It was in the mid-1930s right after the Italians aggression the league of nation chaired in Europe to mediate the clash between Ethiopia and Italy. Eventually, assembles of mostly white representatives with pro-colonialism sentiment passed a ridiculous decision.
While a naked truth was that Italia had traveled 10 thousands of kilometers for colonial ambition in The Horn of Africa violating protocols of the league in invading member country, but the league issued sanction of procurement of weapon upon the two.
This injustice inscribed in history and exposed the league was formed to defend voracious interest of colonial powers as Italy was able to make weapon and an invading country.
Again in the Ogaden war the United States didn’t even hand over to Ethiopia procured weapons while Siad Bare Invaded Ethiopia assisted by USSR and Ethiopia was fighting The USs war.
Moreover, recently, driven by neocolonialism mentality, the western world still remained to refrain from its stubborn stance and yearning the fragmentation of Ethiopia and establish impotent states from its debris.
While the TPLF terrorist group committed, treason, war crimes, crime against humanity, looting and destructing, some western powers work for their selfish interest by committing injustice in Ethiopia under the guise of democracy and human right. These powers backed the terrorist group with high-energy foods, medication, armament, logistic and communication facilities, and launch campaign of defaming the legitimate federal government via reputed western media.
What lied beneath? Prominent scholars attribute the essence to remain in survival to adopt sound economic modality investigating the journey of Ethiopia in flash back and fore shadowing the future.
Befekadu Degefe (PhD), a well experienced scholar is serving in institution of Development Research in Addis Ababa University as senior researcher. On an Econ Seminar organized by Department of Economics College of Business & Economics of Addis Ababa University Dr. Befekadu said that first of all it is important to see procedural aspects of the Ethiopian economy theoretically and analytically than to see it from the perspective of historical dynamism.
Where we are today? Where are we going? And what are to be done are questions that matters so as to find clues to address much complications we are encountering at this concurrent. These grand people and country which ought to be respected has frequently to be seen threatened and humiliated.
The western have already made a world map excluding Ethiopia. They seemed interested in the disintegration of Ethiopia. Though the country clearly identified enemies eager to engulf and swallow its existence, there was no effort to invent weapons to defend.
“As we observe the Ethiopian military industry, it reserved shield and scimitar for the close formation and arrows and spears for distant targets”
Ethiopia has never attacked other countries instead intended itself to help and give hands at times of emergencies. Believing that the world should adhere to the principle of justice, Ethiopia developed a culture of submitting complaints to the international council.
Be it as it may, however the country is surrounded by enemies, but it has not been playing its card well in inventing weapons to defend it. Hence, rather than lamenting the naked truth, it is better to devise mechanisms and sound economic modality taking every challenges as an opportunity.
Before to tracing where our economy gauges, essential it could be what we want from our economy. Beyond producing self sufficient amount, our development has to focusing on sustaining the country and handing over better country for the posterity.
Most notably, what is demanded from the economy is the betterment of the public and consolidation of the country. To change the general objective into practice paving the way for individuals who want eat bread upon their sweat is a must. In precise terms, there is a need to undergo institutional reform to create enabling environment for visionary citizens, he noted.
Second, citizens have to take advantage of systems and able to score sustainable development and third, the new wealth reaped from such the new system has to be fairly distributed and price of product stabilized. Finally, the other pillar of the economy is the establishment of partnership in foreign policy without violating national sovereignty.
However, the economy could provide such benefits, over the past 40 years, it was in vain to achieve so even it was difficult to be self-sufficient in producing food items and basic needs.
Such failure has been accelerating inflation. What is worse would be the inflation rate in food related area is more escalated compared to non-food items albeit it is a paradox.
To fill the gab the country has to made procurement from oversea market. Yet there are short comings in affording foreign currency and incumbent upon loans from abroad. As a result the mirrored reflection of Ethiopia seems to be a country unable to rescue itself and the citizenry from begging. What is left for an Ethiopian is good psychological makeup and proud despite all odes.
There is the problem somewhere so that to put lasting solution, identifying the source is important. There is abundant water, arable land and workaholic farmers along with universities producing agriculture professionals. “The question that matters is why we are starved and why inputs and mechanizations and implementation failed to modernize the farmers? Why the industry sector is crawling while the country is part of the wisdom world?” the scholar asks.
The country is not the only entity troubled by its problem. Countries and strategic partners have also felt the complication. They reiterate advising Ethiopia formulating strategies and they are also doing it at this concurrent.
They always come up with two affairs- system and strategy. They begin with saying that Ethiopia is rich with natural resource and human capital the short coming is skill and production facilities. Knowledge gap limited to produce machineries unable to afford the cost forced the country to buy. Hence, they consider this for the economy is crawling adding that administration involvement in the economy is another constituent while the economy ought to be left to the private sector based on free market economy.
They also repeatedly are observed to say the government highly involved in economic endeavors harm the public for instance when it took a loan from banks the private sector would not get cashes.
They in short terms, claim public enterprises of Ethiopia and recommend the government to focus in safeguarding law and order. They ardently oppose subsidy and advocate competency and madly need capital account liberalization. Neutrality of National bank and limiting its duty to stabilize market are also some aspects such entities demanded.
They also claim that Ethiopia has to be competent in the globe unless it loses what it could get from the competition. However, from the economic perspective, there is no country compete with one another but companies. For instance, in terms of car market, Toyota may compete with BMW or Mercedes, but Japan never competes with USA or Germany.
The other is the establishment of stock market for its importance for the availability of capital and generating lucrative foreign currency for newly emerging firms. Nonetheless, the presence of stock market can’t help the establishment of new ones and they do not have relation as well.
Three criterions have to be fulfilled for one company to sale stocks. One, the company has to be active and operational then, it must be productive and third, the company must be sustainable. Hence, stock exchange does not help the establishment of emerging firms.
Foreign investors could generate foreign currency but the deposition is short term as they withdraw it to exchange stocks but banks might be in desperate to pay. On the process their strive to obtain to pay for stock holders the money value would fall to zero as banks may engage in black market.
Thus, share market is a real casino that involves brokers through encouraging buyers and discouraging holders and hastens the exchange rate. It reduces investment fund since there is highly competitive relationship between investment fund and share market.
As time went by, the value of one USD has reached 50 ETB. If situations went on similar momentum, it would elevate to 100 soon. In this connection, the Ethiopian government should not devalue its currency as most items are purchased from oversea market.
Medicine, capital good, petroleum and other important items are purchased from abroad and currency does not have equilibrium. The other adverse effect of devaluation is it is inflationary.
Hence, what is recommended for the nation is contextualizing Structural Adjustment Program (SAP) with home grown and learn from best practices. Second, it is also advisable investigate the fundamental reason of prosperous countries in reaching the helm of success.
“What lastly we learn from them is government in and by itself cannot bring about economic growth and economic development. Second there is no country that has followed in and through the so called free trade modality. Hence, Development urges the cooperation between government and market,” he suggested.
Abdurazak Hussien (PhD), Lecturer in the Economics Department and Post Graduate Program Coordinator for his part said that Ethiopia is proud since it has a story to narrate even if we take the economic history starting from 1950. Because, there have not been other African countries that were autonomous in the mentioned year.
“Again if we take the chronology from 1900, there would not be also countries of Europe to narrate their story of economics as many states were not incepted in the year. Hence Ethiopia is lucky that it has something to say that many are forced to be mute.”
So the country had started the journey while others were not born however presently the human development index gauge the country at 173rd in the world and 40th in Africa leading South Sudan and Eritrea in East Africa.
Over the last 60 years the country has been remained to be demonstration centers of economic modal ranging from feudalism to command and developmental state economy.
Of course like Ethiopia, the world has passed through political regimes weather it is monarchic, military or civilian, but Ethiopia is still in shock draught famine civil war, coups, international transition had its own impact though. Hence, investigating at least the past 60 years economic history of the country might be of paramount significance to reach some sorts of relief, he stressed.
BY LAKACHEW ATINAFU
THE ETHIOPIAN HERALD TUESDAY 30 DECEMBER 2021
