Anchoring Growth In Peace, Rule Of Law

As he is wont to do whenever he speaks of his administration’s performance, Prime Minister Abiy Ahmed (PhD) painted a rosy picture of the Ethiopian economy this week during his defense of the speech delivered by President Taye Atskeselassie at the joint session of House of Peoples’ Representatives and the House of the Federation on October 7, 2024. Addressing lawmakers’ questions raised to him regarding the economy, the premiere said Ethiopia’s GDP grew by 8.1 percent in the 2023-2024 fiscal year, describing the rate as one of the fastest in the world. His projection for the 2024-2025 fiscal year comes in at 8.4 percent, with the agriculture, industry and service sectors anticipated to register a 6.1 percent, 12.8 percent and 7.2 percent growth, respectively, as compared to the previous year.  Citing expected surges across various indicators in these sectors as well as the tripling of export revenues in the first quarter of the current fiscal year, the Prime Minister claimed the actual growth could be in excess of the target his administration has set.  While time will tell if the figures he bandied about are grounded in reality, he did not go in detail into how his administration plans to do about the factors that are fundamental to creating an enabling environment for sustainable economic growth.

Ethiopia, a nation with a rich tapestry of cultural heritage and historical significance, has been facing numerous challenges over the past several decades. The complexities of ethnic diversity, socio-political tensions, and economic disparities have contributed to an atmosphere that often hinders national progress. Central to Ethiopia’s prospects for economic development are two critical pillars: peace and the rule of law. Both concepts—interconnected yet distinct—play a vital role in achieving the kind of growth and prosperity the Prime Minister and his ruling Prosperity Party assure Ethiopians they will. Without them the vast majority of Ethiopians living in abject poverty cannot hope to lead a better life.

Although Prime Minister Abiy commenced his tenure with the introduction of a series of reforms that garnered widespread approval, namely the release of political prisoners, the return of exiled opposition leaders, and the repeal of oppressive laws that restricted the full exercise of constitutionally protected rights, it did not long for the gains to be rolled back.  Ethiopia has faced significant challenges over the past six –and-half years since he has been in office, with the most severe being the outbreak of conflicts and a seemingly unending wave of violence that have devastated and continue to all regions of the country. This has led to the deaths of hundreds of thousands and the displacement of millions, many of whom are left with deep psychological scars. This period has also been characterized by a disturbing frequency of egregious violations of fundamental rights, including acts of torture, ransom abductions, forced disappearances, and unjust restrictions on freedom of movement at the hands of both state and non-state actors. Numerous politicians, journalists, and ordinary citizens have been imprisoned on questionable legal grounds, with due process rights frequently disregarded. Additionally, rampant corruption, nepotism, and other forms of bad governance have persisted on the present government’s watch, coupled with a failure to take decisive action against those responsible for this deplorable state of things.

Despite the adoption of the government’s much-touted homegrown economic reform program, Ethiopia’s economic performance has been a mixed bag due primarily to the absence of conditions that help ensure the prevalence of peace and the rule of law.  As a result, the economy has continued to be beset by such critical issues, including persistent unemployment, an overwhelming burden of both domestic and foreign debt, a dramatic increase in inflation rates, an expanding trade deficit, and a swift devaluation of the local currency, leading to reduced real income. Additionally, there is a consistently high demand for emergency aid due to both natural and human-induced disasters, a failure to attain food security despite the presence of extensive arable land and significant water resources, and a fragile manufacturing sector that struggles to replace imported capital goods and food products. It’s a miracle that the economy has stayed afloat amidst these crippling challenges.

Peace and the rule of law are not isolated concepts; they are interdependent and mutually reinforcing in the context of economic development. Instability undermines the rule of law, while weak legal systems exacerbate tensions and conflict. Ethiopia may break the cycle of violence and poverty it’s mired in if all stakeholders—most of all the government—implement strategies that help usher in an era of peace and respect for the rule of law. Accordingly, if the government prioritizes these foundational pillars, Ethiopia can build a prosperous future that leverages its rich cultural heritage and resources, ultimately improving the quality of life for its citizens. The commitment to fostering peace and upholding the rule of law will not only enhance economic opportunities, but also secures a stable and equitable society for generations to come.