ADDIS ABABA—Remittance is one of the source of foreign currency for the nation. Sources indicated that Ethiopia, in the past six months, has earned about 2.7 billion USD in the form of remittance. This is greater than the income the nation earns from export of goods.
Despite this significant role to the national economy scholars are suggesting a better and steady supply of remittance and foreign currency for sustainable economy.
As to Misgnaw Gashaw, Ass. Professor at Bahir Dar University, consorted efforts should be exerted to diversify means of acquiring foreign currency. Diversification of production and productivity and high focused effort to create informed Diaspora community is needed.
Ethiopian diaspora community is the second largest population in the USA next to Nigeria.
According to him, most Ethiopians send money for their families for consumption purpose not for investment. This will not bring a lasting solution for their family as well as the country. This trend should be changed.
In this regard, the government should also do its assignment by providing them with incentives to invest at home.
He also noted that the policies should be revisited to the advantages of the diaspora. What is more, Ethiopian diplomatic communities should work aggressively to create informed diaspora community.
“It is my opinion that to cope up with the existing foreign currency scarcity the country faced, the diaspora community should be well informed how their contribution and investment could play key role in the development of their nation.”
According to him, the already started system of saving money in foreign currencies should be further encouraged. It should be taken seriously.
India and Nigeria have used their diaspora community as means to prosper their nation. Ethiopia should take the same lesson from their experiences.
Strengthening bilateral discussions with respective nation where Ethiopians reside is key factor.
The financial sectors should also develop tailor systems that will encourage diaspora communities.
For instance some banks have put in place mortgage, which saves about twenty percent in foreign currency and offer the rest to purchase home in Ethiopia. This approach could one way to draw the diaspora.
The remittance case should not intertwine with politics. Documents confirmed that last year Ethiopia has only secured 1.21 billion USD from export of goods within six months. The income from export is declining while the import bill reached 16 to 17 billion USD per year.
Because of hard currency shortage Ethiopia has been in a vicious circle. This has negatively affected various projects directly or indirectly.
Shiferaw Shitaye, an Economist for his part said that before the government mobilizes the diaspora community to send remittance it should first capitalize on peace and security issues. Whenever there is peace and security the diaspora country will have trust on the government. Nation should work hard on ensuring peace and security issues.
The Ethiopian Herald March 4/2020
BY MENGISTEAB TESHOME
