Recently, the Addis Ababa Chamber of Commerce and Sectorial Associations had held panel discussion focusing on current political and economic issues.
On the occasion discussants raised opportunities and challenges. They stressed the prevalence of instability and underlined it as a constraint factor for a proper business functioning.
The scarcity of hard currency has been critically affecting import and export trade, said Getachew Regassa, the Executive Secretary of the Chamber.
Three decades back the nation was under a highly-centralized command economy. Against this backdrop, the private sector began to flourish. Its creeping growth and existence was closely related to and Status quo. Hence, rethinking and adopting new way for the thriving of business for a strong base is essential. This makes the private sector competent both continentally and internationally.
As to Getachew, the private sector should not be dependent on a political system, a given political party or a certain ethnic group. It must believe in competition and prioritize the nations’ benefit. It has to be well disciplined and modernized. To that end, the burgeoning of a democratic system is essential.
The private sector’s development is closely related with the political development of the nation. In addition to discussing and assisting the economy, the chamber should engage in political discourses. And to that effect organizing a platform is vital.
He further said that there are still political questions that beg for a redressing work. Hence, all stakeholders must unleash their potential for ensuring rule of law, strong governance and democracy. Exerting citizenship duty is essential. The role of members of the chamber, in these political discourses, is invaluable.
The President of the Chamber, Mesenbet Shenkut on her part said that, to effect solutions, for the multifaceted problems the nation is facing, developing the culture of dialogue between stakeholders is essential. She further said that though the nation displayed double digit economic growth for a decade, challenges and uncertainties still beset the macro economy.
When conflicts breakout in various parts of the country, traders are forced to close their businesses. This, in turn, forces them down the precipice of bankruptcy. Peace is the backbone of the burgeoning of trade and investment. Cognizant of this, the chamber will organize platforms to talk about politics.
To let the disrupted development surge ahead parrying instability and to allow the proper and peaceful conduct of the coming national election, the chamber is ready to exert its efforts in collaboration with stakeholders.
The conflict-resolution expert and lawyer Seife Ayalew, on his part, said that regarding the political aspect of the nation there are questions which need to be addressed.
He further said that consensus among various stakeholders lays a ground for achieving peace. However, in a nation where abject poverty and food insecurity are rampant restoring peace is not an easy task.
Negative trade balance, inflation, foreign debt service and other problems have hamstrung the economy. Ineffective budget utilization and deficient monetary policy implementation further aggravate the situation and make attaining stability a pipe dream.
Unhealthy money supply which poses inflation, the tumbling of the exchange rate of Birr in the face of foreign currency, shortage of hard currency, the price hike of commodities and services have been a headache to the economy.
As to Seife, Trade has an international dimension. It never bases itself on ethnic or racial identity.
Only through driving home peace and democracy is unattainable. Economic progress also needs strong commitment.Imposing peace by force is not an enduring solution.
Ensuring the rule of law is a key for the observance of peace. Citizens must not only be asking the government to enforce law. The relation between the government and citizens, particularly the business community, must be defined on legal bases.
As to him, if the market is run by market forces, containing illegal trade will not be impossible. This creates favorable situation for free market.
In the nation’s modern history, political instability and conflict coupled by poverty and famine had been common characteristics for the last 27 years. As such the questions of group rights were not clearly debated and addressed.
As to Seife, the popular uprising by students and peasants in the 1950s and 1960 had been posed by economic demand but the political problems that resurfaced again and again are directly related to the nation building process. Addressing the question properly can bring long-lasting solutions.
The federal system experimented by the former EPRDF regime was to devolve or divulge power from the center to the peripheries.
The federal system mainly tried to address questions related to the ethnic identity. But at the same time it causes problem among rival ethnic groups. Moreover, pervasive ethnic strife, here and there, further aggravates economic crises making doing business very hard.
Behind Ethnic conflicts witnessed here and there, there are economic questions regarding the equal sharing of local resources. Hence, if the real question is economy, the private sector, together with the public sector, should make an effort to stimulate the economy.
Even if the nation pursues free market economy, at times, when market fails, strong intervention from the government’s part is essential and such kind of approach is common in many countries of Africa and Asia.
However, in addition to the government intervention and market governance, there is a third way. That is mixing intervention and market governance. Such approach is practiced in many countries and can uplift the majority’s poor living standard. But to accomplish that there must be a strategic cooperation between the government and the private sector. Attracting foreign investment is essential for job creation, technological and knowledge transfer, import substitution and boosting export. But side by side with this, encouraging local investors is essential.
Opening the economy to foreign investors does not mean letting the market disfavoring by local stakeholders. It should be recognized that the public sector also has a crucial role in stabilizing the market.
As to Seife, the investment policies should favor the local investors. No country has achieved economic development by foreign investment. When foreign investors face uncertainties they might pull out their capital. Therefore, indigenous capital should play a key role.
As mentioned above for economic growth, stabilizing the politics is vital. But this still remains an unsolved assignment. The fusion between government institutions and political parties has made public institutions not to be impartial. This, in turn, opens the door to lawlessness.
Conflict of interest between them also let culprits to go with impunity. Therefore, to ensure rule of law the relation between party officials and public institutions should be impersonal and institutional.
During the discussion comments and suggestions were forwarded by participants. Among the comments were found “It must be the economy that must lead the politics. But contrary to this, the politics dominate the economy. The absence of a strong chamber of commerce has opened the door to government’s intervention in the economy. When economic policies are drafted,often, members of chambers are ignored!”
Another complaint runs instead of forwarding their demand on legal bases some members of the chambers resort to extort government official which in turn aggravate red tape. Hence, to make the chamber strong the members also should display professional integrity.
THE ETHIOPIAN HERALD SUNDAY EDITIONFEBRUARY 16 / 2020
BY ABEBE WOLDE GIORGIS
