November 12, 2012
By Jerome Mwanda
Some three months after the death of Ethiopia’s strogman Meles Zenawi, uncertainty prevails over the country’s political stability and economic development under his successor Hailemariam Dessalegn, says a new study by the British Institute of Development Studes (IDS).
In particular, Ethiopia’s economic challenges are dominated by the need to find secure livelihoods for what is now the second largest population in Africa and by the acute vulnerability of its major economic sector – rainfed agriculture which is dominated by small plots that are leased by the government.
Most private businesses are similarly small-scale. Excluding smallholder agriculture, informal livestock and contraband trades, two thirds of the economy is controlled by government through nationalised and ‘para-statal’ enterprises, including banks, insurance companies, telecommunications, transport and other industry.
The study, titled After Meles: Implications for Ethiopia’s Development, notes that Meles is credited with steering Ethiopia onto a path of impressive economic growth over the past decade. Ethiopia is Africa’s fastest-growing non-energy economy with annual GDP growth averaging nearly 10 per cent between 2006 and 2011, though some question the government’s economic data.
The Ethiopian government projects the economy to grow at double digit rates in the coming years – which would make it the world’s third fastest-growing economy after China and India in the period 2010-2015. However, the International Monetary Fund (IMF) estimates that growth in 2012 has continued at a pace of about 7 per cent and will slow to 6.5 per cent in 2012/13 and over the medium term.
Meles Zenawi, who passed away on August 21, 2012, 21 years after the Tigrayan People’s Liberation Front’s (TPLF) victory over the regime of Megistu Haile Mariam, built up “a complex web of relationships that conjoined domestic political forces with foreign investors, leading the country towards impressive rates of growth and substantial achievement of some development indicators”, says the report
“Under his (Meles’) rule Ethiopia’s national image began a slow transformation from famine-plagued nation to a fast-growing country which was at the heart of a new global realpolitik in Africa. The challenge now is whether Ethiopia’s institutions, dominated at all levels by a single party, can transition to greater pluralism and, if so, will this enable the country to approach middle-income status by 2025 – a much-vaunted goal of the late Prime Minister,” states the study.
The study is authored by Mulugeta Handino and Jeremy Lind of the Institute of Development Studies, and Berouk Mesfin of the Ethioüian Institute for Security Studies.
They point out that Meles shrewdly manipulated rivalries between and within the four parties of the Ethiopian People’s Revolutionary Democratic Front (EPRDF) while concentrating state power around himself. “Post-Meles, new actors within the EPRDF may seek to exploit the perceived advantage of a leadership vacuum to advance ethnic and other political causes and strengthen their political constituencies, particularly at the regional level,” the study says.
Meles’ successor, Hailemariam Dessalegn, who is from Wolaita – a part of the Southern Nations, Nationalities and People’s Region (SNNPR) – is not a member of the TPLF and is seen as a non-divisive figure for that reason. At the same time he is regarded by many as weak precisely through lack of association with Tigray and the TPLF. “Whilst this may suggest that the real power remains hidden behind him, there is also a possibility that through his regional affiliation a more pluralistic ethnic make-up within the governing system could emerge, reducing the orthodoxy of rule from the ‘North’,” the study points out.
However, though Hailemariam’s appointment has been welcomed by Southerners within Ethiopia, representation of SNNPR in the military and federal command structure is minimal or absent altogether. This is because the TPLF maintains control over the National Intelligence and Security Services, as well as the all-powerful federal police, who have the capacity to crush political protest.
“Although internal TPLF discussions around the succession are hermetically sealed from the wider public, it is widely thought to have been only half-backed by TPLF stalwarts. Many senior party members regard themselves as the only legitimate leaders of the country by virtue of the overthrow of Mengistu. They are not willing to share power, which is at the crux of the future political faultline,” the study says.
It adds: “Beyond the competence of Hailemariam lies the bigger question of the viability of the machine put in place since 1991, engineered to allow a semblance of autonomy whilst ensuring that control remains strong at the centre. A new political pluralism would challenge this system to the core, forcing change or retrenchment based on insiders’ careful calculations as to whether they can hold onto the economic reins whilst loosening their grip on the political sphere.”
According to the report, external pressures on Ethiopia are relentless, shaped by wider global confrontations including the so-called ‘War on Terror’, a massive strategic push by China into Africa, and the ‘winds of change’ blowing in from authoritarian states to the north, where calls for democracy are leading to a resurgence of Islamist parties. “Without the steadying hand of a practised and seasoned global player (Meles), Ethiopia’s presence and capacity for global influence may well have diminished,” the report says.
The IDS study finds that China’s largesse is visible across the dramatic skyline that is the African Union’s new headquarters in Addis Ababa, a deal Meles brokered. However, it adds, there is already scepticism in some circles about the quality of Chinese investment (versus the quantity), and the implications of over-reliance. Ethiopia has also reached out to other non-conventional donors such as Turkey, Brazil and India but has also opened its doors to U.S. geostrategic interests, through positioning drones at Arba Minch, which enables greater U.S. geostrategic reach in and around Somalia.
In the immediate neighbourhood, notes the report, Meles was also careful to cultivate relations with both old and new Sudan(s), and with Kenya and Djibouti, not least because of continued dependence on existing and potential future port facilities in these two countries.
“Ethiopia’s bilateral ties with Egypt are strained, in part due to the championing by Meles of a caucus of upstream states on the Nile which has signed the Nile Cooperation Framework, whilst Cairo and Khartoum had demurred. Ethiopia’s Grand Millennium Dam project on the Blue Nile is also a source of some tension. A wider concern is that Egypt’s foreign relations in the Greater Horn of Africa under President Mohammed Morsi will adopt a more Islamist approach, aligning interests in Sudan, Somalia and Egypt with Muslim communities in Ethiopia,” says the report.
It adds: “There are many in the Ethiopian establishment who fear a Muslim Brotherhood-led Egypt is capable of exploiting simmering tensions between Ethiopia’s government and its large Muslim population (officially about 30 per cent of the population).”
The study further points out that the Ethiopian military has played a significant regional role in Somalia, Sudan, Rwanda, Burundi and Liberia. Ethiopia’s regional role has increased particularly after forging a strong alliance with the U.S. in the ‘War on Terror’ and currently the Ethiopian military controls a number of key strategic areas in south-central Somalia. Ethiopia has for many years been deeply involved in Somalia and will continue to be the most important foreign country determining the future of various processes to strengthen the country’s security and governance.
In fact, a contingent of Ethiopians troops is also based near the troubled border of Abyei between the Sudan and the Republic of South Sudan under a United Nations mandate. “This is testament to the respect Meles commanded in both Khartoum and Juba, navigating the complex politics of peace negotiations between the two countries and supporting African Union negotiations under Thabo Mbeki, which culminated in a partial agreement in late September to create a demilitarised zone and resume oil exports,” the study notes.
Paying tribute to the deceased Ethiopian leader, the authors of the report emphasize that Meles championed regional economic integration and was deeply engaged in the Lamu-South Sudan-Ethiopia Transport project (LAPSSET) as well as several hydroelectric schemes under which Ethiopia sought to position itself as a regional energy exporter. Work was completed in March 2012 on a new 296km transmission line between Ethiopia and Sudan and Ethiopia will provide Sudan with up to 100mw of power. Electricity is also being exported to Djibouti and there are hopes to export to Kenya as well.
“While Meles’ death creates new complications in existing relations, it will not upset these processes, which are likely to intensify and strengthen the economy in the long term, steering the trade sector away from an over-dependence on agricultural exports,” says the report striking an optimistic note.
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