The current progress in Ethiopia’s infrastructure and development projects threatened by a towering set of challenges, delayed performances and unpaid loan costs, are seeking aggressive development reforms to address the increasing strategic importance in the economic sector, Experts opine.
Approached by The Ethiopian Herald, Public Relation Director with the Ministry of Finance Haji Ibsa says that almost 1,000 development projects launched across the country have been postponed from one to seven years and expended additional 43.1 billion cost overruns.
According to the Director, the delay in projects has urged the country to allocate unnecessary budget, which often causes for bad governance. Of the total 346.9 billion Birr fiscal budget, the country has allocated 113 billion birr, 32 per cent, for development projects, he discloses.
The Director also says almost all the country’s loan is run for such projects; hence, the delay in projects leads for extra debt and affects the national economy. The country’s external debt exceeds 26.7 billion USD, which makes Ethiopia among the high risk countries with the largest debt since late 2018, Haji noted.
Approached by The Ethiopian Herald, Tilaye Kassahun (PhD), Associate Professor with St. Mary University and PRIN International Consultancy and Research Service General Manager says that Ethiopia is known as a center of development projects at this time.
With its vision of becoming middle income country, Ethiopia is facilitating the path towards industrialization investing more on mega development projects such as industrial parks, sugar projects, power generating plants, and road infrastructures among others, he adds.
Although the country is aspiringly investing on the construction of such mega projects, but the delay becomes a major problem to hasten other development efforts.
According to Dr. Tilaye, to make the projects successful, they have to be completed as per the schedule, with the primarily allocated budget, and must fulfill the desired quality & standard.
For him, if a project fails to meet these criteria, it is a failed project. In fact, Ethiopian projects have usually faced these problems due to lack of comprehensive feasibility study and continuous follow-up with accountability, Dr. Tilaye indicates.
The scholar noted that a project differs from other programs and operational activities by its clearly specified completion time period with clearly defined scope, otherwise it does not qualify as a successful project.
Change Management Expert, Zekarias Assefa on his part explains that the government gives priority to complete the projects in full swing is good immediate solution, yet the country needs long-term solution to exit from the current vicious circle.
For Zekarias, well-identified project plan, feasibility study, and proper management are crucial for well-timed completion of projects finalized as in schedule.
“Meanwhile, the proper and timely completion of projects requires operative policy direction, functional project management system with properly designed strategy, and well defined structure as well as proper selection of man power.”
As to Dr. Tilaye, the weakness in Ethiopian projects is lack of defined feasibility study that would bring incredible risks, weak controlling management, and absence of serious evaluation, lack of defined budget for evaluation and follow-up, and paper report exaggeration.
Zekarias also agrees that the projects’ feasibility study should put in action to control even variable situations which may happen during the construction process. Zekarias also shares with Dr. Tilaye on the necessity of project evaluation, controlling mechanism, and defined legal system.
In this regard, Haji says the major problems observed under the 1000 investigated projects are the cost overrun of delayed development projects and lack of well-defined project profile.
According to him, lack of proper project profile encompasses the initial and finale completion period, total allocated budget, use of finance, evaluation on physical and financial paper reports.
In addition, the financial agreements between project owner and contractors were also a major problem to examine the projects’ accountability.
According to Dr. Tilaye, since project and resource are interconnected, it also needs strict enforcement and decision.
For him, the current economic reform should focus on filling the gaps on project implementation, strengthening proper management and controlling mechanism, enforcing accountability, and combating corruption.
It was learned that the National Planning Commission is preparing a proclamation and legal frameworks to address the challenges faced so far.
The Ethiopian Herald February 23/2019
BY DARGIE KAHSAY
