The conflict in northern Ethiopia ended only nine months ago with the signing of the permanent Cessation of Hostilities Agreement (COHA) in Pretoria. But a lot of positive developments happened since then so much so that they already sound to be things of a distant past.
The Tigray region is currently busy with a breathtaking fast-track return to normalcy with a range of activities for building peace and stability. The peace deal is being implemented slowly but surely, without any complaints from either side of the signatories. This is the fruit of their determination to build trust in each other, and being committed to carrying out their share of responsibilities.
The Tigray combatant leaders are in their civilian clothes, carrying pens and paper, busy planning and implementing the reconstruction of their region. The transportation systems, both on land and air, linking the region with the rest of the country are operational, and people and businesses are freely moving. Things that were considered luxury a few months like power, telecom is now available to the public. Social and financial services like schools and health services, banks, shops, and open markets are up and running brimming with people.
Moreover, we learned to our delight this week that the largest higher learning institution in the Tigray region has flung open its doors to its students for the first time since June 2021, when federal forces withdrew from the regional capital, Mekelle, declaring unilateral ceasefire.
All the above-mentioned peace-building activities in Tigray are not just government reports, they have been verified by foreign journalists, diplomats, missions of international organizations, and even leaders of intergovernmental agencies and top of foreign government officials.
To mention the few, the the German chancellor and the American Especial Envoy for the Horn of Africa have come to Ethiopia to get first-hand information on the actual progress being made to implement the Pretoria peace deal.
Ethiopian officials themselves including the Premier himself has traveled widely to different countries to meet world leaders and heads of multinational organization to explain the works being done to implement the peace deal and the spectacular achievements registered as a result.
The relentless efforts made by all stakeholders to bring peace in the conflict-affected region of the country have received due recognition from the international community, and this has undoubtedly brought huge success in economic diplomacy.
Following its careful assessment of the impressive progress made in restoring peace and stability in the war-torn region, the Biden administration determined last month to lift the legal designation it imposed against Ethiopia in connection with the conflict. The crucial decision paved the way for the resumption of the dispatch of U.S. and international economic aid to Ethiopia.
According to the recent statement made by the Ethiopian Minister of Finance, Ethiopia’s bilateral and multilateral economic cooperation with development partners have been restored to its pre-war state. “Following the implementation of peace agreement our economic cooperation with development partners has seen improvement in two aspects. First, there is a lot of improvement in terms of the finance the country is receiving. Second, various financing instituitions in the US and EU are making arrangements to provide financial assistance to the planned development projects. The US [the World Bank’s biggest shareholder] and the EU officials have resumed their support to help us secure assistance from the World Bank and the IMF. Recently they helped us secure development assistance of 730 million dollars that will finance the upgrading of the Addis-Djibouti corridor,” he said.
The upgrading of this road is essential in expediting the the nation’s economy as it is a lifeline trade route connecting Ethiopia to the major port of Djibouti, though which more than 90 percent of Ethiopia’s import and export trade is being carried out. The minister is optimistic that both the World Bank and IMF would further extend the possible technical and financial support to the nation’s endeavor in infrastructure and human resource development as well as structural reform measures and private sector financing.
Especially, World Bank could contribute a lot to poverty reduction and creation of jobs by financing small sclale entrepreneurs, and investors in the manufacturing sector, modernization of agriculture, and stimulating the expansion of agro processing industries. The World Bank should also support Ethiopia to be qualified to benefit from debt relief initiatives.
The resliance of Ethiopian eonomy which is evidenced by its remarkable growth despite the challenges of the devastating two-year war, COVID, and the climate change [extensive draught in some parts of the country] is quite impressive. During the time of the two-year conflict, Ethiopia did not stop implementing its home grown economic reform. Thus the economy was growing during the time of the war. All these are indicators of the country’s potential for further economic boom if development partners provide favorable support.
These are some of the lures of Ethiopia that entitles to it to deserve high level attention of multinational development partners like the IMF, ADB, and World Bank. The newly appointed president of the World Bank, Ajay Banga, came to Ethiopia with less two months of taking office. Even, Banga was reported to have said Ethiopia was World Bank Group’s focal center for the Eastern Africa region.
Being a nation with the second largest population in Africa, and the recipient of the world’s second largest assistance from IDA/WB in grants and concessional loans as well as being one of the fast-growing economies despite some macroeconomic challenges, it would not be a surprise to see Ajay Banga, to choose Ethiopia his first African stop in a months-long global tour as a president of WBG.
The renowned Ethiopian financial analyst and investment executive, Zemedeneh Negatu analyzes the meaning and the possible outcome of the visit of the WBG president to Ethipia from a private sector perspective. “The coming of such high profile global leaders of the financial world means a lot. The visit of WBG president to Ethiopia would send a positive signal to foreign investors and financiers, enhancing Ethiopia’s current status as a reliable and desirable potential destination of investment. It is also indicates the normalization of Ethiopia’s relations with such power players like the US.” he said
One of the three pillars that anchor Ethiopia’s foreign policy is economic diplomacy. The incumbent government has forged strong economic ties with all development partners from every corner of the current multipolar world, based on the objective of achieving mutual benefits and serving national interests.
For instance, a few days after the Ethiopian leader attended the Africa-Russia summit and secured several development deals with Russia, the finance minister here in Addis Ababa inked a USD 84.3 million grant agreement with the African Development Bank. The grant is mainly intended to upgrade the production and marketing capabilities of small-scale wheat farmers in Ethiopia.
Ethiopia’s excellent development partnership with China which is continuously strengthening through the years is another hard evidence of the encumbant government’s success in economic diplomacy. A few months ago, after the signing of the Pretoria peace deal, Ethiopia signed with its top trade and investment partner, China, a memorandum of understanding, MOU that takes their economic ties to new heights.
The MoU intends to establish an investment and economic cooperation working group aimed at jointly boosting bilateral economic and trade relations in strategic fields, by facilitating the implementation of the development strategies of the nine programs of the 8th Ministerial Conference of Forum on China-Africa Cooperation (FOCAC) and the Belt and Road initiative.
BY SOLOMON WASSIHUN
THE ETHIOPIAN HERALD TUESDAY 8 AUGUST 2023
