor of buildings where newly-born chicken are kept. Animals can peck outside and/or be fed with a mix of cereals and added minerals. The entire area required for the farm is 3 ha. Agricultural machinery required will include a small truck, tractor, movable water tank, water collector, generator (in case of breakdown of central power supply), laboratory equipment, four breeder machines, a feed crusher and a feed mixer. The chicken houses need reliable heating and ventilation at all times. All house floors where chicken and hens are kept must be disinfected and provided with new hay once a week. The area required for growing hay is 1-2 ha, depending on whether hens will peck in the open or be kept inside. Drinking water must be treated with chloride for disinfection. For market introduction, the farms will participate in two trade fairs in Gondar and Bahr Dar. They will print a booklet which will explain their products, services, prices and conditions.

Training requirements: Business administration (3 x 1), accounting/bookkeeping (3 x 2), poultry-keeping/production management (3 x 10) Full-time jobs created: 3 x 22 Manager, bookkeeper, poultry expert, veterinarian, delivery driver, seller, farm workers (8), cleaner, guards (7) Indirect economic benefits: Food security in the region is enhanced; Increased attractiveness for tourists through an expanded choice of meals.

49

4.2.1.1. Investment Plan Poultry Farm

1. 1.1. 1.2. 1.3. 1.4. 2. 2.1. 2.2. 2.3. 2.4. 2.5. 3. 3.1. 3.2. 4. 4.1. 4.2. 4.3. 4.4. 4.5. 5. 5.1. 5.2. 5.3. Legal and administrative costs Lawyer Registration Construction Permits Other fees and licenses Sub-Total Legal and Administrative Costs Real Estate Land 2 ha Planning and design Buildings and Constructions Development Electrical and sanitary installations Sub-Total Real Estate Machinery, Furnitures and Equipment Machinery and Equipment Office Furniture and Equipment Sub-Total Machinery, Furnitures and Equipment First Set of Goods 6750 hens and roosters Transport of fowl from Bahr Dar Veterinary and vaccination drugs Feeds Packaging materials Sub-Total First Set of Goods Market Introdution Company plate Opening Ceremony Presentation on 2 trade fairs 350 60 1.500 6.200 8.110 0 30.000 1.233.830 408.484 18.680 1.690.994 797.150 79.600 876.750 94.500 7.575 33.750 36.000 2.926 174.751 10.000 5.000 7.000 13.822 35.822 25.900 18.500 12.100 11.380 67.880

5.4. Company Booklet Sub-Total Public Relations 6. Trainings 6.1. Poultry production & management 6.2. Veterinary care 6.3. Business administration 6.4. Accounting/Bookkeeping Sub-Total Trainings

Total Investment Costs (ETB) Total Investment Costs (USD)

2.854.307 335.801

2.2. Buildings and Constructions Purpose Offices Rearing rooms Brooder House Incubator House Feed processing and storage Laboratory Toilet/Shower house Machinery house Warehouse Guard House Fence Total Buildings and Constructions Description 4 rooms 4x4m each 5 rooms 5x8m each 5 rooms 5x8m each 1 room 5mX5m 5x6m with 2 rooms 5x6m with 2 rooms 2 toilets, 1 shower 1 generator room, 1 tools room 4 x 6m with 2 rooms 3 rooms 1,75 x 1,75m each 500m mesh wire Size (sqm.) 64 200 200 25 30 30 6 24 24 9 Costs 128.000 400.000 400.000 50.000 60.000 60.000 12.000 48.000 48.000 18.000 9.830 1.233.830

50

2.3. Development Description Electricity (pole, wire & install.) Water pipe 6m Water pipe installations Telephone installation Internet installation Hand-dug well Total Development Unit cost 880 130 1.304 284 184 12.000 No. of units 200 1.668 2 3 1 1 Costs 176.000 216.840 2.608 852 184 12.000 408.484

2.4. Electric and Sanitary Installations Item Water tank (300 l) Shower Solar Water Heater / B2QH25 Mirror Sideboard Armature Toilet bowl Handwash bowl Ceramic for the floor / m wall / m Elbow (Corba) Pipe (3/4 inch) 3m - 1piece Counter 3/4 inch Water pipe 1/2 inch -3m Counter 1/2 inch Tape Reducer Nipples Foset Total Sanitary installations Unit cost 1.000 350 12.240 200 400 200 520 250 95 60 5 130 350 100 300 5 5 5 20 No. of units 1 1 170 l 2 1 2 2 2 2 6 15 4 1 3 pieces 1 9 9 9 6 Total cost 1.000 350 12.240 400 400 400 1.040 500 190 360 75 520 350 300 300 45 45 45 120 18.680

3.1. Machinery and Equipment Description Toyota Double Cab Vehicle Movable water tank Water Tank (Rooto) Generator Laboratory equipment + furniture Incubator Breeder Feed crusher Feed mixer Ventilators Feeders Drinkers Egg-tray Egg-laying stands Poultry Crate Chick Crate Debeaker Total Agricultural Machinery + Equipment Unit cost 250.000 9.000 2.500 15.500 70.000 250.000 1.250 17.000 9.000 1.200 120 120 2 2.500 350 400 300 No. of units 1 1 2 1 1 1 25 1 1 20 200 200 600 10 40 60 15 Costs 250.000 9.000 5.000 15.500 70.000 250.000 31.250 17.000 9.000 24.000 24.000 24.000 900 25.000 14.000 24.000 4.500 797.150

51

3.2. Office Furniture and Equipment Description Chair Office table Office chair Sideboard Safe PC + Monitor, Keyboard, Mouse and USB Printer Bookkeeping software Software for breeding record Antivirus software Telephone Fax Miscellaneous Total Office Furniture and Equipment

Unit cost No. of units 500 12 1.100 7 450 7 1.500 5 3.000 1 11.000 3 4.000 3 300 1 450 1 400 1 150 2 2.800 1 3.000 1

Costs 6.000 7.700 3.150 7.500 3.000 33.000 12.000 300 450 400 300 2.800 3.000 79.600

6. Trainings Description Unit cost No. of units Poultry production & management Training fee 1 month 250 30 Per diem 10 participants 58 300 Travel (Debark - Andasa - Debark) 100 10 Sub-Total Poultry Production and Management Veterinary Care Training fee 1 month 250 30 Per diem 5 participants 70 150 Travel (Debark - Andasa - Debark) 100 5 Sub-Total Veterinary Care Business Administration Training fee 1 month 250 30 Per diem 2 participants 70 60 Travel (Debark - Addis Ababa - Debark) 200 2 Sub-Total Business Administration Bookkeeping Training fee 1 month 250 30 Per diem 2 participants 58 60 Travel (Debark - Addis Ababa - Debark) 200 2 Sub-Total Bookkeeping Sub-Total Trainings

Costs 7.500 17.400 1.000 25.900 7.500 10.500 500 18.500 7.500 4.200 400 12.100 7.500 3.480 400 11.380 67.880

52

4.2.1.1. Business Plan Poultry Farm

Year 1 Gross turnover Turnover tax 2% Net turnover Costs for goods Gross profit Running Costs Personnel Telecommunication, electricity, water Office and administration Small equipment purchases Maintenance and repair Public Relations Land lease, legal and bookkeeping services Transports Travel Savings (10% of machine & equipment costs) Losses (5% of costs for goods) Result before taxes (net profit) Income tax (10%) Result after taxes (net earnings) Personnel Manager Secretary Bookkeeper Poultry Expert Veterinarian Seller / Cashier Driver Farm worker / poultry keeper Guard Cleaner Total Personnel 395.091 0 395.091 0 395.091 -356.322 -147.000 -36.000 -4.800 -14.400 -10.000 -3.000 -2.200 -48.000 -30.000 -54.250 -6.672 38.769 -3.877 34.892 Year 2 Year 3 Year 4 Year 5 Year 6 562.890 729.127 815.569 905.569 905.569 0 0 0 0 -18.112 562.890 729.127 815.569 905.569 887.457 -49.223 -67.090 -217.697 -128.216 -128.216 513.667 662.037 597.872 777.353 759.241 -437.042 -505.457 -577.564 -626.224 -626.224 -161.700 -177.870 -195.657 -215.223 -215.223 -45.600 -57.216 -69.994 -84.052 -84.052 -6.000 -7.500 -9.375 -11.719 -11.719 -17.280 -20.736 -24.883 -29.859 -29.859 -12.500 -15.625 -19.531 -24.413 -24.413 -3.600 -4.300 -5.160 -6.192 -6.192 -1.900 -2.015 -2.197 -2.397 -2.397 -60.000 -75.000 -93.750 -93.750 -93.750 -36.000 -51.840 -62.208 -62.208 -62.208 -90.000 -2.462 76.625 -7.663 68.963 -90.000 -3.355 156.580 -15.658 140.922 -90.000 -4.809 20.308 -2.031 18.277 -90.000 -6.411 151.129 -15.113 136.016 -90.000 -6.411 133.017 -13.302 119.715

Salary Year 1 Year 2 Year 3 Year 4 Year 5 per month per year Number Costs Number Costs Number Costs Number Costs Number Costs 1.500 18.000 1 18.000 1 19.800 1 21.780 1 23.958 1 26.354 600 7.200 1 7.200 1 7.920 1 8.712 1 9.583 1 10.542 750 9.000 1 9.000 1 9.900 1 10.890 1 11.979 1 13.177 750 9.000 1 9.000 1 9.900 1 10.890 1 11.979 1 13.177 750 9.000 1 9.000 1 9.900 1 10.890 1 11.979 1 13.177 500 6.000 1 6.000 1 6.600 1 7.260 1 7.986 1 8.785 600 7.200 1 7.200 1 7.920 1 8.712 1 9.583 1 10.542 500 6.000 8 48.000 8 52.800 8 58.080 8 63.888 8 70.277 400 4.800 5 24.000 5 26.400 5 29.040 5 31.944 5 35.138 400 4.800 2 9.600 2 10.560 2 11.616 2 12.778 2 14.055 22 147.000 22 161.700 22 177.870 22 195.657 22 215.223

N.B: There is a 10% annual salary increment

53

Cost of Goods Year 1 Amount Hens Roosters Feed in kg Packing material Total Cost of Goods
6.000 750 30.000 1.064

Unit Cost
14,00 14,00 1,20 2,75

Total Cost
(investment) (investment) (investment) (investment)

Year 2 Unit Amount Cost

7.000 875 35.000 1.241 0,00 0,00 1,30 3,00

Total Cost
0 0 45.500 3.723

Year 3 Unit Amount Cost

8.000 1.000 40.000 1.418 0,00 0,00 1,50 5,00

Total Cost
0 0 60.000 7.090

Year 4 Unit Amount Cost

9.000 1.125 50.000 1.597 12,00 12,00 1,70 7,00

Total Cost
108.000 13.500 85.000 11.179

Amount
10.000 1.250 60.000 1.777

Year 5 Unit Cost

0,00 0,00 1,90 8,00

Total Cost
0 0 114.000 14.216

0,00

49.223

67.090

217.679

128.216

Production Year 1 Gross egg production 3 month old Hen 1 day old Chicken Substitute Hens Substitute Roosters Net Egg production
1.080.000 6000 hens x 180 eggs -5.500 grown for sale, 500 die -2.200 grown for sale, 200 die -7.700 replace original hens -963 replace original roosters 1.260.000 -6.600 -2.200 -8.800 -1.100

Year 2
1.440.000 -7.700 -3.300 -9.900 -1.238

Year 3
1.620.000 -7.700 -3.300 -11.000 -1.375

Year 4
1.800.000 -7.700 -3.300 -11.000 -1.375

Year 5

1.063.637

1.241.300

1.417.862

1.596.625

1.776.625

Gross Turnover Year 1 Amount 3 months old live Hen 1 day live Chicken 17 months old Hen 17 months old Rooster Eggs Total Gross Turnover
5.000 2.000

Unit Price
14,00 3,00

Total
70.000 6.000

Year 2 Unit Amount Price

6.000 2.000 6.000 750 15,00 3,00 14,00 14,00 0,30

Total
90.000 6.000 84.000 10.500 372.390

Year 3 Unit Amount Price

7.000 3.000 7.000 875 1.417.862 15,00 3,25 15,00 15,00 0,35

Total
105.000 9.750 105.000 13.125 496.252

Year 4 Unit Amount Price

7.000 3.000 8.000 1.000 1.596.625 16,00 3,25 15,00 15,00 0,35

Total
112.000 9.750 120.000 15.000 558.819

Amount
7.000 3.000 9.000 1.125 1.776.625

Year 5 Unit Price

16,00 3,25 16,00 16,00 0,35

Total
112.000 9.750 144.000 18.000 621.819

1.063.637

0,30

319.091

1.241.300

395.091

562.890

729.127

815.569

905.569

54

4.2.1.2. Sisal Plantation

Sisal is a native agave plant of the Yucatan Peninsula, Mexico. It is essentially a plant of the tropics and subtropics, and production benefits from temperatures above 25 C and plenty of sunshine. Sisal prefers a rainfall of not less than 1000 to 1500 mm p.a. The more even the rainfall distribution, the higher is the quality of fibre and opportunity for continuous leaf harvesting. The crop generally prefers a medium or light soil, with a pH between 5.5 and 7.5. Sisal can thrive in drought conditions and in rough land with very little nutrition. In 100 years of commercial sisal growing in Tanzania there has not been a year when there was a drought to kill sisal plants. It helps to stop soil erosion and captures moisture from the atmosphere. It can be planted any time of the year and harvested throughout the year. It even survives fire. There are very few commercially grown plants in the world with these qualities. Sisal is a perennial succulent which, with good growing conditions, forms an inflorescence after 6 - 9 years after having produced 300 - 450 leaves, and then dies. Leaves average 120cm in length and are arranged spirally around the thick stem. The leaves are 75% schlerenchyma bundles. The root system is shallow but extends up to 3.5m from the stem. As a cactus, agave plants survive and produce a marketable product in infertile arid regions which in many cases would otherwise be unproductive. As it is a labour intensive crop, it offers at least stability for a large rural population. Sisal is the most important of the group of hard fibres. It is essentially a commercial crop which has so far mostly been grown on large plantations in order to justify the use of expensive machinery required. However, a prototype of an inexpensive small mobile sisal decorticator has been developed for about USD 2.000, which makes sisal-growing a profitable economic activity for small farmers. The worlds largest sisal producers are Brazil (199,000t), Kenya (40,000t), Tanzania (28,000t) and Madagascar (20,000t). There are significant exports only from Brazil (65,000t), Kenya (31,000t), Tanzania (18,000t) and Madagascar (9,000t). The greatest demand for sisal is for use as binder twine, but it can also be used to make ropes, sacks and bags of various types as well as marine cordage. Long fibres (>90cm long) are used for ropes and binder twine. Approximately 25% of the fibres are shorter (flume tow and tow fibre), and these are used for padding, mats and stair carpet, also for paper and building panels. After fibre extraction 95 - 96% of the leaves' weight still remains, this is used as fertiliser, or the dried pulp as a fuel for methane production (experimental). Propagation Propagation of sisal is by means of bulbils which appear on the flower stalk, or by suckers growing around the base of the plant. Plants produce up to 4,000 bulbils/plant compared with less than a quarter of this number of suckers, hence bulbils are preferred for propagation. Only large bulbils should be selected for planting. Bulbils are first planted into nursery beds at spacings of 25-30 cm apart in rows 50 cm apart. The bulbils are allowed to grow to about 40 cm or until they are about 9-12 months old, after which they are transplanted to the field. At this time the bulbils have good roots. The growth of bulbils is improved by mulching sisal nurseries with grass. Mulching with partially rotted sisal gives best results. Transplanting takes place preferably at the beginning of the rainy season. A recommended planting pattern in the field is a series of double rows 60 cm apart with a 2.5 m alley between a pair of rows, giving a population of about 25.000 plants per hectare.

55

Productivity and Harvesting In the countries of production and optimal production cutting of the leaves takes place 18-24 months after planting. More usually plants are harvested after 24-36 months. About 50 leaves, each weighing up to 1 kg may be cut per plant per year. The ripest lower leaves are cut first and this continues periodically over the next four years. On average, over the first 4 years, two cuttings are made annually. In the following years only one cut is made per year, until the flower stalks begin to develop. A total of about 400 leaves may be harvested during the economic life of each plant, adding up to a total of 2000 tonnes fibre/ha over 8 years. The crop dies after producing the inflorescence and bearing a crop of vegetative bulbs, when the plant is 8-10 years old. Fibre Extraction A process of decortication is used to extract the fibre from the leaf tissues. Leaves are crushed and beaten by a rotating wheel set with blunt knives, so that only fibres remain. All other parts of the leaf are washed away by water. Decorticated fibres are washed before drying in the sun or by hot air. Proper drying is important as fibre quality depends largely on moisture content. Artificial drying has been found to result in generally better grades of fibre than sun drying. Dry fibres are machine combed and sorted into various grades, largely on the basis of the previous in-field separation of leaves into size groups. Fertilizer application A superphosphate fertiliser applied at about 25 kg P/ha/annum with about 50 kg/ha N applied as calcium ammonium nitrate or urea ensures a good crop. Apply lime where the pH of the soils falls below 6.5. Where rainfall levels are good, nitrogen can be supplied by growing leguminous cash crops in-between rows. It has also been known to have a sizeable demand for calcium as a nutrient and frequently responded to small dressings of lime when grown acid soils. The crop is also susceptible to boron deficiency. The yield deteriorates over the year, and more rapidly under continuous cultivation. Soil potassium deficiencies are indicated by a bending-over of the normally straight and stiff older leaves. Boron deficiency which causes leaf cracking is more difficult to control. Decorticating wastes including both liquids and solids have proved effective as a fertiliser supplement, especially when supplemented with lime. The crop should be kept weed-free and annual legumes such as beans may be cultivated between rows to suppress weed growth and limit erosion. For the present calculation, however, no profits from such intercropping have been considered. Pests and diseases The plant has a leathery epidermis and some species have sharp spines for protection. It has very few diseases which in most cases does not need any pesticides. The only pest known to occasionally reach pest proportions is the Sisal Weevil (Scyphophorus interstitialis). Sisal is a tough plant. Production and Labour Costs The sisal plantation itself shall have a size of 1,5ha. Another 0,5ha is needed to cultivate bulbils, and an additional 0,5ha for buildings and driveways. With 25,000 plants per ha, each giving 50 leaves per year, a total of 1.875.000 leaves can be harvested per year on 1,5 ha. With 300 working days per year, 6.250 leaves must be cut per

56

day. Assuming that 4 leaves can be cut and thrown on a cart or trailer per minute, 1.563 minutes of work are required per day. A working day having 8 hours or 480 minutes, 3,26 workers are needed to do the work. The decorticator has a capacity to produce 200kg of fiber per day, representing 20% of the original leaves. This means that it processes a maximum of 1,000 leaves per day. Since 6.250 leaves must be decorticated per day, seven decorticators are needed to cope with the work required. 1.875.000 leaves equalling 1.875.000 kg, and the percentage of fiber being 20%, there will be a total output of 375.000 kg of fiber per year. With one truckload carrying 10.000 kg, 38 transports to Addis Ababa will be required where they will be sold for 4 ETB/kg, resulting in an income of 1.500.000 ETB annually. In the long run, 37.500 bulbils must also be planted and nourished per year in order to replace those which have flowered and died. In 300 working days, 125 bulbils must be planted per day. Assuming that it takes 10 minutes to plant one bulbil (including cutting, preparing nursery beds, replanting, watering etc.), 48 bulbils can be planted on a working day of 8 hours or 480 minutes. This means that 2,6 labourers are required for planting bulbils. Marketing Since the sisal factory in Addis Ababa has expressed their demand of sisal fiber, there is no marketing problem for the foreseeable future. The sisal factory presently buys imported sisal for 4,7 - 5 ETB/kg (landed costs) and local sisal for 3-4 ETB/kg (landed costs). Sisal from the Simen Mountains can be delivered to Addis Ababa for 4 ETB/kg (landed costs), making it competitive with both imported and local sisal.

Trainings required: Business Administration (1), Bookkeeping (1), Sisal-growing (1) Full-time jobs created: 29 Manager, accountant/bookkeeper, sisal expert, technician, plantation workers (20), guards (4), cleaner Indirect economic impact: Provides a reliable continuing source of supply for the sisal factory in Addis Ababa.

57

4.2.1.2. Investment Plan Sisal Plantation

1. 1.1. 1.2. 1.3. 1.4. 2. 2.1. 2.2. 2.3. 3. 3.1. 3.2. 3.3. 4. 4.1. 4.2. 5. 5.1. 5.2. 5.3. 6. 6.1. Legal and administrative costs Lawyer Registration Construction Permits Other fees and licenses Sub-Total Legal and Administrative Costs Real Estate Land 3 ha Buildings and Construction Development Sub-Total Real Estate Machinery, Furnitures and Equipment Agricultural Machinery and Equipment Vehicles Office Furniture and Equipment Sub-Total Machinery, Furnitures and Equipment First Set of Goods Sisal plants (37.500 seedlings) Packaging materials (100.000m baling rope) Sub-Total First Set of Goods Trainings Business administration Accounting/Bookkeeping Sisal-growing Sub-Total Trainings Financing Start-up assistance Sub-Total Financing Total Investment Costs Total Investment Costs (USD)

350 60 1.500 6.200 8.110 0 226.500 133.062 359.562 828.720 286.000 71.480 1.186.200 187.500 60.000 247.500 4.746 1.274 15.240 21.260 168.451 168.451 1.991.083 234.951

2.2. Buildings and Construction Purpose Offices Machinery house Processing + tools house Fiber storage + supplies house Toilet/Shower House Sub-Total Buildings and Construction Description 3 rooms 1 room 2 rooms 2 rooms 2 toilets, 2 showers Size (sqm.) 40 75 120 50 12 Costs 80.000 37.500 60.000 25.000 24.000 226.500

2.3. Development Description Electricity (pole, wire & install.) Water pipe 6m Water pipe installations Telephone installation Internet installation Sub-Total Development

Unit price No. of units 880 100 130 333 1.304 1 284 1 184 1

Costs 88.000 43.290 1.304 284 184 133.062

58

3.1. Agricultural Machinery and Equipment Description Movable water tank Water collector Water hose for irrigation (100m) Decorticator + import costs Combing machine Baler Machete Spade Leather gloves Ceiling lamps Gate Fence poles (1,5m high, every 2 m) Fence wire (wire, 4 rows) Nails or screws Sub-Total Agricultural Machinery + Equipment 3.2. Vehicles Description Pick-up Truck Mules Carts Sub-Total Vehicles 3.3. Office Furniture and Equipment Description Gate sign Office desk Desk armchair Office table Office chair Trunk Sideboard Ceiling lamp Desk lamp Safe Wardrobe PC + Monitor, Keyboard, Mouse Printer Bookkeeping software Antivirus software Telephone Fax Miscellaneous Sub-Total Office Furniture and Equipment 5.3. Sisal-growing Training Description Travel Debark - Awassa - Debark Per diems 66 days Training fees Sub-Total Sisal-growing Training

Price per unit 9.000 10.725 5/m 17.000 230.000 100.000 25 30 25 80 5.000 67,5 100/100m 9/kg

No. of units 1 1 20 7 2 2 6 4 6 20 1 300 24 25

Costs 9.000 10.725 100 119.000 460.000 200.000 150 120 150 1.600 5.000 20.250 2.400 225 828.720

Price per unit 230.000 10.000 8.000

No. of units 1 4 2

Costs 230.000 40.000 16.000 286.000

Price per unit No. of units 1.000 1 2.000 3 1.270 3 1.100 1 450 4 3.200 2 1.500 3 80 3 300 3 3.000 1 400 3 11.000 3 4.000 1 30 1 400 1 150 2 2.800 1

Costs 1.000 6.000 3.810 1.100 1.800 6.400 4.500 240 900 3.000 1.200 33.000 4.000 30 400 300 2.800 1.000 71.480

Price per unit 500 70 2.500

Participants 2 2 2

Costs 1.000 9.240 5.000 15.240

59

4.2.1.3. Honey Farm

Presently, honey is produced throughout the lower reaches of the Simen Mountains area, but in a very traditional way with very low productivity. Traditional Ethiopian beehives are not well-suited in terms of productivity. The quality of the honey is good, but residues and hygiene problem make it unfit for commercial production on a larger scale. With few exceptions in Adiarkay, honey is not produced as a major occupation but only for home consumption. The World Bank has distributed modern beehives to the local population, but people have not been trained how to use them, and so many people use them for other purposes such as containers for their clothes. The local honey is sold from big canisters or baskets without any packaging, and customers carry it away in whatever containers they bring themselves. Such honey is very cheap (15 ETB/kg), but available only locally. There is no marketing or distribution. Hence, there is an opportunity to produce additional honey for wider distribution under a quality brand name such as Simen Mountains Honey, which can draw from the reputation of the Simen Mountains as an area of high natural value. Honey production is initially foreseen in four forest areas: Angwa Karnaja (Adiarkay Woreda), Limalimo (Debark W.), Michibigny (Debark W.), Dihwara (Debark W.) and Lori (Janamora W.). Honey production units (farms) will be established in these areas (outside the National Park but making use of the Parks and Buffer Zones forests) for only the production of the honey. The land area required will be 0,25ha for each farm and 0,5ha for the central facility. The farmers will bring their honey by mule to a central facility in Debark (the coordination office) where it will be processed, packed and marketed. The central facility will employ a bee-keeping specialist who will provide technical assistance to the five honey farms. The central facility will also buy up honey from family-based producers of the region if their honey meets the quality and hygiene standards of the farm-produced honey. The services of the bee-keeping specialist will be available for them against a small fee. The tasks of the central facility in Debark will be - to collect the honey from the four farms - to guarantee quality and hygiene standards - to provide technical assistance to both the farms and family-based producers - to process the honey - to package the honey - to market the honey - to sell the honey. The coordination office will have a manager, marketing officer and processing expert, as well as labourers for labelling and packaging. In addition to honey, the wax will also be sold.

Production process All beehives of each farm will be placed in one location in order to better collect and protect them. This will happen in January. Then the bees will have time to adapt to their environment until April. From April - October, they will produce honey. The honey will be collected once a year between October and December (after the end of the rainy season). In the long term, it may be possible to collect honey two times a year, but the present calculation is based on one collection only. That could mean that production doubles. In each farm, two beekeepers and two guards will be employed.

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Expected Output and Turnover The farm will establish bee-hives in the five areas as follows: In Limalimo, Angwa Karnaja, Dihwara and Lori there will be 30 beehives each, and in Michibiny 25 beehives, altogether 145 beehives. Based on the existing honey production in the three Woredas of the Simen Mountains area, it is assumed that the honey farm can buy a multiple of its own honey production from local family producers residing in the vicinity of the five farms. Both the number of bee-hives, the productivity of each bee-hive, and the amount of honey bought from individual families are expected to increase over the first five years of operation, for which the detailed figures are given below. The figures used are 5% less than the official estimates. Year 1 In the first year, the output per beehive is expected to be 25kg, which will add to a total output of the farm of 3.625kg per year. In addition, 25,000kg of honey will be bought from individual families, resulting in a total amount of 28,625kg in the first year. Out of the 3.625kg self-production, 7% or 253,75 kg will be wax (wax can be gained only from the self-established farms), leaving 28.371,25kg of honey. Packed in 500g glasses, about 53.905 glasses of honey can be produced. Losses are expected to be 5% of both honey and broken glasses, so that actually 51.209 glasses will be sold. Local family-produced honey costs 11-13 ETB/kg, but immediately after harvest (OctoberDecember), when plenty of it is available, the price for such honey decreases to around 10 ETB/kg. For this calculation, an average price of 11 ETB/kg or 5,5 ETB per 500g is assumed. One packaging glass containing 500g costs 2,20 ETB (landed cost), and labels 0,60 ETB. As a result, each glass of 0,5kg costs 8,3 ETB and will be sold for 12 ETB to the wholesaler. (The final price in the shop will be 18 ETB.) From this, the total turnover will be 12 ETB x 51.209 glasses = 614,508 ETB. With 1kg of wax bringing 50 ETB, 253,75kg of wax can be sold for 12.687 ETB. This will add to a total gross turnover of 627.195 ETB in the first year. Year 2: In the second year the number of beehives will be increased to 27 in Michibigny and 33 in each of the other four localities, altogether to 159. At the same time, the productivity of each beehive is expected to increase from 25kg to 26kg, resulting in a total output of the farm of 4.134 kg. In addition, 29.000kg of honey will be bought from individual families, resulting in a total amount of 33.134kg in the second year. Out of the 4.134kg self-production, 7% or 289,3kg will be wax, leaving 3.844,7kg of honey. Together with the honey bought, there will be 32.844,7kg of honey or 65.689 glasses. With 5% or 3.285 glasses lost, a remaining 62.404 glasses will be sold, resulting in a turnover of 748.848 ETB from honey. Wax will bring 289,3 x 50 ETB = 14.465 ETB, adding up to a total turnover of 763.313 ETB. Costs will be 348.000 ETB for 29.000kg of honey and 183.930 ETB for 65.689 glasses, adding up to total costs of 531.930 ETB. Year 3: In the third year the number of beehives will be increased to 29 in Michibigny and 36 in each of the other four localities, altogether to 173. At the same time, the productivity of each beehive is expected to increase from 26kg to 27kg, resulting in a total output of the farm of

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4.671 kg. In addition, 34.000kg of honey will be bought from individual families, resulting in a total amount of 38.671kg in the third year. Out of the 4.671kg self-production, 7% or 326,9kg will be wax, leaving 4.344,1kg of honey. Together with the honey bought, there will be 38.344,1kg of honey or 76.688 glasses. With 5% or 3.835 glasses lost, a remaining 72.853 glasses will be sold, resulting in a turnover of 874.236 ETB from honey. Wax will bring 326,9 x 50 ETB = 16.495 ETB, adding up to a total turnover of 890.731 ETB. Costs will be 374.000 ETB for 34.000kg of honey and 214.727 ETB for 76.688 glasses, adding up to total costs of 588.727 ETB. Year 4: In the fourth year the number of beehives will be increased to 32 in Michibigny and 38 in each of the other four localities, altogether to 184. At the same time, the productivity of each beehive is expected to increase from 27kg to 30kg, resulting in a total output of the farm of 5.520 kg. In addition, 43.000kg of honey will be bought from individual families, resulting in a total amount of 48.520kg in the fourth year. Out of the 5.520kg self-production, 7% or 386,4kg will be wax, leaving 5.133,6kg of honey. Together with the honey bought, there will be 48.133,6kg of honey or 96.267 glasses. With 5% or 4.814 glasses lost, a remaining 91.453 glasses will be sold, resulting in a turnover of 1.097.436 ETB from honey. Wax will bring 386,4 x 50 ETB = 19.320 ETB, adding up to a total turnover of 1.116.756 ETB. Costs will be 473.000 ETB for 43.000kg of honey and 269.548 ETB for 96.267 glasses, adding up to total costs of 742.548 ETB. Year 5: In the fifth year the number of beehives will be increased to 35 in Michibigny and 40 in each of the other four localities, altogether to 195. The productivity of each beehive is expected to remain at 30kg, resulting in a total output of the farm of 5.850 kg. In addition, again 43.000kg of honey will be bought from individual families, resulting in a total amount of 48.850kg in the fifth year. Out of the 5.850kg self-production, 7% or 409,5kg will be wax, leaving 5.440,5kg of honey. Together with the honey bought, there will be 48.440,5kg of honey or 96.881 glasses. With 5% or 4.845 glasses lost, a remaining 92.036 glasses will be sold, resulting in a turnover of 1.104.432 ETB from honey. Wax will bring 409,5 x 50 ETB = 20.475 ETB, adding up to a total turnover of 1.104.432 ETB. Costs will be 473.000 ETB for 43.000kg of honey and 271.227 ETB for 96.881 glasses, adding up to total costs of 744.267 ETB.

Please see the resulting increase in profits from the business plan. Since the honey will be harvested and packed only at the end of each year, the return of each year will be realized only in the next year. As the honey farm uses resources of the National Park for most of the honey production, it will pay a kind of concession fee in the amount of 10% of its net profits to the National Park Administration and respectively, after its establishment, to the Simen Mountains Trust Fund.

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Marketing Marketing will build on the uniqueness and natural purity of the Simen Mountains. As such, the honey will be marketed as a unique product available only in limited quantities and therefore rather on the high end of the market, but still well within reach of the general population. However, the marketing strategy will mean that it will be available only at selling points which offer goods of a high quality standard, such as the Arts and Crafts Shops (2.3.7.), the Tourist Cafs in Debark and Limalimo (2.3.14. and 2.3.15.), and in high-quality shops in Ethiopias major towns.

Trainings required: Business administration (1), accounting/bookkeeping (2), bee-keeping (10) Full-time jobs: 31 Manager/marketing officer (1), bee-keeping expert (1), accountant/bookkeeper (1), seller/cashier (1), bee-keepers (10), processors & packers (3), cleaners (2), guards (12) Indirect economic impacts: Increases food security and selection of foods available, and thus attractiveness of the region for tourism.

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4.2.1.3. Investment Plan Honey Farm

1. 1.1. 1.2. 1.3. 1.4. 2. 2.1. 2.2. 2.3. 2.4. 2.5. 3. 3.1. 3.2. 4. 4.1. 5. 5.1. 5.2. 5.3. 5.4. 6. 6.1. 6.2. 6.3. 6.4. 6.5. 7. 7.1. Legal and administrative costs Lawyer Registration Construction Permits Other fees and licenses Sub-Total Legal and Administrative Costs Real Estate Land 5.5 ha Planning and design Buildings and Constructions Development Electrical and sanitary installations Sub-Total Real Estate Machinery, Furnitures and Equipment Office Furniture and Equipment Agricultural Machinery and Equipment Sub-Total Machinery, Furnitures and Equipment First Set of Goods Bees Sub-Total First Set of Goods Market Introduction Company plates (6) Opening Ceremony Presentation on trade fairs Company Leaflet (2.000 copies) Sub-Total Market Introduction Trainings Bee-keeping & management Honey processing + quality management Honey Packing & Marketing Business Adminstration Accounting/Bookkeeping (2) Sub-Total Trainings Financing Start-up Assistance Sub-Total Financing Total Investment Costs (ETB) Total Investment Costs (USD) 350 60 1.500 6.200 8.110 0 15.000 617.000 358.726 990.726 276.846 603.825 880.671 34.500 34.500 12.000 5.000 7.000 8.149 32.149 30.380 17.200 17.700 4.746 9.432 79.458 920.750 920.750 2.946.364 346.631

2.3. Buildings and Construction Purpose Offices Tools + supplies house Firm house/office Warehouse Toilet/Shower House Guard house Fence with barbed wire Sub-Total Buildings and Construction

Description 3 rooms, each with 3mX4m 2 rooms 5 ; 1 room for each bee farm 2 rooms; for each farm 2 toilets / 1 shower 6; for 5 farms + coord. office 6, for each farm + coord.office

Size (m) 36 28 80 80 8 54 LS

Costs 72.000 56.000 160.000 160.000 16.000 108.000 45.000 617.000

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2.4. Development Description Electricity (pole, wire & installation) Water pipe 6m Water pipe installations Telephone installation Internet installation Hand-dug well; 2 for each farm Solar energy installation Wireless telephone installation Sub-Total Development

Unit cost No. of units 880 100 130 834 1.304 1 284 2 184 1 12.000 12 2.000 6 850 5

Costs 88.000 108.420 1.304 568 184 144.000 12.000 4.250 358.726

2.5. Electrical and Sanitary Installations Item Water tank (300 l) Shower Solar Water Heater / B2QH25 Mirror Sideboard Armature Toilet bowl Handwash bowl Ceramic for the floor / m wall / m Elbow (Corba) Pipe (3/4 inch) 3m - 1piece Counter 3/4 inch Water pipe 1/2 inch -3m Counter 1/2 inch Tape Reducer Nipples Foset Total Sanitary installations

Unit cost No. of units 1.000 1 350 1 12.240 170 l 200 2 400 1 200 2 520 2 250 2 95 2 60 6 5 15 130 4 350 1 100 3 pieces 300 1 5 9 5 9 5 9 20 6

Total cost 1.000 350 12.240 400 400 400 1.040 500 190 360 75 520 350 300 300 45 45 45 120 18.680

3.1. Office Furniture and Equipment Description Office desk for central facility Desk armchair Office desk for farms Office chairs for 5 farms and central facility Sideboard / trunk Safe Ceiling lamps PC + monitor, keyboard, mouse and UBS Printer Solar panel and battery (for 5 farms) Antivirus software Telephone Fax Miscellaneous Sub-Total Office Furniture and Equipment

Unit cost No. of units 1.800 3 970 3 800 5 300 10 1.500 8 3.000 1 80 26 11.000 3 4.678 2 40.000 5 400 1 150 2 2.800 1

Costs 5.400 2.910 4.000 3.000 12.000 3.000 2.080 33.000 9.356 200.000 400 300 2.800 4.000 276.846

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3.2. Machinery and Equipment Description Toyota Hilux Pic Up (2nd Hand) Frame beehives; for 5 firms Veil; for firm Chisel Knife Fork Enbader Aluminized Queen excluder Wire string Smoker Cast molding Brush Plastic container 100 liter Plastic container 30 liter Table scale Honey extractor Jam jar Honey spoon Honey press Ground scale (200kg capacity) Clothes for bee-keepers & visitors Plastic boots for bee-keepers & visitors Gloves Water cane Company plate Plastic bowl Iron dish (Goal) Honey filler Safe Cloth for filtration Tridle Pump; 2 for each farm Water hose (50m) Water tank (Roto) Ladders Shelves for machinery and tools Shovels, 10 for each farm Hoe; 10 for each farm Hand tool fo cultivation; 10 for each farm Sub-Total Agricultural Machinery + Equipment 6. Trainings Description 6.1. Bee-keeping & management Training fee 1 months Per diem 12 participants Travel for round trip (Holeta or Addis) Sub-Total Bee-keeping and Management Honey processing + quality management Training fee 1 months Per diem 5 participants Travel for round trip (Addis) Sub-Total Honey processing + quality management 6.2. Honey Packing & Marketing Training fee 1 months Per diem 5 participants Travel for round trip (Addis) Sub-Total Honey Packing & Marketing

Unit cost 250.000 650 30 70 25 120 200 110 500 85 7.000 50 135 40 200 3.000 1 65 4.000 3.400 80 55 85 45 500 20 100 1.000 3.000 10 500 250 1.500 500 1.500 30 30 30

No. of units 1 145 50 25 25 25 25 145 3 50 1 50 440 280 12 6 1.000 30 10 6 80 80 80 60 6 10 4 2 1 100 10 6 6 6 6 50 50 50

Costs 250.000 94.250 1.500 1.750 625 3.000 5.000 15.950 1.500 4.250 7.000 2.500 59.400 11.200 2.400 18.000 1.250 1.950 40.000 20.400 6.400 4.400 6.800 2.700 3.000 200 400 2.000 3.000 1.000 5.000 1.500 9.000 3.000 9.000 1.500 1.500 1.500 603.825

Unit cost No. of units 250 58 200 30 360 10

Costs 7.500 20.880 2.000

Totals

30.380 250 58 200 30 150 5 7.500 8.700 1.000 17.200 250 58 300 30 150 5 7.500 8.700 1.500 17.700

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4.2.1.3. Business Plan Honey Farm

Year 1 Gross turnover from honey from wax Turnover tax 2% Net turnover Costs for goods Honey Glasses and labels Beehives Firewood Gross profit Running Costs Personnel Telecommunication, electricity, water Office and administration Vehicle (incl. gasoline) Per diems Small equipment purchases Maintenance and repair Public Relations Fees and legal services Savings (investments over 15 years) Result before taxes (net profit) License fee for use of National Park (10%) Income tax (10 %) Result after taxes (net earnings) 0 0 0 0 0 -434.934 -275.000 -150.934 0 -9.000 -434.934 -190.600 -131.100 -6.000 -2.400 -45.000 -2.400 -500 -1.200 -1.000 -1.000 0 -625.534 0 0 -625.534 -139.300 -6.600 -2.400 -45.000 -2.400 -2.000 -1.500 -5.000 -1.000 0 -128.935 0 0 -128.935 -348.000 -183.930 -9.100 -9.900 76.265 -205.200 -144.700 -7.200 -2.400 -54.000 -2.400 -2.000 -1.500 -5.000 -1.000 0 -65.514 0 0 -65.514 614.508 12.687 0 627.195 -550.930 -374.000 -214.727 -9.100 -10.800 154.686 -220.200 -144.700 -7.700 -2.400 -62.600 -2.400 -2.500 -2.000 -5.000 -1.000 0 -100.767 0 0 -100.767 Year 2 627.195 748.848 14.465 0 763.313 -608.627 -473.000 -269.548 -7.150 -11.500 129.533 -230.300 Year 3 763.313 874.236 16.495 0 890.731 -761.198 Year 4 890.731 Year 5 1.116.756 1.097.436 19.320 0 1.116.756 -763.577 -473.000 -271.227 -7.150 -12.200 353.179 -333.558 -150.100 -8.200 -2.400 -78.250 -2.400 -2.500 -2.500 -5.000 -1.000 -81.208 19.621 -1.962 -1.962 15.697 Year 6 1.116.756 1.097.436 19.320 -22.336 1.094.420 -756.427 -473.000 -271.227 0 -12.200 337.993 -333.558 -150.100 -8.200 -2.400 -78.250 -2.400 -2.500 -2.500 -5.000 -1.000 -81.208 4.435 -444 -444 3.547

Personnel Manager/Marketing Officer Bee-keeping expert Bookkeeper Seller/Cashier Honey processors and packers Cleaner Bee-keepers Guard Total Personnel

Salary per month per year 1.000 12.000 900 10.800 600 7.200 600 7.200 450 5.400 400 4.800 400 4.800 400 4.800

Year 1 Number Costs 1 12.000 1 10.800 1 7.200 1 7.200 2 2.700 2 9.600 10 48.000 7 33.600 25 131.100

Year 2 Number Costs 1 12.000 1 10.800 1 7.200 1 7.200 2 10.800 2 9.600 10 48.000 7 33.700 25 139.300

Year 3 Number Costs 1 12.000 1 10.800 1 7.200 1 7.200 3 16.200 2 9.600 10 48.000 7 33.700 26 144.700

Year 4 Number Costs 1 12.000 1 10.800 1 7.200 1 7.200 3 16.200 2 9.600 10 48.000 7 33.700 26 144.700

Year 5 - 6 Number Costs 1 12.000 1 10.800 1 7.200 1 7.200 4 21.600 2 9.600 10 48.000 7 33.700 27 150.100

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4.2.1.4. Apple Plantation

The largest cities of Amhara State, Bahr Dar and Gondar, with populations of about 177.000 and 212.000 respectively and both equipped with airports, offer an extremely limited selection and amount of fruit. Mainly bananas, lemons and oranges can be bought, and some occasional papayas and mango, but not more than that. North of Gondar, no fruit can be obtained anymore all the way to Debark and further beyond the Simen Mountains escarpment. Only in the lowland villages of Zerima and Adiarkay fruit again become available, but again the small selection listed above. It would be quite difficult to explain for this situation since soil and climate conditions are quite favourable for growing a selection of different fruit such as apple and pineapple, which are in the country already, as well as others which can be introduced. The government has realized the serious lack of fruit in the country and is fully promoting the development of fruit plantations. Examples of plantations both in Fiche and Arba Minch show that apple-growing can be quite successful in Ethiopia. The potential market extends throughout the country except the extremely remote, hot and dry western, southern and southeastern regions. Since the market is virtually inexhaustible for the time being, there is a potential to establish several apple plantations in the Simen Mountains Region. They will find suitable environments in the highlands on brown soils above 2,200m altitude with cool rainy seasons, extended sunny periods, and temperatures never falling below 10 C for any lengthier period of time. There will be two apple plantations: one each in the Woredas of Debark and Janamora. The Woreda administrations have already indicated that they will be happy to provide the land required. It is essential that those plantations have road access throughout the year. Apple and other fruit tree plantations have an additional advantage in that they can be established on slopes, thereby helping to prevent soil erosion. The Austrian-supported IDP Project has already conducted a number of preparatory activities for establishing fruit-growing in the region. These include training, introduction of new plants seeds, hand tools, and technical support. Their experience can be built upon, and those individuals who received the training should be preferably considered for jobs in the plantation, but still practical trainings in existing apple plantations will be necessary. Based on the experience of the GTZ-led project in Fiche, apple trees can best be imported from Spain or obtained from the Fiche project (for 60 ETB landed costs per tree). Per hectare, 713 trees can be planted. For each tree, 5,3 man-days of labour are required per year. For 713 trees, this means that 3.779 man-days are required to work on the trees per year. The year having 300 working days, 12,6 workers are needed to do the work for each hectare, or 38 workers for 3 hectares. The trees start bearing fruit in the third year. Until then, there can be intercropping with vegetable and alfa-alfa grass. However, costs and income from this has not been included in the business plan. From year three, the trees will carry an average of 30kg of apples per year. One kg sold for 10 ETB, a gross turnover of 213.900 ETB can be expected from 1 ha of apple plantation and 641.700 ETB from 3ha. In order to cover running costs, a minimum of 3 ha per plantation is required. Land should however be reserved adjacent to the plantation for later extension.

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With good management, the application of pesticides should not be necessary. In case, however, 1,5kg of pesticides will be required per hectare per year; with costs of 80 ETB/kg and 3ha, the costs will be 360 ETB. Only a pick-up truck for general everyday transportation is foreseen for each fruit plantation, which will be able to manage fruit transportation during the harvesting season as well. Since the trees will have to be planted and reared, but will not bear fruit during the first two years, there will be costs but no income, and a start-up assistance will be needed in order to cover staff salaries and running costs for this time. As soon as the plantations will be well-established and operations will be routine, in addition to selling apples they can start a nursery in order to sell trees to the farmers in the region and provide them with trainings and supervision.

Trainings required: Business administration (2 x 1), bookkeeping (2 x 1), apple-growing (2 x 38) Full-time jobs created: 2 x 51 Manager, assistant/secretary, accountant/bookkeeper, specialist on apple-growing, plantation workers/packers (38), guards (6), technician (1), driver (1), cleaner (1) Indirect economic effect: Better supply for local fruit traders in the region; transfer of technology and know-how to local people; additional food supply helps tourism.

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4.2.1.4. Investment Plan Apple Plantation

1. 1.1. 1.2. 1.3. 1.4. 2. 2.1. 2.2. 2.3. 2.4. 2.5. 3. 3.1. 3.2. 4. 4.1. 4.2. Legal and administrative costs Lawyer Registration Construction Permits Other fees and licenses Sub-Total Legal and administrative costs Real Estate Land 4 ha Planning and design Buildings and Constructions Development Electrical and sanitary installations Sub-Total Real Estate Furniture and Equipment Agricultural Machinery and Equipment Office Furniture and Equipment Sub-Total Furniture and Equipment First Set of Goods 2139 Apple trees (landed costs) Pesticides Sub-Total First Set of Goods 350 60 1.500 6.200 8.110 0 15.000 638.000 198.192 19.980 851.192 490.035 308.271 798.306 128.340 0 128.340 8.149 10.000 18.149 4.746 4.746 3.900 33.300 46.692 430.942 430.942 2.281.731 268.439

5. Market Introduction 5.1. Company leaflet (2.000 copies) 5.2. Presentation on Trade Fairs Sub-Total Market Introduction 6. Trainings 6.1. Business administration (major) 6.2. Bookkeeping (major) 6.3. Marketing 6.4. Apple-growing (38) Sub-Total Trainings 7. Financing 7.1. Start-up assistance Sub-Total Financing Total Investment Costs (ETB) Total Investment Costs (USD)

2.3. Buildings and Construction Purpose Offices Generator, tools and supplies house Apple storage house Vehicle house Toilet / shower house Sub-Total Buildings and Construction

Description 4 office rooms, 1 meeting room 1 room 10m, 1 room 20m 1 room 1 room 2 toilets, 2 showers

Size (m) 100 30 100 80 9

Costs 200.000 60.000 200.000 160.000 18.000 638.000

2.4. Development Description Electricity (pole, wire & install.) Water pipe 6m Water pipe installations Telephone installation Internet installation Sub-Total Development

Unit cost 880 130 1.304 284 184

No. of units 100 834 1 1 1

Costs 88.000 108.420 1.304 284 184 198.192

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2.5. Electrical and Sanitary Installations Item Water tank (300 l) Shower Solar Water Heater / B2QH25 Mirror Sideboard Armature Toilet bowl Handwash bowl Ceramic for the floor / m2 wall / m2 Elbow (Corba) Pipe (3/4 inch) 3m - 1piece Counter 3/4 inch Water pipe 1/2 inch -3m Counter 1/2 inch Tape Reducer Nipples Foset Total Sanitary installations

Unit cost 1.000 350 12.240 200 400 200 520 250 95 60 5 130 350 100 300 5 5 5 20

No. of units 1 2 170 l 2 2 2 2 2 4 12 15 4 1 3 pieces 1 9 9 9 6

Total 1.000 700 12.240 400 800 400 1.040 500 380 720 75 520 350 300 300 45 45 45 120 19.980

3.1. Agricultural Machinery and Equipment Description Tractor Hanger Movable water tank Water collector Water hose for irrigation (100m) Pesticide sprayers Pruning cutters Ladders Bird scares Baskets for harvesting Ground balance Shelves for machinery and tools Ceiling lamps Gate Gate sign Fence posts (1,5m high) Mesh wire, 1,25m high Nails Plastic box for transporting Shovels Hoes Tool kit Sub-Total Agricultural Machinery + Equipment

Unit cost 300.500 93.000 9.000 10.725 500 400 40 500 30 15 5.000 1.500 80 3.000 200 67,5 10/m 9/kg 90 30 30 650

No. of units 1 1 1 1 2 4 10 10 12 60 1 4 20 1 1 250 1.000 25 250 25 25 1

Costs 300.500 93.000 9.000 10.725 1.000 1.600 400 5.000 360 900 5.000 6.000 1.600 3.000 200 16.875 10.000 225 22.500 750 750 650 490.035

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3.2. Office Furniture and Equipment Description Pick-up Truck Office desk Desk armchair Office table Office chair Trunk Sideboard Ceiling lamp Desk lamp Safe Wardrobe PC + monitor, keyboard, mouse Printer Bookkeeping software Antivirus software Telephone Fax Tables Chairs Small water boiler Tea glasses Coffee glasses Tea pot Spoons Miscellaneous Sub-Total Office Furniture and Equipment

Unit cost 212.500 2.000 1.270 1.100 450 3.200 1.500 80 300 3.000 400 11.000 4.000 30 400 150 2.800 800 250 495 4 3 72 2

No. of units 1 4 4 1 4 2 5 8 3 1 3 3 1 1 1 2 1 8 50 1 50 50 3 100

Costs 212.500 8.000 2.540 1.100 1.800 6.400 7.500 640 900 3.000 1.200 33.000 4.000 30 400 300 2.800 6.400 12.500 495 200 150 216 200 2.000 308.271

6. Trainings Description 6.3. Marketing Training fee Travel Per diems Total Marketing Training 6.4. Apple-growing Travel Debark - Fiche - Debark Training fee Per diems trainees Training materials Total Apple-growing Training Sub-Total Trainings

Unit cost No. of units

Costs 3.000 200 700 3.900 1.140 1.000 29.260 1.900 33.300 74.400

200 100

1 7

300 70 50

38 38 x 11 38

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4.2.1.4. Business Plan Apple Plantation

Year 1 - 2 Gross turnover Turnover tax (2%) Net turnover Other income Gross profit Costs for goods Pesticides Net profit Running Costs Personnel Telecommunication, electricity, water Office and administration Vehicle Land lease 4ha (42,55/ha) Small equipment purchases Maintenance and repair Public Relations Fees and legal services Per diems Savings (11,25% of installations and equipment) Result before taxes (net profit) Income tax (10%) Result after taxes (net earnings) 0 0 0 0 0 0 0 0 -215.471 -154.800 -7.500 -3.600 -45.000 -171 0 -2.000 0 0 -2.400 0 -215.471 0 -215.471 Salary + insurances per month per year 1.500 18.000 500 1.200 600 400 400 600 400 400 6.000 14.400 7.200 4.800 4.800 7.200 4.800 4.800 Year 1- 2 Number 1 1 1 1 13 6 1 1 1 26 -274.800 -7.500 -3.600 -60.000 -171 -5.000 -8.000 -8.000 -2.000 -2.400 -102.264 167.605 -16.761 150.844 Year 3- 5 Number 1 1 1 1 38 6 1 1 1 51 Year 3 - 5 641.700 0 641.700 0 641.700 0 -360 641.340 -473.735

Personnel Manager Assistant / secretary Apple specialist Bookkeeper Plantation worker Guard Technician Driver Cleaner Total Personnel

Costs 18.000 7.200 14.400 7.200 62.400 28.800 7.200 4.800 4.800 154.800

Costs 18.000 7.200 14.400 7.200 182.400 28.800 7.200 4.800 4.800 274.800

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4.2.1.5. Fruit Plantation

The largest cities of Amhara State, Bahr Dar and Gondar, with populations of about 177,000 and 212,000 respectively and both equipped with airports, offer an extremely limited selection and amount of fruit. Mainly bananas, lemons and oranges can be bought, and some occasional papayas and mango, but not more than that. North of Gondar, no fruit can be obtained anymore all the way to Debark. Only in the lowland villages of Zerima and Adiarkay north of the Wolkefit Pass fruit again become available, but again the small selection listed above. It would be difficult to explain for this situation since soil and climate conditions are quite favourable for growing a selection of different fruit such as apple, which are in the country already, as well as others which can be introduced. The government has realized the serious lack of fruit in the country and is fully promoting the development of fruit plantations. Examples in other parts of the country show that fruit-growing on a plantation basis can be successful in Ethiopia. The potential market extends throughout the country except possibly the remote, hot and dry extreme western, southern and eastern regions. Since the market is virtually inexhaustible for the time being, there is a potential to establish a number of plantations for different fruit in the Simen Mountains Region. While tropical fruit such as bananas, mango, papayas, avocado and oranges will grow well only in the lowlands north of the escarpment, introduced species from temperate Europe will find suitable environments in the highlands with cool rainy seasons, extended warm and sunny periods. Additional fruit which can be introduced on an economic scale are plum and pear. The Woreda administrations of Debark and Adiarkay have already indicated that they will be happy to provide land for fruit plantations. It is essential that those plantations have road access throughout the year. The Austrian-supported IDP Project has already conducted a number of preparatory activities for establishing fruit-growing in the region. These include training, introduction of new plants seeds, hand tools, and technical support. Their experience is built upon so that some activities and related costs did not have to be considered in this project proposal. An initial number of five plantations is foreseen, four of them in Adiarkay Woreda and one in Dabat or Wogera Woreda and each with a size of 4 hectares. They will all form one company and be managed by one central management unit in Debark, with small field offices and tea/meeting rooms on each of the five fields. This will not only save costs but will also allow an economy of scale, a greater flexibility in the selection of the fruit grown, a better mix of plants on each plantation, and last but nor least better security in times of smaller harvest in one of the five plantations. Five different fruit will be grown in the five plantations: Avocado, Mango, Oranges, Bananas and Papaya. All plants will bear fruit in the fifth year after planting with the exception of Papaya, which will bear fruit after one year. Based on figures from the Bureau of Agriculture and the Agricultural Research Institute, the following quantities have been calculated: Trees / ha 204 204 278 1,600 1111 Trees / farm 816 816 1,112 6,400 4,444 Output / farm 80,000 kg 80,000 kg 52,000 kg 52,000 kg 80,000 kg

Avocado Mango Orange Banana Papaya

74

Sales prices are producer prices, allowing margins of profit for a wholesaler of 15% and a retail seller of 30% before reaching average consumer prices. On that basis, the total income from sales is expected to be 853.200 ETB once all plants have reached full maturity. Since four of the five fruit (Avocado, Mango, Oranges and Bananas) will bear fruit only in the fifth year and Papaya only in the second year, substantial start-up assistance must be given during the first four years when no or little income can be made. The workforce on the farms will consist of 1 foreman and 2 labourers during years 1-4 when there is no or very small harvest, and 1 foreman and 15labourers from year 5. Because of sharply increased turnover and proceedings, the coordinating office will then be strengthened through a bookkeeper and a secretary. Transportation of the fruit will be a seasonal activity. Therefore, only a pick-up truck for general everyday transportation is foreseen for each fruit plantation. For transporting the harvests a truck will be rent from the wholesale and transport company (see 2.3.8.). With the overall harvest expected to reach 344.000 kg in year 5, and a big truck having a capacity of 10.000 kg, a maximum of 35 truckloads must be transported, which cost altogether 52,500 ETB. However it is assumed that an indefinite number of small deliveries will be made using the pick-up truck owned by the fruit plantation, and for this reason only 50,000 ETB have been calculated for transports in the business plan. A similar consideration has been made for calculating transports of Papaya during years 2-5.

Trainings required: Business administration (1), bookkeeping (1), fruit-growing (55) Full-time jobs created: 80 General manager, marketing officer, secretary/assistant, accountant/bookkeeper, agronomist, foremen (5), plantation workers/packers (50), guards (18), driver, cleaner Indirect economic effect: Better supply for local fruit traders in the region; additional food supply helps tourism.

75

4.2.1.5. Investment Plan Fruit Plantations

1. Legal and administrative costs 1.3. Construction Permits 1.4. Other fees and licenses Sub-Total Legal and Administrative Costs 2. Real Estate 2.1. Land 20 ha 2.2. Planning and design 2.3. Buildings and Construction 2.4. Development 2.5. Electrical and sanitary installations Sub-Total Real Estate 3. Machinery, Furnitures and Equipment 3.1. Machinery and Equipment 3.2. Office Furniture and Equipment Sub-Total Machinery, Furnitures and Equipment 4. First Set of Goods 4.1. Fruit seedlings 4.2. Fertilizer 4.3. Pesticides Sub-Total First Set of Goods Market 5. introduction 5.1. Opening Ceremony 5.2. Presentation on trade fairs 5.3. Company leaflet (2.000 copies) Sub-Total Market introduction 6. Trainings 6.1. Business adminstration (major) 6.2. Bookkeeping (major) 6.3. Fruit production and management 6.4. Marketing Sub-Total Trainings 7. Financing 7.1. Start-up assistance Sub-Total Financing Total Investment Costs Total Investment Costs (USD) 1.500 6.200 7.700 0 15.000 911.620 340.382 3.400 1.267.002 473.150 135.662 608.812 93.800 60.072 960 154.832

5.000 7.000 8.149 20.149 4.746 4.746 47.650 12.180 69.322 780.940 780.940 2.908.757 342.207

2.2. Buildings and Construction Purpose Description Coordinating Office 5 rooms (2 x 20sqm, 3 x 9sqm) Warehouse 1 room each for tools and storage Field office 5; each 1 office, 1 meeting room Storehouse 2 rooms for each farm Toilet house 2 toilets (3x2m), 5 outhouses Guard house 6; for 5 farms and coordinating office Barbed wire fence 5 x 700m, 1 x 300m Company plate 6 Sub-Total Buildings and Construction

Size (m) 67 30 150 140 16 9 LS

Costs 134.000 60.000 300.000 280.000 32.000 18.000 75.620 12.000 911.620

76

2.4. Development Description Electricity (pole, wire & installation) Water pipe 6m Water pipe installations Telephone installation Internet installation Hand dug well; 2 for each farm Solar energy installation Wireless telephone installation Sub-Total Development

Unit cost No. of units 880 100 130 834 1.304 6 284 6 184 1 12.000 10 2.000 5 850 5

Costs 88.000 108.420 7.824 1.704 184 120.000 10.000 4.250 340.382

2.4. Electric and Sanitary Installations Item Toilet bowl Handwash bowl Armature Elbow (Corba) Pipe (3/4 inch) 3m - 1piece Counter 3/4 inch Handwash bowl Water pipe 1/2 inch - 3m Elbow Counter 1/2 inch Tape Reducer Nipples Foset Total Sanitary installations

Unit cost No. of units 520 2 250 1 200 1 5 10 130 4 350 1 250 1 100 3 5 5 300 1 5 5 5 5 5 5 20 2

Costs 1.040 250 200 50 520 350 250 300 25 300 25 25 25 40 3.400

3.1. Machinery and Equipment Description Toyota Pick-up Truck Water Pump; 1 for each farm Tridle Pump; 2 for each farm Movable water tank; 1 for each farm Pesticide sprayers; 1 for each farm Water hose for irrigation (200m) Pruning cutters; 2 for each farm Ladders; 2 for each farm + coordinating office Bird scares Shelves for machinery and tools Shovel; 10 for each farm Hoe; 10 for each farm Spade; 10 for each farm Hand tool for cultivation; 10 for each farm Solar panels and battery Plastic box for transporting Sub-Total Agricultural Machinery + Equipment

Unit cost No. of units 212.500 1 7.000 5 500 10 9.000 5 400 5 5 1.000 85 10 500 12 30 10 1.500 6 30 250 30 250 30 250 30 250 20.000 5 90 250

Costs 212.500 35.000 5.000 45.000 2.000 5.000 850 6.000 300 9.000 7.500 7.500 7.500 7.500 100.000 22.500 473.150

77

3.2. Office Furniture and Equipment Description Office desk Field office desk Desk armchair Field office armchair Office table Office chair Sideboard Safe PC + monitor, keyboard, mouse, USB Printer Bookkeeping software Antivirus software Telephone Fax Tables Chairs Small water boiler Tea glasses Coffee glasses Tea pot Spoons Miscellaneous Sub-Total Office Furniture and Equipment

Unit cost No. of units 1.500 5 900 5 1.270 5 750 5 1.100 9 450 10 1.500 5 3.000 1 11.000 4 4.000 2 300 1 400 1 150 10 2.800 1 800 12 250 60 495 6 4 60 3 60 72 6 2 120 LS

Costs 7.500 4.500 6.350 3.750 9.900 4.500 7.500 3.000 44.000 8.000 300 400 1.500 2.800 9.600 15.000 2.970 240 180 432 240 3.000 135.662

4. First set of Goods Description 4.1. Seedlings Avocado Mango Orange Papaya Banana Sub-Total Seedlings 4.2. Fertilizers Avocado Mango Orange Papaya Banana Sub-Total Fertilizers 4.3. Pesticides Avocado Mango Orange Papaya Banana Sub-Total Pesticides Total First Set of Goods

Unit cost 6 6 10 2 10

No. of units 816 816 1.112 4.444 6.400

Cost 4.896 4.896 11.120 8.888 64.000 93.800 653 653 4.436 12.090 42.240 60.072 0 0 640 320 0 960 154.832

4/kg 4/kg 4/kg 4/kg 4/kg

163,2 163,2 1.108,8 3.022,4 10.560,0

80/l 80/l 80/l 80/l 80/l

0 0 8 4 0

78

6. Trainings Description Unit cost No. of units Fruit Production and Management Training fee for 1 months 250 / day 30 Per diem 55 participants 70 / day 55 x 9 Travel (Debark - Bahir Dar - Debark) 100 55 Sub-Total Fruit Production and Management Marketing Training fee 250 / day 30 Per diem 70 / day 2 x 32 Travel (Debark - Bahir Dar - Debark) 100 2 Sub-Total Marketing

Costs 7.500 34.650 5.500 47.650 7.500 4.480 200 12.180

79

4.2.1.6. Vegetable Farm

The largest cities of Amhara State, Bahr Dar and Gondar, with populations of about 177,000 and 212,000 respectively and both equipped with airports, offer an extremely limited selection and amount of vegetables. Mainly potatoes, cabbage and red beet can be bought, and some occasional carrots and tomatoes, but not more than that. North of Gondar, no vegetables can be obtained anymore all the way to Debark and further beyond the Simen Mountains escarpment. Only in the lowland villages of Zerima and Adiarkay vegetables again become available, but again the small selection listed above. It would be difficult to explain for this situation since soil and climate conditions are quite favourable for growing a selection of different vegetables such as potatoes, carrots, tomatoes, Swiss chard and salad, which are grown in other parts of the country already, as well as others which can be introduced. The government has realized the serious lack of vegetables in the country and is fully promoting the development of vegetables plantations. Examples in Oromiya show that vegetable-growing can be quite successful in Ethiopia. The potential market extends throughout the country except possibly the hot and dry extreme western, southern and eastern regions. Since the market is virtually inexhaustible for the time being, there is a potential to establish a number of plantations for different vegetables in the Simen Mountains Region. They will find suitable environments in the highlands with cool rainy seasons, extended warm and sunny periods. Additional vegetables which can be introduced as the vegetables market develops are sweet pepper, peas and cucumbers. The Woreda administrations of Debark, Adiarkay and Janamora have indicated that they will be happy to provide land for vegetable plantations. It is essential that those plantations have road access throughout the year. The Austrian-supported IDP Project has already conducted a number of preparatory activities for vegetable-growing in the area. These include training, introduction of new plants seeds, hand tools, and technical support. Their experience is built upon so that some activities and related costs did not have to be considered in the present project proposal. Five fields are foreseen, two in Janamora and one each in Dabat or Wogera Woreda and in the vicinity of Debark and Gondar. Each field will have a size of 3 hectares, with a small farm house and a potential for further extension. They will all form one company and be managed by one central management unit. This will not only save costs but will also allow an economy of scale, a greater flexibility in the selection of the fruit grown, a better mix of plants on each plantation, and last but nor least better security in times of smaller harvest in one of the five plantations. Vegetable grown will be Swiss chard, potatoes, carrots, salad and garlic. There will be three harvests for Swiss chard and two harvests for each of the other plants. Transportation of the vegetables will be a seasonal activity. Therefore, only a pick-up truck for general everyday transportation is foreseen for each vegetables plantation. For irregular transportations a truck will be rent from the wholesale and transport company (see 2.3.8.) Trainings required: Business administration (1), accounting/bookkeeping (1) Full-time jobs created: 113 Manager/marketing and sales officer, secretary, accountant/bookkeeper, seller/cashier, agronomist, foremen (5), plantation workers/packers (95), driver, guards (5), cleaner Indirect economic effect: Better supply for local vegetable traders in the region; additional food supply helps tourism.

80

4.2.1.6. Investment Plan Vegetable Farm

1. 1.1. 1.2. 1.3. 1.4. 2. 2.1. 2.2. 2.3. 2.4. 2.5. 3. 3.1. 3.2. 4. 4.1. 4.2. 4.3. 4.4. 5. 5.1. 5.2. 5.3. 6. 6.1. 6.2. 6.3. 6.4. Legal and administrative costs Contract agreements and statutes Registration Construction Permits Other fees and licenses Sub-Total Legal and Administrative Costs Real Estate Land 20.5 ha Planning and design Buildings and Construction Development Electrical and sanitary installations Sub-Total Real Estate Machinery, Furnitures and Equipment Machinery and Equipment Office Furniture and Equipment Sub-Total Machinery, Furnitures and Equipment First Set of Goods Vegetable seeds Fertilizer Pesticides Packaging and transporting materials Sub-Total First Set of Goods Market introduction Opening Ceremony Presentation on trade fairs Company leaflet (2.000 copies) Sub-Total Market introduction Trainings Business adminstration (major) Bookkeeping (major) Vegetable production and management Marketing Sub-Total Trainings Total Investment Costs Total Investment Costs (USD) 350 60 1.500 6.200 8.110 0 15.000 1.714.680 224.858 3.400 1.954.538 309.260 94.497 403.757 43.840 26.400 960 10.800 82.000 5.000 7.000 8.149 20.149 4.746 4.746 137.700 12.180 159.372 2.627.926 309.168

2.2. Buildings and Construction Purpose Description Offices 4 rooms, each with 3x4m Warehouse 1 room each for tools and storage Field office 10; each 1 office, 1 meeting room Storehouse 2 rooms for each farm Toilet house 2 toilets (3x2m), 10 outhouses Guard house 11; for 10 farms and central office Barbed wire fence 10 x 600m, 1 x 300m Company plate 11 Sub-Total Buildings and Construction

Size (m) 48 56 320 280 26 16,5

Costs 96.000 112.000 640.000 560.000 52.000 33.000 199.680 22.000 1.714.680

81

2.3. Development Description Electricity (pole, wire & install.) Water pipe 6m Water pipe installations Telephone installation Hand dug well Solar energy installation Wireless telephone installation Sub-Total Development

Unit cost No. of units 880 100 130 834 1.304 1 284 1 12.000 2 2.000 1 850 1

Costs 88.000 108.420 1.304 284 24.000 2.000 850 224.858

2.4. Electric and Sanitary Installations Item Unit cost Toilet bowl 520 Handwash bowl 250 Armature 200 Elbow (Corba) 5 Pipe (3/4 inch) 3m - 1piece 130 Counter 3/4 inch 350 Handwash bowl 250 Water pipe 1/2 inch - 3m 100 Elbow 5 Counter 1/2 inch 300 Tape 5 Reducer 5 Nipples 5 Foset 20 Sub-Total Sanitary installations

No. of units 2 1 1 10 4 1 1 3 5 1 5 5 5 2

Total cost 1.040 250 200 50 520 350 250 300 25 300 25 25 25 40 3.400

3.1. Machinery and Equipment Description Unit cost No. of units Toyota Pick-up Truck 212.500 1 Water Pump 7.000 1 Tridle Pump 500 2 Movable water tank 9.000 1 Pesticide sprayers 400 10 Water hose for irrigation 5 1.000 Bird scares 30 12 Shelves for machinery and tools 1.500 2 Shovel 30 20 Hoe 30 20 Spade 30 20 Hand tool for cultivation 30 20 Solar panels and battery 20.000 1 Plastic box for transporting 90 500 Sub-Total Agricultural Machinery + Equipment

Costs 212.500 7.000 1.000 9.000 4.000 5.000 360 3.000 600 600 600 600 20.000 45.000 309.260

82

3.2. Office Furniture and Equipment Description Unit cost Office desk 1.500 Desk armchair 1.270 Office table 1.100 Office chair 450 Sideboard 1.500 Safe 3.000 PC + monitor, keyboard, mouse, USB 11.000 Printer 4.000 Bookkeeping software 300 Antivirus software 400 Telephone 150 Fax 2.800 Tables 800 Chairs 250 Small water boiler 495 Tea glasses 4 Coffee glasses 3 Tea pot 72 Spoons 2 Miscellaneous Sub-Total Office Furniture and Equipment

No. of units 4 4 5 9 4 1 3 2 1 1 4 1 6 55 1 50 50 1 50

Costs 6.000 5.080 5.500 4.050 6.000 3.000 33.000 8.000 300 400 600 2.800 8.000 13.750 495 200 150 72 100 3.000 94.497

83

4. First Set of Goods Description Unit cost No. of units 4.1. Seeds Swiss chard 112 ETB/kg 30 Potato 1,25 ETB/kg 4.000 Salad 112 ETB/Kg 30 Carrot 120 ETB/kg 12 Garlic 360 ETB/kg 15 Sub-Total Seeds 4.2. DAP Swiss chard 4 ETB/kg 450 Potato 4 ETB/kg 450 Salad 4 ETB/kg 450 Carrot 4 ETB/kg 600 Garlic 4 ETB/kg 0 Sub-Total DAP 4.2. Urea Swiss chard 4 ETB/kg 100 Potato 4 ETB/kg 300 Salad 4 ETB/kg 150 Carrot 4 ETB/kg 0 Garlic 4 ETB/kg 600 Sub-Total Urea 4.3. Pesticides Swiss chard 80 ETB/l 0 Potato 80 ETB/l 6 Salad 80 ETB/l 0 Carrot 80 ETB/l 0 Garlic 80 ETB/l 0 Sub-Total Pesticides 4.4. Packaging / Transporting Materials Plastic transport boxes 90 ETB 60 Sub-Total Cost of Goods

Costs 3.360 5.000 3.360 1.440 5.400

Seasons 3 2 2 2 2

Totals 10.080 10.000 10.080 2.880 10.800 43.840 5.400 3.600 3.600 4.800 0 17.400 1.200 2.400 600 0 4.800 9.000 0 960 0 0 0 960 10.800 82.000

1.800 1.800 1.800 2.400 0

3 2 2 2 2

400 1.200 600 0 2.400

3 2 2 2 2

0 480 0 0 0

3 2 2 2 2

5.400

6. Trainings Description Unit cost Vegetable Production and Management Training fee for 1 month 250 / day Per diem 110 participants 70 / day Travel (Debark - Bahir Dar - Debark) 100 Sub-Total Fruit Production and Management Marketing Training fee 250 / day Per diem 70 / day Travel (Debark - Bahir Dar - Debark) 100 Sub-Total Marketing

No. of units 14 110 x 16 110

Costs 3.500 123.200 11.000 137.700 7.500 4.480 200 12.180

30 2 x 32 2

84

4.2.1.6. Business Plan Vegetable Farm

Year 1 Gross turnover Turnover tax 2% Net turnover Costs for goods Gross profit Running Costs Personnel Telecommunication, electricity, water Office and administration Vehicle (gasoline 20.000km) Transports Travel Small equipment purchases Maintenance and repair (incl. vehicle) Public Relations Fees, legal and bookkeeping services Saving (10% of equipment and machinery) Result before taxes (net profit) Income tax (10%) Result after taxes (net earnings) 832.650 0 832.650 0 832.650 -725.868 -570.600 -9.600 -3.600 -20.080 -70.000 -3.000 -2.400 -20.000 -5.000 -1.500 -20.088 106.782 -10.678 96.104 Turnover Unit price 2,2 / kg 1,4 / kg 1,1 / kg 1,4 / kg 6,7 / kg Year 1 - 6 Units sold Income 108.000 237.600 180.000 252.000 72.000 79.200 151.200 108.000 134.000 20.000 488.000 854.000 -12.200 -21.350 475.800 832.650 Year 2 - 4 832.650 0 832.650 -82.000 750.650 -728.868 -570.600 -9.600 -3.600 -20.080 -70.000 -3.000 -2.400 -23.000 -5.000 -1.500 -20.088 21.782 -2.178 19.604 Year 5 832.650 0 832.650 -82.000 750.650 -727.368 -570.600 -9.600 -3.600 -20.080 -70.000 -3.000 -2.400 -25.000 -1.500 -1.500 -20.088 23.282 -2.328 20.954 -570.600 -9.600 -3.600 -20.080 -70.000 -3.000 -2.400 -25.000 -1.500 -1.500 -20.088 6.629 -663 5.966 Year 6 832.650 -16.653 815.997 -82.000 733.997 -727.368

Swiss chard Potato Salad Carrot Garlic Raw Turnover Losses 2,5% of output Final Turnover

85

Cost of Goods Description Unit cost Seeds Swiss chard 112 ETB/kg Potato 1,25 ETB/kg Salad 112 ETB/Kg Carrot 120 ETB/kg Garlic 360 ETB/kg Sub-Total Seeds DAP Swiss chard 4 ETB/kg Potato 4 ETB/kg Salad 4 ETB/kg Carrot 4 ETB/kg Garlic 4 ETB/kg Sub-Total DAP Urea Swiss chard 4 ETB/kg Potato 4 ETB/kg Salad 4 ETB/kg Carrot 4 ETB/kg Garlic 4 ETB/kg Sub-Total Urea Pesticides Swiss chard 80 ETB/l Potato 80 ETB/l Salad 80 ETB/l Carrot 80 ETB/l Garlic 80 ETB/l Sub-Total Pesticides Plastic transport boxes 90 ETB Sub-Total Cost of Goods No. of units 30 4.000 30 12 15 Year 2 - 6 Costs Seasons 3.360 5.000 3.360 1.440 5.400 3 2 2 2 2 Totals 10.080 10.000 10.080 2.880 10.800 43.840 5.400 3.600 3.600 4.800 0 17.400 1.200 2.400 600 0 4.800 9.000 0 960 0 0 0 960 10.800 82.000 Personnel Manager / Marketing officer Secretary Bookkeeper Agronomist Foreman Farm worker Seller/cashier Driver Guard Cleaner Total Personnel Costs

450 450 450 600 0

1.800 1.800 1.800 2.400 0

3 2 2 2 2

Salary Year 1 - 6 per month per year Number Costs 1.250 15.000 1 15.000 500 6.000 1 6.000 600 7.200 1 7.200 750 9.000 1 9.000 550 6.600 5 33.000 400 4.800 95 456.000 500 6.000 1 6.000 400 4.800 1 4.800 4.800 5 24.000 400 400 4.800 2 9.600 113 570.600

100 300 150 0 600

400 1.200 600 0 2.400

3 2 2 2 2

0 6 0 0 0 60

0 480 0 0 0 5.400

3 2 2 2 2 2

86

4.2.2. Processing Sector

4.2.2.1. Cotton - Weaving Cooperative
Cotton is grown by local farmers in the Simen Mountains region. They either sell it as a raw material on the open markets or spin it into threads. Locally, cotton is mainly woven into fota which are always in high demand. The Cotton-Weaving Workshop will both buy raw cotton and spin it and will buy dyed and undyed threads and silk in Gondar. As many women living in SMNP are already involved in spinning, there is a great potential to involve them in producing on a household level (once they have removed) and to buy their products from them for the cotton-weavery. Products will be fota, blankets, curtains and cultural clothes. More sophisticated items can be included in time and as skills allow. Sales will be both directly to end-users through a sales point at the manufacture (mainly for local people) and through arts and crafts shops in the Simen Mountains Region and beyond in the tourist centers of Gondar and Bahr Dar. Constructions for the manufacture will include a building for offices and the sales point, and one building for spinning, weaving and the storage of materials. For the calculation of input and output as well as costs and income please see the explanation given on the business plan. It is assumed that through practice and experience, the work productivity will increase after the third year.

Trainings required: Business administration (minor) (1), bookkeeping (minor) (1), design (15), weaving (15), spinning and sewing (5) Full-time jobs created: 24 Manager, bookkeeper, sales manager, spinners (5), weavers (15), cleaner Indirect economic impact: Contributes to establishing a value-added of wool production; increases attractiveness as a tourism destination through offering high-value souvenirs.

87

4.2.2.1. Investment Plan Cotton Weaving Cooperative

No. 1. 1.1. 1.2. 1.3. 2. 2.1. 2.2. 2.4. Items Legal and Administrative Costs Contract agreement and statutes Registration fee Construction permit for municipality Sub-Total Legal and Administrative Costs Real Estate Design and planning Buildings (office, store, storage and workshop) Development Electricity Telephone line Water Sanitary installations Sub-Total Real Estate Furniture and Equipment Furniture Chairs for workers Office chairs Office table Shelf Shelf / metal (1 piece = 3m) Display desk with glass Front display desk Wardrobe Curtains Equipment Weaving loom Spinning machine Sewing machine Lamps Fixed telephone apparatus Seals Seal pad with ink Company plate Stove, small Teapot (kettle) Tea glasses Coffee glasses Spoons for tea Stationary and related Sub-Total Furniture and Equipment Market introduction Marketing strategy Leaflet Presentation on trade fairs Sub-Total Market Introduction First Set of Goods Threads Cotton fibers of different color Packaging materials Sub-Total First Set of Goods Trainings Business administration Bookkeeping Design Weaving Spinning and sewing Sub-Total Trainings Total Investment Costs (ETB) Total Investment Costs (USD) Unit Cost 350 60 1.500 No. of units Total cost 350 60 1.500 1.910 15.000 2.000 1.000 284 1.694 15.000 300.000 1.000 284 1.694 2.280 317.978 Totals

150m2

2.5. 3. 3.1.

100 450 1.100 3.200 43 1.500 1.500 500 300 5.023 480 3.500 60 150 416 10 200 100 72 4 3 2

25 10 3 3 50 2 3 1 8 15 5 3 15 1 2 1 1 2 1 10 10 10

2.500 4.500 3.300 9.600 2.150 3.000 4.500 500 2.400 75.345 2.400 10.500 900 150 832 10 200 200 72 40 30 15 500 123.644

3.2.

4. 4.1. 4.2. 4.3. 5. 5.1. 5.2. 5.3. 6. 6.1. 6.2. 6.3. 6.4. 6.5.

5.000 . 5.000

1 expert 1000 copies 2 times

5.000 5.093 10.000 20.093

15 8 1

100 packets 200 rolls 500

1.500 1.500 500 3.500

1 1 15 15 5

1.277 1.277 13.100 109.340 15.040 140.034 607.159 71.431

88

2.5. Sanitary Installations Item Toilet bowl Handwash bowl Water pipe 1/2 inch -3m Elbow Counter 1/2 inch Tape Reducer Nipples Foset Total Sanitary installations

Unit price 520 250 100 5 300 5 5 5 20

No. of units 2 2 3 pieces 5 1 5 5 5 2

Total 1.040 500 300 25 300 25 25 25 40 2.280

6. Trainings Item 6.1. Business Administration Travel Debark - Bahr Dar - Debark Per diems Training fee Materials Total Business Administration Training 6.2. Bookkeeping Travel Debark - Bahr Dar - Debark Per diems Training fee Materials Total Bookkeeping Training 6.3. Design Travel trainer Addis - Debark - Addis Per diems trainer Training fees Coffe break trainees Training materials Total Design Training 6.4. Weaving Travel Trainer Addis - Debark - Addis Per diems Training fees Per diems trainees Training materials Total Weaving Training 6.4. Sewing and Spinning Travel Trainer Gondar - Debark - Gondar Per diems Training fees Per diems trainees Training materials Total Spinning and Sewing Training Total Trainings

Unit price 100 70 637 lump sum

Unit 1 1x7 1

Total 100 490 637 50 1.277 100 490 637 50 1.277 300 1.600 4.000 4.200 3.000 13.100 300 6.440 3.000 96.600 3.000 109.340 100 2.240 1.000 11.200 500 15.040 140.034

100 70 637 lump sum

1 1x7 1

300 100 lump sum 20 200

1 1 x 16 15 x 14 15

300 70 70 200

1 1 x 92 15 x 92 15

100 70 70 100

1 1 x 32 5 x 32 5

89

4.2.2.1. Business Plan Cotton Weaving Cooperative

Month Gross turnover Turnover tax (2%) Net turnover Costs for goods Other income Gross profit Running Costs Personnel Telecommunication, electricity, water Office and administration Small equipment purchases Maintenance and repair Public Relations Fees and legal services Transports Travel Savings Result before taxes (net profit) Income tax 10 % Result after taxes (net earnings) 23.400 -468 22.932 -10.075 0 12.857 -12.655 -11.900 -300 -150 0 -150 0 -5 -150 0 0 202 -21 181 Year 1-3 280.800 -5.616 275.184 -120.900 0 154.284 -151.860 -142.800 -3.600 -1.800 0 -1.800 0 -60 -1.800 0 0 2.424 -243 2.181 Month 32.500 -650 31.850 -13.975 0 17.875 -14.127 -11.900 -300 -150 0 -150 0 -5 -150 0 -1.472 3.748 -375 3.373 -142.800 -3.600 -1.800 0 -1.800 0 -60 -1.800 0 -17.664 44.976 -4.498 40.478 Year 4-5 390.000 -7.800 382.200 -167.700 0 214.500 -169.524

Turnover Output / day Turnover years 1-3 Weaving Spinning Total Turnover years 1-3 Turnover years 4-5 Weaving Spinning Total Turnover years 4-5 5m / day Days / month 26 26 No. of workers 15 5 Output / month 1.950m Unit price 10 / m 30 Income / month 19.500 3.900 23.400 27.300 5.200 32.500 Income / year 234.000 46.800 280.800 327.600 62.400 390.000

7m / day

26 26

15 5

2.730m

10 / m 40

90

Cost of Goods Product Years 1-3 Roll of fiber Cotton Total Cost of Goods Years 4-5 Roll of fiber Cotton Total Cost of Goods Unit cost 7,5 10 No. of units 0,6 5 Output / month 1950m 26 Cost / month Cost / year 8.775 1.300 10.075 12.285 1.690 13.975 105.300 15.600 120.900 147.420 20.280 167.700

7,5 13

0,6 5

2.730m 26

Personnel Salaries / month Quantity Manager Bookkepper and accountant Weaver Guard Cleaner Sewer Spinner Total Personnel 600 500 500 400 400 500 400 3.300 1 1 15 1 1 1 5 25 Salaries / year 600 500 7.500 400 400 500 2.000 11.900

91

4.2.2.2. Basketry Cooperative

Basketry is among the most important types of handmade souvenirs in Ethiopia (antiques are not considered here). The main basketry products are shallow bowls and oval or round boxes with lids in various sizes. Basketry is still in general household use, and thus basketry souvenirs reflect in some way local culture. However, with few exceptions, the items are of simple standard from a point of view of both art and craftsmanship. Most of it is mass production, and although exhibiting good taste and style not made to last or for with an ambition for high artistic quality. Tourists visiting Ethiopia in general and the northern highlands in particular are mostly welleducated, well-earning middle-class people interested in the history, culture and nature of the country. They can be expected to have a more refined taste and be ready to spend more money on quality items which truly reflect Ethiopian culture rather than items of little or no value and authenticity. The basketry will be produced from three different types of grasses: Papyrus, and Akirma and Sendero. Papyrus, which is used for more gross products such as big storage baskets and injera will be transported from Adiarkay or Lake Tana. About four baskets can be produced from one bundle of papyrus which costs 30 ETB on the open market in Bahr Dar. Akirma and Sendedo (which are always used together) can be found in the Simen Mountains and are used for finer basketry such as plates, trays and small bowls. Akirma costs 20 ETB per bundle of 4kg, and Sendedo costs 1 ETB per bundle of ca. 20g undyed, and 8 ETB per bundle of ca. 250g dyed. Dyes cost 400 ETB per kg, lasting for about one year. For tourists, a decorated plate of ca. 35cm diameter is sold for 35 ETB, a small decorated basket with lid for 12 ETB, and a bigger decorated basket with lid (30cm) for 28 ETB. It is assumed that each artisan will produce at least an item for 35 ETB per day. With 10 artisans and 26 working days per month, the income will be 9.100 ETB per month or 109.200 per year. To produce an item for 35 ETB requires fibers in the value of 7,5 ETB. Therefore, the cost of goods for one months production of 10 artisans is 1.950 ETB in fibers and 34 ETB in dyes, adding up to 1.984 ETB per month or 23.808 ETB per year. A basket covered with cattle leather sells for 30-40 ETB depending on size, and a cow skin costs 120-150 ETB. From each skin, 8 big baskets can be covered. One of the artisans will be trained in business administration, another one in bookkeeping, and they will assume the respective tasks in addition to their artistic work. All artisans will sell their items for the same agreed and fixed prices and under a common brand name, and thus strengthen their market position Trainings required: Business administration (1), bookkeeping (1), basketry design (10) Full-time jobs created: 11 Artisans (10), cleaner Indirect economic effects: Increases the attractiveness of the region for tourism through a better offer of high-quality souvenirs.

92

4.2.2.2. Investment Plan Basketry Cooperative

No. 1. 1.1. 1.2. 1.3. 2. 2.1. 2.2. 2.4. Items Legal and Administrative Costs Fee for developing contract agreement and statutes Registration fee Construction permit from municipality Sub-Total Legal and Administrative Costs Real Estate Design and planning Buildings (office, toilets, store, storage and workshop) Development Electricity Telephone line Water Sanitary installations Sub- Total Real Estate Furniture and Equipment Furniture Chairs for workers Office chairs Office table Shelf Shelve / metal ( 1 piece =3m) Display desk with glass Front display desk Lamps Wall/room decoration Curtains Equipment Complete basketry equipment Telephone Seals Seal pad with ink Company sign Stove, small Tea pot (kettle) Tea glasses Coffee glasses Spoons for tea Sub-Total Furniture and Equipment Market Introduction Leaflet Presentation on trade fairs Sub-Total Market Introduction First Set of Goods Goods Cotton fibers of different color Sendedo and akirma Papyrus Dyes Stationery and related Transports Sub-Total First Set of Goods Trainings Business administration Bookeeping Design Sub-Total Training Total Investment Costs Total Investment Costs (USD) Unit cost 350 60 1.500 No. of units Total cost 350 60 1.500 1.910 15.000 2.000 1.000 284 1.694 15.000 160.000 1.000 284 1.694 2.280 177.978 Totals

80 m2

2.5. 3. 3.1.

100 450 1.100 3.200 43 1.500 1.500 60 500 300 10 150 416 10 200 100 72 4 3 2

20 10 3 3 25 2 3 30 1 8 100 1 2 1 1 2 1 10 10 10

2.000 4.500 3.300 9.600 1.075 3.000 4.500 1.800 500 2.400 1.000 150 832 10 200 200 72 40 30 15 35.224

3.2.

4. 4.1. 4.2. 5. 5.1.

5.000

1000 copies 2 times

5.093 10.000 15.093

100 roles

5.2. 6. 6.1. 6.2. 6.3.

5.000 5.000 5.000 100 500 3.000 18.600

1.277 1.277 750

1 1 10

1.277 1.277 7.500 10.054 258.859 30.454

93

2.5. Sanitary Installations Item Toilet bowl Handwash bowl Water pipe 1/2 inch -3m Elbow Counter 1/2 inch Tape Reducer Nipples Foset Total Sanitary installations Unit price 520 250 100 5 300 5 5 5 20 No. of units 2 2 3 pieces 5 1 5 5 5 2 Total 1.040 500 300 25 300 25 25 25 40 2.280

6. Trainings Item 6.1. Business Administration Travel Debark - Bahr Dar - Debark Per diems Training fee Materials Total Business Administration Training 6.2. Bookkeeping Travel Debark - Bahr Dar - Debark Per diems Training fee Materials Total Bookkeeping Training 6.3. Design Travel trainer Addis - Debark - Addis Per diems trainer Training fees Per diem trainees Training materials Total Design Training Total Trainings

Unit price 100 70 637 lump sum

Unit 1 1x7 1

Total 100 490 637 50 1.277 100 490 637 50 1.277 300 1.200 1.000 2.000 3.000 7.500 10.054

100 70 637 lump sum

1 1x7 1

300 100 lump sum 70 200

1 1 x 12 10 x 10 15

94

4.2.2.2. Business Plan Basketry Cooperative

Month Gross turnover Turnover tax (2%) Net turnover Costs for goods Other income Gross profit Running Costs Personnel Telecommunication, electricity, water Office and administration Small equipment purchases Maintenance and repair Public Relations Fees and legal services Transports Travel Savings Result before taxes (net profit) Income tax (10 %) Result after taxes (net earnings) 9.100 -182 8.918 -1.984 0 6.934 -6.344 -5.400 -200 -100 0 -100 0 -50 -200 0 -294 590 -59 531 Year 1-5 109.200 -2.184 107.016 -23.808 0 83.208 -76.128 -64.800 -2.400 -1.200 0 -1.200 0 -600 -2.400 0 -3.528 7.080 -708 6.372

Personnel Basketry artisans Cleaner Total Personnel

Salaries Salaries / Salaries / / month Quantity month year 500 10 5.000 60.000 400 1 400 4.800 11 900 5.400 64.800

95

4.2.2.3. Leatherworks Cooperative

Leatherworks are among the most important types of handmade souvenirs in Ethiopia (antiques are not considered here). Leather items include, among others, purses, belts and hides painted with portraits and sightseeing attractions of Ethiopia. While basketry is still in general household use and thus basketry souvenirs reflect in some way local culture, leather is only used for baby backpacks by rural women. It may be for this reason that, with few exceptions, leather handicrafts are of very poor standard from a point of view of both art and craftsmanship. Tourists visiting Ethiopia in general and the northern highlands in particular are mostly welleducated, well-earning middle-class people interested in the history, culture and nature of the country. They can be expected to have a more refined taste and be ready to spend more money on quality items which truly reflect Ethiopian culture rather than items of little or no value and authenticity. Although there is a large number of livestock in the region, skins and hides are not processed on place but are transported to Gondar, Bahr Dar and even Addis Ababa. The only locally-produced leather item to be found in quantities on the market in Debark is presently the traditional backpack for babies. However, the example of a leatherworks manufacture in Bahr Dar shows that this business can be quite profitable, and developing the leather industry is one of the highest priorities of the national government. The leatherworks cooperative shall produce simple processed leather items such as belts, bags and purses. Belts will be produced from cattle, and bags from sheep and goat skin. Buckles will be imported from China. The present quality level of leather handicrafts in Ethiopia is in general extremely low, which means that there is an economic niche in the upper segment of the market. Over time, the leatherworks cooperative shall strive to produce more refined items in order to increase profits and to meet the particular demands of tourists. For this reason, trainings are foreseen in order to ensure a quality level which will be attractive, and will positively distinguish items from the Simen Mountains Region from others. However, this level can be achieved only over time, and during the first years of operation which are calculated here, products of a lower standard are foreseen. The high profits to be made in this business allow much room for providing more training and obtaining better equipment almost at will. According to information from the leatherworks manufacture in Bahr Dar, each worker can produce 30 belts per day, selling each for 24 ETB. On 22 working days, this will amount to an output of 660 belts and an income of 15.840 ETB per worker and month, or 6.600 belts and 158.400 ETB for 10 workers. Over the year, a turnover of 1.900.800 ETB is achieved. It is assumed that other products have a similar result. On the cost side, 20 belts can be produced from 10 sq. feet of leather, which cost 105 ETB. This means that the leather for one belt costs 5,3 ETB. With 8 ETB added for the buckle, the cost of production of one belt is 13,3 ETB. For a months production of 6.600 belts the costs are 87.780 ETB, and for a years production they are 1.053.360 ETB.

Trainings required: Business administration (1), bookkeeping (1), leatherworks (10), sewing (1)

96

Full-time jobs created: 16 Manager/sales officer, accountant/bookkeeper, cashier/purchaser, workers (10), sewer, cleaner, guard Indirect economic effects: Processing of livestock raw material can contribute to opening up a way for decreasing the number of livestock by creating value-added chains.

97

4.2.2.3. Investment Plan Leatherworks Cooperative

No. 1. 1.1. 1.2. 1.3. 2. 2.2. 2.3. 2.4. Items Legal and Administrative Costs Contract agreement and statutes Registration Construction permit from municipality Sub-Total Legal and Administrative Costs Real Estate Planning and design Building (office, toilets, store, storage and workshop) Development Electricity Telephone line Water Sanitary installations Sub-Total Real Estate Furniture and Equipment Furniture Equipment Set of letters for imprints Scissors and pinging shears Scissors Hammers Design making instrument Sewing machine Fixed telephone Seals Seal pad with ink Company sign Pocket calculator Stove, small Tea glasses Coffee glasses Spoons for tea Teapot (kettle) Sub-Total Furniture and Equipment Market Introduction Leaflet Presentation on trade fairs Sub-Total Market Introduction First Set of Goods Goods Leather Threads Stationary and related Transports Sub-Total First set of Goods Trainings Business administration Bookkeeping Leatherwork Sewing Sub-Total Trainings Unit cost 350 60 1.500 No. of units Total cost 350 60 1.500 1.910 15.000 2.000 1.000 284 1.694 15.000 200.000 1.000 284 1.694 2.280 217.978 27.000 2.000 300 25 50 3.500 150 416 10 200 60 100 4 3 2 72 1 2 12 5 1 1 2 1 1 4 2 10 10 10 1 2.000 600 300 250 2.700 3.500 150 832 10 200 240 200 40 30 15 72 38.139 1000 copies 2 times 5.093 10.000 15.093 Totals

100m

2.5. 3. 3.1. 3.2.

4. 4.1. 4.2. 5. 5.1.

5.000

12 5

2.000 100 packets

5.2. 6. 6.1. 6.2. 6.3. 6.4.

24.000 500 500 500 25.500

1 1 10 1

4.746 4.746 74.640 14.680 98.812

Total Investment Costs (ETB) Total Investment Costs (USD)

397.432 46.757

98

2.5. Sanitary Installations Item Toilet bowl Handwash bowl Water pipe 1/2 inch -3m Elbow Counter 1/2 inch Tape Reducer Nipples Foset Total Sanitary installations

Unit price 520 250 100 5 300 5 5 5 20

No. of units 2 2 3 pieces 5 1 5 5 5 2

Total 1.040 500 300 25 300 25 25 25 40 2.280

3.1. Furniture Item Chairs for workers Office chairs Office table Shelf Work tables Shelve / metal ( 1 piece =3m) Display desk with glass Lamps Curtains Total Furniture

Unit price 100 450 1.100 3.200 400 43 1.500 80 300

No. of units 20 3 3 2 10 50 2 30 8

Total 2.000 1.350 3.300 6.400 4.000 2.150 3.000 2.400 2.400 27.000

6. Trainings Item 6.1. Business Administration Travel Debark - Addis Ababa - Debark Per diems Training fee Materials Total Business Administration Training 6.2. Bookkeeping Travel Debark - Addis Ababa - Debark Per diems Training fee Materials Total Bookkeeping Training 6.3. Leatherworks Travel trainer Addis - Debark - Addis Per diems trainer Training fees Per diem trainees Training materials Total Leatherworks Training 6.4. Sewing Travel Trainer Gondar - Debark - Gondar Per diems Training fees Per diems trainees Training materials Total Sewing Training Total Trainings

Unit price 300 100 lump sum

No. of units 1 1 x 16

Total 300 1.600 2.746 100 4.746 300 1.600 2.746 100 4.746

300 100 lump sum

1 1 x 16

300 70 lump sum 70 200

300 6.440 1.500 10 x 92 64.400 10 2.000 74.640 1 1 x 92 100 6.440 1.500 1 x 92 6.440 1 200 14.680 98.812

1 1 x 92

100 70 70 200

99

4.2.2.3. Business Plan Leatherworks Cooperative

Gross turnover VAT (15%) Turnover tax (2%) Net turnover Costs for goods VAT return (15%) Other income Gross profit Running Costs Personnel Telecommunication, electricity, water Office and administration Small equipment purchases Maintenance and repair Public Relations Fees and legal services Transports Travel Savings (10% of investments) Result before taxes (net profit) Income tax (10 %) Result after taxes (net earnings) Month 158.400 -23.760 -3.168 131.472 -87.780 13.167 0 56.859 -13.923 -8.600 -500 -2.000 0 -500 0 -5 -2.000 0 -318 42.936 -4.294 38.642 Year 1-5 1.900.800 -285.120 -38.016 1.577.664 -1.053.360 158.004 0 682.308 -167.074 -103.200 -6.000 -24.000 0 -6.000 0 -60 -24.000 0 -3.814 515.234 -51.524 463.710

Personnel Manager Bookkeeper Cashier and purchaser Workers Sewer Cleaner Guard Total Personnel

Salaries 1.200 600 500 500 500 400 400

Quantity 1 1 1 10 1 1 1 16

Salaries / month 1.200 600 500 5.000 500 400 400 8.600

Salaries / year 14.400 7.200 6.000 60.000 6.000 4.800 4.800 103.200

100

4.2.3. Trade and Services Sector

4.2.3.1. - 4.2.3.3. Supermarkets for Household Goods, Packed Food and Mixed Goods
The selection of household goods, packed foods and drugstore items available in the Simen Mountains Region is minimal. Although there are many shops which offer such goods, none of them offers more than only the most basic items. In contrast, the demand for such goods is great. Household goods like buckets, brushes, small towels, cleaning items are in need everywhere and anytime. Packed foods such as juices, biscuits, chocolates, nuts and kernels, dried fruit, and any kind of vegetables in glasses and cans must all be bought in Gondar. The same is true for any wider selection of perfumes, hair and personal care as well as female make-up items. Observation in Debark and Gondar tells clearly that people are looking for such items and will buy if they an option to do so. One problem which lies behind the fact that such items are not available in The Simen Mountains Region lies in the fact that traders do not possess enough capital in order to hold other items in store than those which promise the fastest return of investment. They cannot afford to buy items which they may sell only after a few weeks or even months. Another problem is that such items are not even easily available in the next major town, Gondar, and thus it becomes difficult for traders to buy them. If this problem will be addressed through the establishment of a wholesaler, people who used to buy in Gondar will be able to buy in Debark, and a lot of people who usually cannot afford trips to Gondar will have an opportunity to buy items otherwise out of their reach. Specialized supermarkets for household goods will be established in the major woreda centers of Debark and Adiarkay, serving not only the towns, but also wide areas to the south and the north of the Simen Mountains. A specialized supermarket for packed foods will rely on tourists for a sizeable part of its sales and therefore will be profitable only in Debark. However, there is a smaller demand for household goods, packed foods, drugstore items as well as fruit and vegetable also in the woreda centers of Mekhane Berkhan and Dabat, and for these two towns, mixed supermarkets will be established. Based on observations in existing supermarkets in Bahr Dar, it will be sufficient if one person will be present in the shop at any given time. This can be the manager/cashier or the seller. These two will be required to have some knowledge of English not only for serving foreign customers but also in order to be able to read information on the goods packages. The supermarkets will receive one full set of first goods for assumed sales of one month instead of cash as a start-up assistance. In their calculation, they differ only by the goods they offer. For the household supermarket, costs for goods amount to 15.885 ETB per month or 190.620 ETB per year. The average margin of profit is calculated to be 30% on top of the costs of goods, or 4.765 ETB per month. This makes a turnover of 20.650 ETB per month or 247.800 ETB per year. Likewise, for the food & drugs supermarket costs for goods amount to 40.480 ETB per month or 490.080 ETB per year. The average margin of profit is calculated to be 15% on top of the costs of goods, or 6.126 ETB per month. This makes a turnover of 46.966 ETB per month or 563.592 ETB per year.

101

The mixed supermarket will have a selection of both of the other two supermarkets. Here, costs for goods amount to 30.242 ETB per month or 362.904 ETB per year. The average margin of profit is calculated to be 20% on top of the costs of goods, 6.048 ETB per month or 72.580 ETB per year. This makes a turnover of 39.290 ETB per month or 435.484 ETB per year. Trainings required: English language (5 x 2), business administration (5 x 1), bookkeeping (5 x1) Full-time jobs created: 5 x 4 Manager/bookkeeper (1), cashier/seller (1), storage worker/packer/cleaner (1), guard (1) Indirect economic impact: Supermarkets will be important customers of the wholesaler company to be established. They will enhance the attractiveness of the region for tourism and shift spending to Debark which otherwise will be done in Gondar.

102

4.2.3.1. Investment Plan Supermarket for Household Items

No. 1. 1.1. 1.2. 1.3. 2. 2.1. 2.2. 2.3. Item Legal and administrative costs Registration Contracts Municipality construction permit Sub-total Legal & Administrative Real Estate Eviction compensation Planning and design Development Water Electricity Telephone Line Building Shop Storage room Toilet Electric and sanitary installations Sub-Total Real Estate Furniture and Equipment Furniture Chair Shelf / Dekson metal Cashier desk Ceiling lamp Equipment Telephone Cashier machine Pocket calculator Display board Company sign Ladder Seals Seal Pad with ink Sub-Total Furniture and Equipment First Set of Goods Goods Transport of goods Receipt blocks / office supply Sub-Total Goods Trainings Business management Accounting / Bookkeeping English language Sub-Total Trainings Total Investment Costs (ETB) Total Investment Costs (USD) Unit Cost 60 350 Total Amount Costs 60 350 1.500 1.910 60.000 15.000 1.694 1.000 284 2.000 2.000 2.000 60.000 15.000 1.694 1.000 284 42m 84.000 30m 60.000 4m 8.000 1.850 231.828 Totals

2.4.

2.5. 3. 3.1.

275 43 1.000 80 150 5.000 80 500 200 500 416 10

2 96 pieces 1 8 1 1 1 1 1 1 2 1

550 4.128 1.000 640 150 5.000 80 500 200 500 832 10 13.590 15.885 1.251 500 17.636

3.2.

4. 4.1. 4.2. 4.3. 5. 5.1. 5.2. 5.3.

1.277 1.277 4.720

1 1 2

1.277 1.277 9.440 11.994 276.958 32.584

103

4.1. Goods Description Stove Gasoline Kettles (set ) Pots / set Coffee cups Tea cups Water glass Whisky glass Scissors Knife / set Fork / set Teaspoon Spoon for soup Thermos / average Liquor glass Wine glass Beer glass Juice / milk shake glass Mug Salt cellars / set Bottle opener /set Bottle opener / single Teapot / set Waste bin Plastic bowls Towls - Large - Small - Dish Sponge Brush for - table - Pots / set - Pans / set Dish for eating / set Toilet brush Plastic buckets - 30 litre - 20 litre - 10 litre Floor brush / sweeper Plastic bags Match box / packet Lump Candle Clothes line Clothes hanger Foot mats Clothes detergent Dish detergent Detergent for bathroom Insecticide spray Shoe shine Intermediate Total Goods

Unit Cost 40 35 70 1.950 2 3 5 9 23 70 70 1 40 9 10 7 7 4 20 30 5 70 15 35 20 3 20 0.5 15 120 170 65 15 30 20 10 17 1 2 2 6 0.60 350 25 1 4 15 25 17

No. of units 10 10 10 1 100 100 100 10 10 1 1 100 100 10 10 10 10 10 10 10 10 10 10 10 10 10 10 10 200 10 1 1 1 10 10 10 10 10 100 50 100 50 200 2 10 100 50 10 10 10

Totals 400 350 700 1.950 200 300 500 90 230 70 70 100 100 400 90 100 70 70 40 200 300 50 700 150 350 200 30 200 100 150 120 170 65 150 300 200 100 170 100 100 200 300 120 700 250 100 200 150 250 70 12.075

Description Intermediate Total Goods Shoe brush Adapters / multi-plugs Light bulbs Soap - for cloth - for body Body cream Shampoo Hair spray Hair brush / set Comb Tooth brush Tooth paste Deo Perfumes Lipsticks Make-up Hair-needles Hair decoration Razor blades Shaving cream Sun glass Toilet paper Paper napkins Paper handkerchiefs Sub-Total Goods

Unit Cost 2 10 3 2 2 10 18 24 12 1 3 8 20 70 3 45 0,05 12 1 10 13 2 30 7

No. of units 50 10 50 100 100 10 10 10 10 100 50 10 10 10 10 5 100 10 10 10 10 100 10 10

Totals 12.075 100 100 150 200 200 100 180 240 120 100 150 80 200 700 30 225 5 120 10 100 130 200 300 70 15.885

2.5. Electric and Sanitary Installations Description Unit Cost No. of units Switch 20 3 Socket 10 3 Electric wire 5 50m Toilet bowl 520 1 Handwash bowl 250 1 Water pipe 1/2 inch -3m 100 3 pieces Elbow 5 5 Counter 1/2 inch 300 1 Tape 5 5 Reducer 5 5 Nipples 5 5 Foset 20 2 Total Electric and Sanitary Installations

Totals 60 30 250 520 250 300 25 300 25 25 25 40 1.850

104

4.2.3.1. Business Plan Supermarket Household Items

Gross turnover Turnover tax (2%) Net turnover Costs for Goods Other incoms Gross Profit Running Costs Personnel Telecommunication, electricity, water Office & administration Small equipment purchase Maintenance & repair Transports Savings Losses( 5% of cost for goods) Result Before taxes (Net profit) Income tax (10%) Result after taxes (Net earnings) Year 1 - 5 247.800 -4.956 242.844 -190.620 0 52.224 -46.191 -26.400 -3.600 -1.200 -500 -1.200 -2.400 -1.360 -9.531 6.033 -604 5.429

Personnel Salaries 800 600 400 400 Quantity 1 1 1 1 4 Salaries / month 800 600 400 400 2.200 Salaries / year 9.600 7.200 4.800 4.800 26.400

Manager Cashier/seller Cleaner Guard Total Personnel

105

4.2.3.2. Investment Plan Supermarket for Food and Drugs

No. 1. 1.1. 1.2. 1.3. 2. 2.1. 2.2. 2.3. Item Legal and administrative costs Registration Contracts Municipality construction permit Sub-total Legal & Administrative Real Estate Eviction compensation Planning and design Development Water Electricity Telephone Line Building Shop Storage room Toilet Electric and sanitary installations Sub-Total Real Estate Furniture and Equipment Furniture Chair Shelf / Dekson metal Cashier desk Ceiling lamp Equipment Telephone Cashier machine Pocket calculator Display board Company sign Ladder Seals Seal Pad with ink Sub-Total Furniture and Equipment First Set of Goods Goods Transport of goods Receipt blocks / office supply Sub-Total Goods Trainings Business management Accounting / Bookkeeping English language Sub-Total Trainings Total Investment Costs (ETB) Total Investment Costs (USD) Unit Cost 60 350 No. of units Costs 60 350 1.500 1.910 60.000 15.000 1.694 1.000 284 2.000 2.000 2.000 60.000 15.000 1.694 1.000 284 42m 84.000 30m 60.000 4m 8.000 1.850 231.828 Totals

2.4.

2.5. 3. 3.1.

275 43 1.000 80 150 5.000 80 500 200 500 416 10

2 96 pieces 1 8 1 1 1 1 1 1 2 1

550 4.128 1.000 640 150 5.000 80 500 200 500 832 10 13.590 40.840 1.251 500 42.591

3.2.

4. 4.1. 4.2. 4.3. 5. 5.1. 5.2. 5.3.

1.277 1.277 4.720

1 1 2

1.277 1.277 9.440 11.994 301.913 35.520

106

4.1. Goods Item Margarine Chocolate Butter Peanut butter Packed Honey 1/4 kg Macaroni Pasta Edible Oil Tomato sauce Lentils Wheat flour Rice Yeast Sugar Salt Pepper Spices Packed spices Tea Roasted / Powder Coffee Nescafe Cacao Biscuit Chocolate Candies Chewing Gum Bottled water Packed Juices Bottled Juice - Apple - Mango - Papaya - Orange - Banana - Avocado - Pineapple Soft drinks - Coca Cola - Pepsi - Lemon - Fanta - Mirinda - 7 UP Beer Box for bottles Wine - little - big Intermediate Total

Unit cost No. of units 25 10 27 10 13 10 24 10 4 / kg 100 4 100 11 lit / 100 5 100 4 kg 100 400 quint / 10 5 / kg 100 5 50 8 kg 200 1.5. 200 15 50 17 50 1 100 2 100 30 10 23 10 25 10 4 100 4 100 17 50 2 100 36 50 18 50 8 lit / 50 8 50 8 50 8 50 8 50 8 50 8 50 40 box 10 40 10 40 10 40 10 40 10 40 10 65 box 40 78 40 7 50 20 50

Totals 250 270 130 240 400 400 1.100 500 400 4.000 500 250 1.600 300 750 850 100 200 300 230 250 400 500 850 200 1.800 900 400 400 400 400 400 400 400 400 400 400 400 400 400 2.600 3.120 350 1.000 29.940

4.1. Goods ctd. Item Intermediate Total Vodka Ouzo Dry Gin Gordon Gin Highland Queen White Horse Alcohol Box for bottles Soap for body Soap for cloth Toilet Soap Razor blade Brush for table Tooth brush Tooth paste Shaving Shampoo Hair Oil Hair Cream Powder detergent Deodorant Soft paper Shampoo Sub-Total Goods

Unit cost No. of units Totals 29.940 95 10 950 17 50 850 13 50 650 145 10 1.450 110 10 1.100 170 10 1.700 10 10 100 77 10 770 2 100 200 2 100 200 0.5 400 200 1 100 100 16 10 160 1 100 100 8 50 400 10 50 500 26 10 260 18 10 180 1 200 200 23 10 230 2 200 400 20 10 200 40.840

2.5. Electric and Sanitary Installations Description Unit Cost No. of units Totals Switch 20 3 60 Socket 10 3 30 Electric wire 5 50m 250 Toilet bowl 520 1 520 Handwash bowl 250 1 250 Water pipe 1/2 inch 100 / 3m 3 pieces 300 Elbow 5 5 25 Counter 1/2 inch 300 1 300 Tape 5 5 25 Reducer 5 5 25 Nipples 5 5 25 Foset 20 2 40 Total Electric and Sanitary Installations 1.850

107

4.2.3.2. Business Plan Supermarket for Food & Drugs

Gross turnover Turn over tax (2 %) Net turnover Costs for goods Other income Gross profit Running Costs Personnel Telecommunication, electricity, water Office and administration Small equipment purchases Maintenance and repair Fees, legal and bookkeeping services Transports Travel Savings Losses (2% of costs for goods) Result before taxes (net profit) Income tax (10%) Result after taxes (net earnings) Year 1 - 5 563.592 -11.272 552.320 -490.080 0 62.240 -48.961 -26.400 -3.600 -1.200 -1.000 -1.200 -1.000 -2.400 -1.000 -1.359 -9.802 13.279 -1.328 11.951

Personnel Salaries Quantity Manager Cashier/seller Cleaner Guard Total Personnel 800 600 400 400 1 1 1 1 4 Salaries / month 800 600 400 400 2.200 Salaries / year 9.600 7.200 4.800 4.800 26.400

108

4.2.3.3. Investment Plan Mixed Supermarket

No. 1. 1.1. 1.2. 1.3. 2. 2.1. 2.2. 2.3. Item Legal and administrative costs Registration Contracts Municipality construction permit Sub-total Legal & Administrative Real Estate Eviction compensation Planning and design Development Water Electricity Telephone Line Building Shop Storage room Toilet Electric and sanitary installations Sub-Total Real Estate Furniture and Equipment Furniture Chair Shelf / Dekson metal Cashier desk Ceiling lamp Equipment Telephone Cashier machine Pocket calculator Display board Company sign Ladder Seals Seal Pad with ink Sub-Total Furniture and Equipment First Set of Goods Goods Transport of goods from Gondar Receipt blocks / office supply Sub-Total Goods Trainings Business management Accounting / Bookkeeping English language Sub-Total Trainings Total Investment Costs (ETB) Total Investment Costs (USD) Unit Cost 60 350 No. of units Costs 60 350 1.500 1.910 60.000 15.000 1.694 1.000 284 2.000 2.000 2.000 42m 30m 4m 60.000 15.000 1.694 1.000 284 84.000 60.000 8.000 1.850 231.828 Totals

2.4.

2.5. 3. 3.1.

275 43 1.000 80 150 5.000 80 500 200 500 416 10

2 96 pieces 1 8 1 1 1 1 1 1 2 1

550 4.128 1.000 640 150 5.000 80 500 200 500 832 10 13.590 30.242 1.251 500 31.993

3.2.

4. 4.1. 4.2. 4.3. 5. 5.1. 5.2. 5.3.

1.277 1.277 4.720

1 1 2

1.277 1.277 9.440 11.994 291.315 34.273

109

4.1. Goods Item Margarine Chocolate Butter Peanut butter Packed Honey 1/4 kg Macaroni Pasta Edible Oil Tomato sauce Lentils Wheat flour Rice Yeast Sugar Salt Pepper Spices Packed spices Tea Roasted / Powder Coffee Nescafe Cacao Biscuit Chocolate Candies Chewing Gum Bottled water Packed Juices Bottled Juice - Apple Mango Papaya Orange Banana Avocado Pineapple Soft drinks - Coca Cola - Pepsi - Lemonade - Fanta - Mirinda - 7 UP Beer Box for bottles Wine - little - big Vodka Ouzo Dry Gin Gordon Gin Highland Queen White Horse Alcohol Box for bottles Intermediate Total

Unit cost No. of units Totals 10 10 100 10 12 120 10 7 70 10 12 120 100 / kg 4 400 100 4 400 lit / 100 8 800 100 5 500 kg 100 4 400 quint / 10 200 2.000 100 / kg 3 300 50 5 250 kg 200 6 1.200 200 1,0 200 50 10 500 50 10 500 100 1 100 100 1 100 10 10 100 10 5 50 10 10 100 100 2 200 100 2 200 50 10 500 100 1 100 50 18 900 50 9 450 lit / 50 4 200 50 4 200 50 4 200 50 4 200 50 4 200 50 4 200 50 4 200 box 10 20 200 10 20 200 10 20 200 10 20 200 10 20 200 10 20 200 box 40 30 1.200 40 39 1.560 50 2 100 50 5 250 95 5 475 17 25 425 13 25 325 145 5 725 110 5 550 170 5 850 10 5 50 77 5 385 20.155

4.1. Goods ctd. Item Intermediate Total Soap for body Soap for cloth Toilet Soap Blade Brush for table Tooth brush Tooth paste Shaving Shampoo Hair Oil Hair Cream Powder detergent Deodorant Soft paper Shampoo Stove Gasoline Kettles (set ) Pots / set Coffee cups Tea cups Water glass Whisky glass Scissors Knife / set Fork / set Teaspoon Spoon for soup Thermos / average Liquor glass Wine glass Beer glass Juice / milkshake glass Mug Salt cellars / set Bottle opener /set Bottle opener / single Teapot / set Waste bin Plastic bowls Towels - Large - Small - Dish Sponge Brush for - table - Pots / set - Pans / set Dish for eating / set Toilet brush Plastic buckets - 30 l - 20 l - 10 l Intermediate Total

Unit cost No. of units Totals 20.155 2 50 100 2 50 100 0.5 200 100 1 50 50 16 5 80 1 50 50 8 25 200 10 25 250 26 5 130 18 5 90 1 100 100 23 5 115 2 100 200 10 10 100 40 5 200 35 5 175 70 5 350 1.950 1 1.950 2 30 60 3 40 120 5 50 250 9 4 36 23 5 115 70 1 70 70 1 70 1 30 30 1 30 30 40 3 120 9 4 36 10 4 40 7 5 35 7 5 35 4 5 20 20 3 60 30 4 120 5 4 20 70 3 210 15 5 75 35 10 350 20 10 200 3 10 30 20 10 200 1 50 50 15 2 30 120 1 120 170 1 170 65 1 65 15 3 45 30 5 150 20 5 100 10 5 50 27.607

110

4.1. Goods ctd. Item Intermediate Total Brush for the floor / sweeper Plastic bags Match box / packet Lump Candle Clothes line Clothes hanger Foot mats Clothes detergent Dish detergent Detergent for bathroom Insecticide spray Shoe shine Shoe brush Adapters / multi-plugs Light bulbs Body cream Hair spray Hair brush / set Comb Perfumes Lipsticks Make-up Hair-needles Hair decoration Razor blades Sun glass Toilet paper Paper napkins / Hotel packet Paper handkerchiefs Sub-Total Goods

Unit Cost No. of units Totals 27.607 17 5 85 1 30 30 2 20 40 2 50 100 6 20 120 0,6 100 60 2 100 200 25 4 100 1 50 50 4 25 100 15 5 75 25 5 125 17 5 85 2 25 50 10 5 50 3 20 60 10 5 50 24 5 120 12 5 60 1 50 50 70 5 350 3 10 30 45 5 225 0,05 100 5 12 5 60 1 5 5 13 5 65 2 50 100 30 5 150 7 5 35 30.242

2.5. Electric and Sanitary Installations Description Unit Cost No. of units Totals Switch 20 3 60 Socket 10 3 30 Electric wire 5 50m 250 Toilet bowl 520 1 520 Handwash bowl 250 1 250 Water pipe 1/2 inch -3m 100 3 pieces 300 Elbow 5 5 25 Counter 1/2 inch 300 1 300 Tape 5 5 25 Reducer 5 5 25 Nipples 5 5 25 Foset 20 2 40 Total Electric and Sanitary Installations 1.850

111

4.2.3.3. Business Plan Mixed Supermarket

Gross turnover Turnover tax (2 %) Net turnover Costs for goods Other income Gross profit Running Costs Personnel Telecommunication, electricity, water Office and administration Small equipment purchases Maintenance and repair Fees, legal and bookkeeping services Transports Travel Savings Losses (2% of costs for goods) Result before taxes (net profit) Income tax (10%) Result after taxes (net earnings) Year 1 - 5 435.484 -8.710 426.774 -362.904 0 63.870 -48.961 -26.400 -3.600 -1.200 -1.000 -1.200 -1.000 -2.400 -1.000 -1.359 -9.802 14.909 -1.491 13.418

Personnel Salaries Quantity 800 1 600 1 400 400 1 1 4 Salaries / month 800 600 400 400 2.200 Salaries / year 9.600 7.200 4.800 4.800 26.400

Manager Cashier/seller Cleaner Guard Total Personnel

112

4.2.3.4. Fruit and Vegetable Stores

With many more kinds of fruit and vegetable available through the establishment of the plantations (see 4.2.1.4. - 4.2.1.6), it will become both possible and advisable to establish stores specialized on agricultural goods in the major towns of the region - Debark, Adiarkay and Dabat. The fruit stores will guarantee that fresh fruit and vegetables will be available any day - this will indeed be their major task -, so that people do not have to rely on the open markets which are only twice a week. This will be particularly convenient for hotels and restaurants, as well as cafs which offer fresh juice. In order to have the various goods delivered to them regularly, they will have to be stationary and reachable at all times. Those fruit which they cannot obtain from local producers they will have to bring from the southern cities through the wholesaler. The stores themselves will be rather small, just big enough to offer the following fresh fruit and vegetables: Fruit: Orange, lemon, mango, papaya, pineapple, banana, avocado, apple Vegetables: Potatoes, carrots, cabbage, red beet, hot pepper, onion, garlic, tomatoes, Swiss chard and salad. In addition, the store may have a small selection of related packed foods such as peanuts and raisins. The costs of goods are assumed to be 14.218,5 ETB per month or 170.622 ETB per year. The margin of profit for agricultural goods being calculated at 30%, the gross turnover will be 18.582 ETB per month or 222.984 ETB per year. This means that on average goods in the amount of 611 ETB must be sold every day. This is considered to be well achievable. The stores will be located in Debark, Adiarkay and Dabat, and placed in central locations on the main road. They will need only one sales room big enough to accommodate all goods and a desk for the cashier and telephone.

Trainings required: Business Administration (minor) (3 x 1), Bookkeeping (minor) (3 x 1) Full-time jobs created: 3 x 4 Manager/bookkeeper (1), Seller/cashier (1), cleaner/packer (1), guard (1)

113

4.2.3.4. Investment Plan Fruit and Vegetable Store

No. 1. 1.1. 1.2. 1.3. 2. 2.1. 2.2. 2.3. Item Legal and administrative costs Registration Contracts Municipality construction permit Sub-total Legal & Administrative Real Estate Eviction compensation Planning and design Development Water Electricity Telephone Line Building Shop 42 m Storage room 30 m Toilet 4 m Electric and sanitary installations Sub-Total Real Estate Furniture and Equipment Furniture Chair Cashier desk Ceiling lamp Equipment Telephone Cashier machine Pocket calculator Display board Company sign Ladder Spring balance Wooden box Seals Seal Pad with ink Sub-Total Furniture and Equipment First Set of Goods Goods (for 1 month) Transport of goods Receipt blocks / office supply Sub-Total Goods Trainings Business management Accounting / Bookkeeping Sub-Total Trainings Total Investment Costs (ETB) Total Investment Costs (USD) Unit Cost 60 350 No. of units Costs 60 350 1.500 1.910 60.000 15.000 1.694 1.000 284 2.000 2.000 2.000 42m 20m 4m 60.000 15.000 1.694 1.000 284 84.000 40.000 8.000 1.850 211.828 Totals

2.4.

2.5. 3. 3.1.

275 1.000 80 150 5.000 80 500 200 500 250 10 416 10

2 1 8 1 1 1 1 1 1 1 30 2 1

550 1.000 640 150 5.000 80 500 200 500 250 300 832 10 10.012 14.219 750 500 15.469

3.2.

4. 4.1. 4.2. 4.3. 5. 5.1. 5.2.

1.277 1.277

1 1

1.277 1.277 2.554 241.773 28.444

114

2.5. Electric and Sanitary Installations Description Unit Cost No. of units Switch 20 3 Socket 10 3 Electric wire 5 50m Toilet bowl 520 1 Handwash bowl 250 1 Water pipe 1/2 inch -3m 100 3 pieces Elbow 5 5 Counter 1/2 inch 300 1 Tape 5 5 Reducer 5 5 Nipples 5 5 Foset 20 2 Total Electric and Sanitary Installations

Totals 60 30 250 520 250 300 25 300 25 25 25 40 1.850

4.1. Goods (for 1 month) Item Oranges Bananas Apples Mango Pineapples Papayas Avocados Carrots Potatoes Lemons Tomatoes Swiss Chard Cabbage Red beet Salad Garlic Onions Hot Pepper raw Hot Pepper processed Peanuts Raisins Sub-Total Goods

Unit Cost 3,9 / kg 3,1 / kg 12,5 / kg 2,3 / kg 2,3 / kg 3,1 / kg 2,3 / kg 1,6 / kg 1,6 / kg 1,9 / kg 3,1 / kg 2,3 / kg 1,9 / kg 1,6 / kg 1 / kg 7,7 / kg 2,3 / kg 8,5 / kg 16 / kg 12,5 / kg 15,5 / kg

No. of units 260 kg 390 kg 130 kg 260 kg 260 kg 320 kg 260 kg 390 kg 390 kg 130 kg 390 kg 580 kg 390 kg 320 kg 190 kg 130 kg 390 kg 10 kg 5 kg 2 kg 1 kg

Costs 1.014 1.209 1.625 598 598 992 598 624 624 247 1.209 1.334 741 512 190 1.001 897 85 80 25 15,5 14.218,5

115

4.2.3.4. Business Plan Fruit and Vegetable Store

Gross turnover Turnover tax (2%) Net turnover Costs for goods Other income Gross profit Running Costs Personnel Telecommunication, electricity, water Office and administration Small equipment purchases Maintenance and repair Fees, legal and bookkeeping services Transports Saving Losses (5% of costs for goods) Result before taxes (net profit) Income tax (10%) Result after taxes (net earnings) Year 1 - 5 222.984 -4.460 218.524 -170.622 0 47.902 -46.032 -24.600 -2.400 -800 -500 -1.200 -1.000 -6.000 -1.000 -8.532 1.870 -187 1.683

Cost of goods and Turnover No. of units / month 260 kg 390 kg 130 kg 260 kg 260 kg 320 kg 260 kg 390 kg 390 kg 130 kg 390 kg 580 kg 390 kg 320 kg 190 kg 130 kg 390 kg 10 kg 5 kg 2 kg 1 kg Cost of goods / month 1.014 1.209 1.625 598 598 992 598 624 624 247 1.209 1.334 741 512 190 1.001 897 85 80 25 15,5 14.218,5 Cost of goods / year 12.168 14.508 19.500 7.176 7.176 11.904 7.176 7.488 7.488 2.964 14.508 16.008 8.892 6.144 2.280 12.012 10.764 1.020 960 300 186 170.622 Sales price 5 / kg 4 / kg 18 / kg 3 / kg 3 / kg 4 / kg 3 / kg 2 / kg 2 / kg 2,5 / kg 4 / kg 3 / kg 2,5 / kg 2 / kg 1,5 / kg 10 / kg 3 / kg 11 / kg 21 / kg 16 / kg 20 / kg Turnover / year 15.600 18.720 28.080 9.360 9.360 15.360 9.360 9.360 9.360 3.900 18.720 20.880 11.700 7.680 2.700 15.600 14.040 1.320 1.260 384 240 222.984

Item Unit Cost Oranges 3,9 / kg Bananas 3,1 / kg Apples 12,5 / kg Mango 2,3 / kg Pineapples 2,3 / kg Papayas 3,1 / kg Avocados 2,3 / kg Carrots 1,6 / kg Potatoes 1,6 / kg Lemons 1,9 / kg Tomatoes 3,1 / kg Swiss Chard 2,3 / kg Cabbage 1,9 / kg Red beet 1,6 / kg Salad 1 / kg Garlic 7,7 / kg Onions 2,3 / kg Hot Pepper raw 8,5 / kg Hot Pepper processed 16 / kg Peanuts 12,5 / kg Raisins 15,5 / kg Total Cost of Goods and Turnover

Personnel Manager/bookkeeper Cashier/seller Cleaner/packer Guard Total Personnel

Salaries 750 500 400 400

Quantity 1 1 1 1 4

Salaries / month 750 500 400 400 2.050

Salaries / year 9.000 6.000 4.800 4.800 24.600

116

4.2.3.5. Bakery
Debark has two very small bakeries both of whom produce an extremely limited range of goods: Mainly a type of buns in the form of small white breads. They cannot meet the existing local demand, and moreover, there is practically no choice of breads in town. Local people do not bake bread at home but only the Ethiopian staple diet, injera. While there is a small, but acceptable choice of pastries in Gondar and Bahr Dar, there are no pastries at all in Debark. With tourist numbers expected to grow in the coming years, the demand for more and better bakery products as well as a broader choice will increase. The bakery will sell through its own shop, and in addition will reach its economy of scale through having selling points also in the two next southern towns of Dabat and Woken. Fresh products will be delivered to the selling points every morning through the local bus. The business calculation is based only on the four most familiar types of products, for which a safe business can be expected: wheat bread and buns, cake and bagels. Introducing new products is considered to be highly desirable but frought with risk. Only once the bakery will be well-established, and with increasing tourism, some more sophisticated products should be obtained from bakeries and cafs in Gondar on a test basis. If and once demand justifies, such products shall be produced in the bakery itself and added to the goods on the general offer. Trainings for baking cakes can be obtained in Gondar or Addis Ababa.

Training needs: Business administration (1), bakery (2) Full-time jobs created: 8 Manager/bookkeeper/accountant, baker (2), seller (3),cleaner/assistant, guard Indirect economic impact: Will contribute to food security in the region and lead to an increased demand for products brought by the wholesaler from Addis Ababa or Gondar.

117

4.2.3.5. Investment Plan Bakery

No. Items 1. Legal and Administrative Costs 1.1. Contract agreement and statutes 1.2. Registration fee 1.3. Construction permit from municipality Sub-Total Legal and Administrative Costs 2. Real Estate 2.1. Planning and design 2.2. Construction 2.3. Development Electricity Telephone line Water 2.4. Sanitary installations Sub-Total Real Estate 3. Furniture and Equipment 2.5. Furniture Chairs for workers Office table Sideboard Display desk with glass Ceiling lamps 3.2. Equipment Baking oven Fixed telephone Seals Seal pad with ink Company sign Small office items Various baking tools Baskets Hand carts Bike with cart Sub-Total Furniture and Equipment 4. Market Introduction 4.1. Opening ceremony Sub-Total Market Introduction 5. First Set of Goods 5.1. Goods 5.2. Transports Sub-Total Frst Set of Goods 6. Trainings 6.1. Business administration 6.2. Bookkeeping 6.3. Baking Sub-Total Tainings Unit costs No. of units Total cost 350 60 1.500 350 60 4.500 4.910 15.000 2.000 1.000 284 1.694 15.000 68.000 3.000 284 5.082 17.380 108.746 Totals

34 m 3 1 3

100 1.100 500 1.500 80 300.000 150 416 10 200 5.000 30 500 2.000

10 2 2 1 6 1 1 2 1 3 2 3 2 1

1.000 2.200 1.000 1.500 480 300.000 150 832 10 600 500 10.000 90 1.000 2.000 321.362 1.000 1.000 14.760 1.200 15.960

1.277 1.277 1.410

1 1 2

1.277 1.277 2.820 5.374

Total Investment Costs (ETB) Total Investment Costs (USD)

457.352 53.807

118

2.2. Constructions Bakery (bakery room 10m, shop 8m, office 6m, toilet 2m) Selling point 1 (4m) Selling point 2 (4m) Total Constructions

52.000 8.000 8.000 68.000

2.4. Electric and Sanitary Installations Description Unit Cost No. of units Solar Water Heater 170l 12.240 1 Water tank (300 l) 1.000 1 Switch 20 5 Socket 10 5 Electric wire 5 100m Toilet bowl 520 1 Handwash bowl 250 3 Water pipe 1/2 inch -3m 100 9 pieces Elbow 5 15 Counter 1/2 inch 300 3 Tape 5 15 Reducer 5 15 Nipples 5 15 Foset 20 6 Total Electric and Sanitary Installations

Totals 12.240 1.000 100 50 500 520 750 900 75 900 75 75 75 120 17.380

5.1. Goods Item Unit price Bread 2,2 Buns 0,26 Cake 12,00 20 Bagels 9,30 Total Goods / day Total Goods / month 492 x 30

Output 20 1.000 11 120

Total 44 260 132 56 492 14.760

119

4.2.3.5. Business Plan Bakery

Month Gross turnover Turnover tax (2%) Net turnover Costs for goods Other income Gross profit Running Costs Personnel Telecommunication, electricity, water Office and administration Small equipment purchases Maintenance and repair Fees and legal services Transports Travel Savings (10% of investments) Result before taxes (net profit) Income tax (10%) Result after taxes (net earnings) 24.813 -497 24.316 -14.760 0 9.556 -8.978 -4.300 -500 -50 -50 -100 -100 -1.200 0 -2.678 578 -58 520 Year 1-5 297.756 -5.956 291.800 -177.120 0 114.680 -107.737 -51.600 -6.000 -600 -600 -1.200 -1.200 -14.400 0 -32.137 6.943 -695 6.248

Personnel Quantity 1 2 3 1 1 8 Salary 800 600 500 400 400 Total Monthly 800 1.200 1.500 400 400 4.300

Manager Baker Seller Cleaner / assistant Guard Total Personnel

120

Costs for goods 1 Bread Flour Yeast Salt Sugar 1 bread sale +36%

500g 20g 10g 5g

4,05 / kg 5 / kg 1,5 / kg 8 / kg

ETB 2,025 0,100 0,015 0,040 2,180 2,2 ETB 3,00

Buns Flour Yeast Salt Sugar Margarine

500g 20g 10g 20g 10g

10 buns cost per piece sale per piece Bagels Flour Butter Sugar Eggs Yeast Milk Salt

ETB 2,025 0,100 0,015 0,160 0,250 2,550 2,6 ETB 0,26 0,40 ETB 4,050 1,875 0,400 1,200 0,200 1,500 0,030 9,255 9,3 ETB 0,47 1,00

1 Cake Flour Butter Sugar Eggs Salt Coffee cream Vanilla sugar Baking powder

250g 200g 200g 3 1g 150ml 1 1

4,05 / kg 25 / kg 8 / kg 0,4

1 cake 16 pieces; cost 1 piece sale per piece

ETB 1,013 5,000 1,600 1,2 0,001 2,0 0,5 0,5 11,814 12 ETB 0,75 1,50

1000g 75g 50g 3 40g 0,5l 20g

20 bagels cost per piece sale per piece

Costs / day Item Unit price Bread 2,2 Buns 0,26 Cake 12,00 20 Bagels 9,30 Total Costs / day Costs / month 492 x 30

Output 20 1.000 11 120

Total 44 260 132 56 492 14.760

Sales / day Item Unit price Breads 3,00 Buns 0,40 Cake (by pieces) 1,50 Bagels 1,00 Total Turnover / day Turnover / month 844 x 30 Losses 2% of output Final Turnover Debark 10 400 100 50 Units sold Dabat 8 400 60 40 Woken 2 200 16 30 Total units sold 20 1.000 176 120 Total income 60 400 264 120 844 25.320 -507 24.813

121

4.2.3.6. Shop for Printed Matter, Office, Computer and Photo Supplies
As with other consumables in Debark, only the most elementary items for school and offices can be obtained such as writing pads and pencils. There is no book store; only a few stands on the open market offer books. Postcards and maps can be bought only in the National Park information center, which is on the edge of town. Although in addition to the schools and the various offices of the Woreda administration (who have computers), some international projects and the National Park Administration have offices in Debark, all computer items (even paper) must be bought in Gondar or Bahr Dar. Tourists can buy neither films nor batteries, and outside the NP Administration there is no possibility for making photocopies. The Office Store shall be established in the center of Debark, within easy reach and visibility of international tourists, and provide the whole range of basic items from the world of letters and pictures. By its overall appearance of cleanliness and order, it shall send a message that items to be obtained here are of a higher standard and reliability than elsewhere. All standard basic items required for schools (both teaching and learning materials), offices and computer work shall be offered. Photo supplies shall include not only standard films, one-way cameras and the most widely-used batteries, but also a good selection of frames. There are three small kiosks in Debark who print photos from CDs, and the demand for frames is steadily increasing. Last but not least, the shop will have a selection of quality books, maps and postcards about the Simen Mountains NP and Ethiopia in general - these are not available in Debark so far. With the implementation of the project proposal submitted here, the Office Store will have an easy start. Both the population of the town and the number of tourists is expected to grow continuously, and the need and interest for donor projects will remain for the foreseeable future. Considering this dynamic, it would seem that sufficient sales for the Office Store will be secure. Costs for goods for the store amount to 41.310 ETB per month or 495.720 ETB per year. The average margin of profit is calculated to be 15% on top of the costs of goods, or 6.196 ETB per month. This makes a turnover of 47.506 ETB per month or 570.078 ETB per year. Trainings required: English language (2), business administration (1), bookkeeping (1) Full-time jobs created: 4 Manager/bookkeeper, cashier/seller, packer/cleaner, guard Indirect economic impact: Increase attractiveness of Debark both as a basis for donor projects and as a tourist destination.

122

4.2.3.6. Investment Plan Office & Photo Supply Store

No. 1. 1.1. 1.2. 1.3. 2. 2.1. 2.2. 2.3. Item Legal and administrative costs Registration Contracts Municipality construction permit Sub-total Legal & Administrative Real Estate Eviction compensation Planning and design Development Water Electricity Telephone Line Building Shop Storage room Toilet Electric and sanitary installations Sub-Total Real Estate Furniture and Equipment Furniture Chair Shelf / Dekson metal Cashier desk Ceiling lamp Equipment Telephone Cashier machine Pocket calculator Display board Company sign Ladder Seals Seal pad with ink Photocopy machine Sub-Total Furniture and Equipment First Set of Goods Goods Transport of goods Receipt blocks / office supply Sub-Total Goods Trainings Business management Accounting / Bookkeeping English language Sub-Total Trainings Unit Cost No. of units 60 350 Costs 60 350 1.500 1.910 60.000 15.000 1.694 1.000 284 2.000 2.000 2.000 20m 20m 4m 60.000 15.000 1.694 1.000 284 40.000 40.000 8.000 1.850 167.828 Totals

2.4.

2.5. 3. 3.1.

275 43 1.000 80 150 5.000 80 500 200 500 416 10 1

2 96 pieces 1 8

550 4.128 1.000 640

3.2.

1 150 1 5.000 1 80 1 500 1 200 1 500 2 832 1 10 17.000 17.000 30.590 41.310 1.251 500 43.061

4. 4.1. 4.2. 4.3. 5. 5.1. 5.2. 5.3.

1.277 1.277 4.720

1 1 2

1.277 1.277 9.440 11.994

Total Investment Costs (ETB) Total Investment Costs (USD)

255.383 30.046

123

4.1. Goods Item Paper Pen Pencil Exercise books - small - medium - large Stapler - small - big Staples Remover Pin Agraph Glue Pencil sharpener - small - big Plaster Writing pad Envelopes Carbon paper Eraser Tape Post it - small - large Transparencies Drawing paper Technical pens Folders Files Puncher Ruler - long - short Parker - small / set - big / set Fixer Lids for the fixer Marker / set Pin dish Paper tray Photo Camera - Yashica - Wiesen Photo films - Fuji - Kodak Photo Flash ( National ) Photo paper - black - colour Note books - small - medium - large Clip board Intermediate Total

Unit cost No. of units

40 50 0.20 1.5 2 4 20 240 18 3 1.5 0.8 5 0.7 45 2 5 0.5 25 0.7 1.5 5 7 55 8 695 30 10 12 6 1.5 75 110 8 1.5 53 5 27 395 95 15 13 175 60 690 3 5 9 23 packet of 10 packet of 10 400 100 100 100 20 5 packet of 10 50 packet of 50 packet of 50 packet of 50 100 5 50 50 100 packet of 10 100 100 50 50 packet of 10 packet of 50 1 set 10 50 10 10 100 1 1 10 50 10 10 10 10 5 10 10 5 packet of 10 1 roll 50 50 50 50

Total
400 500 80 150 200 400 400 1.200 80 150 750 40 250 70 225 100 250 50 250 70 150 250 350 550 400 695 300 500 120 60 150 75 110 80 75 530 50 270 3.950 475 150 130 875 600 690 150 250 450 1.150 19.200

124

4.1. Goods ctd. Item Intermediate Total Bags - Local - Omega - Samsonite Photo albums ( for 200 photos) Hard cover Desk pad Desk set for writing utensils Photo frame - large - small Batteries /average Waste paper basket Seal pad Ink pad Paid seal Rolled paper for calculator Ring - No - 10 - No - 12 - No - 14 CD Disket (packet) Toner for printer Tonner for copy machine Mouth pad Total Goods

Unit cost

No. of units

Total
19.200 1.850 475 1.200 250 400 140 415 1.100 600 260 500 300 300 300 200 450 570 650 400 250 7.000 3.500 1.000 41.310

37 50 95 5 240 5 50 5 40 packet of 10 14 10 83 5 110 10 30 20 13 20 10 50 3 100 3 100 3 100 2 roll of 100 45 10 57 10 65 10 4 100 25 10 700 10 350 10 100 10

2.5. Electric and Sanitary Installations Unit Description No. of units Cost Switch 20 3 Socket 10 3 Electric wire 5 50m Toilet bowl 520 1 Handwash bowl 250 1 Water pipe 1/2 inch -3m 100 3 pieces Elbow 5 5 Counter 1/2 inch 300 1 Tape 5 5 Reducer 5 5 Nipples 5 5 Foset 20 2 Total Electric and Sanitary Installations

Totals 60 30 250 520 250 300 25 300 25 25 25 40 1.850

125

4.2.3.6. Business Plan Office & Photo Supply Shop

Gross turnover VAT 15% Turn over tax (2%) Net turnover Costs for goods VAT return on cost of goods 15% Gross profit Running Costs Personnel Telecommunication, electricity, water Office and administration Small equipment purchases Maintenance and repair Fees, legal and bookkeeping services Transports Tonner ( Photo copy machine) Saving Losses (2% of costs for goods) Result before taxes (net profit) Income tax 10 % Result after taxes (net earnings) Year 1 - 5 570.072 -85.511 -11.402 473.159 -459.720 74358 87.797 -51.620 -26.400 -3.600 -1.800 -1.000 -2.400 -1.000 -2.400 -1.260 -2.565 -9.195 36.177 -3.618 32.559

Personnel Salaries Quantity 800 1 600 1 400 1 400 1 4 Salaries Salaries / / month year 800 9.600 600 7.200 400 4.800 400 9.600 2.200 31.200 Salaries / year 9.600 7.200 4.800 4.800 26.400

Manager Cashier/seller Cleaner Guard Total Personnel

126

4.2.3.7. Arts and Crafts Shops

Debark In Debark, which is the place where all tourists visiting the Simen Mountains NP come through, and many spend the night, there is only one place to buy arts and crafts or souvenirs, which is the small shop in the premises of the NP Administration. That shop is hardly visible from outside unless one goes quite close. For the tourists who come to the NP Administration in order to organize their Park visit it is not easily recognizable due to its poor visibility and window dressing. Moreover, those tourists who arrive in groups do not have any opportunity to visit the Park Administrations souvenir shop because their fees are handled by their tour operator. In addition, the choice, quality and display of the items in this shop are not suitable enough to attract customers to buy. In conclusion, there is a need for a good-quality arts and crafts / souvenir shop with good visibility and within easy reach from Debarks only international hotel - on the main road between the hotel and the branch-off to the National Park. The Arts and Crafts Shop will be small, but it will be distinguished by its choice of items, some of which may be difficult to obtain in other parts of the country. For a shop in a place which is not itself a destination but only an overnight stopover, the unique selling argument is: If you do not buy here and now, you will not get it! Gondar Although Bahr Dar is the thriving capital city of Amhara State, Gondar, with its university, hospitals, military headquarters and industries has always been and still is its major urban center, at the crossroads to Simen and Tigray in the north and Sudan in the west, both less than a day drive away. In addition, Gondar benefits much from its history as a former capital of the Ethiopian Empire, and due to the World Heritage status of its historic palaces, it is one of the main tourist destinations of Ethiopia and the point of departure for all tourists who visit the Simen Mountains National Park. It has a well-developed tourism infrastructure with hotels, restaurants and entertainment facilities. In spite of this, the number and quality of arts and crafts / souvenir shops in Gondar does not correspond to its importance as a tourist destination. There is one high-quality, but a little bit sterile arts and crafts shop in the compound of Gondars best hotel (where most international tourists stay) outside of town, and only two or three in the city center which do not offer anything else but the mainstream low-quality items. There is no arts and crafts shop in direct vicinity of the Imperial Palaces. This situation allows for another high-quality Arts and Crafts Shop in the city center if it can be placed in the immediate vicinity, either just inside or just outside of the entrance gate of the Imperial Palace grounds. Concept and Selection of Items In the first place, the Arts and Crafts Shops will have various souvenirs related to their site of interest. In the case of the Simen Mountains NP, these will be especially images and effigies of its most prominent wild animals made of wood or textile. In the case of Gondar, the thematic focus will be not only on the palaces, but also on the various monasteries in the town which themselves are not suitable for selling souvenirs. The full selection of printed matter about both sites will be available here - books and booklets, posters and calendars, maps and postcards.

127

In the second place, the unique woollen fota, blankets and other textiles produced in the local wool workshop will be offered here. (These will attract local customers as well who otherwise may not frequent the Arts and Crafts Shop.) Just the same, the cotton fota, table cloth and clothes produced by the cotton weaving workshop will also be chiefly marketed through the Arts and Crafts Shops. The high-quality basketry and leatherworks produced by the newlyestablished workshops will add to the distinctive selection of the shops. In addition, a few other products which are unique for the region will be sold such as honey (see 2.1.4.). Thirdly, brass crosses, some antics as well as any other items already available in other shops may complete the selection. These may account for some necessary income, but attention must be given that they do not dominate the overall outlook of the shops. It is important that the shops are not overloaded with a mass of items where the visibility and beauty of each single one gets lost. At the same time, an impression of a European-style highly selective Shop most be avoided because it will be considered non-original and suspected to be overpriced. Originality, traditional culture and local flair must come together with high quality, modern style and display in a unique blend. The Arts and Crafts Shops will be very important sales points for the cotton, basketry and leather workshops and will synergize with these. At the same time, these workshops will need a new kind of shops in order to expose the new quality goods which they produce in a different shopping environment. Taken all together, they will introduce a new level of quality for tourists who are looking for high-value usable and culturally-informative souvenirs. It is assumed that each Arts and Crafts Shop will sell on average 25 items per day for an average price of 25 ETB. With 26 working days, this will amount to a turnover of 16.250 ETB per month of 195.000 ETB per year. The average margin of profit is assumed to be 30%. Trainings required: English language (4), Business administration (minor) (2), Bookkeeping (minor) (2) Full-time jobs created: 2 x 3 Manager/Bookkeeper (1), Seller/Cashier (1), Storage worker/Packer/Cleaner (1) Indirect economic impact: Helps to promote tourism, buys locally-produced high-quality arts and crafts.

128

4.2.3.7. Investment Plan Arts and Craft Shops

1. 1.1. 1.2. 1.3. 2. 2.1. 2.2. 2.3. 2.4. Items Legal and Administrative Costs Contract agreement and statutes Registration fee Construction permit from municipality Sub-Total Legal and Administrative Costs Real Estate Planning and design Eviction compensation Building (shop, office, storage, toilet) Development Electricity Telephone line Water Electric and sanitary installations Sub-Total Real Estate Furniture and Equipment Interior design Furniture Equipment Sub-Total Furniture and Equipment Market Introduction Leaflet Promotion mailout Sub-Total Market Introduction First Set of Goods Goods Various types of souvenirs Tourist maps Booklets Postcards Poster Office supplies Transportation Sub-Total First Fet of Goods Trainings Business administration (minor) Bookkeeping (minor) English language Sub-Total Trainings Unit cost No. of units 350 60 1.500 Total cost 350 60 1.500 1.910 15.000 2.000 1.000 284 1.694 100 m
2

Totals

15.000 60.000 200.000 1.000 284 1.694 1.850 279.828 6.000 26.730 13.101 45.831

2.5. 3. 3.1. 3.2. 3.3. 4. 4.1. 4.2. 5. 5.1.

1000 copies

5.093 350 5.443

65 35 3 35 300

20 50 50 20

5.2. 6. 6.1. 6.2. 6.3.

25.000 1.300 1.750 150 700 300 1.000 30.200

1.277 1.277 4.720

1 1 2

1.277 1.277 9.440 11.994

Total Investment Costs Total Investment Costs (USD)

375.206 44.142

129

2.5. Electric and Sanitary Installations Item Unit Cost Switch 20 Socket 10 Electric wire 5 Toilet bowl 520 Handwash bowl 250 Water pipe 1/2 inch -3m 100 Elbow 5 Counter 1/2 inch 300 Tape 5 Reducer 5 Nipples 5 Foset 20 Total Electric and Sanitary Installations

No. of units 3 3 50m 1 1 3 pieces 5 1 5 5 5 2

Totals 60 30 250 520 250 300 25 300 25 25 25 40 1.850

3.2. Furniture Item Office desk Desk armchair Office table Sideboard Wardrobe Cashier desk with drawers Chairs Display shelves Display desk Changing cabin Ceiling lamps Spot light Wall/room decoration Total Furniture

Unit Cost 1.500 970 1.100 1.500 250 1.000 450 1.500 1.500 450 60 180

No. of units 1 1 1 2 1 1 4 5 3 1 6 10

Totals 1.500 970 1.100 3.000 250 1.000 1.800 7.500 4.500 450 360 1.800 2.500 26.730

3.3. Equipment Item Clothes stand w hangers Stand for postcards Display stands + containers Fixed telephone Fax machine Company sign Safe Cashier machine Pocket calculator Seals Seal Pad with ink Total Equipment

Unit Cost 150 150 2.379 200 3.000 5.000 80 416 10

No. of units 1 3 1 1 1 1 1 1 2 1

Totals 500 450 500 150 2.379 200 3.000 5.000 80 832 10 13.101

130

4.2.3.7. Business Plan Arts and Crafts Shop

Month
Gross turnover Turnover tax (2%) 16.250 -325

Year 1-5
195.000 -3.900

Net turnover
Costs for goods Other income Gross profit Running Costs Personnel Telecommunication, electricity, water Office and administration Small equipment purchases Maintenance and repair Public Relations Fees and legal services Transports Travel Savings (10% of investment) Losses (2% of costs for goods)

15.925
-11.375 0 4.550 -3.912 -2.100 -550 -250 0 -400 0 -50 0 0 -334 -228 638 -64 574 -20.400 -6.600 -3.000 0 -4.800 0 -600 0 0 -4.000 -2.730

191.100
-136.500 0 54.600 -42.130

Result before taxes (net profit)

Income tax (10%) Result after taxes (net earnings)

12.470 -1.247 11.223

Personnel Salaries / month Manager/book keeper Seller/casher Storage worker/packer/cleaner Total Personnel 800 500 400

Total Salaries / Quantity Monthly year

1 1 1 3 800 500 400 2.100 9.600 6.000 4.800 20.400

131

4.2.3.8. Wholesale and Transport Company in Debark

This company will combine two branches in one: buying goods from producers and selling them to retailers, and transporting these and other goods. The combination of the two tasks in one company has distinctive advantages: It allows a much more flexible use of the vehicle park, it will save personnel costs for management, bookkeeping, technician and guards, and most importantly, it will be in a much better position to react on changes in the business. Debark, located half-way between Gondar and Adiarkay and at the crossroads to Janamora and Beyeda, is the perfect place to establish a wholesale and transport company for practically the entire Simen Mountains Region, in order to provide a continuing supply for all its small shops and traders. Wholesaler In Debark as well as in all of the other small towns and villages in the region, there exist an innumerable number of very small shops and kiosks which sell a wide variety of small goods at the lowest price level - soap, toilet paper, tomato paste, chewing gum, bottled water, matches etc. etc. Other such micro-businesses exist on the open market. Some of the traders there buy from the local small shops and kiosks for a slightly lower price and thus have only an almost invisible margin of profit when they sell. A sketchy survey showed that shopkeepers have to travel to Gondar in order to buy their goods, even those in Adiarkay, for whom it takes a whole day trip just to get there. This situation has a number of severe disadvantages: - The traders have to pay their way to Gondar and back, diminishing their profit. - The traders loose at least two days for making the trip. - The amount of goods they can bring is limited by what they can carry. - Whenever they run out of any single item, they have to wait until they go to Gondar the next time in order to replenish, so they loose customers all the time. There will be an additional demand for a wholesaler through the various agricultural enterprises and supermarkets which will be established in Debark and the region. In turn, these businesses will be strengthened through the reliable and locally available services provided by the wholesaler. The enterprise needs two trucks for its operations, one big truck with a capacity of 100 Quintals or 10.000kg, and a smaller one with a capacity of 60 Quintals or 6.000kg. Every two weeks, the big truck will go to Addis Ababa once (5 days) and to Gondar twice (2 days). The smaller truck will be used for delivery to all the villages between Dabat in the south and Adiarkay in the north, as well as Merkane Birkhan. While bringing goods to these places from the newly-established agricultural farms, on the way back it will bring goods to supply the shops and supermarkets. Spare time has to be allowed for irregular services and for maintenance and repair. Turnover from sales is calculated to be 177.400 ETB per month, and with a margin of profit of 15%, there will be a gross profit of 1.809.480 ETB per year. As the other newlyestablished businesses will come into existence, the monthly turnover from sales is expected to rise to around 400.000 ETB. This rise may require the purchase of a third truck.

132

Transportation The transportation branch of the company will receive many of its initial assignments from the Project submitted here. A large number of transports will have to made in order to bring furniture and equipments for establishing the various businesses as well as the Project Coordination unit itself. Other long-term clients will be found in particular among both local farmers and wood growers and the increasing number of construction companies who will build the main road, hotels and technical infrastructure. There will be one big and one small truck in the company which can be used for either the wholesale or the transportation branch according to their respective needs. Fees for hiring an empty truck for a full day will be 1,000 ETB per day for the small truck and 1,500 ETB per day for the big truck. These figures represent averages and include full driving days as necessary when travelling to Addis Ababa. It is assumed that the trucks will be rent for 66% of their capacity, and will be used for the wholesale business for 33% of their capacity.

Running Costs It is assumed that the trucks will work for eight hours a day, out of which on average will be six hours for driving and two hours for un-/loading. With a maximum average speed of 40 km/h, the trucks can cover a maximum distance of 250km per day. There will be 300 working/driving days, adding up to a total distance of 75.000km covered per year. On other days, the drivers will rest and/or the car will be out of duty for maintenance and repair. The full set of tyres will be replaced two times a year, and oil and lubricants four times a year. Small maintenance will be due every 5.000km, larger maintenance every 10.000km, and extensive maintenance every 50.000km. They are calculated to cost each 2.000 ETB, 5.000 ETB and 10.000 ETB respectively. In addition there will be repairs, for which 50.000 ETB are available per year. Location The company can be located at any place in Debark which can easily be accessed by truck. A walled compound will be built to accommodate a storehouse and selling point, a parking and maneuvering lot for the trucks, a meeting and tea room for the workers, and an office.

Trainings required: Business administration (major) (1), bookkeeping (major) (1) Full-time jobs created: 15 Manager, procurement officer, goods delivery officer, cashier, accountant/bookkeeper, storekeeper, cleaners (2), truck drivers (2), driver assistants (2), guards (3) Indirect economic effects: Better supply with goods otherwise not available in the region; improved sales through continuing supply with goods.

133

4.2.3.8. Investment Plan Wholesale and Transport Company

No. 1. 1.1. 1.2. 1.3. 2. 2.1. 2.2. Item Legal and administrative costs Registration Contract Agreement Construction permit from Municipality Sub-total Legal & administrative costs Real Estate Planning and design Building and Constructions Wholesale storage Office Crew room Guard house Toilets and showers Open area for vehicles Foundation of fence (200 x 0.5m) Angle iron fence posts (3m / piece) Barbed wire (1 role - 100m) Gate Outside lights Development Water Electricity Telephone Line Electrical and sanitary installations Sub-Total Real Estate Equipment and Furniture Furnishing Office Equipment Other Company plate Ground balance Ladder Hand cart Tool kit Small water boiler Tea glasses Coffee glasses Tea pot Spoons for tea Vehicles Big truck (FSR) - 100 Quintals Small Truck (ISUZU) - 60 Quintals Sub-Total Equipment First Set of Goods Goods Sub-Total Goods Trainings Business administration Accounting / Bookkeeping Sub - Total Trainings Unit cost No. of units Total cost 60 350 1.500 1.910 15.000 2000 / m 2000 / m 2000 / m 2000 / m 2000 / m 500 / m 100 135 100 5.000 450 70 36 30 2 10 100 100m 102 pieces 10 roles 1 3 140.000 72.000 60.000 4.000 20.000 50.000 10.000 13.770 1.000 5.000 1.350 1.694 1.000 284 19.980 415.078 37.038 39.604 1.000 5.000 500 350 650 495 4 3 72 2 520.000 240.000 1 1 1 2 1 1 10 10 1 10 1 1 1.000 5.000 500 700 650 495 40 30 72 15 520.000 240.000 845.144 177.400 177.400 4.746 4.746 1 1 4.746 4.746 9.492 Totals

2.3.

2.4. 3. 3.1. 3.2. 3.3.

3.4.

4. 4.1. 5. 5.1. 5.2.

Total Investment Costs (ETB) Total Investment Costs (USD)

1.449.024 170.474

134

2.4. Electric and Sanitary Installations Item Unit cost No. of units Water tank (300 l) 1.000 1 Shower 350 2 Solar Water Heater / B2QH25 12.240 170 l Mirror 200 2 Sideboard 400 2 Armature 200 2 Toilet bowl 520 2 Handwash bowl 250 2 Ceramic for the floor / m2 95 4 wall / m2 60 12 Elbow (Corba) 5 15 Pipe (3/4 inch) 3m - 1piece 130 4 Counter 3/4 inch 350 1 Water pipe 1/2 inch -3m 100 3 pieces Counter 1/2 inch 300 1 Tape 5 9 Reducer 5 9 Nipples 5 9 Foset 20 6 Total Sanitary installations

Total cost 1.000 700 12.240 400 800 400 1.040 500 380 720 75 520 350 300 300 45 45 45 120 19.980

3.1. Furnishing Item Office desk Desk armchair Sideboard Trunk Office chair Shelve/ Dekson metal Table Chair Cashier desk Ceiling lamp Wardrobe Waste bins Total Furnishing

Unit cost No. of units 2.000 3 970 3 1.500 3 3.200 1 450 6 43 72 600 10 250 20 1.000 1 80 16 400 3 19 8

Total cost 6.000 2.910 4.500 3.200 2.700 3.096 6.000 5.000 1.000 1.280 1.200 152 37.038

3.2. Office Equipment Item PC w monitor, keyboard, mouse Printer Safe (200 kg) Fixed telephone Cashier machine Pocket calculator Electric calculator Seals Seal pad & ink Small office supplies Sub-Total Office Equipment

Unit cost No. of units 11.800 2 4.000 1 3.000 1 150 1 5.000 1 60 2 1.050 1 416 4 10 2

Total cost 23.600 4.000 3.000 150 5.000 120 1.050 1.664 20 1.000 39.604

135

4.1. Goods Item Soft drinks Beer Sugar Flour Juice ( bottled ) Juice (packed ) Bottled water Edible Oil Tea Coffee ( packed ) Match box Candle Cloth detergent Dish detergent Bathroom detergent Razor blades Shaving shampoo Toilet paper Napkins - Hotel - Pocket Soap for Cloth Soap for body Toilet soap Light bulb Shoeshine Shoe brush Comb Toothpaste Tooth brush Sponge Yeast Salt Tomato paste Marmalade Peanut butter Chocolate butter Margarine Biscuits Candies Rice Honey packed (1/2kg) Wine - small - big Intermediate Total

Unit cost 40 / box 66 / box 900 / Quint. 405 9/l 19 / l 36 / packet 11 2 / bag 30 2 6 1,5 4 17 8/ packet 10 2 33 / packet 7 2 2 0.5 3 8 2 1 8 3 0.5 4 1 / kg 7 11 84 28 25 3 17 5 / kg 11 6 / bottle 20

No. of units 100 100 10 10 Quint. 100 100 100 200 200 50 100 100 500 100 100 50 50 100 100 100 200 200 500 100 50 50 100 50 50 500 100 1.000 100 50 50 50 50 100 100 100 50 100 50

Total cost 4.000 6.600 9.000 4.050 900 1.900 3.600 2.200 200 1.500 200 600 750 400 1.700 400 500 200 3.300 700 400 600 250 300 400 100 100 400 150 250 400 1.000 700 550 4.200 1.400 1.250 300 1.700 500 550 600 1.000 59.800

136

4.1. Goods ctd. Item Unit cost No. of units Carry-over Intermediate Total Vodka 90 50 Ouzo 17 100 Dry Gin 13 100 Gordon Gin 140 50 Highland Queen 110 50 White Horse 170 50 Alcohol 9 100 Nails 7 / kg 100 Bottle opener - single 6 100 Plastic rope 12 / 100m 100 Paint 22 / kg 100 Plastic water pipe 2/m 1.000 Corrugated iron sheet 55 / piece 500 Total Goods

Total cost 59.800 4.000 1.700 1.300 7.000 5.500 8.500 900 700 600 1.200 2.200 2.000 27.500 119.600

137

4.2.3.8. Business Plan Wholesale & Transport Company

Turnover from sales Turnover from transports Gross turnover VAT on sales (15%) Turnover tax on sales 2% Turnover tax on transports (10%) Net turnover Costs for goods Other income (15% VAT on costs for goods) Gross profit Running Costs Personnel Telecommunication, electricity, water Office and administration Vehicle maintenance Vehicle repair Vehicle consumables Savings (10% of investment costs) Losses (5% of costs for goods) Result before taxes (net profit) Income tax (10%) Result after taxes (net earnings) Year 1 - 5 2.128.800 500.000 2.628.800 -319.320 -42.576 -50.000 2.216.904 -1.809.480 271.422 678.846 -676.412 -130.800 -3.600 -3.600 -132.000 -50.000 -181.423 -84.515 -90.474 2.434 -8.812 -6.378 Turnover from transports Item Fee / day Small Truck 1.000 Big Truck 1.500 Total Turnover from transports Personnel Salary / month Salary / year Manager 1.000 12.000 Accountant / Bookkeeper 900 10.800 Procurement officer 800 9.600 Goods delivery officer 800 9.600 Cashier 600 7.200 Storekeeper 600 7.200 Cleaner / assistant 400 4.800 Driver Grade III 1.500 18.000 Driver Grade IV 2.300 27.600 Driver assistant 400 4.800 Guard* 400 4.800 Total Personnel * one guard to be paid by the Construction Workers' Cooperative Vehicle consumables Unit cost Tyres Big Truck Small Truck Oil Big Truck Small Truck Lubricant Big Truck Small Truck Gasoline Big Truck Small Truck Total Vehicle consumables 1.850 970 108 108 38 38 5,02 / l 5,02 / l No. of units 6 4 4 4 1 1 50 45,5 Times / year 2 2 4 4 4 4 300 300 Total 22.200 11.640 1.728 1.728 152 152 75.300 68.523 181.423 No. of jobs 1 1 1 1 1 1 2 1 1 2 3 (2) Total 12.000 10.800 9.600 9.600 7.200 7.200 9.600 18.000 27.600 9.600 9.600 130.800 No. of days 200 200 Turnover 200.000 300.000 500.000

138

4.2.3.9. Construction Workers Cooperative

The construction sector is expected to boom in Ethiopia over the next years. In the Simen Mountains Region, in addition to increasing private investments, the government is planning to support better housing in Debark and other Woreda centers. The tarmac road between Gondar and Shire will be completed with high priority, and the project proposal presented here will alone account for a large number of construction projects to be implemented over a time frame of one or two years. For these reasons, construction workers such as masons, carpenters and painters are well sought. Since there are few such workers who have received vocational training anywhere in Ethiopia, those who have such training have a strong competitive advantage. The Construction Cooperative will be made up of workers available to be contracted by government or private construction companies for various tasks in the construction sector such as building roads, bridges, residential, commercial and agricultural buildings as well as wooden constructions of any kind. There will be 20 masons, 10 carpenters and 2 painters. Contracts will not be made with the individual workers but with the cooperative which will provide the workers and be responsible for the fulfilment of the contract. This will protect both the employer and the employees. The income derived from all contracts will go to the account of the cooperative from which all workers will receive the same monthly salary of 600 ETB. This regulation will also make sure that emergency funds will be available in times of insufficient assignments. From their salary, the workers will pay insurances, make a saving for their old-age pension, and will have to pay their personal set of tools. The workers themselves will select one of them who is idle at the time to be present in a small one-room office in order to receive telephone calls and do administrative and financial work. In addition to the office room, they will have a meeting room in order to discuss common affairs. The office of the construction cooperative will share the same compound with the wholesale and transport company (2.3.8.) in order to save costs for guards. It is assumed that the 40 workers will have a daily wage of 35 ETB and each work on 270 days per year, thereby earning a total annual income of 378.000 ETB per year. Trainings required: Masonry (25), carpentry (13), painting (2) Full-time jobs created: 40 Masons (25), carpenters (13), painters (2)

139

4.2.3.9. Investment Plan Construction Workers Cooperative

No.
Items 1. Legal and administrative costs 1.1. Registration 1.2. Contract Agreement 1.3. Construction permit from municipality Sub-Total Legal & administrative costs 2. Real state 2.1. Planning and Design 2.2. Construction 2.3. Sanitary installations 2.4. Development Water Electricity Telephone line Sub-Total Real Estate 3. Furniture and Equipment 3.1. Furniture 3.2. Equipment Sub-Total Furniture and Equipment 4. First Set of Goods 4.1. Goods 4.2. Transports Sub-Total First Set of Goods 5. Trainings 5.1. Masonry 5.2. Carpentry 5.3. Painting Sub-Total Trainings Unit cost 60 350 1.500 No. of units Total cost 60 350 1.500 1.910 15.000 40.000 3.280 1.694 1.000 284 61.258 3.640 53.392 57.032 1.224 2.000 3.224 914 982 1.760 25 13 2 22.850 12.766 3.520 39.136 Totals

2000/m

20

1.694 1.000 284

Total Investment Costs (ETB) Total Investment Costs (USD)

162.560 19.125

3.1. Furniture Chair Table Ceiling lamp Switch Socket Electric wire Toilet bowl Handwash bowl Water pipe 1/2 inch -3m Elbow Counter 1/2 inch Tape Reducer Nipples Foset Total Furniture

Unit cost 275 600 80 20 10 5/m 520 250 100 5 300 5 5 5 20

No. of units 3 1 8 3 3 50 1 1 3 5 1 5 5 5 2

Total 550 600 640 60 30 250 520 250 300 25 300 25 25 25 40 3.640

140

3.2. Equipment Fixed telephone Pocket calculator Display board Company plate Seals Seal pad & ink Lock Lockable trunk Ladder Spade Meter band - 50m >> - 3m Level Pick axe Axe Hammer - 6 kg - 2 kg - 0,5 kg Saw for wood Saw for metal Chisel Angle (squadra) - big - small Working clothes Working Shoes Helmets Masonry spoon Total Equipment

Unit cost 150 60 500 200 416 10 10 2.000 500 45 50 6 60 30 40 170 35 20 25 15 10 16 8 50 100 35 25

No. of units 1 1 1 1 2 1 32 16 1 20 30 30 30 20 20 20 20 10 10 20 30 10 20 64 32 32 20

Total 150 60 50 200 832 10 320 32.000 500 900 1.500 180 1.800 600 800 3.400 700 200 250 300 300 160 160 3.200 3.200 1.120 500 53.392

4.1. Goods Brush for painting Wall paint brush Oil paint brush Plastic rope / m Container for mixing paint Plastic cover for carpenters Total Goods

Unit cost 5 17 5 0.4 30 45

No. of units 2 2 1.500 4 10

Total 10 34 10 600 120 450 1.224

5. Trainings Per diem trainees Per diem trainer Travel trainer Gondar - Debark - Gondar

No. of units 32 days 12 days 2 tours

Unit cost 70 150 20

Totals 2.240 1.800 40

141

4.2.3.9. Business Plan Construction Workers Cooperative

Gross turnover Turnover tax Net turnover / gross profit Running Costs Personnel Telecommunication, electricity, water Office and administration Small equipment purchases Maintenance and repair Fees, legal and bookkeeping services Commuting Savings Result before taxes (net profit) Income tax (10 %) Result after taxes (net earnings) Year 1-5 378.000 0 378.000 -347.416 -291.216 -3.600 -1.200 -2.400 -2.400 -600 -40.000 -6.000 30.584 -3.059 27.525

Personnel Mason Carpenters Painters Guards (shared with Wholesaler) Total Personnel

Salary / month 600 600 600 400

No. of jobs 25 13 2 0,67 40,67

Total / month 15.000 7.800 1.200 268

Total / year 180.000 93.600 14.400 3.216 291.216

142

4.2.3.10. Shower Houses

In the rural areas of Ethiopia such as the Simen Mountains Region, even in the towns only a minority of buildings are built of stone or concrete and are connected to the electricity and water systems. Mainly, these buildings are hotels, offices and shops. The residential houses are nearly all simple huts on the bare ground with walls of small eucalyptus trees and doors, windows and roofs made of metal. In the better cases, the walls are kept together with mud. Water is fetched to these houses from the next creek. Usually women bring a 20l tank on their back once a day, and this will have to be sufficient for the whole familys needs for washing, cooking and cleaning. As a result, the possibilities to keep themselves clean, or at least to wash thoroughly from time to time, are almost nil for the overwhelming majority of the rural population. Even if water was more easily available, there is seldom privacy anywhere outside the houses in particular in the overcrowded residential areas of the small towns and villages. Since this situation is impossible to be changed within the next ten years at least, the only way to provide better opportunities for washing to the general population is to establish public shower houses. The shower houses will be established in the center of residential areas for easy and quick access. The will be built of concrete, with tiled walls and ceramic floors. Energy supply will be through solar panels in order to reduce the main running costs and thus keep the operation economical on a very low price level. Each shower house will have 8 shower cabins which will be big enough to change clothes as well. The showers can be taken hot or cold. While 50 customers are expected per day on the average, there will be peak times, and this will require having 8 showers available at any time. The 170l water boiler will feed the showers with hot water, and each customer will be given a maximum of 30 minutes use of the cabin. The shower houses will be open eight hours a day, allowing for a maximum of 128 customers per day. In order to make the shower affordable for everyone, the fee will be 2 ET Birr for a cold shower and 5 ET Birr for a hot shower. In addition, soap, shampoo and the rent of a towel will be offered for 1 ET Birr each. It is estimated that 50% of the customers will take hot showers. In addition to their economic function, the shower houses will be extremely useful points of public health education. Both government agencies and international donors working in this field will be invited to provide educational materials for display and/or take away in the shower houses against a modest fee. In addition, condoms and other items related to public and/or reproductive health will be sold. Shower houses will be established at least in the following towns: Adiarkay, Debark, Mekane Birkhan, Dabat and Amba Gyorgis. Trainings required: None Full-time jobs created: 5 x 4 Manager/cashier; cleaners (2), guard Indirect economic effect: Demand created for laundry (from rented towels) and consumption of body care items.

143

4.2.3.10. Investment Plan Shower House

No. 1. 1.1. 1.2. 1.3. 2. 2.1. 2.2. 2.3. Items Legal and administrative costs Registration Contract Agreement Construction permit from municipality Sub-Total Legal & administrative costs Real Estate Eviction compensation Planning and design Construction - Showers 62 m - Office 12 m - Toilets 4 m Sanitary installations Development Water Telephone Line Sub-Total Real Estate Furniture and Equipment Furniture Equipment Transports Sub-Total Furniture and Equipment First set of goods Detergent for bathroom Shampoo Soap Condoms Towels Sub-Total First Set of Goods Unit cost No. of units 60 350 Total cost 60 350 1.500 1.910 60.000 15.000 2000 / m 60.000 15.000 156.000 Totals

78

2.4. 2.5.

30.215 1.694 284 1.694 284 263.193 4.936 2.402 1.522 8.860 19 0.75 0.75 0.40 57 10 100 100 500 80 190 75 75 200 4.560 5.100 279.063 32.831

3. 3.1. 3.2. 3.3. 4.

1.522

Total Investment Costs Total Investment Costs (USD)

144

2.4. Sanitary installations Solar Water Heater 170l Shower Mirror Sideboard Toilet Bowl Armature for bathroom Water tank (300 l) Plastic bucket (30 l) Toilet brush Sweeper Plastic water pipe / m Elbow ( Corba ) Pipe ( 3/4 inch ) - 3m Ceramic for the floor wall Tape Reducer Nipples Foset Counter - 3/4 inch Handwash bowl Water pipe 1/2 inch -3m Elbow Counter 1/2 inch Tape Reducer Nipples Foset Total Sanitary installations

Unit cost No. of units 12.240 1 350 8 200 1 1.500 1 520 1 200 8 1.000 1 35 2 19 5 20 5 3 30 5 20 130 16 95 / m 32 60 / m 48 5 16 5 16 5 16 20 16 350 1 250 1 100 3 5 5 300 1 5 5 5 5 5 5 20 2

Total 12.240 2.800 200 1.500 520 1.600 1.000 70 95 100 90 100 2.080 3.040 2.880 80 80 80 320 350 250 300 25 300 25 25 25 40 30.215

3.1. Furniture Chair Table Shelf Drawer Mirror Sideboard Ceiling lamp Switch Socket Electric wire Total Furniture

Unit cost No. of units 275 2 500 1 1.500 1 1.056 1 200 1 150 1 80 8 20 3 10 3 5/m 50

Total 550 500 1.500 1.056 200 150 640 60 30 250 4.936

3.2. Equipment Telephone Pocket calculator Display board Company plate Tool kit Seals Seal pad with ink Total Equipment

Unit cost No. of units 150 1 60 1 500 1 200 1 650 1 416 2 10 1

Total 150 60 500 200 650 832 10 2.402

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4.2.3.10. Business Plan Shower House

Year 1-5 Turnover from rents Turnover from sales Gross turnover Turnover tax on rents (10%) Turnover tax on sales (2%) Net turnover Costs for goods (70% of sales) Other income Gross profit Running Costs Personnel Telecommunication, water, electricity* Office and administration Small equipment purchases Maintenance and repair Savings (10% of equipment) Losses (5% of costs for goods) Result before taxes (net profit) Income tax 10% Result after taxes (net earnings) * N.B. Electricity will be provided by solar panels. 64.605 11.900 76.505 -6.461 -238 69.806 -8.330 0 61.476 -37.217 -24.000 -3.600 -1.200 -500 -3.600 -3.900 -417 24.259 -2.426 21.833

Turnover Rents Cold shower Hot shower Towels Sub-Total Rents Sale of goods Soap Shampoo Condoms Sub-Total Sales Total Turnover No. of Unit price units / day 2 25 5 25 1 20 No. of units / month 500 100 100 Total / day 50 125 20 Total / month 500 75 50 Total / year 18.250 45.625 730 Total / year 6.000 900 5.000 11.900 76.505 Totals

64.605 Unit price 1 0.75 0.50

Personnel Manager/ Cashier Cleaners Guard Total Personnel

Salary / month No. of jobs 800 1 400 2 400 1 4

Total / month 800 800 400 2.000

Total / year 9.600 9.600 4.800 24.000

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4.2.3.11. Laundry
In Debark, a town of nearly 27,000 inhabitants, all private and business laundry is done by hand, including that of the hotel and the many local guest houses. Since most households do not have running water, let alone hot water, the laundry is done in little creeks many of which do not carry clean water themselves. As a result, the creeks are polluted by detergents but the laundry does not become clean. In the rainy season, when it is quite cold and air humidity reaches almost 100%, there is often no possibility to dry laundry for several days. At the same time, Debark is the gateway to excursions into the Simen Mountains National Park, which often involves camping and trekking in wild terrain, which creates an increased demand for cleaning clothes and equipment of tourists. This demand will grow considerably with increasing tourism over the next years. Taken together, there is an urgent and growing need for a laundry operation in Debark. This need to establish a laundry was also expressed by the Mayor of the town. In addition to commercial aspects, there is also social justification for a laundry. Laundry, quite a back-breaking activity, is considered to be womens work, adding to the many hard duties which rural women have to face. It is also time-consuming and takes essential time away for caring and breast-feeding children. Studies have shown that very poor women in particular have too little time for breast-feeding and hygiene of their babies, which leads to malnutrition, vulnerability to diseases and other factors severely impeding the proper development of children. The laundry can be located anywhere in Debark where it can be found easily by tourists. If advisable, it may have a reception point on the main road and run its operation further away. Since water is the main resource, the easy availability of large quantities of water, together with the possibility to establish an effective sewerage system, will be the decisive argument for its location. Since professional laundromats require running hot water for operation, household-size laundromats will have to be used for washing. Two laundromats are foreseen to run parallel with warm and hot water. During the dry season, laundry can be dried on clothes line in the open air, for which an appropriate area is provided, and machine-drying can be reserved for express service such as hotels. For the wet season, however, a drying machine is essential. In addition to the laundry, a dry-cleaning machine is also foreseen since the next drycleaning service available is 100km away in Gondar. An ironing service will also be offered. Obviously, this business opportunity lends itself to be owned by women. It is expected that the laundry will have various kinds of customers: - The existing local hotels, but more so the newly-built hotels which will have a higher standard; - Foreign tourists; - Domestic tourists; - Local inhabitants of Debark, in particular civil servants. With two laundromats each having a capacity of 4,5kg of laundry and 1 hour of program operation, the laundry will have a capacity of 54kg of laundry per day. However, it is assumed that actually on the average only 30kg will be washed, adding up to 9.000kg per

147

year (300 working days). In order to cover personnel and running costs, an annual income of 70.000 ETB is required from washing, dry-cleaning and ironing, or only 234 ETB per day, which seems to be easily achievable.

Full-time jobs created: 6 Manager/receptionist/cashier (1), washers/machine operators/ironers/sorters/packers (5) Indirect economic effect: The laundry will be a customer of the wholesaler for detergents, and will support the tourism sector by offering a new and essential quality service

148

4.2.3.11. Investment Plan Laundry

No. 1. 1.1. 1.2. 1.3. 2. 2.1. 2.2. 2.3. 2.4. 2.5. 2.6. 2.7. 3. 3.1. 3.2. 3.3. 4. 4.1. 4.2. 4.3. 5. 5.1. 6. 6.1. Item Legal and administrative costs Lawyer Registration Construction permit Sub-Total Legal and Administrative Costs Real Estate Land Planning Construction 50m Sanitary Installations Electricity Water Telephone Sub-Total Real Estate Machinery, Furnitures and Equipment Machinery Furnitures Equipment Sub-Total Machinery, Furnitures and Equipment First Set of Goods Detergents Dry-cleaning chemicals Packing materials Sub-Total Goods Trainings Business Administration / Bookkeeping Sub-Total Trainings Financing Start-up assistance (running costs 1 month) Sub-Total Financing Total Investment Costs Total Investment Costs (USD) Costs 123 456 1.500 2.079 0 15.000 100.000 3.280 1.000 1.694 284 121.258 21.500 9.970 11.290 42.760 500 417 375 1.292 1.277 1.277 2.000 2.000 170.666 20.079 Totals

3.1. Machinery Item Washing machine Drying machine Dry-cleaning machine Ironing machine and board Total Machinery

Unit price 3.600 3.000 10.000 650

No. of units 2 1 1 2

Totals 7.200 3.000 10.000 1.300 21.500

149

2.3. Sanitary Installations Item Water tank (300 l) Toilet bowl Handwash bowl Water pipe 1/2 inch -3m Elbow Counter 1/2 inch Tape Reducer Nipples Foset Total Sanitary installations

Unit price 1 520 250 100 5 300 5 5 5 20

No. of units 1.000 2 2 3 pieces 5 1 5 5 5 2

Total 1.000 1.040 500 300 25 300 25 25 25 40 3.280

3.2. Furniture Item Front Desk Chair Office desk Office chair Office shelf Ceiling lamp Clothes shelves Clothes bars Company plate Total Furnitures

Unit price 500 275 1.191 984 1.500 80 1.500 500 200

No. of units 1 1 1 1 1 4 2 4 1

Totals 500 275 1.191 984 1.500 320 3.000 2.000 200 9.970

3.3. Equipment Item Telephone Cashier Calculator Clothes hanger Ladder Ironing board Small office supplies Display board Seals and ink Total Equipment

Unit price 150 5.000 60 30 500 650 500 430

No. of units 1 1 1 100 1 1 lump sum 1 1

Totals 150 5.000 60 3.000 500 650 1.000 500 430 11.290

150

4.2.3.11. Business Plan Laundry

Years 1-5 Gross turnover Turnover tax (10%) Net turnover Costs for goods Other income Gross profit Running Costs Personnel Telecommunication, electricity, water Office and administration Small equipment purchases Maintenance and repair Savings (10% of equipment costs) Result before taxes (net profit) Income tax (10%) Result after taxes (net earnings) 70.000 -7.000 63.000 -15.500 0 47.500 -46.576 -33.600 -6.000 -1.200 -500 -1.000 -4.276 924 -93 831

Costs for Goods Item Detergent Dry-cleaning chemicals Plastic bags for packing Total Costs for Goods

Amount Unit price 300kg/yr 20/kg 100kg/yr 50/kg 9.000 1

Total 6.000 5.000 4.500 15.500

Personnel Position Manager Workers Total Personnel

Salary/Month 800 400

Salary/Yr 9.600 4.800

Number 1 5

Total 9.600 24.000 33.600

151

4.2.3.12. Tour Operator in Debark

Debark has no local tour operator. All tours into the Simen Mountains National Park are arranged from offices in Gondar or even Addis Ababa. As a result, with the exception of local guides and mule drivers, almost none of the profits from tourism into the Park benefits the region itself. So far, the lack of a gasoline station has been the main factor which rendered the establishment of a tour operator in Debark impossible. However, the building of a gasoline station is said to be started within 2006 and expected to be functional in 2007. A local tour operator will be able to compete for three groups of tourists: 1) Individual tourists who travel by public transportation, mainly backpackers. Since there is no public transportation from Debark, they have to rent a car all the way from Gondar in order to get into the Park. If they could rent a car or participate in a tour from Debark, this would significantly reduce their costs. 2) Special-interest tourists and visitors such as scientists and experts who have individual demands, need tailor-made services and a tour operator nearby. 3) The growing number of domestic tourists as well as Ethiopian tourists who live abroad. In addition, a local tour operator will have competitive advantages because s/he will - be able to offer specialized services such as mountain bikes, or several-day tours on horseback to destinations off the main road, such as to buffer zone villages; - be much more flexible in meeting demands expressed by tourists upon arrival in Debark; - have a much better ability to keep a close relationship with local guides; - have a much better knowledge of local and less-known attractions; - have much more up-to-date information about conditions in the Park; - be in a position to hire the best local people for guides before they are identified by others; - be able to offer services for a lower price due to relatively lower costs in Debark. National tour operators in Addis Ababa who arrange country-wide tours on behalf of international tour agencies may utilize the specialized services of a local tour operator in order to improve or extend their own services, and will be able to make arrangements in case of having to change their local schedule on short notice. Other sources of income for the Tour Operator will be - the sale of printed matter about the Simen Mountains NP; - renting extra equipment such as tents, raincoats and other waterproof equipment.for those tourists who otherwise do not need such equipment during their visit to Ethiopia, and thus do not have it in their baggage; - acting as a marketing outlet for mule tour guides who live in the buffer zone of the park; - acting as a travel agent for international airline companies. The Tour Operator will be located on the main road in Debark between the Park Administration and the main square. Next to an office building, he will need a parking lot for several vehicles. (There will be only two vehicles in the beginning, but room must be left for a future expansion of services.) The turnover of this type of business is difficult to estimate because many different services are involved which each have different margins of profit. Since organizing tours will be the main source of income, only this is calculated, and a lump sum turnover is included from other services. The annual turnover in the first year is assumed to be two thirds of what it will be during years 2-5. For details, please see the table attached to the business plan.

152

Trainings required: Business administration (major), bookkeeping (major), tour guide Full-time jobs created: 8 Manager, assistant/secretary, bookkeeper, tour guides (2), drivers (2), guard Indirect economic effects: Will increase the demand of gasoline in Debark, will contribute to the general development of Debark as a tourist destination

153

4.2.3.12. Investment Plan Tour Operator in Debark

1. 1.1. 1.2. 1.3. 2. 2.1. 2.2. 2.3. 2.4. 2.5. Items Legal and Administrative Costs Contract agreement and statutes Registration fee Construction permit from municipality Sub-Total Legal and Administrative Costs Real Estate Planning and design Compensation for evacuation Building Sanitary installations Development Electricity Telephone line Internet line Water Sub-Total Real Estate Furniture and Equipment Furniture Equipment Sub-Total Furniture and Equipment Market Introduction Development of promotion strategy Leaflets Presentation on trade fairs Sub-Total Market Introduction First Set of Goods Tourist maps Booklets Posters Postcards Sub-Total First Set of Goods Trainings Business Administration (major) Bookkeeping (major) Tour guide English language Sub-Total Trainings Unit cost 350 60 1.500 No. of units Total cost 350 60 1.500 1.910 15.000 60.000 2000/m 15.000 60.000 162.000 3.280 1.000 284 184 1.694 243.442 23.260 503.022 526.282 1 expert 4000 copies 5.000 3 fairs 5.000 5.000 10.690 15.000 30.690 20 35 35 3 10 105 15 334 200 3.675 525 1.002 5.402 4.746 4.746 5.280 4.720 1 1 2 6 4.746 4.746 10.560 28.320 48.372 Totals

81

1.000 284 184 1.694

3. 3.1. 3.2. 4. 4.1. 4.2. 4.3. 5. 5.1. 5.2. 5.3. 5.4. 6. 6.1. 6.2. 6.3. 6.4. 6.5.

Total Investment Costs Total Investment Costs (USD)

856.098 100.772

154

3.1. Furniture Managerial desk Desk armchair Secretary desk Chair for secretary Office table Movable glass shelf Normal shelf Display board Office chair Curtains Wall/room decoration Ceiling lamp Low table Armchairs Total Furniture

Unit cost No. of units 2.000 1 1.270 2 1.600 1 620 1 1.000 1 3.200 1 1.500 1 500 3 450 4 300 8 500 1 40 10 1.300 2 800 2

Total costs 2.000 2.540 1.600 620 1.000 3.200 1.500 1.500 1.800 2.400 500 400 2.600 1.600 23.260

3.2. Equipment Mobile phone Fixed telephone Fax machine Land Cruiser (4WD Station Wagon) Minibus (12 seats) Electric calculator Company sign Television (21 inch) Satellite dish Small Stove DVD / video player Umbrella Tents (for 4 people) Photo camera digital Video camera digital Raincoats Mountain bike Desk top computer Scanner Color printer Black and white printer Seals Seal pad with ink Postcard stand Tea glasses Coffee glasses Tea pot Spoons for tea Stationary and related Sub-Total Equipment

Unit cost No. of units 1.100 1 150 1 2.739 1 255.000 1 160.000 1 1.050 1 2.000 1 2.800 1 1.600 1 100 1 1.600 1 25 10 2.410 5 2.600 1 9.000 1 100 10 1.500 10 10.800 2 5.000 1 3.000 1 4.000 1 832 2 10 1 300 1 4 10 3 10 72 1 2 10

Total costs 1.100 150 2.739 255.000 160.000 1.050 2.000 2.800 1.600 100 1.600 250 12.050 2.600 9.000 1.000 15.000 21.600 5.000 3.000 4.000 416 10 300 40 30 72 15 500 503.022

155

4.2.3.12. Business Plan Tour Operator in Debark

Year 1 Turnover from services Turnover from sales Gross turnover Turnover tax on services (10%) Turnover tax on sales (2%) Net turnover Costs for goods Other income Gross profit Running Costs Personnel Telecommunication, electricity, water Office and administration Maintenance and repair Fees and legal services - Tyres - Gasoline (150km x 10 times x 5,5 ETB) - Oil and lubricants - Maintenance Promotion Savings (10% of investment costs) Result before taxes (net profit) Income tax (10%) Result after taxes (net earnings) 344.333 7.667 352.000 -34.434 -154 317.412 -5.200 0 312.212 -298.072 -57.600 -6.000 -15.600 -4.800 -600 -1.352 -66.000 -784 -113.336 0 -32.000 14.140 -1.414 12.726 -57.600 -6.000 -15.600 -4.800 -600 -15.528 -99.000 -1.176 -170.004 -15.000 -55.000 28.012 -2.802 25.210 Year 2 - 5 516.500 11.500 528.000 -51.650 -230 476.120 -7.800 0 468.320 -440.308

Turnover (years 2-5) Low Season (5 months) Foreign customers Domestic customers High Season (7 months) Foreign customers Domestic customers Renting materials and other services Total Turnover

No. / month 10 0 240 180 lump sum

Expenditures 250 0 250 60

Total / month Total / season 2.500 12.500 0 60.000 10.800 0 420.000 54.000 30.000 516.500

Purchases and Sales (years 2-5) Item Booklets Posters Postcards Total Purchases and Sales

Unit cost 35 35 3

No. of units 160 20 500

Cost 5.600 700 1.500 7.800

Sales 8.000 1.000 2.500 11.500

Personnel Quantity Manager Secretary and assistant Bookkeeper Tour Guide Driver Guard Total Personnel 1 1 1 2 2 1 8 Salary / month 1.000 600 600 600 500 400 Total / month 1.000 600 600 1.200 1.000 400 4.800 Total / year 12.000 7.200 7.200 14.400 12.000 4.800 57.600

156

4.2.3.13. Hotel in Mekane Berkhan

Being a Woreda center, Mekane Berkhan has a constant flow of visitors from throughout the Woreda who arrive there for shopping and trade or for administrative business, but also from other Woredas, especially Debark, the only town to which it is connected by road. Mekane Berkhan has 3 hotels, which are however below the lowest of standards. They have no toilets, let alone showers, are infested with vermin, and the room floor is of bare earth. Since all of Mekane berkhan is not connected to the power grid, electricity is available only from a generator between 20:30h and 23:00h. And yet, these hotels are always fully booked because there is no alternative. Due to this situation, everyone avoids to spend the night in Mekane Berkhan if he can. For this reason, the town looses a lot of opportunities. Thus, a better hotel will not only improve the offer of accommodation, but will also open up many new opportunities for the town in trade and tourism. The hotel planned will have eight single and two double bedrooms, toilets and showers as well as a restaurant and bar which can also serve customers which are not hotel guests. A generator will provide an independent source of energy for 24 hours. Each room will be furnished with a bed, bedside table(s), chair, table, wardrobe and sideboard. The restaurant and bar will each have eight tables, and the bar will have TV. Room rates will be 20 ETB for a single and 35 ETB for a double bedroom without breakfast. It is assumed that the hotel will have an occupancy rate of 6 single and 1 double beds on average, adding up to an annual income from room rents of 56.575 ETB. Furthermore, it is assumed that on average 30 breakfasts (3 ETB each), 50 meals (7 ETB each) and 150 drinks (2,5 ETB each) will be served per day. These add up to an income from meals and drinks of 297.475 ETB annually, and with a margin of profit of 50%, a profit of 148.737,5 ETB annually will be achieved.

Trainings required: English language (8), business administration and bookkeeping (1), cook (2), waiter and hospitality (4) Full-time jobs created: 17 Manager/purchaser, bookkeeper, receptionist (2), cooks (2), barkeeper (1), waiters (4), cleaners (4), guards (2) Indirect economic impact: The availability of an acceptable hotel in Mekane Berkhan will lead to extended stays of visitors in the town and thus contribute to its general economic growth. The hotel itself will be an additional customer for the wholesale dealer in Debark.

157

4.2.3.13. Investment Plan Hotel in Mekane Berkhan

No. 1. 1.1. 1.2. 1.3. 2. 2.1. 2.2. 2.3. 2.4. 2.5. 2.6. Items Legal and Administrative Costs Contract agreement and statutes Registration fee Construction permit for municipality Sub-total legal and administrative costs Real Estate Planning and design Buildings Parking lots Wall, gate and sign Sanitary Installations Development Electricity Telephone line Water Sub-Total Real Estate Equipment and Furniture Office and Reception Maintenance Bedrooms Restaurant and Bar Kitchen Sub-Total Equipment and Furniture Market Introduction Opening celebration Mailout Sub-Total Market Introduction First Set of Goods Goods Delivery Sub-Total First Set of Goods Trainings Business Administration Bookkeeping Waiters Cook English language Sub-Total Trainings Total Investment Costs Total Investment Costs (USD) Unit costs 350 60 1.500 No. of units Total cost 350 60 1.500 1.910 15.000 2000/m 200/m 42/m 15.000 420.000 18.000 4.200 19.980 1.000 284 1.694 480.158 1.530 17.197 43.130 74.237 51.725 187.819 20 3 100 guests 100 2.000 300 2.300 23.065 2.000 25.065 4.746 1.277 5.280 1.410 4.720 1 1 4 2 8 4.746 1.277 21.120 2.820 37.760 67.723 764.975 89.998 Totals

210 60 100

1.000 284 1.694

3. 3.1. 3.2. 3.3. 3.4. 3.5. 4. 4.1. 4.2. 5. 5.1. 5.2. 6. 6.1. 6.2. 6.3. 6.4. 6.3.

2.2. Buildings Item 8 single rooms 2 double rooms 2 showers 2 toilets Restaurant Bar Reception / Office Kitchen Storage room Generator room Total Buildings

Unit price 2000/m 2000/m 2000/m 2000/m 2000/m 2000/m 2000/m 2000/m 2000/m 2000/m

No. of units 64 18 4 4 40 40 9 16 9 6 210

Total 128.000 36.000 8.000 8.000 80.000 80.000 18.000 32.000 18.000 12.000 420.000

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2.4. Wall, Gate and Sign Item Wall Gate Sign Total Wall, Gate and Sign 2.5. Sanitary Installations Item Water tank (300 l) Shower Solar Water Heater / B2QH25 Mirror Sideboard Armature Toilet bowl Handwash bowl Ceramic for the floor / m2 wall / m2 Elbow (Corba) Pipe (3/4 inch) 3m - 1piece Counter 3/4 inch Water pipe 1/2 inch -3m Counter 1/2 inch Tape Reducer Nipples Foset Total Sanitary installations 3.1. Office and Reception Item Front desk Chairs Table Telephone Pocket calculator Small office supplies Total Office and Reception 3.2. Maintenance Item Generator Plastic bucket (30 l) Toilet brush Sweeper Water hose Detergent for toilets / showers Detergent for floor sweeping Detergent for windows Detergent for dishes Soap Sponge Brush for table Waste bin Plastic bowls Dish towels Toilet paper Total Maintenance

Unit price No. of units 42/m 100 5.000 1 1.000 1

Total 4.200 5.000 1.000 10.200

Unit price No. of units 1.000 1 350 2 12.240 170 l 200 2 400 2 200 2 520 2 250 2 95 4 60 12 5 15 130 4 350 1 100 3 pieces 300 1 5 9 5 9 5 9 20 6

Total 1.000 700 12.240 400 800 400 1.040 500 380 720 75 520 350 300 300 45 45 45 120 19.980

Unit price No. of units 1.000 1 150 6 400 1 150 1 80 1

Total 1.000 900 400 150 80 1.000 1.530

Unit price No. of units 15.500 1 35 2 19 5 20 5 30/m 10 19 10 15 2 20 1 4 5 1 180 1 20 18 5 19 3 40 3 26 5 2,75 100

Total 15.500 70 95 100 300 190 30 20 20 180 20 90 57 120 130 275 17.197

159

3.3. Bedrooms Item Single beds Double beds Single matrasses Double matrasses Pillows Blankets Sheets Bedside tables Chairs Tables Wardrobes Lamps Curtains Waste bins Total Bedrooms 3.4. Restaurant and Bar Item Chair Ledge Tables Table cloths and decoration Cashier desk Curtains Complete wall/room decoration Decorated ceiling lamp Normal ceiling lamp Wall mirror Bar couch Sink Cashier machine TV set (21 inch) Refrigerators Manu Complete bottle opener Simple bottle opener Big glasses ( juices) Beer glasses Wine glasses Liquor glasses Whisky glasses Tea machine Seals Seal pad with ink Service flat Set of tea pot (kettle) Set of salt coilers Spoon for tea Set of dishes Coffee cup Mug Big glass (juice) Tea cup Water/soft drink glass Juice making machine / small Juice making machine / large

Unit price No. of units 800 8 1.200 2 400 8 600 2 20 12 400 10 60 10 250 10 150 20 400 10 1.200 10 40 10 300 10 19 10

Total 6.400 2.400 3.200 1.200 240 4.000 600 2.500 3.000 4.000 12.000 400 3.000 190 43.130

Unit price No. of units 200 64 800 1 200 16 500 1 1.000 1 300 6 500 1 1.000 2 40 8 200 1 600 4 1.700 1 5.000 1 2.800 1 5.000 2 25 10 35 2 8 2 8 10 8 10 11 10 10 10 10 10 25.000 1 416 2 10 1 20 3 72 1 6 12 2 15 72 2 3 15 5 10 8 10 4 20 6 15 400 1 1.450 1

Total 12.800 800 3.200 500 1.000 1.800 500 2.000 320 200 2.400 1.700 5.000 2.800 10.000 250 70 16 80 80 110 100 100 25.000 832 10 60 72 75 23 144 45 50 80 80 90 400 1.450

Total Restaurant and Bar

74.237

160

3.5. Kitchen Item Hearth Deep fry Sink Refrigerator Water boiler Tables Meat grinder Set of knives Table Small water boiler Toaster Microwave Set of knives, forks, and spoons Set of pots Cutter board for cooking (set) Set of pans Spoon for soup Cooking materials complete Lamp Total Kitchen 5.1. Goods Item Dashin beer (case of 24 bottles) Meta beer (case of 24 bottles) Bedele beer (case of 24 bottles) St George beer (case of 24 bottles) Whisky Cognac Bottled water (mineral water) Vodka Ouzo/Gin Wine (small size) Wine ( big size) Tea Sugar Coffee (Alem) Bottled water big size Bottled water medium size Bottled water small size Soft drinks Bottle juice big size Bottle juice medium size Bottle juice Small size Edible oil Packed spices Different spices for tea Salt Tomato paste Marmalade Packed honey Peanut butter Hot Peppers Eggs Meat, potatoes, rice, vegetables Napkins Total First Set of Goods

Unit price No. of units 19.000 1 3.000 1 2.500 2 5.000 1 3.000 1 500 3 5.000 1 80 2 400 2 495 1 250 1 650 1 180 3 3.000 1 100 1 1.000 1 2 15 2.000 1 400 3

Total 19.000 3.000 5.000 5.000 3.000 1.500 5.000 160 800 495 250 650 540 3.000 100 1.000 30 2.000 1.200 51.725

Unit price No. of units 57 10 Box 74 10 Box 80 10 Box 68 10 Box 175 10 20 5 38 100 packet 100 10 40 19 100 9 100 20 3 100 packet 8 10kg 32 10 packet 44 30 box 38 30 box 28 30 box 25 30 box 12 30 bottles 10 30 bottles 5 30 bottles 13 10 liters 2 100 packet 2 12 13 13 10 17 5 for 2 birr 9 10 kg 25 10 packet 10 packet 10 packet 5 kg 500 eggs 10 packets

Total 570 740 800 680 1.750 100 3.800 1.000 760 900 2.000 275 80 320 1.320 1.140 840 750 360 300 150 125 200 50 20 300 130 130 100 85 200 3.000 90 23.065

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6. Trainings Item 6.1. Business Administration Travel Debark - Addis Ababa - Debark Per diems Training fee Total Business Administration Training 6.2. Waiters Travel Debark - Bahr Dar - Debark Per diems Training fees Total Waiters Training 6.3. English Language Travel Debark - Bahr Dar - Debark Per diems Training fees Total English Language Training Total Trainings

Unit price 300 70 2.748

Unit 1 1 x 16 1

Total 300 1.120 2.748 4.168 400 17.920 2.000 20.320 800 35.840 640 37.280 61.768

100 70 500

4 4 x 64 4

100 70 80

8 8 x 64 8

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4.2.3.13. Business Plan Hotel in Mekane Berkhan

Year 1 Gross turnover Room rents Meals and drinks Turnover tax 10% Net turnover Costs for goods Other income Gross profit Running Costs Personnel Telecommunication, electricity, water Gas for hearth Office and administration Small equipment purchases Maintenance and repair Public Relations Fees, legal and bookkeeping services Transports Travel Savings (10% of furniture and equipment) Result before taxes (net profit) Income tax 10% Result after taxes (net earnings) 354.050 56.575 297.475 -35.405 318.645 -148.738 0 169.907 -168.860 -94.200 -36.000 -4.800 -2.400 -1.200 -3.000 0 -1.000 0 -5.000 -21.260 1.047 -105 942

Personnel Position Manager Cashier / Bookkeeper Receptionist Chef Assistant cook Barkeeper Waiters Cleaners Guards Total Personnel Salary / month 900 550 500 500 450 450 400 400 400 Salary / year 10.800 6.600 6.000 6.000 5.400 5.400 4.800 4.800 4.800 No. of jobs 1 1 2 1 1 1 4 4 2 17 Total salaries 10.800 6.600 12.000 6.000 5.400 5.400 19.200 19.200 9.600 94.200

163

4.2.3.14. Tourist Caf in Debark

Debark is the main gateway to Simen Mountains National Park. It hosts the Park Administration where visitors have to pay entrance fees, and here the road to the Park branches off from the main road. It is almost impossible to visit the Park without spending at least one night in Debark. This importance is not reflected in the supply of hotels and other tourist facilities in town. Although two hotels are said to be built, presently there is only two hotels which are available for foreign visitors, the Simen Park Hotel and the Red Fox Hotel. This hotel is not substandard in every respect, but the facilities it offers are also extremely limited. Besides problems of cleanliness, the rooms do not have tables and chairs, the caf and restaurant have TV in considerable loudness and close down as early as nine p.m. This situation leaves visitors with practically no place to go to for reading or writing postcards, chatting or exchanging experiences with others, or just relaxing and observing life in the street. The demand for a caf which meets certain minimum standards in Debark is obvious. It shall be built on the main road in the center of the town, between the Simen Park Hotel in the south and the main square in the north. The caf shall attract foreign tourists and experts (whose numbers are expected to increase considerably in the future) as well as domestic tourists, but also those young and bettereducated local people who have been in touch with the modern world and aspire to have international contacts. The design of the caf shall be both modern and inviting. It shall be a place where one would feel at ease spending an hour or two, or even an afternoon, which encourages cultural and intellectual exchange among tourists, resident experts and local people. TV shall be restricted to international news at certain hours. As in many such cafs all over the world, tourists will leave read books here for future readers. With tourism development and general supply improving over time, the caf will offer international news magazines. The menu shall contain hot and cold drinks, small dishes and pastries of considerably more taste and higher quality than can be found elsewhere in Debark. It is important that the caf shall be open for some hours after dinner in the evenings. Because of the extremely small supply in Debark, the caf is expected to fill a niche even for local people. It will meet a strongly-felt demand also for tourists who visit in the rainy season and for that reason will be open the whole year around, albeit with smaller staff. It is assumed that the caf will have on average 200 customers each day who will each order for an average of 4 ETB so that the total income per month will be 24.000 ETB. Trainings required: English language (6), business administration, bookkeeping, waiter (4), barman, cook Full-time jobs created: 10 Manager, waiter (4), barman, cashier, cook, dish-washer, cleaner/dish remover Indirect economic effects: Continuing demand for pastries and drinks. Increase of attractiveness of the region for tourism.

164

4.2.3.14. Investment Plan Tourist Caf in Debark

No. 1. 1.1. 1.2. 1.3. 2. 2.1. 2.2. 2.3. 2.4. Items Legal and Administrative Costs Contract agreement and statutes Registration fee Construction permit from municipality Sub-total legal and administrative costs Real Estate Planning and Design Construction Sanitary installations Development Electricity Telephone line Water Sub-Total Real Estate Equipment and Furniture Unit costs 350 60 1.500 No. of units Total cost 350 60 1.500 1.910 15.000 200.000 3.280 1.000 284 1.694 221.258 66.937 44.465 111.402 20 . 100 guests 1000 copies 2.000 5.093 7.093 11.070 2.197 2.000 15.267 4.746 1.277 1.410 5.280 4.720 1 1 1 5 6 4.746 1.277 1.410 26.400 28.320 62.153 Totals

3. 3.1. Equipment 3.2. Furniture Sub-Total Equipment and Furniture 4. Market Introduction 4.1. Opening celebration 4.2. Leaflets Sub-Total Market Introduction 5. First Set of Goods 5.1. Food and Drinks 5.2. Household items 5.3. Transports Sub-Total First of Goods 6. Trainings 6.1. Business Administration (major) 6.2. Bookkeeping (minor) 6.3. Cook 6.4. Waiter / Barman 6.5. English Language Sub-Total Trainings

Total Investment Costs Total Investment Costs (USD)

419.083 49.304

2.3. Sanitary Installations Item Water tank (300 l) Toilet bowl Handwash bowl Water pipe 1/2 inch -3m Elbow Counter 1/2 inch Tape Reducer Nipples Foset Total Sanitary installations

Unit cost 1 520 250 100 5 300 5 5 5 20

No. of units 1.000 2 2 3 pieces 5 1 5 5 5 2

Total 1.000 1.040 500 300 25 300 25 25 25 40 3.280

165

3.1. Equipment Telephone Cashier machine Company plate Television (21 inch) Tape recorder Tea machine Seals Small water boiler Toaster Microwave Seal pad with ink Service flat Set of knives Stove Complete bottle openers Single bottle openers Refrigerator Cutter board for cooking (set) Set of tea pots (kettles) Set of salt coilers Spoon for soup Spoon for tea Set of dishes Set of knives, forks and spoons Set of pots Set of pans Coffee cups Mug Big glass (juice) Tea glass Water/soft drink glass Juice-making machine / small Juice-making machine / large Cooking materials Total Equipment

Unit costs 150 5.000 200 2.800 3.000 25.000 416 495 250 650 10 20 80 8.500 35 8 7.000 72 72 6 2 2 72 180 125 176 3 5 8 4 6 400 1.450 2.000

No. of units Total cost 1 150 1 5.000 1 200 1 2.800 1 3.000 1 25.000 2 832 1 495 1 250 1 650 1 10 3 60 2 160 1 8.500 2 70 2 16 2 14.000 1 72 1 72 12 75 15 30 15 23 2 144 3 240 3 375 3 528 15 45 10 50 10 80 20 80 15 80 1 400 1 1.450 1 2.000 66.937

3.2. Furniture Chairs Tables Front display desk Table cloths and decoration Cashier desk Curtains Manu Parasol Wall/room decoration Ceiling lamp Foot mat Decorated ceiling lamp Lamps outside Light bulbs Mirror Kitchen table Kitchen sideboard Tea machine with sink Total Furniture

Unit costs 275 500 1.500 100 1.000 300 25 675 500 40 30 1.000 40 5 200 600 1.300 3.400

No. of units Total cost 60 16.500 15 7.500 1 1.500 12 1.200 1 1.000 6 1.800 20 500 10 6.750 1 500 4 160 3 90 1 1.000 6 240 5 25 2 400 1 600 1 1.300 1 3.400 44.465

166

5.1. Food and Drinks Tea Sugar Coffee (Alem) Bottled water big size Bottled water medium size Bottled water small size Soft drinks Bottle juice big size Bottle juice medium size Bottle juice small size Chewing gum Packed spices Different spices for tea Salt Ketchup Cake Bread Marmalade Packed honey Peanut butter Chocolate butter Margarine Edible oil Pepper Orange Papayas Pineapple Mango Avocado Banana Eggs Cognac Whisky Ouzo Martini Total Food and Drinks

Unit costs No. of units Total cost 2,75 50 packets 140 7,50 100 kg 750 32 10 packets 320 44 30 boxes 1.320 38 30 boxes 1.140 28 30 boxes 840 25 30 boxes 750 12 30 bottles 360 10 30 bottles 300 5 30 bottles 150 3 100 packets 300 2 30 packets 60 50 2 10 kg 20 5 25 125 2 500 1.000 0,5 500 250 12,50 10 packets 125 13 10 packets 130 10 10 packets 100 30 10 packets 300 27 10 packets 270 12,50 10 liters 125 17 0.5 kg 85 5 30 kg 150 4 30 kg 120 4 30 kg 120 3,50 30 kg 105 4 30 kg 120 2,50 30 kg 75 0,40 500 200 20 5 100 175 5 875 19 5 95 20 5 100 11.070

5.2. Household Items Sponge Sweeper Brush for table Toilet brush Waste bin Plastic bowls Water Tank Dish towels Dish detergents, liquid Toilet paper Napkins Total Household Items

Unit costs No. of units Total cost 1 20 20 20 4 80 18 5 90 19 2 38 19 3 57 40 3 120 1.000 1 1.000 26 5 130 297 / 9l 1 297 2,75 100 275 9 10 packets 90 2.197

167

4.2.3.14. Business Plan Tourist Caf in Debark

Month Gross turnover Turnover tax (10%) 24.000 -2.400 Year 1-5 288.000 -28.800

Net turnover
Costs for goods 50% Other income

21.600
-12.000 0

259.200
-144.000 0

Gross profit
Running Costs Personnel Telecommunication, electricity, water Office and administration Small equipment purchases Maintenance and repair Public Relations Fees and legal services Transports Travel Savings -4.500 -1.600 -100 0 -400 0 -5 0 -1.000 -150

9.600
-7.755 -54.000 -19.200 -1.200 0 -4.800 0 -60 0 -12.000 -1.800

115.200
-93.060

Result before taxes (net profit)

Income tax (10%) Result after taxes (net earnings)

1.845
-185 1.660

22.140
-2.214

19.926

Personnel
Quantity 1 1 4 1 1 1 1 10 Salary / month 800 400 400 450 400 450 400 Total Monthly 800 400 1.600 450 400 450 400 4.500

Manager Cashier Waiter Barkeeper Cleaner and dish washer Cook Dish washer Total

168

4.2.3.15. Roadside Caf on the Limalimo Road

The Limalimo Road is one of the most spectacular roads anywhere in the world. Descending from Wolkefit Pass (2.900m asl) down the almost vertical northern escarpment of the Simen Mountains, it offers numerous breathtaking views both more than one thousand meters down into the deeply-cut valleys of Adiarkay Woreda, up towards the sheer cliffs of the escarpment, and far views to the East along most of the National Parks escarpment and to the North across Amharas rugged lowlands. The road winds down in an almost incessant sequence of sharp curves, often cut as only a narrow step into the vertical cliffs. Negotiating this road is a difficult challenge even for experienced drivers, and stopping on the way presents a serious hazard for other traffic. Thus the road offers few safe spots to stop and enjoy the phenomenal sights. One of the very few such spots, about half-way down, is on a long protruding cliff reaching out to the north and with steep slopes to three sides, thus offering a most spectacular lookout. The road makes a curve of 180 shortly before the e nd of the cliff, leaving a perfect and safe space for a lookout on its very tip. This tip is planned to be the location of a roadside caf. The site is not only the best lookout on the entire Limalimo Road, but also has the practical conditions for establishing a caf there. On the last stretch of road before reaching the tip of the cliff, there is safe and plain space by the side of the road for parking cars and a spring which provides fresh water all the year round. The tip itself has no trees since earthworks have been carried out on the site during previous road construction. Because of its very exposed location and the proneness to landslides during the rainy season, extra attention will have to be given to solid statics and fundaments of the building. The caf will primarily appeal to tourists, but will also be a welcome stopover for truck drivers and anyone else passing by. Buses leaving from Debark in the early morning or arriving there in the evening will pass this spot during the time of the most beautiful light of the day perfect for taking photos. Moreover, due to its vicinity to Debark, it has the potential to develop into a favourite spot for weekend recreation and family celebrations. Since the entire escarpment is located inside the National Park (including the Limalimo Road and the roadside caf), Park restrictions will prevent any other such caf from being built. The one planned on the Limalimo Road can be justified only because of the unavoidable impact which the road itself and its traffic already have - and always will have, to which the caf will not add substantially, and from the point of view of concentrating tourists on a few impact areas in the Park. The caf shall offer room for about 50 guests (two tour groups of 20 plus a few individual travellers at a time). There is enough space available for this number of guests outside on the lookout terrace. The inside room will be for only 20 people. It will be important that the terrace will extend all around the three sides of the tip of the cliff. It is taken for granted that the cafs architecture will blend perfectly with the environment both in style, materials and colours. Energy and water supply as well as waste management will be strictly in line with Park regulations. It will be a quiet place, paying tribute to the awesomeness and serenity of the landscape. The kitchen will offer mainly hot and cold drinks as well as pastries and snacks, but it shall have the capacities to prepare warm meals for announced groups and festive events as well. On the plain space along the road immediately above the tip of the cliff, a parking lot will be reserved for visitors. It will not be asphalted but prepared with stones which have holes in order to let vegetation grow through and have minimal visible impact.

169

Because foreign tourists will be critical group of guests for the economical success of the caf, an extra effort will be necessary to alert tour agencies, tour operators and travel guide publishers to this new attraction. To this end, an e-mail mailout and a website will be launched which will give a visual impression of the site and an overview of the cafs offerings. In addition, a small leaflet will be printed which will be available through the Ethiopian Tourism Commission, tourist information offices, tour operators offices and major hotels. The business plan was developed assuming that the caf will be a seasonal operation. The peak season, which lasts from mid-September to March, will make or break the business. The secondary season - until mid-June - follows with substantially less visitors. It is expected that the establishment of the Caf will itself attract many more visitors to take half-day excursions down the Limalimo Road, and use the Caf as the point to make a stopover or lunch break before returning. Details concerning the number of customers and their expenditures are given in a separate table with the business plan. The turnover in the first year is assumed to be two thirds of that of the following years, along with the increase of the total numbers of tourists visiting the SMNP.

Trainings required: English language (4), business administration, bookkeeping, waiter (3), barman, cook Full-time jobs created: 8 Manager/cashier, waiter (2), barman, cook, dish-washer, cleaner/dish remover, guard Indirect economic effects: Continuing demand for pastries and drinks.

170

4.2.3.15. Investment Plan Roadside Caf in Limalimo

No. 1. 1.1. 1.2. 1.3. 2. 2.1. 2.2. 2.3. 2.4. Items Legal and Administrative Costs Contract agreement and statutes Registration fee Construction permit from Kebele Sub-total legal and administrative costs Real Estate Planning and Design Construction Sanitary installations Development Solar energy Telephone line Water Sub-Total Real Estate Equipment and Furniture Unit costs 350 60 1.500 No. of units Total cost 350 60 1.500 1.910 6.900 158.000 1.027 18.000 284 1.694 185.905 66.937 44.465 Totals

3. 3.1. Equipment 3.2. Furniture Sub-Total Equipment and Furniture 4. Market Introduction 4.1. Opening celebration 4.2. Leaflets Sub-Total Market Introduction 5. First Set of Goods 5.1. Food and Drinks 5.2. Household items 5.3. Transportations Sub-Total First of Goods 6. Trainings 6.1. Business Administration (major) 6.2. Bookkeeping (minor) 6.3. Cook 6.4. Waiter / Barman 6.5. English Language Sub-Total Trainings

20 .

100 guests 1000 copies

2.000 5.093 7.093 11.070 2.197 2.000 15.267

4.746 1.277 1.410 5.280 4.720

1 1 1 3 4

4.746 1.277 1.410 15.840 18.880 42.153

Total Investment Costs Total Investment Costs (USD)

252.328 29.686

2.3. Sanitary Installations Item Water tank (300 l) Toilet bowl Handwash bowl Water pipe 1/2 inch -3m Elbow Counter 1/2 inch Tape Reducer Nipples Foset Total Sanitary installations

Unit cost 1 520 250 100 5 300 5 5 5 20

No. of units 1.000 2 2 3 pieces 5 1 5 5 5 2

Total 1.000 1.040 500 300 25 300 25 25 25 40 1.027

171

3.1. Equipment Telephone Cashier machine Company plate Television (21 inch) Tape recorder Tea machine Seals Small water boiler Toaster Microwave Seal pad with ink Service flat Set of knives Stove Complete bottle openers Single bottle openers Refrigerator Cutter board for cooking (set) Set of tea pots (kettles) Set of salt coilers Spoon for soup Spoon for tea Set of dishes Set of knives, forks and spoons Set of pots Set of pans Coffee cups Mug Big glass (juice) Tea glass Water/soft drink glass Juice-making machine / small Juice-making machine / large Cooking materials

Unit costs 150 5.000 200 2.800 3.000 25.000 416 495 250 650 10 20 80 8.500 35 8 7.000 72 72 6 2 2 72 180 125 176 3 5 8 4 6 400 1.450 2.000

No. of units Total cost 1 150 1 5.000 1 200 1 2.800 1 3.000 1 25.000 2 832 1 495 1 250 1 650 1 10 3 60 2 160 1 8.500 2 70 2 16 2 14.000 1 72 1 72 12 75 15 30 15 23 2 144 3 240 3 375 3 528 15 45 10 50 10 80 20 80 15 80 1 400 1 1.450 1 2.000

Total Equipment

66.937

3.2. Furniture Chairs (aluminum) Table (aluminum) Front display desk Table cloths and decoration Cashier desk Curtains Manu Parasol Wall/room decoration Ceiling lamp Foot mat Decorated ceiling lamp Lamps outside Light bulbs Mirror Kitchen table Kitchen sideboard Tea machine with sink

Unit costs 275 500 1.500 100 1.000 300 25 675 500 40 30 1.000 40 5 200 600 1.300 3.400

No. of units Total cost 60 16.500 15 7.500 1 1.500 12 1.200 1 1.000 6 1.800 20 500 10 6.750 1 500 4 160 3 90 1 1.000 6 240 5 25 2 400 1 600 1 1.300 1 3.400

Total Furniture

44.465

172

5.1. Food and Drinks Tea Sugar Coffee (Alem) Bottled water big size Bottled water medium size Bottled water small size Soft drinks Bottle juice big size Bottle juice medium size Bottle juice small size Chewing gum Packed spices Different spices for tea Salt Ketchup Cake Bread Marmalade Packed honey Peanut butter Chocolate butter Margarine Edible oil Pepper Orange Papayas Pineapple Mango Avocado Banana Eggs Cognac Whisky Ouzo Martini

Unit costs 2,75 7,50 32 44 38 28 25 12 10 5 3 2 2 5 2 0,5 12,50 13 10 30 27 12,50 17 5 4 4 3,50 4 2,50 0,40 20 175 19 20

No. of units Total cost 50 packets 140 100 kg 750 10 packets 320 30 boxes 1.320 30 boxes 1.140 30 boxes 840 30 boxes 750 30 bottles 360 30 bottles 300 30 bottles 150 100 packets 300 30 packets 60 50 10 kg 20 25 125 500 1.000 500 250 10 packets 125 10 packets 130 10 packets 100 10 packets 300 10 packets 270 10 liters 125 0.5 kg 85 30 kg 150 30 kg 120 30 kg 120 30 kg 105 30 kg 120 30 kg 75 500 200 5 100 5 875 5 95 5 100

Total Food and Drinks

11.070

5.2. Household Items Sponge Sweeper Brush for table Toilet brush Waste bin Plastic bowls Water Tank Dish towels Dish detergents, liquid Toilet paper Napkins

Unit costs 1 20 18 19 19 40 1.000 26 297 / 9l 2,75 9

No. of units Total cost 20 20 4 80 5 90 2 38 3 57 3 120 1 1.000 5 130 1 297 100 275 10 packets 90

Total Household Items

2.197

173

4.2.3.15. Business Plan Roadside Caf in Limalimo

Year 1
Gross turnover Turnover tax (10%) 124.100 -1.241

Year 2-5
186.150 -1.815

Net turnover
Costs for goods 50% of turnover Other income Gross profit Running Costs Personnel Electricity (gasoline) , water Office and administration Small equipment purchases Maintenance and repair Public Relations Fees and legal services Transports Travel Savings

122.859
-62.050 0 60.809 -53.000 -45.600 -1.800 -1.600 0 0 0 -600 -2.400 -1.000 0 7.809 -781 7.028 -45.600 -2.400 -2.400 0 -2.400 0 -600 -3.600 -1.000 -13.350

184.335
-93.075 0 91.260 -71.350

Result before taxes (net profit)

Income tax (10%) Result after taxes (net earnings)

19.910 -1.991 17.919

Turnover (years 2-5) Low Season (5 months) Foreign customers Domestic customers High Season (7 months) Foreign customers Domestic customers Total Turnover No. / month Expenditures 15 20 100 2,5 1.000 400 25 3 Total / month 300 250 25.000 1.200 Total / season 1.500 1.250 175.000 8.400 186.150

Personnel Quantity 1 2 1 1 1 1 1 8 Salary / month 800 400 500 500 400 400 400 Total Monthly 800 800 500 500 400 400 400 3.800 Total / year 9.600 9.600 6.000 6.000 4.800 4.800 4.800 45.600

Manager/cashier/purchaser Waiter Barman Cook Cleaner Dish washer Guard Total

174

4.2.3.16. Cultural Night Bars

Although Amhara has a rich musical tradition, there is presently no place or institution in any of the regions Woreda centers which would respond to the cultural needs of the local population or the interest of tourists in Ethiopian musical and dance traditions. Furthermore, with the exception of the restaurant in the Simen Park Hotel (which has loud TV and closes down at 9:00 p.m.) there is not a single public place in the whole region where tourists or locals can stay in the evenings for social exchange and entertainment. In the nearest major town, Gondar, numerous small night bars exist which offer live Ethiopian music and dance performances, and which are well frequented by both Ethiopians and tourists, and it would seem a natural thing to establish such night bars also in Debark and Adiarkay. The bars will employ their own music and dance groups who will perform almost every night. It is assumed that demand is high enough to allow for two of such bars to be established in Debark as well as a free group (see 2.3.16.) which will serve the hotels of Debark, bars in the other Woreda centers of the region (Dabat, Mekane Berkhan) and social festivities such as wedding and birthday parties. The bars music and dance group will consist of a basic team of two dancers and two players each of Masinko (a string and bow instrument) and Kebero (drum). The Masinko player by tradition is also the singer. However, only one of each two artists will perform at one time. This is necessary because all artists have to take turns during one performance which usually lasts several hours. (The dancers may take additional rests during some songs which do not have dance accompaniment.) The bars shall be established at central locations in the Woreda centers of Debark (2) and Adiarkay. They will be regular one-room bars with seats for up to twenty-six guests and will be open from six p.m. to midnight. Every evening, a music and dance group will perform on the open space between the chairs and tables. No fee will be added to the costs of drinks for this, but tea and coffee will not be available in order to prevent guests from ordering only the cheapest of drinks. It is expected that a minimum of sixty persons will visit per day on average, among them 10 foreign visitors and 50 local inhabitants, and each of them will order an average of two beers or their equivalent. One beer will cost 10 ETB for a foreigner and 5 ETB for a local. This means that 10 foreigners will spend 20 ETB on 30 days a month, adding up to 6.000 ETB, and 50 locals will spend 10 ETB on 30 days a month, adding up to 15.000 ETB, giving a total turnover of 21.000 ETB per month. The average wholesale price of a bottle of beer being 2,8 ETB, and 60 customers drinking 120 beers a day or 3.600 beers a month, the costs for goods per month are on average 10.080 ETB.

Trainings required: English language (3 x 10), business administration (3 x 1), bookkeeping minor (3 x 1), waiter (3 x 2), barman (3 x 1), repertoire and performance (3 x 6) Full-time jobs created: 3 x 12 Manager (1), cashier (1), barman (1), waiter (2), cleaner (1), musicians and dancers (6) Indirect economic impact: Increases demand for cold drinks. Increases attractiveness of the region for tourism.

175

4.2.3.16. Investment Plan Cultural Night Bar

No. 1. 1.1. 1.2. 2.1. 2. 2.2. 2.3. 2.4. 2.5. 2.6. Item Legal and Administrative Costs Contract agreement and statutes Registration fee Construction permit for municipality Sub-total legal and administrative costs Real Estate Compensation for evacuation Planning and Design Construction Toilet and sink Development Electricity Telephone line Water Sub-Total Real Estate Furniture and Equipment Furniture Equipment Sub-Total Furniture and Equipment Market Introduction Opening celebration Leaflet Mailout Sub-Total Market Introduction First Set of Goods Goods Transportation Sub-Total First Set of Goods Trainings Business Administration (minor) Bookkeeping (minor) English Language Barman Waiter Repertoire and Performance Sub-Total Trainings Total Investment Costs Total Investment Costs (USD) 3.1. Furniture Item Chair (made of bamboo) Ledge Table (made of bamboo) Front display desk Table cloths and decoration Cashier desk Curtains Wall/room decoration Decorated ceiling lamp Normal ceiling lamp Light bulbs Wall mirror Bar couch Sink Total Furniture Unit costs 350 60 1.500 No. of units Total cost 350 60 1.500 1.910 60.000 15.000 2.000 1 120 m
2

Totals

60.000 15.000 240.000 3.280 1.000 284 1.694 321.258 20.265 30.126 50.391

1.000 284 1.694

3. 3.1. 3.2. 4. 4.1. 4.2. 4.3. 5. 5.1. 5.2. 6. 6.1. 6.2. 6.3. 6.4. 6.5. 6.6.

20 . 3

100 guests 1000 copies 100

2.000 5.093 340 7.433 16.750 1.500 18.250

1.277 1.277 4.720 5.280 5.280

1 1 10 1 2 6

1.277 1.277 47.200 5.280 10.460 20.080 85.574 484.816 57.038

Unit Cost 200 800 200 1.500 500 1.000 300 500 1.000 40 5 200 600 1.700

No. of units 27 1 9 1 1 1 6 1 1 6 5 2 6 1

Totals 5.400 800 1.800 1.500 500 1.000 1.800 500 1.000 240 25 400 3.600 1.700 20.265

176

3.2. Equipment Item Fixed telephone Cashier machine Company sign (with light) TV (21 inch) Tape recorder Refrigerators Manu Musical instruments / kirar Musical instruments / masinko Big drum Small drum Traditional men's dress Traditional women's dress Service for providing drinks Complete bottle opener Simple bottle opener Big glasses ( juices) Beer glasses Wine glasses Liquor glasses Whisky glasses Total Equipment

Unit Cost 150 5.000 1.000 2.800 3.000 7.000 25 80 80 35 30 300 400 20 35 8 8 8 11 10 10

No. of units 1 1 1 1 1 2 10 3 3 2 2 5 3 3 2 2 10 10 10 10 10

Totals 150 5.000 1.000 2.800 3.000 14.000 250 240 240 70 60 1.500 1.200 60 70 16 80 80 110 100 100 30.126

5.1. Goods Item Dashin beer (case of 24 bottles) Meta beer (case of 24 bottles) Bedele beer (case of 24 bottles) St George beer (case of 24 bottles) Whisky Bottled juice Bottled water (mineral water) Vodka Ouzo/Gin Wine (small size) Wine ( big size) Total Goods

Unit Cost 57 74 80 68 175 10 38 100 40 100 100

No. of units 10 cases 10 cases 10 cases 10 cases 10 100 packet of 100 10 19 9 20

Totals 570 740 800 680 3.500 2.000 3.800 1.000 760 900 2.000 16.750

6.6. Repertoire and Performance Training Item Specification Participants Travel Debark - Gondar - Debark Per diems 32 days x 70 Materials lump sum Trainer Honorarium 1 month Travel Addis Ababa - Gondar - Addis Ababa Per diems 32 x 70 Total Repertoire and Performance Trainings

Cost 100 2.240 100 3.000 200 2.240

Number 6 12 12 1 1 1

Totals 600 13.440 600 3.000 200 2.240 20.080

177

4.2.3.16. Business Plan Cultural Night Bar

Gross turnover Turnover tax (2%) Net turnover Costs for goods Other income Gross profit Running Costs Personnel Telecommunication, electricity, water Office and administration Small equipment purchases Maintenance and repair Public Relations Fees and legal services Transports Savings Losses (5% of costs for goods) Result before taxes (net profit) Income tax (10%) Result after taxes (net earnings) Month 20.000 -400 19.600 -10.080 0 9.520 -8.822 -6.400 -500 -100 0 -800 0 -5 -50 -463 -504 698 -70 628 Year 1-5 240.000 -4.800 235.200 -120.960 0 114.240 -105.858 -76.800 -6.000 -1.200 0 -9.600 0 -60 -600 -5.550 -6.048 8.382 -839 7.543

Personnel Salary / month Quantity 800 1 400 1 500 2 500 1 400 1 550 6 2.950 12 Total Monthly 800 400 1.000 500 400 3.300 6.400

Manager Cashier Waiter Barman Cleaner Musician and dancer Total

178

4.2.3.17. Traditional Music and Dance Group

Artistic life in the Simen Mountains region is at a minimum. Music and dance performances are limited to festivities such as weddings or public holidays. For these events, ad-hoc hobby musicians and dancers are invited who are very limited both in their repertoires and their artistic capacities. No musical classes are given in schools either, so the music and dance tradition in this area is at constant risk and only upheld by those few who develop selfacquired skills. On the other hand, there is a strong and natural desire for cultural life and experience, as everywhere else in the world. A well-trained Music and Dance Group of reasonable quality can be certain to be invited to perform regularly in the local bars of the Woreda centers of Adiarkay, Debark, Dabat and Mekhane Birkhan in the festive months of January-February and April-May. Additional opportunities will arise from wedding and birthday celebrations since a professional group in beautiful costumes will easily be preferred to individual occasional players. Almost daily engagements by tourist hotels in Debark can be expected in the high tourist season (October - May), and occasional engagements (two per week on average) whenever a group arrives during the rainy season (June - September). The Music and Dance Group will have a broader spectrum of instruments and more dancers than the groups who work in the night bars. This is so because in the night bars the groups will only be an additional feature, while the independent group performances will be special events exhibiting a greater degree of professionalism. The groups will consist of four dancers and two players each of Masinko (a string and bow instrument), Krar (a string instrument picked by hand), Kebero (drum) and Washint (flute). However, only two dancers and four musicians will perform at any given time. This is necessary because all musicians have to take turns during one performance which usually lasts several hours. (The dancers may take rests during songs which will have no dance accompaniment.) The group will have a building where they can practice, keep their instruments and have a telephone where they can be contacted for engagement. One of the group members will coordinate the schedule. A good promotional leaflet will be essential. The group will be expected to pay for their own travel and accommodation when they play outside their residence town of Debark. For travel, they will use public busses. It is assumed that the group will have engagements on average 15 days a month and will earn a honorarium of 1.000 ETB per engagement, adding up to a monthly income of 15.000 ETB.

Trainings required: Repertoire and Performance (12) Full-time jobs created. 12 Musicians (8), dancers (4) Indirect economic effect: Contributes to increasing the consumption of drinks and the attractiveness of the region for tourism.

179

4.2.3.17. Investment Plan Traditional Music and Dance Group

No. 1. 1.1. 1.2. 1.3. 2. 2.1. 2.2. 2.3. 2.4. Items Legal and Administrative Costs Contract agreement and statutes Registration Construction permit for municipality Sub-Total Legal and Administrative Costs Real Estate Compensation for evacuation Fee for design work Building (office and practice room) Development Electricity Telephone line Water Sub-Total Real Estate Equipment and Furniture Equipment Mobile telephone and Sim card Fixed telephone Company sign Tape recorder Safe to keep cash Musical instruments / kirar Musical instruments / masinko Big drum Small drum Flute Traditional men's clothes Traditional women's clothes Stationary and related Furniture Chairs Table Shelf Wardrobe Cabins Sub-Total Equipment and Furniture Market Introduction Opening celebration Leaflet Mailout Sub-Total Market Introduction Trainings Business Administration (minor) English language Repertoire and Performance Sub-Total Trainings Total Investment Costs (ETB) Total Investment Costs (USD) Unit costs 350 60 1.500 No. of units Costs 350 60 1.500 1.910 60.000 15.000 2.000 1.000 284 1.694 1 50 m
2

Totals

60.000 15.000 100.000 1.000 284 1.694 177.978

3. 3.1.

1.460 150 200 3.000 1.000 80 80 35 30 10 300 400

1 1 1 1 1 2 2 2 2 2 9 3

1.460 150 200 3.000 1.000 160 160 70 60 20 2.700 1.200 500 5.400 2.200 3.000 3.000 24.280

3.2.

450 1.100 1.500 1.500

12 2 2 2

4. 4.1. 4.2. 4.3. 5. 5.1. 5.2. 5.3.

20 . 3

100 guests 1000 copies 100

2.000 5.093 340 7.433

1.277 4.720

1 12 12

1.277 56.640 34.720 92.637 304.238 35.793

Repertoire and Performance Training Item Specification Travel participants Debark - Gondar - Debark Per diems participants + trainer 32 days x 70 Training materials lump sum Honorarium trainer 1 month Travel trainer Addis Ababa - Gondar - Addis Ababa Total Repertoire and Performance

Cost Number 100 12 2.240 13 100 12 3.000 1 200 1

Totals 1.200 29.120 1.200 3.000 200 34.720

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4.2.3.17. Business Plan Traditional Music and Dance Group

Month Gross turnover Turnover tax (10%) Net turnover/ Gross profit Running Costs Personnel Telecommunication, electricity, water Office and administration Maintenance and repair Fees and legal services Travel Accommodation and food Savings (10% of equipment) Result before taxes (net profit) Income tax 10 % Result after taxes (net earnings) 15.000 -1.500 13.500 -13.379 -6.000 -300 -50 -100 -50 -2.880 -3.780 -219 121 -13 108 -72.000 -3.600 -600 -1.200 -600 -34.560 -45.360 -2.627 1.453 -146 1.307 Year 1-5 180.000 -18.000 162.000 -160.547

Personnel Salary / month Quantity 500 4 500 1.000 8 12 Total / Month 2.000 4.000 6.000 Total / Year 24.000 48.000 72.000

Dancer Musician (masinko, kirar, drum, flute) Total

Travel Destinations Adiarkay Mekhane Berkhan Total No. of trips 2 2 4 Cost per trip 40 80 120 Participants 12 12 24 Total 960 1.920 2.880

Accommodation and Food Destinations Adiarkay (food) Adiarkay (accommodation) Mekane Berkhan (food) Mekane Berkhan (accommodation) Total No. of trips 2 2 3 2 9 Cost per trip 50 15 50 20 135 Participants 12 12 12 12 48 Total 1.200 360 1.800 420 3.780

181

4.2.3.18. Simen Mountains Museum

There is no museum in Bahr Dar, Gondar or Debark that would explain the natural and cultural heritage of the Simen Mountains National Park and Region. The Information Center at the Park Administration is not laid out for the purpose of a permanent exhibition; it rather provides technical visitor information. A Simen Mountains Museum will fill this gap and conforms with the Amhara State Strategy for tourism development. A museum will not only provide public access to the wealth of information about the Parks natural and cultural values which already exists but has never been prepared for public education. It will also be the principal tool for environmental education of the local population of the region, especially school children, and will therefore make an invaluable contribution to the long-term public support and thus the sustainability of the Park. In addition, it will make tourists extend their stay in Debark and will be a welcome place to go on days when the Park is inaccessible during the rainy season. The museum will consist of two parts, each having a separate building: one about the natural environment and one about the culture of the local population. The natural part will be a conventional building and mainly feature specimen, photos, diagrams and maps, and will include space for a small sales point, an office room and two toilets for visitor use. The cultural part will take the form of an open-air museum with an original traditional tukul family compound including all typical household items and explanatory text tables next to them. Some additional photo/text tables may visualize the important daily activities such as preparing injera and coffee, or producing basketry items. The natural part will explain the following aspects of the Simen Mountains: - Landforms and Geo-History - Climate and Water - Soils and Vegetation - Wildlife and Conservation - Land Use and its Problems - History and Management of the Park - UNESCO World Heritage. Each of these seven aspects will have a separate section. Real specimens shall be used as much as possible, and texts will be very short mainly in order to explain visual presentations such as photos, diagrams and maps. Wild animals shall be presented through stuffed specimens whenever animals found dead in the wild or which died in zoos present an opportunity to create preparations. For this purpose, cooperation shall be sought, i.e., with the Frankfurt Zoological Society - which has a Gelada Baboon Project in the Simens. Since most of these animals are very rare and elusive, visitors rarely catch sight of them, and preparations will enable even the casual visitor to have an impression of their appearance from a close distance, which otherwise is almost impossible. Obviously, the more preservation objects the museum will have, the more attractive it will be, and special efforts should be made by the museum director to enter into cooperation agreements with European or American museums in order to obtain well-done preparations, or to train Ethiopian specialists to do this. For reasons of costs and maintenance, the museum shall not be dependent on high-tech equipment such as air temperature and humidity control, interactive media etc. Displays will be simple and robust so as to withstand changing weather conditions as well as intensive use by groups, local people and school classes.

182

Since the museum cannot be a destination in its own right, it shall be located where tourists come to stay. Places to be considered in this respect are either Debark itself or the nearest vicinity to the newly-built lodge in Buyit Ras. Debark is considered to be preferable because it allows much better access for the local population, especially school children. Moreover, the lodge maybe closed during the rainy season, and then it will be quite difficult to keep the museum open. For the costs of the museum interiors and exhibition, only lump sums can be suggested in this proposal because these costs depend very much on the detailed concept for the museum which needs a separate study. However, the running costs can be determined and show that they can be covered from entrance fees and sales. For adding objects, especially preparations, and updating information panels funds will have to be made available from profits from time to time. All texts in the museum shall be in both Amharic and English languages. Since most tourists visiting Simen Mountains NP are organized in groups on a pre-set itinerary, it is essential that the museum will become known to tour agencies and operators as soon as possible. In addition, information about the museum should be provided to travel guide book publishing houses. For this purpose, a leaflet will be produced, which the museum director will circulate on a special tour to introduce the museum to tour operators offices and major hotels in Gondar and Addis Ababa. In the absence of any other good and comprehensive source of information on the Park, it is expected that after an introductory period of two years, as soon as tour operators have adjusted their itineraries, about 75% of all foreign Park visitors will visit the museum. The substantial profits made from entrance fees and sales will be added to the Trust Funds assets and be available for grant-making to the Buffer Zone population as well as the Park itself, or to improve the museum through preparations.

Trainings required: English language (2), Museum operation (1), Bookkeeping (1), Guide (2) Full-time jobs created: 4 Director/Curator/Public Relations Manager (1), Seller/Cashier/Guide (1), Guard (1), Gardener/Cleaner (1) Indirect economic impact: Increases the regions attractiveness for tourism.

183

4.2.3.18. Investment Plan Simen Mountains Museum

No. 1. 1.1. 1.2. 1.3. 2. 2.1. 2.2. 2.3. 2.4. 3. 3.1. 3.2. 3.3. 4. 4.1. 4.2. 5. 5.1. 5.2. 6. 6.1. 6.2. 6.3. 6.4. 7. Item Legal and administrative costs Lawyer Registration Building permits Sub-Total Legal and Administrative Costs Real Estate Land Buildings Toilet and sink Development Sub-Total Real Estate Furnitures and Equipment Furnitures Office Equipment Exhibitions Sub-Total Machinery, Furnitures and Equipment First Set of Goods Souvenirs Printed Materials Sub-Total Goods Market Introduction Leaflet (A4 full colour, 1000 copies) Information Campaign Sub-Total Public Relations Trainings English Language (2) Museum management Bookkeeping Guide / Customer Service (2) Sub-Total Trainings Financing Start-up assistance Sub-Total Financing Costs 350 0 7.682 8.032 0 241.000 3.280 3.162 247.442 13.690 23.429 120.400 157.519 2.800 1.000 3.800 7.593 5.000 12.593 9.440 10.000 1.277 10.560 31.277 5.063 5.063 4. First Set of Goods Woollen items Cotton items Basketry Leatherworks Woodworks Honey Total Souvenirs 10 Broschures 10 Posters 100 Postcards Total Print Materials 1.200 500 300 200 500 100 2.800 350 350 300 1.000 Totals 2.3. Development Electricity Water Telephone Internet Total Development 3.1. Furnitures Cashier desk Chair Showcase Office desk Desk chair Desk lamp File trunk Shelf Chair Ceiling lamp Curtain Total Furnitures 1.000 1.694 284 184 3.162 2.2. Buildings Item Exhibition House Planning Construction Tukul compound Gate Walls Total Buildings Size 100 sqm Cost 15.000 210.000 2.500 3.000 10.500 241.000

120 sqm 3m 250m

2.364 984 2.679 1.191 1.270 400 2.122 1.700 600 80 300 13.690

3.2. Office Equipment PC (incl. monitor, keyboard, mouse) B/w printer Telephone Fax machine Cashier machine Safe Desk items Multiplug Bookkeeping software Cleaning materials Total Office Equipment 3.3. Exhibitions Concept and Interior Design Photos 12 Information Panels Specimen Showcases Walls, Pedestals etc. Lighting Installation Tukul Ethnographica Explanatory panels Total Exhibitions

9.586 3.393 230 3.150 5.000 500 1.000 40 30 500 23.429

Total Investment Costs (ETB) Total Investment Costs (USD)

465.726 54.792

8.500 40.000 20.000 10.000 18.000 10.000 6.000 2.400 500 5.000 120.400

184

4.2.3.18. Business Plan Simen Mountains Museum

Year 1 Gross turnover Entrance Fees Sales Total Gross Turnover Turnover tax (10% from entrance fees) Turnover tax (2% from sales) Net turnover Costs for goods Other income Gross profit Operational Costs Personnel Running Costs Office and administration Small equipment purchases Maintenance and repair Public Relations Services Transports Travel Losses (2% of goods) Savings Result before taxes (net profit) Income tax (10%) Result after taxes (net earnings) 60.750 11.900 72.650 -6.075 -238 66.337 -7.218 0 59.119 -64.182 -28.800 -5.411 -2.250 -2.000 -3.000 -5.000 -7.000 -2.000 -7.000 -145 -1.576 -5.063 0 -5.063 -28.800 -5.411 -2.250 -2.000 -3.000 -5.000 -7.000 -2.000 -7.000 -289 -1.576 53.462 -5.347 48.115 Year 2 121.000 23.800 144.800 -12.100 -476 132.224 -14.436 0 117.788 -64.326 -28.800 -5.411 -2.250 -2.000 -3.000 -5.000 -7.000 -2.000 -7.000 -361 -1.576 83.062 -8.307 74.755 Year 3-5 151.500 29.750 181.250 -15.150 -595 165.505 -18.045 0 147.460 -64.398 Personnel Director Cashier/Guide Gardener/Cleaner Guard Total Personnel Services Auditor Bookkeeper Lawyer Total Services Running Costs Land lease 1/4ha Telephone Electricity Water Total Operations Office Supplies Printer toner Paper pack Folders Small items Total Office Supplies 12.000 7.200 4.800 4.800 28.800

1.200 4.800 1.000 7.000

11 1.800 2.400 1.200 5.411

1.800 200 50 200 2.250

185

Purchases and Sales (Years 3-5) Item Unit cost Cotton items various Basketry various Leatherworks various Woodworks various Honey 15 Booklets 35 Posters 35 Postcards 3 Total Purchases and Sales

Cost No. Sold 8.500 100 20 100 25 60 100 30 900 60 5.600 160 1.400 20 1.500 500 18.045

Sales 10.000 2.500 1.800 4.500 1.200 5.250 2.000 2.500 29.750

Entrance fees Visitors Foreign Domestic School Children Total Entrance Fees

Fee 30 5 1

Visitors yr 1 2.000 50 500 2.550

Total 60.000 250 500 60.750

Visitors yr 2 4.000 50 1.000 5.050

Total 120.000 250 750 121.000

Visitors yr 3-5 5.000 100 1.000 6.100

Total 150.000 500 1.000 151.500

186

4.2.4. Financing Sector

4.2.4.1. Simen Mountains Trust Fund
The Simen Mountains Trust Fund (SMTF) shall be established in order to have an independent financing instrument at hand for a broad variety of tasks concerning the promotion of nature conservation and sustainable development in the Simen Mountains Area, such as environmental education, enabling the local population to contribute to reaching the Parks objectives, and improving the Parks infrastructure and services. The SMTF will have the status of an NGO or cooperative and will operate a grant program and a Soft Loans program. Both these programs will have separate financing sources and shall each cover all their expenses from these sources. Because it is anticipated that it will take some time to prepare the necessary legal basis for the Trust Fund, it is planned that it will become operational only from year 3 of the Project. At this point in time it can also move into offices which will become free in the Parks premises as the number of Project staff will be reduced. Grant Program Grants shall be given to non-profit organizations, business companies, gotts and state institutions and organizations in order to upgrade public health, education, culture, nature conservation and the protection of the environment, and to solve acute problems of the Simen Mountains National Park and the Kebeles which share its territory. For details, please see the By-laws of the Grant Program (Appendix 6.7.). The original deed for the Trust Fund shall be 850.000 ETB (100.000 USD). This deed will remain in full on a bank account, and only the annual interests it produces will be available for expenditures. It is expected that 5% interest (42.500 ETB) can be gained from this amount annually. The second regular source of income shall be from the sale of printed materials about the SMNP (booklets, posters, postcards). The average annual profit from these sales is expected to be 100.462 ETB. With these two amounts, after deducting operational costs and salaries, the Trust Fund is expected to be able to issue grants in the amount of 342.000 ETB over a 4-year period, representing an annual average of 85.500 ETB. In the long term, the SMTF has a potential to have income also from the following sources: - a certain percentage of the entrance fees of the Park; - a certain percentage of the licenses issued by the Park; - all income from a tourism tax or fee to be collected from tourism-related businesses in Debark as well as tour operators who include Simen National Park in their operations - donations and grants from other sources. These sources of income have not been considered in the present business plan because the amount of their revenues is not clear and they require extensive political and administrative procedures. Soft Loans Program The Soft Loans Program will be organized under the Simen Mountains Trust Fund as a separate and financially self-sufficient entity. Because of its high general priority, in case the

187

establishment of the Trust Fund will be delayed, a way shall be found to make it operational even before the Trust Fund will come into existence. For details of the Soft Loans Program, see description 4.2.4.2. The Soft Loans Program, including expenses for staff and operations, shall be financed through an original deed of 2.125.000 ETB. It shall promote the sustainable development of the buffer zone of the Simen Mountains National Park by providing financial assistance to people living in the buffer zone for running small businesses and improving their livelihoods, on the condition that they reduce their impact on, and contribute to the protection of the Simen Mountains National Park. For details, please see the By-laws of the Small Loans Program (Appendix 6.8.). Organizational Structure The Simen Mountains Trust Fund shall have an organizational structure as simple and small as possible, bodies being the members assembly, executive board and executive director. Members shall be one representative of the National Park Administration and one representative from each Kebele sharing the National Park. The members assembly will be the supreme body of the SMTF, oversee all its activities and give tasks to its Executive Board. It will meet usually once a year and elect from their ranks an Executive Board of five persons (the NP representative and four Kebele representatives) which will be the decision-making body. It should be guaranteed that the Executive Board always an equal representation of women as well as of the three Woredas. Details will have to be specified in the statutes of the SMTF. The Executive Board will meet according to their work load, but not less than every two months. It will decide about all grants given out by the SMTF and hire an Executive Director and other staff who will be in charge of all day-to-day operations. The members and executive board will be honorary positions. They will not have offices and receive only compensations for their expenses but no honoraria or salaries. The Executive Director and other staff will be paid positions and have offices. The premises of the SMTF shall be with the Park Administration in Debark in order to have a visible association with the National Park in the perception of the general public. The Executive Director will have the overall responsibility for the implementation of the Grant Program, including monitoring, preparation of all meetings, and financial administration. He will have the task to inform both the general public and individual persons about all aspects of the Grant Program, and respond to their inquiries. He will check the incoming grant requests on conformity with the requirements and if necessary give further advice. Upon final receipt of the grant request, he will give a written recommendation to the Executive Board which will take the decision on the requests. He will also be responsible for issuing the grant payments as well as for keeping records of all financial transactions. He will receive specialized training both on financial administration, the program itself and on keeping standards of impartiality, transparency and accountability. Office furniture and equipment will be taken over for free from the Project after two years when the Project staff will be reduced significantly. Therefore, no investment costs arise for office furniture and equipment. Vehicles will be shared with the Project for the time of its duration, and after that with those institutions which will take over the vehicles from the Project, most probably the Park Administration.

188

However, a special training will be required on grant-making and micro-financing, in particular its ethical principles, and ways to increase the capital stock and other means to raise income. A simple booklet shall be printed in Amharic language explaining all relevant conditions of the Grant Program and the Soft Loans Program. In particular, it shall contain the full text of the by-laws of the two programs. The booklet will be in A5 format, black/white, with 16 pages of 80g paper and a two-colour cover of 150g paper. It will be given out for free to anyone considering requesting a loan. The high circulation of 20.000 copies will make sure that about 90% of the households eligible for Soft Loanss can obtain a copy. Trainings required: English language (2) Business administration, bookkeeping: none (employees are expected to have relevant education) Grants and Micro-Credit Administration: 1 Full-time jobs created: 2 Executive Director, Bookkeeper (to be shared with Soft Loans Program) Indirect economic effects: Matching funds from donors can be obtained, cash-flow and purchasing power in the region are increased, temporary jobs are created through grants

189

4.2.4.1. Investment Plan Simen Mountains Trust Fund

No. 1. 1.1. 1.2. 2. 2.1. 2.2. 2.3. 3. 3.1. 3.4. 4. 4.1. 5. Item Legal and Administrative Fees Lawyer Registration Sub-Total Legal and Administrative Fees Premises + Equipment Office Furniture Office Equipment (seal and pad) Vehicles Sub-Total Premises and Equipment Education and Trainings English Language Grants and Micro-Credit Administration Sub-Total Education and Trainings Public Relations Information Booklet Sub-Total Public Relations Original Trust Fund Deed Costs 350 60 410 0 500 0 500 9.440 5.500 14.940 36.556 850.000 36.556 850.000 Totals

Total Investment Costs (ETB) Total Investment Costs (USD)

902.406 106.166

5.1. Information Booklet A5 Format, 2-colour cover 150g paper, 16 black/white pages 80g paper, 20.000 copies 5 photos Layout and Design Printing Total Information Booklet 2.500 3.755 30.301 36.556

190

4.2.4.1. Business Plan Simen Mountains Trust Fund

Year 1 Income Interests from deed (5% / year) Revenues from fees and leases (x%) Donations Sales of print media Expenses Production of print media Debt of previous year Net turnover (= Gross profit) Operating Costs Personnel (Executive Director) Office running costs Office supplies Small equipment purchases Maintenance and repair Auditor, legal and bookkeeping services Travel and Allowances Total Operating Costs Result Interest payments (13%) 42.500 ? ? 140.250 -159.152 23.598 -18.000 -4.800 -2.200 -1.000 -1.000 -7.000 -15.350 -49.350 -25.752 -3.348 -18.000 -4.800 -2.200 -1.000 -1.000 -7.000 -15.350 -49.350 104.300 0 -29.100 153.650 -18.000 -4.800 -2.200 -1.000 -1.000 -7.000 -15.350 -49.350 133.400 0 182.750 Year 2 42.500 ? ? 140.250 From year 3 42.500 ? ? 140.250

Result (available for grants)

Office Running Costs Telephone Electricity Water Sub-Total Office Running Costs / year Office Supplies Item Printer toner Paper pack Folders Small items Sub-Total Office Supplies / year

-29.100

104.300

133.400

1.800 2.400 600 4.800

Travel and Allowances Person Costs / day Days of travel Executive Director lump sum Executive Board 50 7 x 4 pers. x 2 days Members 50 1 x 17 pers. x 3 days Total Travel and Allowances Publications Item Leaflet SMTF 48p. col. booklet A2 Colour Poster Postcards Total Publications

Costs 10.000 2.800 2.550 15.350

Services Auditor Bookkeeper Lawyer Total

1.200 4.800 1.000 7.000

Costs 1.800 200 50 150 2.200

Copies printed 2.000 16.000 1.000 16.000

Costs -8.149 -121.333 -6.028 -23.642 -159.152

Price 0 35 35 3

Income / 4 years 0 490.000 35.000 36.000 561.000

Profit / 4 years 0 368.667 28.972 12.358 401.848

191

4.2.4.2. Soft Loans Program

The Soft Loans Program is supposed to serve three main purposes: 1) It shall facilitate the development or improvement of businesses which are based on the initiatives of the local population and/or could not have been covered by the Project Proposal. 2) It shall inject capital into the local economy by increasing the overall purchasing power of the local population. 3) It is calculated to operate under economic principles and therefore constitutes a business in itself, creating directly as many as four jobs in addition to the labour opportunities which will be created indirectly through the loans. The Soft Loans Program will be organized under the Simen Mountains Trust Fund. However, because of its high general priority, in case the establishment of the Trust Fund will be delayed, a way shall be found to make it operational even before the Trust Fund will come into existence. It is planned to become operational from year 3 of the Project when it can move into offices which will become free in the Parks premises as the number of Project staff will be reduced. The general objective of the Soft Loans Program is to promote the sustainable development of the buffer zone of the Simen Mountains National Park by providing financial assistance to people living in the buffer zone for running small businesses and improving their livelihoods, on the condition that they reduce their impact on, and contribute to the protection of the Simen Mountains National Park. (By-laws 1.1., see appendix 6.8.) The Soft Loans Program is designed to serve the greatest possible number of beneficiaries in order to both have an equal distribution of wealth and to promote wide identification with the Park and the Region. Loans shall be given to individuals, households, businesses and organizations who have their residence in the Buffer Zone, in the Kebeles (communities) who share the Buffer Zone territory and the centers of the three Woredas (counties) who share the National Park and Buffer Zone Debark, Adiarkay and Janamora (By-laws 1.4.) for the running and expansion of their activities if these contribute to the development of the buffer zone and are compatible with the Management Plan of the Simen Mountains National.Park. (By-laws 2.1.1.) The conditions and operating principles have been derived from a model which has proven to be very successful with an extremely poor rural buffer zone population in Mongolia. The Business Plan for the Soft Loans program has been developed on the basis of the following considerations: It is estimated that in any given year about 5% of those qualifying to be recipients will actually receive loans. With a total number of about 22.450 households in the region (assessment made on the basis of the 2005 population statistics, assuming 5,5 persons per household), this will amount to a number of 1.123 loan recipients per year. The total amount of funds available for the loans will be 2.125.000 ETB (250.000 USD), being an average of 1.893 ETB per loan. For the first 4 months after signing the loan contract, no interest is charged. For repayments made in the second 4 months after signing the loan contract, a 4% interest is due, and for repayments made in the third 4 months, 8% interest is due. (By-laws 2.1.3.) It is assumed that in all but a few cases loans will be taken for one year, and repayments made after half a year, so that the average interest obtained per loan will be at least 5%. The Soft Loans Program is planned to be led by one Program Director, based at the premises of the Park Administration, and three line officers, one based in each of the three Woreda centers.

192

The line officers will have the task to inform both the general public and individual persons about all aspects of the Soft Loans Program, and respond to their inquiries. They will check the incoming loan requests on conformity with the requirements and if necessary give further advice. Upon final receipt of the loan request, they will give a written recommendation to the Executive Board which will take the decision on the requests. They will also be responsible for issuing loan payments as well as taking in interest payments, and for keeping records of all financial transactions. The Program Director will have the overall responsibility for the implementation of the Program, including the supervision of the line officers, preparation of all meetings, and financial administration. In particular, he has to make sure that a sufficient amount of loans are extended so that the operational costs will remain below the income from interests. All four staff will receive specialized training both on financial administration, the program itself and on keeping standards of impartiality, transparency and accountability. A simple booklet shall be printed in Amharic language explaining all relevant conditions of the Soft Loans Program. It will be published together with the text of the Grant Program under the Simen Mountains Trust Fund. For details, see description and investment costs 2.4.1. The Program Director is expected to have a previous education and experience in financial administration, preferably also in micro-credits in rural areas. The line officers will receive each two 5-day-courses in financial administration and bookkeeping. All four staff will receive special training on micro-crediting, in particular its ethical principles and practical considerations. They should be very well familiar with the local conditions, and be wellrespected in the three Woredas.

Trainings required: Business administration (3), bookkeeping (3), Micro-Crediting (4) Full-time jobs created: 4 Program Director, line officers (3) Indirect economic impact: Increase of cash-flow and improvement of businesses in the region

193

4.2.4.2. Investment Plan Soft Loans Program

No. 1. 1.1. 1.2. 2. 2.1. 2.2. 3. 3.1. 4. 4.1. 4.2. 4.3. 5. 5.1. Item Costs Legal and administrative costs Lawyer 350 Registration 60 Sub-Total Legal and Administrative Costs Furniture + Equipment Office Furniture 31.088 Office Equipment 66.321 Sub-Total Furniture and Equipment Capital Stock Start-up Capital 2.125.000 Sub-Total Capital Stock Education and Trainings Business Administration (major) (3) 14.238 Bookkeeping (minor) (3) 3.831 Micro-Crediting (4) 22.000 Sub-Total Education and Trainings Market Introduction Information Booklet see 4.2.4.1. Sub-Total Market Introduction Totals 2.1. Office Furniture Head Desk Desk Chair Desk lamp Table Chair File Trunk Heater Ceiling lamp Curtains Wardrobe Foot mat Company plate Sub-Total Office Furniture 1 1 1 1 4 1 1 1 1 1 1 1 3 branches Total Unit price Total Costs 3 4 1.946 5.838 3 4 983 2.949 3 4 400 1.600 3 4 1.191 3.571 8 12 600 7.200 2 3 1.500 4.500 2 3 800 2.400 2 3 80 240 2 3 300 900 2 3 400 1.200 2 3 30 90 2 3 200 600 31.088

410

97.409

2.125.000

40.069 2.2. Office Equipment 0 Head 3 branches Total Unit price Total Costs PC, monitor etc. 1 3 4 9.586 38.344 Printer 1 2 3 3.393 10.179 Multiplug 1 3 4 40 160 Telephone 1 3 4 150 450 Internet connection 1 3 4 184 736 Safe 1 2 3 4.474 13.422 Desk items 1 3 4 1.000 3.000 Bookkeeping software 1 30 30 Sub-Total Office Equipment 66.321

Total Investment Costs (ETB) Total Investment Costs (USD)

2.262.888 266.223

194

4.2.4.2. Business Plan Soft Loans Program

Year 1 - 5 -2.125.000 2.082.500 106.250 63.750 -63.750 -37.200 -7.300 -1.700 -500 -500 0 -10.750 -4.800 -1.000 0 0

Loans extended Loan repayments (98%) Interests from loan recipients (average 5%) Gross profit Operational Costs Personnel Rents, telecommunication, electricity, water Office supplies Small equipment purchases Maintenance and repair Public Relations Fees, legal and bookkeeping services Travel (1x to Debark per month) Savings Net profit Income tax

Result after taxes (net earnings)

Personnel Salary / month 1.000 700 Salary / yr 12.000 8.400 Total No. of jobs salaries 1 12.000 3 25.200 4 37.200

Program director Branch officer Total Personnel

Fees, services Bookkeeper Auditor Lawyer Total Fees

6.000 4.000 750 10.750

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4.3.

Park Population Removals

Transports

The households removing from the park will be expected to bring all their belongings and animals with them to the road from where they will be picked up by truck (either with or without their animals). For this, the newly-established transport company will be hired. It is calculated that for those households which will remove to Debark and its vicinity, two transports can be made per day. For all other locations further to the north and south, it is calculated that only one transport can be made per day. Housing

As a general rule, costs for constructing resident housing are calculated to be 2.000 ETB per m for concrete-built houses. On that basis, however, the costs for providing new housing alone would go beyond any acceptable limits. For this reason, another model has been developed: Housing for the households removing from the park will include three buildings, thereby considering local traditions: a residential building with living and sleeping room, a kitchen building and a toilet building. All buildings will have a concrete floor for solidity and hygiene reasons. Walls will be of mudbricks, and roofs will be of corrugated iron in order to protect against the heavy rains, and covered by grass (for protection against heat, and for aesthetics). Doors and windows will be of wood. Kitchen and toilet will have modern but simple equipment such as shower, stand toilet and running water with concrete sinks. It is expected that the residents will add any other improvements such as fences etc. on their own cost and initiative.

196

4.3. Park Population Removal Costs

No. Item Unit Cost No. of units 3.1. Transports 3.1.1. Truck rental 1500/day 403 days Sub-Total Transports Sub-Total Transports (USD) 3.2. Housing 3.2.1. Planning and Design 15.000 1 3.2.2. Construction permits 1.500 586 3.2.3. Development 2.978 586 3.2.4. Construction 20.000 586 Sub-Total Housing Sub-Total Housing (USD) Total Park Population Removals Total Park Population Removals (USD) Costs 604.500 604.500 Totals

604.500 71.118

15.000 879.000 1.645.108 11.360.000 13.899.108

13.899.108 1.635.190 14.574.726 1.706.308

Transports No. of households 400 203 603 No. of days 200 203 403

To Debark and Janamora To other locations Totals

197

5. Project Implementation

198

5.1.

Risks, Assumptions and Prerequisites

5.1.1. General Economic Development It is assumed that the general economic development in Ethiopia in general as well as in ANRS will be positive. In particular, it is assumed that within the project period, the power supply will be stabilized, eliminating the frequent blackouts in particular during the rainy season; a commercial bank will start operations in Debark. Without a minimum financial sector, there can be no sustained economic growth. Actually, the proposed project with its considerable financial volume would necessitate the establishment of a bank branch office in Debark. There are clear commitments by the Ethiopian government for these first three requirements; a gasoline station will be operational in Debark in the near future; the road from Gondar to Debark will be asphalted; tourism in the region will increase considerably (see figures in section 2.1.). This assumption is very well supported by tourism development in the previous years; local demand will increase considerably in the future, particularly in the food production sector. Although some of the businesses proposed mainly rely on tourists, the majority of them are depending on local demand. Obvious evidence shows, and the sharply increasing population represent a guarantee for this demand. 5.1.2. Acceptance The project has been presented and approved in an internal meeting of PaDPA, on four park village meetings and on a two-day major stakeholder workshop involving chief officials and policy-makers from the Regional State, Zone, Woredas, Kebeles, Municipalities and Park Administration. There can be no doubt that the project has the full acceptance and support of all stakeholder groups. Conflicts may arise when people who have been living in poverty outside the SMNP will realize that the people removing from the Park receive very substantial benefits only because they happened to live inside the Park. This situation may lead to jealousy and social tension in the neighbourhood of the new homes of the former Park inhabitants. In order to address this risk, a substantial part of the profits made by the new businesses should be transferred to the Simen Mountains Trust Fund and thus made available for the general population of the Simen Mountains Region. 5.1.3. Business Risks Some risks must be expressed concerning the businesses themselves. Firstly, the extremely low purchasing power in the region may lead to insufficient incomes of the new businesses. For this reason, the grant and soft loan programs play an extremely important role for the success of the project because they provide critical purchasing power to the general population. The project is therefore not to be implemented without the grant and Soft Loans programs. The main safety against this risk, however, is the fact that all the

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businesses established under this project will support each other, and that crucial support in terms of demand will come from foreign and domestic tourists and their purchasing power. Secondly, the former park population may be inexperienced in handling even very small businesses, may be induced to overspending instead of making savings, and have to adjust to new livelihoods in general. This risk will be met by the presence of the projects Business Development Advisor who will be around for the first several years, and will be able to take pro-active action where needed, including making use of the contingency fund in case more investment should be needed or liquidity shortages must be overcome. In general it has to be mentioned that taking risks is inherent in starting any new business, wherever and under whatever circumstances. No study or calculation, no matter how carefully done, can provide complete safety against such entrepreneurial risk. The final proof whether a business is feasible or not can only be given by reality itself. For this reason, at last there is no other way than to take that risk and try. Since this project proposal involves an extremely large number of different costs and expenses, there is a risk of miscalculation. In addition, the value of the Ethiopian Birr against the US Dollar may change, and prices may rise significantly, in particular for gasoline and building materials. For this reason, a contingency fund has been included in the budget in order to mitigate such unforeseeable respectively incalculable changes in costs.

5.2.

Project Management

The project will be based upon an agreement between the government of ANRS and the donors, who will in turn assign an implementing agency with the project. The Project Coordinator will decide that payments can be made each time all conditions have been met for one of the businesses to start. It is crucially important that the project will enter into contractual agreements with the owners of the new businesses which will prohibit them to sell any of their assets. For that purpose it may be recommended to provide investments only on a borrowing basis, and turn them over into the property of the Simen Mountains Trust Fund after the end of the duration of the project. For some of the businesses, rather substantial net profits have been calculated. The contractual agreements between the project and the owners of the new businesses shall also include a clause whereby profits above a certain level shall either be fully returned to the project in order to recover investment costs, or shall be transferred in whole or in part to the Simen Mountains Trust Fund for non-profit spending.

5.3.

Monitoring and Evaluation

All aims of the project are directly depending on each other, and can be easily monitored by obvious facts. The first aim of the project - attracting the park population out of the park - will be monitored by simply registering their involvement in the project and their removal from the park. In case this aim will not be achieved fully or to a sufficient degree, by logic the other three goals also cannot be achieved. The risks and probabilities that the park population may (at least in part) be unwilling to remove has been discussed above, and this would obviously jeopardize (at least in part) the success of the project. Project staff and counterparts from

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PaDPA as well as Woreda officials will therefore make regular visits and engage the park population in a continuing discussion about the project in order to create confidence and trust that their aspirations will be met. Very clearly a significant number of households is more than willing to remove. If those will be removing quickly, this will inevitably represent a strong pull factor, which will be increasing every time more households will remove. For that reason, an intelligent start of the project can be of crucial importance. Removals from the park will also be the single monitoring criterion for the second aim, complying with the UNESCO benchmark of reducing the park population. Proof of compliance will be documented by the relevant communication from the UNESCO World Heritage Centre. The key monitoring approach for businesses is obviously to compare actual performance with planned performance. The main reason why the project has been planned to continue for three years after the businesses have been established is to provide a continuing monitoring of the businesses. This will be done by the Business Development Advisor. The construction of new housing for the removing park population can again be monitored through visual evidence by the Construction Supervisor. Evaluation will be in the form of a continuing discussion between stakeholders how best to attract the park population out. This will necessarily include a constant revision of the appropriateness of the proposed businesses. The project document shall foresee the reallocation of funds in case one or the other business should show to be not realistic.

5.4.

Time and Activity Plan

Given the very complex nature of the task of establishing both a project coordination unit and more than 30 business companies, only an indicative Time and Activity Plan can be presented here. The detailed Logical Framework will have to be developed at the start of the project by the project staff and stakeholder representatives. In all cases, it will be important to open the new businesses immediately before their relative best selling season will begin in order to enable them to have a good start. Additional trainings may become necessary as experience will show. For this purpose, the contingency fund will be available. Year 1 Year 2 Inception Phase / Logical Framework Constructing PCU / Guest House Selection of Business Personnel Trainings Legal Preparations and Advice Constructions Establishing Businesses Monitoring, Advice, further Training Final Report Year 3 Year 4 Year 5

201

6. Appendices

202

6.1.

Simen Mountains National Park and Region

203

6.2.

Simen Mountains National Park and Villages

204

6.3.

Simen Mountains Region Population Figures (by Kebele)

Based on Kebele population census of 01.07.1997 (2005) Name of the Kebele Adiarkay Woreda Angana kerenega Sera Gudela Kabena Agidamya Sub-Total Adiarkay Woreda Debark Woreda Zebenba Deber Deb Bahir Adesege and Male Gebsa Arginjona Abergina Adebabaycewen Sub-Total Debark Woreda Janamora Woreda Barna Debele Lure Ategeba Bahr amba Zekeleta Sakeba Sub-Total Janamora Woreda Total Population Name of Woreda Center Adiarkay Adiarkay Sub-Total Adiarkay Debark Kebele (District) 1 Kebele (District) 2 Sub-Total Debark Janamora Mekane Berkhan Sub-Total Janamora Total Woreda Center Population Population 6.537 4.940 2.782 14.259 3.139 6.469 4.206 7.693 4.688 4.224 7.928 38.347 5.933 4.693 5.918 4.500 4.072 3.787 6.238 35.141 87.747 Population 6.715 6.715 16.136 10.012 26.148 2.862 2.862 35.725 35.725 Totals 87.747 Totals

Total Population Simen Mountains Region

123.472

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6.4.

Costs of Vehicles

1. Purchasing Costs Item Big truck Small Truck 4WD Station Wagon Pick-up Truck Motorcycle 2. Running Costs (USD) Item Big truck Small truck 4WD Station Wagon Pick-up Truck Motorcycle 3. Rentals (USD) 3.1. Big truck rental per day Gondar Salaries Tyres Spare parts Maintenance Per diems Gasoline 250km Savings Total ETB 3.2. Big truck rental per day Bahr Dar Salaries Tyres Spare parts Maintenance Per diems Gasoline 520km Savings Total ETB

Qualifications new new used used 185ccm, new

ETB 520.000 230.000 255.000 212.500 29.750

USD 61.177 27.059 30.000 25.000 3.500

Unit month month month month month

ETB

USD

5.015 5.015 425

590 590 50 4. Running Costs per year Big Truck (100 Quintals)

89 61 50 500 40 251 260 1.251

Tyres 2 x 6 x 1850 Spare parts + repair Maintenance Gasoline 5km/l, 5.02 ETB/l Savings 10% of purchase Small Truck (60 Quintals) Tyres 2 x 6 x 970 Spare parts Maintenance Gasoline 5km/l, 5.02 ETB/l Savings 10% of purchase Pick-up Truck Tyres 2 x 4 x 970 Spare parts Maintenance 30.000km Gasoline 6km/l, 5,02 ETB/l Savings 10% of purchase

22.200 10.000 100.000 52.000

11.640 7.500 85.000 25.000

89 61 50 500 40 522 260 1.522

7.760 5.000 21.000 21.250

3.3. Truck Rental to Addis (5 days with big truck) Item Unit cost No. of units Salary 89 5 Tyres 61 5 Spare parts 50 5 Maintenance 500 5 Per diems 140 8 Gasoline 1800km 5,02/l 360 Savings 260 5 Total ETB

Costs 445 305 250 2.500 1.120 1.808 1.300 7.728

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6.5. Costs of Printed Matter

1. Leaflet A4 2x folded, full colour, 150g paper 10 Photos Design Printing and folding Total Leaflet Cost per copy 2. Poster A2, full colour Photo Design Printing Total Poster Cost per copy 3. Black/White Booklet A5, black/white, cover 150g, inside 80g Photos Design Printing Total B/W Booklet Cost per copy 4. Full-Colour Booklet A5, full colour, cover 250g, inside 150g Photos Design Printing Total Full-Colour Booklet Cost per copy 5. Calendar A3, full colour, 12 leaves, spiral 12 Photos Design Printing Total Calendar Cost per copy 6. Postcards Set of 8 motifs, 12x17cm, 4/1 colour 8 Photos Design Printing Total Postcards Cost per set Cost per postcard 150g 150g 250g 250g 500 copies 1000 copies 500 copies 1000 copies 6.000 6.000 6.000 6.000 3.833 3.833 3.833 3.833 24.513 35.224 28.242 42.680 34.346 45.057 38.075 52.513 68,70 45,06 76,15 52,52 32 pages 48 pages 96 pages 96 pages 2000 2000 copies 2000 copies 1000 copies copies 16.000 24.000 48.000 48.000 2.938 4.407 7.490 7.490 18.810 26.681 38.264 51.699 37.748 55.088 93.754 107.189 18,88 27,55 93,76 53,60 8 pages 10.000 copies 2.500 2.073 9.249 13.822 1,38 16 pages 32 pages 32 pages 20.000 10.000 copies 20.000 copies copies 2.500 2.500 2.500 3.145 3.755 3.755 30.301 28.993 42.721 35.946 35.248 48.976 1,80 3,53 2,45 150g 1000 copies 500 711 3.736 4.947 4,95 150g 2000 copies 500 711 5.571 6.782 3,39 250g 1000 copies 500 711 4.817 6.028 6,03 250g 2000 copies 500 711 7.732 8.943 4,48

1000 copies 2000 copies 4000 copies 1000 copies 5.000 5.000 5.000 2.500 608 608 608 608 1.985 2.541 5.082 1.985 7.593 8.149 10.690 5.093 7,60 4,08 2,68 5,10

500 copies 4.000 0 15.862 19.862 39,73 4,97

1000 copies 4.000 0 17.480 21.480 21,48 2,69

2000 copies 4.000 0 19.642 23.642 11,83 1,48

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6.6. Costs of Trainings

Business Administration (major) Item Travel Per diems Fee Materials Total Business Admin. Training (major) Business Administration (minor) Item Travel Per diems Fee Materials Total Business Admin. Training (minor) Bookkeeping (major) Item Travel Per diems Fee Materials Total Bookkeeping Training (major) Bookkeeping (minor) Item Travel Per diems Fee Materials Total Bookkeeping Training (minor) English Language Item Travel Per diems Fee Materials Total English Language Training Waiter Item Travel Per diems Fee Materials Total Waiter Training Specification Debark - Addis Ababa - Debark 100 x 16 days 14 days lump sum Cost 300 1.600 2.746 100 4.746

Specification Debark - Bahr Dar - Debark 70 x 7 days 5 days lump sum

Cost 100 490 637 50 1.277

Specification Debark - Addis Ababa - Debark 100 x 16 days 14 days lump sum

Cost 300 1.600 2.746 100 4.746

Specification Debark - Bahr Dar - Debark 70 x 7 days 5 days lump sum

Cost 100 490 637 50 1.277

Specification Debark - Bahr Dar - Debark 70 x 62 days 2 months lump sum

Cost 100 4.340 80 200 4.720

Specification Debark - Bahr Dar - Debark 70 x 64 days 2 months lump sum

Cost 100 4.480 500 200 5.280

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6.7. By-Laws of the Grant Program

SIMEN MOUNTAINS NATIONAL PARK TRUST FUND

GRANT PROGRAM BY-LAWS

1.

GENERAL PROVISIONS

1.1

The general objective of the Grant Program is to promote nature conservation, public services and the sustainable development of the Simen Mountains National Park and its buffer zone by providing financial assistance to public interest stakeholders in the Simen Mountains Region. The funds available from the Grant Program consist of a percentage of the Parks income from fees and licenses, the Parks profits from sales of educational and promotional materials as well as donations and grants from international and national organizations, individuals and other sources. Funds from the Grant Program are available for non-profit organizations, business associations, gotts and state institutions and organizations, including the Simen Mountains National Park Administration itself, who have their residence in those Kebeles which share the territory of the National Park. Non-profit organizations who do not have their residence in the Kebeles which share the territory of the National Park can receive funding if - the majority of their members have their residence inside the Buffer Zone; - they play an important role for the development of the Buffer Zone, i.e. through a history of previous activities for the objectives of the Grant Program.

1.2

1.3

1.4

2.

PROCEDURE

2.1. General Provisions 2.2.1. The objective of the Grant Program is to upgrade public health, education and science, culture, social life, nature conservation and the protection of the environment, and to solve acute problems of the Simen Mountains National Park and the Kebeles which share its territory. Each grant should not exceed the amount of 10.000 ET Birr.

2.1.2.

2.1.3. Grants can be given to non-profit organizations, business associations, gotts and state institutions and organizations.

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2.2. Receiving and Considering Grant Requests 2.2.1. Grant applications can be made at any time. They must be delivered in writing to the Executive Director of the SMT and carry the signature of at least two legal representatives of the grant applicant. Applications which are coming in too late to be considered in the next meeting of the Executive Board must be considered in the following meeting. The following documents must be enclosed with the application: Detailed description of the project and its expected results, including a time and activity plan; Explanation how the project will meet the objectives of the grant program (justification); Short overview of the applicants organization and past activities and achievements; Estimation of required work and service costs (budget or cost plan); Specification which costs will be covered by the applicant (own contribution in cash or kind) and which are expected to be covered by the SMTF (financing plan); List of materials and equipment to be purchased, indicating quantities and prices (purchasing list); Certification or record of the Woreda Citizens Representative Meeting on the importance and need for such project (supportive statement) A recommendation or comment of the Simen Mountains National Park (park recommendation); Other documents to substantiate statements made in the grant application if necessary.

2.2.2. -

2.2.3. The Executive Director, after careful study of the grant application, provides his recommendation to the Executive Board of the SMT at least one week before its next meeting. The Executive Board will take the final decision on the grant application. 2.3. Grant Agreement 2.3.1 For each grant given, a grant agreement is concluded between the Executive Director of the SMT and an authorized representative of the applicant organization (see appendix). 2.3.2 The grant agreement must include the addresses of the two parties, purpose and amount of the grant, terms of implementation, obligations under the contract and conditions for its annulment. 2.3.3 A subsequent change of the representative who signed the agreement from her/his position is not a reason for the annulment of the agreement. 2.4. 2.4.1 Control of the Grant and Annulment of the Agreement

Grants must be spent only for the purpose specified in the Grant Agreement.

2.4.2 The Executive Director of the SMT has the right to check whether the grant is spent according to purpose, and implementation is in time.

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2.4.3 In case the grant or a part of it was spent for another purpose, the project could not reach its objective or the term of the project was exceeded, the Executive Director will issue a warning, giving a specified term for complying with the Grant Agreement. In case the warning does not lead to the full compliance with the Grant Agreement, the Executive Board has the right to annul the Grant Agreement with immediate effect upon recommendation of the Executive Director. 2.4.4 In the case of the annulment of the Grant Agreement, the full amount of the grant provided must be returned to the Grant Program within one month after the annulment of the agreement. 2.4.5 These By-Laws of the Grant Program were duly adopted by the Simen Mountains National Park Trust on this day the __________________________ at the city of __________________________.

_________________________________ Member of the Executive Board Simen Mountains Trust

_________________________________ Member of the Executive Board Simen Mountains Trust

_________________________________ Member of the Executive Board Simen Mountains Trust

_________________________________ Member of the Executive Board Simen Mountains Trust

_________________________________ Member of the Executive Board Simen Mountains Trust

_________________________________ Executive Director Simen Mountains Trust

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Appendix

SIMEN MOUNTAINS NATIONAL PARK TRUST

GRANT AGREEMENT

________________________________ (Place and Date)

1.

Mr./Ms. _________________________________ and

Mr./Ms. __________________________________, both duly established legal representatives of _______________________________________________________, which is a duly established non-profit organization / business association / gott / state or public institution or organization (the grant recipient) residing in __________________ Kebele, ____________________ Woreda, and Mr./Ms. __________________________________, Executive Director of the Simen Mountains National Park Trust, have concluded this agreement based on the by-laws of the Simen Mountains National Park Trusts Grant Program. 2. The Grant Program of the Simen Mountains National Park Trust provides a non-

repayable grant of ___________ ET Birr to the grant recipient according to their application (no. ___________ of ________________________ (date). 3. Within 20 (twenty) days after the planned end of the project implementation, the grant recipient has to submit a final report including a detailed description of all problems which occurred during the project and lessons learned. 4. If the project is not implemented according to plan, or if the parts of the grant are used for purpose other than foreseen in the budget, the Simen Mountains National Park Trust has the right to annul the grant agreement. The Simen Mountains National Park Trust has the right to employ an independent (non-governmental) expert in order to investigate the correct expenditure of grant, and in this case the grant recipient is obliged to submit original copies of all project documents immediately and unconditionally. 5. In case the grant is not returned to the Simen Mountains National Park Trust within 20 days after the grant agreement has been annulled, or in case of any other argument between the contracting parties, the case will be settled in court.

212

CONTRACT CONCLUDED BY:

_________________________________ Executive Director, Simen Mountains National Park Trust

_________________________________ Legal Representative, Grant Recipient

________________________________ Legal Representative, Grant Recipient

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6.8. By-Laws of the Soft Loans Program

SIMEN MOUNTAINS NATIONAL PARK TRUST

SOFT LOANS PROGRAM BY-LAWS

1. GENERAL PROVISIONS 1.1. The general objective of the Soft Loans Program is to promote the sustainable development of the buffer zone of the Simen Mountains National Park by providing financial assistance to people living in the buffer zone area for running small businesses and improving their livelihoods, on the condition that they reduce their impact on, and contribute to the protection of the Simen Mountains National Park. The funds available from the Soft Loans Program consist of a donation from (donor) government for developing the buffer zone of the park, funds from loan interests, and donations from international and national organizations, individuals and other sources. Funds from the Soft Loans Program are available for individuals, households, businesses and organizations who have their residence in the Buffer Zone, in the Kebeles who share the Buffer Zone territory and the centers of the three Woredas who share the National Park and Buffer Zone Debark, Adiarkay and Janamora. Individuals, households, business companies and organizations who do not have their residence in the Buffer Zone can receive funding if - the majority of their members or employees have their residence inside the Buffer Zone - they play an important role for the development of the Buffer Zone, i.e. through processing or marketing of products produced in the Buffer Zone, or providing services mainly for the (people living in the) Buffer Zone.

1.2.

1.3.

1.4.

1.5.

2. PROCEDURE FOR GRANTING SOFT LOANS 2.1. General Provisions 2.1.1. Soft loans can be granted to individuals, households, business companies and organizations for the running and expansion of their activities if these contribute to the development of the buffer zone and are compatible with the Management Plan of the Simen Mountains National.Park. 2.1.2. The maximum amount of any loan is 10,000 ET Birr. Repayment is due within one year.

214

2.1.3. For the first 4 months after signing the loan contract, no interest is charged. For repayments made in the second 4 months after signing the loan contract, a 4% interest is due, and for repayments made in the third 4 months, 8% interest is due. 2.1.4. Soft loans are only granted to a loan recipient with a partner. The partner can be a member of the loan recipients family such as mother, father or adult children. Partners have same rights and duties as loan recipients. 2.2. Procedure of Considering Requests 2.2.1 The applicant has to submit a request to the Soft Loans Program. The requested amount of the loan, purpose and repayment term should be clearly specified in the request, and the following documents should be enclosed.

a) Project proposal for loan funding. The following subjects should be mentioned: Name of the project, place of implementation, duration of the project Demonstration of experience of the loan recipient in the planned activity Description of the development of the activity in the past three years Detailed description of use of the loan sought, reflected in the business plan Detailed business plan for the duration of the loan, including costs and expenses of products and services, calculation of prices of products and services, income and profit. Availability of raw materials and professional workers Source of repayment and estimation of term of repayment. b) Order contract and market capacity c) Notarized certification of property for loan mortgages, price estimation and property ownership. 2.2.2 The Soft Loans Program has to assess the requesters working attitude and entrepreneurial skills; determine whether the person has an outstanding debt acquired from another source, and submit its opinion to the Executive Board of the Simen Mountains Trust Fund. The Executive Board will then take a decision, taking into consideration a) Completeness of the grant request, scale of business, market capacity and feasibility of the activity b) Conclusion on the probability of loan repayment, the reliability of the mortgage, assessment of the accuracy of the cost calculation, on-site check. The decision of the Executive Board can be appealed only on the grounds that considerations unrelated to the matter have influenced its decision. Such appeals must be made in writing and within 20 days of notification of the decision. In case of appeal, the Executive Board must hear the relevant Woreda AO and Kebele DA before reconsidering the loan, and take a new decision on its next meeting.

2.2.3

2.3. Exclusions 2.3.1 As long as 70% of the loans (including interest) granted to recipients from a particular Kebele have not been returned to the Soft Loans Program, or as long as recipients

215

from that Kebele have not fulfilled their duties under their contracts, no more loans can be granted to recipients from that Kebele. 2.3.2 Loans can not be granted to individuals, households, business companies and organizations who have debts and/or interests outstanding with the Soft Loans Program. 2.4. Contract 2.4.1. Loans are granted based on the contract (see app.1) concluded between an authorized person from the Simen Mountains National Park Trust and the recipient of the loan. 2.4.2. The loan contract must include the addresses of the lender and recipient, the amount of money lent, the term of the loan, the interest rate, all duties under the agreement, and a detailed list of the mortgage items. 2.4.3. In case that one legal person representing the recipient is liquidated or transformed, or in case a natural person representing the recipient is physically or mentally unable to perform her/his duties under the loan agreement, all her/his duties under the contract are assigned to her/his partner. 2.4.4. In case the officer in charge of the Soft Loans Program will be changed, all duties and obligations under the contract remain the same. 2.5. Mortgage 2.5.1. The Soft Loan Program will hold a loan mortgage property. Such property will be transferred to the Soft Loan Program in order to compensate losses if the loan recipient should not repay the loan and its interest. 2.5.2. The loan recipient can pledge as a mortgage any property, equipment, goods and vehicles or items of value that can be sold. 2.5.3. The lender and recipient of the loan have to agree on the mortgage item(s) and its/their value. Mortgage items are valued at a maximum of 70% of their market price. 2.5.4. The value of the mortgage items must not be less than the combined amount of the loan and its interest. 2.5.5. The loan recipient has to keep her/his mortgage items in the same number and condition until her/his loan is returned. The transfer of mortgage items to others, sale or pledge to third parties are prohibited. 2.6. Guarantee 2.6.1. A third party individual, household, business company or organization who provides mortgage property on behalf of a loan recipient is called guarantor.

216

2.6.2. The guarantor must be based in the same Woreda as the loan recipient. S/he must provide mortgage under the same conditions as the loan recipient and can pledge free money from a bank account or goods and property which can be sold easily. 2.6.3. In case a guarantor is involved, the loan is granted on the basis of an agreement with the guarantor (app. 2), and the guarantor has the same duties under the loan contract as the recipient. 2.6.4. Any organization which owns or possesses state property cannot be a guarantor. 2.7. Repayment, Responsibilities 2.7.1. The loan recipient must return her/his loan and interest within the agreed term. 2.7.2. If the loan recipient did not fulfill her/his duties within the agreed term, s/he has to pay a penalty of 0.2% of the amount of the loan for each day of delay. If the loan recipient has returned a part of the loan within the agreed term, s/he has to pay the same penalty for the outstanding part. 2.7.3. If a loan and interest were not returned within two months after the expiry of the term, the mortgage becomes property of the Simen Mountains National Park Trust. 2.7.4. Disagreements between the contracting parties are to be settled in Court.

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Appendix 1 Simen Mountains National Park Trust LOAN CONTRACT

_______________________________________ (Place and Date) 1. Mr./Ms. __________________________ (the recipient), from ____________________ Got, ____________ Kebele, __________________ Woreda, and Mr./Ms. ___________________ __________________________, Soft Loan Officer of the Simen Mountains National Park Trust, conclude this contract based on the Soft Loans Program of the Simen Mountains National Park Trust. 2. The Soft Loans Program of the Simen Mountains National Park Trust grants a loan of ___________ ET Birr to the recipient with a duration of _________ months. 3. The loan recipient will not pay interest in first 4 months, but will pay 2% interest in the second 4 months and 4% in last 4 months. 4. In case the loan recipient will not return her/his loan with the due interest in time, s/he will be charged a penalty of 2 % of the amount of the loan for each day, without interest. 5. The loan recipient mortgages the items listed in the attachment, which is part of this contract. 6. The loan recipient nominates Mr./Ms. _________________________________________ as her/his partner. The partner has the same rights and duties as loan recipient. 7. Any disagreement between two parties must be settled in court.

_____________________________________ Soft Loan Officer SMNP Alternative Livelihoods Project

____________________________________ Loan recipient

Partner Full name Complete address Signature ________________________________________________________ ________________________________________________________ ________________________________________________________

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Attachment to Loan Contract MORTGAGED ITEMS

1. LOAN RECIPIENTS FULL NAME _____________________________________

2. PASSPORT NUMBER

_____________________________________

3. The loan recipient mortgages the following items as a guarantee to return the loan and with interest based on the contract made on ______________________________.

Item no. 1. 2. 3. 4. 5.

Amount Mortgaged items of item

Price per item

Total price

Quality

Total The items have to be notarized.

4. The loan recipient consents to settle up the loan, interest and penalty by the mortgaged property in the case s/he fails to fulfill her/his duties under the loan contract.

5. The loan recipient bears the responsibility to keep the mortgaged items in their present quality until the loan is repaid with interest.

Loan recipients signature

________________________________________

Partners signature

________________________________________

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Appendix 2 GUARANTEE CONTRACT

________________________________ (Place and Date)

1. Mr./Ms. __________________________, __________________ Kebele, _______________________________ Woreda, guarantees by her/his own property for the loan granted to Mr./Ms. ________________________________, ____________ Kebele, __________________ Woreda. 2. If the loan recipient will not repay her/his loan with the due interest in time, the guaranteed property will be under the owned by the Simen Mountains National Park Trust without any further procedure. 3. This contract will be effective until the loan recipient will have fulfilled her/his duties under the contract. 4. The guarantor obligation to bear the loan recipients duties under the contract will start on the first day after the end of the loan term. S/he will have to repay the loan, interest and penalty within 15 days from that date. 5. In case the guarantor will not fulfil her/his duties under this contract, the Simen Mountains National Park Trust will take her/him to Court.

CONTRACT CONCLUDED BY: Guarantor ________________________________________

Loan recipient

________________________________________

Soft Loan officer

________________________________________

220