BY ABEBE WOLDEGIORGIS
During the imperial era, though the nation’s economy was very small as compared to today, the private sector had its own role particularly in modern agriculture flourished in the Awash valley, in Arsi, Setithumara and Wolayta areas. It also had involved in import and export business and contributed to the nation hard currency earning venture.
That time, to protect the interest of the private sector, the chamber of commerce had been established. However, the advent of the Ethiopian revolution broke forth in 1974 and the assumption of power of the socialist oriented Derg crippled the private sector’s aspiration and confiscated its properties. Since then, the chamber has not been able to work independently.
Birhane Mewa served as the former president of the Addis Ababa Chamber of Commerce and sectorial associations returned home from abroad following the regime change four years ago. Currently, he is in the process to establish a pharmaceutical industry with 24 million US Dollar investments. Recently, he made an interview with local media. While explaining about the establishment of chamber of commerce since the imperial time, he said that firstly in the imperial era the chamber was established as the Chamber of the Addis Ababa Traders; but later on, it was named as the Ethiopian Traders Chamber. That time the chamber was independent because it had an objective in advising the government and proposed ideas for policy improvement and its relation with the government was fairly good.
When the Derg assumed power, the economic system was changed. Being member of the chamber became obligatory. Therefore, when traders wanted to get license, they were obliged to be member. In addition, the person was required to pay monthly contribution in cash. The leadership of the chamber were removed and replaced by the new ones.
Out of the 11 members of the board of the chamber, 9 of them were from the government corporation. From the side of business men, there was only one board member, Wubishet Workalemahu, the renowned advertising company owner appointed as vice president. That time Birhane Mewa was the vice president of the Ethiopian Private Manufacturing Industry and in order to strengthen the chamber, he served as a vice president.
Later on, Kihbour Gehna, the renowned economist became president of the chamber. Again after fierce competition, Birhane himself was reelected as a president. The objective of the establishment of chamber of commerce was that to generate ideas that can be utilized as an input when the government prepares draft laws with regard to the business so that the laws do go in line with the interest of chamber members.
The second objective of the chamber is providing consultancy service to the business community. It established a radio station to disseminate valuable information and ideas regarding business to the public which received international award by its good performance. The award was given by South Africa named as “The Best Chamber in Africa”. As to Birhane, while he was in his presidency, the former regime pursued a divisive policy.
As a result, misunderstanding and conflict was prevailed between the Addis Ababa Chamber of Commerce and the chambers established in cities of the regions. Hence, when he became president his priority issue was creating enabling environment to all chambers to come together and narrow the differences among them.
He exerted great effort to change the regions chamber attitude towards the Addis Ababa Chamber of Commerce and to look it as partner rather than foe. To that end, he provided some trainings and technical support to strengthen them. In addition to that, there was a plan to repatriate the chamber properties and land holding confiscated by the Derg regime.
The place which is serving as an exhibition center at the moment is reinstated to the chamber by the current government. By now, the construction of the new head office is undergoing and the size of the land is more than 100 thousand square meter. Asked how he could define the role of the private sector as compared to that of the public in the economy, he said that in the view of fundamental principle, the free market economy considers the private sector as the back bone. The private sector plays crucial role.
When it was in power, the earlier regime did not recognize the private sector as a partner. To perpetuate its power, it created its own so called private entities which move in his orbit as if they were endowments. And later they named as the government development organizations.
They are supported not only to compete with the private sector but to play a dominant role in the business sector. To that extent, they were supported by information, finance; bureaucratic facilities and such practice weaken the private sector. The trend is still witnessed and the problems created that time have existed to date. They are intermingled with media and political parties. There are also numerous business firms which have affinity with parties. There are also opportunist traders which are backed by the party and have privilege to get loan access from banks. They are also allowed to import goods free of tax and sell in advantageous price.
To tell the fact as to Birhane, there are few business entities grew up by their own effort and professional integrity. He further said that, an inappropriate marriage between political parties and the business entities is not an outdated practice. Even it came today by changing its feature. Whenever one asks with regard to a business firm he can trace it which is behind that business. Therefore, the legible private sector should be represented by the chamber of commerce.
The business entity should be free from political party affiliation. When trader is defined it has to comprise actors from retailers in the traditional market up to the factory and bank owner. They have common interest. They need the chamber which defend their interest. Nevertheless, still conducive environment is not created to chambers to empower themselves. Conflict and misunderstanding among various chambers is prevailed. There are still unresolved problems. It should be understood that the fate of the nation’s economy is determined by the strong and empowered private sector.
The private sector includes both local and foreign investment. But the local private sector is more valuable than the foreign one. When severe situation occurs the foreign investors might repatriate their capital to somewhere else because they have their own country and other investment destiny. But the local investor has no other country than his native country. Foreign investor has the right to repatriate his profit to the country of origin. He will take his capital when he faces uncertainty.
True private sector is created naturally. If you go Mercato you come across with crowded people unable to pass by but all you see are exchanging their goods and services through purchasing and selling. No one is government employee and salaried and the private sector emerges in such activities. Creating conducive environment to the business is vital and in addition to supporting the sector, inspection is needed.
As to Birhane, there is affinity between the private sector and the political parties even in the USA. The sector finances various parties and assumed the practice as legal bribe. Corruption is official but they call it as lobbying. But when you examine, it is corruption they do not consider as crime but at the same time there is supervision. In Ethiopia political parties establish their business and derive their income. The established business entities have a duty to support the parties which politically sponsored. But what is worse is when parties themselves engage in business. What prevails in our country is blatant which is immoral and illegal. Therefore, parties must be completely banned from such activities.
The Ethiopian Herald December 29/2022
