BY ABEBE WOLDEGIORGIS
According to the Ministry of Industry, following the strict measures taken by the government to redress commodities inflation, progress has been witnessed. To support the effort in curbing the economic crises task force is established at the federal level and carried out inspection work in the regions such as Oromya, Southern Nation and Nationalities, Sidama, Amhara regions and Addis Ababa city. After completion its visit recently, the task force reported its findings to the Ministry of Industry Melaku Alebel.
According to the findings, misconduct was witnessed on the trade activities including hiding commodities, closure of shops, denying providing receipts to customers, providing receipts with reduced price figure, and refusal to announcing the true price of the commodities in detail.
On his part, Melaku said that while the government is currently busy in defending the nation’s territorial integrity, ill mind guided economic sabotage that put pressure against the consumers and such kind of misdeed is unacceptable.
He further said that the cumbersome value chain and the intervention of greedy brokers aggravated inflation and to avert the situation the Ministry will take measures in collaboration with stakeholders such as the Federal Police and consumers’ cooperative associations.
As a result of the following up of the business activities by the task force, some improvements are witnessed in Oromya region. Prices are getting stabilized and shown deduction on some commodities. For instance, price deduction from Birr 2000 to Birr 1500 is observed and in some towns inspection took place whether commodities are illegally horded or not.
In line with this, Business men who are found guilty of illegal activities were fined up to 50 thousand Birr and imprisoned up to three months. But night time trade and malfunctioning of value chains remain rampant still in the region that created fertile ground to the illegal trade.
Supervision took place on 135 thousand trade institutions in Oromya region so that more than ten thousand traders those found guilty are punished by fine and imprisonment. Other legal measures were also taken that played pivotal role in stabilizing the price.
The Addis Ababa Trade and Industry Bureau task force inspected 31,278 trade shops and took legal and administrative measures on 1967 trade enterprises. As a result, the price of some commodities was relatively reduced and the market could be stabilized especially during the Ethiopian New Year holyday. The Addis Ababa press secretariat announced that, to settle the problems witnessed in the city business such kind of measures will continue in the future.
The Ministry of Trade and Industry Communication Affairs Director Abeba Tamene recently announced that in order to manage misconduct in business the task force will continue its measures against illegal acts.
Recently, the task force could size 250 quintals Nigger in Adama town and four trucks of onion illegally marketed in Harar town. It has also taken measures on illegal brokers in Halaba town in the Southern Nation, Nationalities Region.
Besides, it confiscated illegally hidden iron which can be used for construction in Addis Ababa. Despite various measures have been taken, one can imagine the outcome of the measures is not as it was expected.
As to Abeba, the outcome of the measures does not meet what the society was expecting. The reason for this is the intervention of various brokers in the value chain at various levels with no value addition but making the price of the agricultural and other products to be sky rocketed. The measure that was taken in Halaba town of Southern Nation and Nationalities should be replicated in other parts of the country, it was said.
The root cause of the rampant artificially sated commodity price is related with the past political establishment led by the now defunct and leveled as terrorist organization, TPLF. The Minster further said that the looter and the terrorist group TPLF made dangerous economic sabotages that left the nation pauperized when it was in power for the past 27 years.
By the name of free market, it introduced trade policy to favor its cocliques. For instance, it inhibited other entrepreneurs not to open new cement factories only to create favorable condition to monopolize cement market. Construction materials were only imported by companies loyal to TPLF. Business enterprises which have political and business affiliation with the defunct organization grab vast farmland and instead of cultivating it they used the land as collateral to obtain money from banks but the banks did not regain the money they borrowed yet.
Cognizant of these economy sabotages, the reformist government intended to take various measures to reverse the situation. However, instead of working in cooperation with the reform that includes introduction of new economic reform, the Junta ignited war against the government that resulted in economic crises especially in the war torn areas though its intended objectives to regain the control of the economy is unfulfilled.
Currently, according to Melaku, the nation is facing serious challenges because of the war ignited by the terrorist group. Therefore, investors, instead of maximizing their profit margins, should rally to stand together in stabilizing the market that can be considered equals to defending the nation’s territorial integrity and peace.
Professor Alemayehu Geda is a senior macro economist at Addis Ababa University. As to him, to curb inflation of agricultural products, rising productivity and supplying plenty of products to the market should be a priority agenda of the government.
Particularly, importing basic food items including wheat and cooking oil by allocating billions of Birr must be substituted by local products at any cost. The reason is whenever the price of food crops increased in the international market, importing countries will take the price which results in high cost in the domestic market.
Expansion of irrigation farm aiming to raise productivity which is being implemented by government and some investors to substitute imported wheat can be taken as exemplary in this regard.
Irrigation farm needs investment and planned management and if it is properly implemented, it will practically reduce the artificially inflated price food items. But thinking of large irrigation investment should consider the lively hood of farmers that means it must incorporate the farmers as share holders or organizing them in a form of cluster farming for mutual benefit. Doing so, the farmers and the country will be benefited fairly via securing food self sufficiency.
In fact, it is impossible to bring down the inflated price overnight but if producing crops twice or three times a year with irrigation is attainable, it can bring lasting solution.
On the other hand, fort short term solution supplying basic food items through cooperative associations in urban centers can be taken as a way out and in this regard the Ethio-fruit enterprise can be mentioned as exemplary. For the last forty years the enterprise provided consumers fruits in fair price.
The Ethiopian Herald October 14/2021
