Booming Ethiopia??

[ElPunto]

Ethiopia, Long Mired in Poverty, Rides an Economic Boom

 

By ISMA’IL KUSHKUSH

MARCH 3, 2015

 

ADDIS ABABA, Ethiopia — The bulldozers, tractors and cranes are busy day and night, paving new roads, building tall glass buildings and constructing a new light rail system to stitch together the city’s ends.

 

In less than five years, the city’s skyline has changed drastically. Above the dust, in a seven-story building overlooking Meskel Square, sits Abiy Gebeyehu, a real estate development manager at the Sunshine Construction Company. He is going through files and figures, looking down at the spot where Ethiopia’s former communist dictator, Mengistu Haile Mariam, once smashed to the ground three bottles of what was supposedly blood as a warning to his opponents.

 

“The government changed its policy,” Mr. Gebeyehu said, explaining how his company became part of Ethiopia’s economic growth. “They are engaging private business.”

 

Once the epitome of poverty and hunger, Ethiopia is changing. Three decades after a famine that prompted America’s top singers to respond with “We Are the World,” Ethiopia has had an average economic growth rate of 10 percent for over a decade and has met or is coming close to meeting several important Millennium Development Goals of the United Nations, according to the World Bank.

 

Some economists have called Ethiopia an “African lion,” mimicking the success stories of Asia’s economic tigers, and the government here has an ambitious plan to make Ethiopia a middle-income country by 2025.

 

It sometimes seems that everything here in the capital is under construction. Head out on one road in the morning and you might find it blocked off for a development project by evening. The thumping of jackhammers, the sight of men in orange vests, and the comments of Ethiopians who are at once infuriated by the inconvenience and impressed with their country’s transformation are constant.

 

But critics of Ethiopia’s economic growth story point to human rights abuses (some carried out in the name of economic development) and the lack of genuine democracy, and they question the sustainability of the nation’s economic path.

 

“When a society is not free, development is not as sustainable,” said Obang Metho, executive director of the Solidarity Movement for a New Ethiopia, an advocacy group. “It is not investment in building the human capacity of the people, but only in infrastructure and opportunities that mostly benefit the narrow interests of regime cronies.”

 

By no means has Addis Ababa eliminated the problems found in many developing capitals. Tin houses in shanty neighborhoods can still be seen around town, electricity cuts are common, the Internet is frustratingly slow and telecommunications are largely not reliable.

 

“The overall performance,” however, said Guang Z. Chen, the World Bank’s country director here, “remains impressive.”

 

There are many reasons for the boom, but analysts attribute part of the growth to the idea of “the developmental state,” championed by former Prime Minister Meles Zenawi in his writings, as the framework in which the current economy functions.

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“The idea is a state with a sense of mission,” said Dereje Feyissa Dori, Africa research director at the International Law and Policy Institute, who is based in Addis Ababa. “It is building capitalism from above.”

 

Following the examples of countries like South Korea and China, he said, the government is heavily involved in the economy, directing the private sector. It has expanded in the areas of services, public investment, infrastructure, education and health by borrowing heavily from state-owned banks and effectively managing foreign development aid from the United States, Britain and other parts of Europe.

 

An economy that once depended on coffee as a main source of income now sees its national carrier, Ethiopian Airlines, as the main generator of foreign exchange. The country is also constructing Africa’s largest hydropower plant, the Grand Ethiopian Renaissance Dam, which Ethiopian officials proudly claim will be built with the nation’s own financial might, not foreign assistance.

 

“Our struggle is to fight poverty,” said Haji Gendo, a spokesman for the Ministry of Finance and Economic Development. “We are targeting specific sectors.”

 

Remittances from the large Ethiopian diaspora and private investment from countries like China, India, Turkey, Sweden and Britain — attracted to the country’s low-cost labor market and proximity to Europe — have also contributed to the growing economy, especially in the textile and leather industries.

 

In an industrial zone on the outskirts of the capital, one of many throughout the country, Pittards, a British leather company, is manufacturing and exporting “Made in Ethiopia” gloves that include work gloves sold at Costco retailers in the United States and fashion gloves worn in Paris and Tokyo.

 

“Ethiopia was a natural choice,” said Reg Hankey, Pittards’s chief executive, citing the availability of raw materials, labor and proximity to global markets.

 

Back in the lobby of Sunshine Construction, where a banner displays the company’s slogan, “Seeing Is Believing,” models of apartment complexes, villas, and new buildings and photographs of road construction adorn the place. Many of these buildings house government offices or are bought by Ethiopians returning from abroad.

 

But the development projects that are part of a government master plan to expand the capital into areas outside the city have bred anger and clashes, as well.

 

Last year, protests led to the deaths of at least nine students. And in other parts of the country, the displacement and relocations of populations for dam and big agriculture projects have also stirred discontent.

 

“While Ethiopia needs development, the government’s approach to development leaves no room for dissent or opposition to government policies,” said Felix Horne, a researcher for Human Rights Watch. “Throughout the country, citizens are routinely displaced for development projects, and there is little consultation or compensation given for the loss of their lands.”

 

The World Bank itself has come under fire for aiding the government despite such abuses. In the Gambella region, residents complained that they were forced off their ancestral lands by the government under the pretext of improving basic services.

 

But in a sleight of hand, residents said, they were moved to places with infertile ground, no schools and no clinics, while their own lands were leased off to investors.

 

“We draw important lessons from this case to better anticipate ways to protect the poor,” the president of the World Bank Group, Jim Yong Kim, said in a statement late last month.

 

Ethiopia’s economic growth comes as its strategic, geopolitical role remains critical.

 

An ally in the American fight against radical Islam in the region, Ethiopia hosts an American military base; is an island of relative stability in a tough neighborhood that includes Sudan, South Sudan and Somalia; and has largely been spared the type of terrorist attacks that have struck Kenya. The country has been able to turn its relative stability into diplomatic capital, hosting international peace talks for neighboring countries.

 

“We no longer have war,” said a cabdriver as he zigzagged his blue Soviet-made Lada through a traffic jam, explaining the roots of the economic boom as he passed a construction site.

 

Still, critics say the government is dominated by members of the Tigre ethnic group, does not tolerate dissent and manages a surveillance program to keep dissidents in check.

 

Elections are scheduled for this year, and Parliament is dominated by the governing Ethiopian People’s Revolutionary Democratic Front. Only one seat belongs to a member of the opposition.

 

“We have elections every five years, it is a multiparty state, but the practice is authoritarian,” Mr. Dori said. “And the opposition is in shackles.”

 

Last year, six bloggers and three journalists critical of government policies were arrested and charged with terrorism and connections to an outlawed United States-based opposition group that the government said was plotting attacks to overthrow it.

 

“I am not happy about the human rights situation in Ethiopia today,” said a lawyer for the bloggers, Ameha Mekonnen. “It is not uncommon to hear from detainees that torture is undergoing in many detentions centers.”

 

Some economists question how long Ethiopia’s model of state-driven capitalism can be sustained.

 

“This kind of economic model has worked very well for Ethiopia,” said Mr. Chen of the World Bank. “The question is, can you continue this model unchanged over the next 10 years? Our argument is no.”

 

Beyond that, many here debate whether development and democracy are necessarily interlinked.

 

“If people are hungry, they will not think of democracy or anything; they need bread,” said Mr. Gendo, the ministry spokesman.

 

Mr. Mekonnen, the lawyer, thought differently.

 

“If there is confidence between the government and the people, that would be better for development,” he said. “I don’t think there is that kind of trust, I am afraid.”

 

http://www.nytimes.com/2015/03/04/world/africa/ethiopia-an-african-lion-aspires-to-middle-income-by-2025.html?_r=0

[ElPunto]

Ethiopian migrants in Somalia

 

By Hamza Mohamed

Saturday, February 28, 2015

 

Bossaso, Somalia - Ankles deep in brown canal water, freshly plucked green weeds in both muddy hands, Abdi Muse Kalon cannot stop grinning. He says life here has given him a second chance - a better chance.

 

Risking his life, Kalon walked for more than four months from Ethiopia to get to Bossaso, a port city nestled next to the Red Sea in Somalia's northeast.

 

Kalon is one of at least 10,000 Ethiopian migrants who have crossed over from neighbouring Ethiopia and settled on the southern coast of the Gulf of Aden in the past five years, according to local authorities.

 

"It was not easy to get here, not everyone makes it. People die of starvation and thirst on the way here. And even wild animals can kill you. I'm very lucky," Kalon told Al Jazeera.

 

He first tried his luck to come to Bossaso in 2009. With wages low and jobs hard to come by back home, Kalon saved enough money and boarded a boat in search of greener pastures. Oman was his final destination, but soon he was picked up by authorities in the Arab sultanate and sent back.

 

Unhappy with what life in Ethiopia offered him and his family, he decided Somalia was his next destination.

 

A cold welcome

 

Kalon and thousands of his countrymen are leaving one of the fastest growing economies on the African continent for a country that until recently was considered a "failed state". This part of the Horn of Africa country has been spared the worst of the two decades-long civil war, and has had relative peace for the last 10 years.

 

But with seven out of 10 of Somali youth unemployed, the presence of these mainly economic migrants has caused tension. Residents want them out, by force if necessary.

 

The local government is leading the efforts to send the Ethiopians back. New strict laws have been put in place to curb the influx of migrants.

 

Any driver caught bringing in foreigners risks a fine of $300 and, or, a jail term.

 

Every vehicle coming into this city of more than half-a-million residents is thoroughly checked by armed soldiers. Anyone caught without valid paperwork is hauled off to an overcrowded prison before being deported back to their country of origin.

 

Landlords have been given firm orders not to rent their homes to the unwelcome guests, forcing Ethiopians into the harsh camps for internally displaced people on the city's outskirts.

 

At these camps, they are at the mercy of raids by security forces and forceful deportations.

 

"We cannot cope with these numbers of undocumented migrants," the town's mayor, Hassan Abdalle Hassan, told Al Jazeera.

 

"Many times before we sent them back, but they don't want to go back to Ethiopia. Now they come by foot because we told drivers not to bring them here."

 

The mayor estimated that hundreds of new arrivals reach Bossaso every week. Some board rickety boats and later head to Gulf countries, but most remain in Bossaso.

 

"Depending on the time of the year we see between 200 and 300 migrants every week. That is way too many for us to accommodate," Hassan said.

 

Working hard and thriving

 

But the government's loud threats are falling on deaf ears. The migrants have taken over a whole neighbourhood of the city that until recently used to be exclusively inhabited by Somalis.

 

Restaurants, laundry shops and taxi services run by the new arrivals have not only opened but are thriving.

 

Every evening the streets of this part of Bossaso are filled with mainly young men from Ethiopia - Africa's second most populous country - gathering around tea stalls. The evening ocean breeze blowing in from the sea is filled with the aroma of spicy Ethiopian food and music.

 

Less than a kilometre from the farm where Kalon works, a dirt road snakes through a large refugee camp.

 

Ahmed Abdi Muse sits in the passenger seat of a beaten-up car. He has been living in Bossaso for more than a decade and is fluent in Somali. He speaks the local dialect, making everyone second-guess his nationality. For the past five years, he has been working as a driving instructor.

 

"There are not that many choices for us but to stay here and do our best to provide for those close to us. Ethiopia is not an option for me, and going to Arab countries is very risky. We come here and work hard. We don't harm anyone. We are here only to support our families," Muse said.

 

The migrants are trying their best to be part of the wider community and have formed community organisations.

 

Mohamed Abadir is the chairman of the Ethiopian community in the Puntland region of Somalia - a semi-autonomous state in the northeast part of the country. A resident of Bossaso for the past 20 years, he now owns a farm outside the city and employs 10 Ethiopians.

 

"Relations between the Somali people and our people are good, but not perfect. We live side by side in peace," Abadir told Al Jazeera.

 

But life here as migrants comes with its own challenges.

 

"Because no one wants to rent houses to us, every Ethiopian family here is housing three other families. Housing is an issue. Apart from that we have a good understanding with our hosts," Abadir said.

 

Despite the migrants best attempts to be a part of the local community, locals can't wait to see them leave - for good.

 

"We are not happy with their presence," said Abdi Noor Galayr, a vocal anti-migrant campaigner in the city.

 

"They have brought many problems in terms of health. We don't know what health issues they may have. They brought criminals to this town like people smugglers. They are also putting pressure on the job market."

 

Galayr and those like-minded might not want the Ethiopians in their city, but Kalon said he is going nowhere.

 

"Somalia is not home, but for now it is home. I hope to bring my wife and children when I have saved enough money. Life is better here," Kalon said.

 

http://www.hiiraan.com/news4/2015/Feb/98384/the_plight_of_ethiopian_migrants_in_somalia.aspx

[ElPunto]

Clearly the boom doesn't seem to be playing out much beyond the capital Addis Ababa. Or maybe whatever level of boom - it won't make much of a dent given the population of 90 million.

[burahadeer]

Skip

[burahadeer]

Ethiopia has done so much,and is best gov't in millennia,but they can't equate to such Asian giants like Korea,africa won't attain its potential so long theirs tribalism, ethnic and religious squabbling.The so called opposition are mainly the Amhara ethnic group yearning for the days they had yoke on people with such disastrous results and must be taken with grain of salt.The fact that Somalis are much ahead of thm in telecommunication(internet,TV,Telephones and all kinds of media),banking,business, and the freedom to curse the president & gov't anywhere at anytime tells that Ethiopia is still rigid society that can only go two steps forward while retrenching a step back.

People in Ethiopia miss-call Somalia because it damn expensive(actually very expensive in/out of Ethiopia).You might spend $3 for less than 2 minutes calling from/to Ethiopia TO from/to hargeisa while that $3 last you atleast 30-40 minutes when calling from Hargeisa or Mogadishu to Europe or America and even double of that late at nite.On top of that Ethiopian telecom/internet very slow & unreliable.Light goes out in addis nightly while in hargeisa/burao you might see that once couple of months for a minute or so unless some drastic happens and that's not all the city but in one or two neighborhoods as there r many different electric companies.

and with all the 10s of billions pouring into Ethiopia! its clear that centralized,gov't run business can only go so far....nothing can match private business.

[Dhagax-Tuur]

It's a simple choice. Authoritarian rulewith economic development or the so called liberal democracy and hunger. I would choose the former.

 

Economic development come with good educationalachievement and better health coupled with good infrastructure. The generation that benefit from this willpeacefully change the system of governance to the rule of the people.

 

Follow Mr Lee's footsteps and Ethiopia will get there.

 

 

[nuune]

ElPunto, having only came back last week from Ethiopia, the booming is not only in Addis Ababa, but in Dire Dawa, Nazreth, Jigjiga, Harer, Mekele, Axum, and many other cities.

 

Spent most of my time in Dire Dawa, and having visited the same city 2 years ago, I could not recognise how fast Dire Dawa is going, itused to be a quite place.

 

I still don't know the driving force behind this booming, but one thing for sure, the government has enforced a tax system on everything, and the benefit of this is being invested on many projects such as the Dam, Roads, construction etc.

 

Example: Every shop I have seen has a cash register(enforced to use) which is connected to the internet(or other real-time systems), and every sale is being communicated to a central unit(revenue) where the revenue knows what to collect and when.

 

That kind of system never existed 3 years ago and slowly every business is converted and enforced to use the cash tax register, it is amazing thing to achieve for a country that has more than 90 million people.

[Che -Guevara]

Ethiopia will soar or crumble depending how much control the state is willing to give up in the long run. The main problem is the ruling party and the state have became one and the same. They either control or have interest in every commercial activity; all major sectors are directly controlled by the state and the TPLF. People within the TPLF and their allies head all major corporations. They are creating a super rich class while the average Ethiopian that lived off his land is being forced to give up his land for the state, the so-called villigization process (in actuality, land grap). Hundreds of thousands were displaced in the Gambella, Oromia and even to lesser degree in Somali Galbeed.

 

The huge projects in Ethiopia are being financed by loans with high interest rates. The average Ethiopian is a farmer with small plot. The plots tend to be degraded and unfit for farming. The Government takes over the land and turned into 'usable' farms. Many Ethiopians on tahriibs are these poor farmers.

 

Their economic model will be sustainable if they create a sizable middle class quickly and are willingly to give some political space.

 

In any case, poverty and prosperity in Ethiopia will impact the Horn immensely. There will be huge people movement within Ethiopia and across its borders.

[nuune]

Che, politically, every point you made is true, also the richer in Ethiopia gets richer, and the poorer gets poorer, the same is happening everywhere in the world, but in Ethiopia, the one party system is killing people, soon there will be an election, the one party that supposed to run was told to leave the country the other day, so simply there will be an election where everyone chooses the current party, election maba la dhihi karo.

 

Also, the articial gov in Jigjiga, is holding election where only the current party will run for election, last month, a group of youth established a party that will run against the current one, one by one, waa loo imaadey and told them, don't you ever think about it, khalas, sheeka waa dhamaatey.

[Che -Guevara]

Nuune..Yes, Ina Iley was in Mnpls.

 

The biggest winners in Ethiopia are TPLF generals and the party inner circle specially those in the conflict areas.The Somali region was run by General Abraha Wolde Gabriel (I don't know if he is still there)

 

The Generals are even getting into the Somali scene and are beginning to have business interests in Somalia, they are in bed with corrupt business people and maamul gobleedyada. General Gabre is in the middle of it all. He is at every Somali shir.

 

Question, did they lift the embargo within the Somali Region? Puntland and the Region set up customs office.

[nuune]

Gabre waxaa iigu dambeysay asagoo Hiraale & Madoobe dhax dhaxaadinaayo, that was dullinimo dullinimo dhaaftey.

 

iley waa la uleeyey baan maqley in Minneapolis, my insider information is telling me the man is a walking to be prisoner in June, u soo fiirso by June, waa lala kacayaaa isla dowlada itoobiya ayaa xabsi galineyso, this information I received from a reliable sources in the government (received a tip).

 

 

[Che -Guevara]

I can't say I wish Ina Iley well, he deserves whatever is coming to him. Perhaps he should have married a Tigray woman like Daud.

 

There's always a room in Jail Ocaden.

[ElPunto]

So there is a boom in building and construction funded by investment and taxes. But what about other private sector job creation? Since most Ethiopians are farmers - investing in agriculture would seem to be the obvious starting point.

 

As long as there are streams of Ethiopians coming into Somalia - there is something not quite right about the current boom.

[Dhagax-Tuur]

Ethiopians number between 80 - 90 million. The boom in the last 20yrs alone isn't going to be enough to economically lift them outra poverty and stay home. Given the trajectory, I am surthat they're on way.

 

It's a stupid fallacy to apply western ideals to developing communities. These communities need honest leadership that might intervene in their personal everyday for a better tomorrow.

 

 

[Dhagax-Tuur]

You have lost few so called liberties, and in exchange you have got security and bread for all. What's the matter with little discomfort, eh?

 

A case in point is the difference between India and China. China is authoritarian, but things get done. India is socalled democracy, almost nothing gets done. The difference between the countries is like day and night.