Unveiling the Truth: Fairfax Africa Fund’s Misleading Claims and Their Impact on Ethiopians

By LJDemissie
October 10, 2024

Abraham Lincoln once said, “Truth is generally the best vindication against slander.” It’s a solid reminder that authenticity and transparency are our best defenses against misinformation.

Dedicated to the Nigerian People

To address the misinformation spread by Ato Zemedeneh Negatu regarding the Nigeria Air project, this article is dedicated to the Nigerian people, particularly to Adeola Fayehunfor speaking out against the false claim that Nigerians own the majority shares of the suspended Nigeria Air project. For instance, Zemedeneh said Nigerians have the majority interest of 51% in Nigeria Air. However, this claim is misleading because the equity allocation is as follows: Ethiopian Airlines holds a 49% stake, the Nigerian government holds 5%, and two other Nigerian stakeholders, SAHCO and other investors, hold 15% and 31% respectively. This means Ethiopian Airlines holds the largest single stake, giving it significant influence over the project, contrary to the claim that Nigerians hold the majority interest.

Furthermore, posing as an investor in the Nigeria Air project, he claimed, “we [including Ethiopian Airlines] acquired expensive multi-million dollar aircraft at our own cost [for Nigeria Air].” It turned out that the aircraft was an Ethiopian Airlines aircraft painted in Nigeria Air livery. Moreover, Ethiopiaan Airlines CEO Mesfin Tasew called this a lie in his Bloomberg TV interview.

Bold Statements and Questionable Facts

Zemedeneh’s statement that 70% to 80% of his business time is conducted outside Ethiopia implies that a substantial portion—approximately $3.4 billion to $5.1 billion—of Fairfax Africa Fund’s $17 billion in African deals is within Ethiopia. This assertion seems to be inconsistent with the visible impact and documented successes on the ground.

Visible Impact and Documented Successes

While Fairfax Africa Fund has made significant claims about their investments, such as the $4 billion oil refinery in Ethiopia project which was shelved back in 2018 according to Institutional Investing in Infrastructure, there is limited tangible evidence to support these figures. This raises questions about the actual impact of their investments. Highlighting this shelved project illustrates the discrepancy between announced plans and actual achievements. For instance, Zemedeneh has stated that the Asians are “very excited” about the projects, but he declined to name the potential investors who have signed memorandums of understandingadding that “some are big commodity trading houses.”

In billion-dollar investments, it is highly unusual and impractical not to disclose the names of the investors. Transparency is crucial for building trust and ensuring accountability. Not naming investors can lead to skepticism about the legitimacy and feasibility of the project. The lack of tangible results further exacerbates these concerns, casting doubt on the credibility of the claims.

The Importance of Transparency

Transparency is paramount in any business operation, especially when dealing with investments that significantly impact national economies and public perception. For Ethiopians, who have a vested interest in the nation’s development and prosperity, misleading statements can lead to misplaced trust and disappointment.

Challenging the $17 Billion Claim: A Call for Transparency

The claim that Fairfax Africa Fund has conducted $17 billion worth of deals in Africa may be misleading, as there is no substantial evidence to support that transactions of this magnitude have been completed between or among parties. It is highly likely that the $17 billion figure includes both completed transactions and proposed projects, such as the $4 billion oil refinery that was shelved six years ago and never materialized.

I challenge Fairfax Africa Fund to provide clear and verifiable documentation to substantiate its claim of conducting $17 billion worth of deals in the last two to four years. Transparency and accountability are essential to maintain trust and credibility in such significant financial assertions.

Call for Accountability

The Ethiopian government, the Federal Ethics and Anti-Corruption Commission of Ethiopia, the Ethiopian state-owned media, and the international media, including Bloomberg (because Bloomberg has interviewed Zemedeneh), should hold Fairfax Africa Fund accountable for its statements and provide clear, verifiable information about its investments and projects. This accountability ensures that stakeholders, including the Ethiopian and the Nigerian public, can make informed decisions and have realistic expectations about the benefits these investments will bring.

Zemedeneh Negatu’s frequent appearances on Ethiopian state-owned media and private media outlets, including Bloomberg, have often gone unchallenged by journalists, which could be due to his impressive credentials and experience. This raises questions about the research journalists conduct before sitting for an interview with their guests and their responsibility to hold them accountable for their claims.

Conclusion

While ambitious projects and substantial investments are always welcome news, it’s crucial to differentiate between genuine contributions and claims that have been questioned. By encouraging transparency and holding entities accountable, we can ensure that the true impact of these investments is both understood and appreciated.

Disclaimer

I have reached out to Fairfax Africa Fund via its website’s “Contact Form” and posted a number of tweets tagging @Zemedeneh,  Zemedeneh Negatu. Unfortunately, they have been unresponsive. This is a red flag. This article is written solely based on publicly available information online and does not intend to defame either Zemedeneh or his company, Fairfax Africa Fund. Should there be any inaccuracies, I will happily correct them if approached.

The writer, LJDemissie, can be reached at [email protected] or @LJDemssie (X formerly known as Twitter).