COMPARING APPLES AND ORANGES

By Mathza, 08/30/10

 

This piece is a reaction to Ephrem Madebo’s Oh! Ethiopia - 10% Growth and 90% Poverty (nazret.com, 08/06/10).

 

The article starts by the following quotation purported to have been said by an anonymous peasant: "But the OPDO development is - development and repression at the same time. They can build roads to the moon but I won't vote for them until we're equal." It is doubtful that a peasant uttered such statements. If anything it implies that the author is disingenuous. That the article is inundated with the usual lies, fabrications, exaggerations, spinning, etc. confirms my assumption. This piece is limited to the part comparing Ethiopia with other African countries.

 

Like his likes, the author compares Ethiopia with other African countries, particularly Ghana in this case. Such comparisons are inappropriate for a number of reasons. These include:

1.    Ghana inherited a modern government system of administration that was established by colonial Britain. All the Ghanaian governments had to do was to introduce some changes to suit the needs created by the new situation.

2.    Ghana was and is a peaceful and stable country.

3.    Ghana was and is fortunate not to have experienced/experiencing recurring natural disasters.

4.    Ghana inherited hundreds of millions of British Pounds when it became independent.

 

1. Administrative system

The situation pertaining to Ethiopia was just the reverse of that of Ghana. There was no ready-made modern system of governance. There were no Ethiopians with exposure to and experiences in modern administration. Ethiopia, therefore, had to start from scratch and go through the agonizingly slow process of change. Government services provided to the public until recently was awkwardly complicated, time consuming and wide open for corruption. The highly successful administrative improvement recently introduced and being introduced through business process re-engineering (BPR) confirms this fact. Thanks to BPR, providing government services that used to take years, months are now done in days, hours and minutes, depending upon the case. Regarding providing services to business, according to Newsweek magazine—which ranks Ethiopia 107 of 183 countries on ease of doing business—it takes nine days to start a new business. The profusion of praise by the public is unequivocal proof of these dramatic changes.

 

As Ghana, or any African country for that matter, Ethiopia has multiple cultures and traditions that have both negative and positive aspects. The negative side that included peoples’ wrong attitude to work coupled with resistance to change hampered the adoption of appropriate methods of governance and therefore progress. The attitude of pregnant women in the countryside is a good example. According to UNIRIN (VOA, 8/19/10) an interview with such women revealed that they have more confidence on the traditional midwives than on the trained midwives.

 

There was a time when parents refused to send their children to modern schools. Under the circumstances, it took a long time to change the attitude of the people to modern education. Building modern schools and producing teachers was a slow process. In the 1940s there were a handful of schools in the country. The first college was opened in the 1950s. It was for quite some time graduating students in the tens, not in the hundreds. It is apparent that there was a dearth of graduates at the tertiary level until recently. This was made worse by lack of peace, which caused exodus of the educated.

 

2. Peace and stability

Peace is a critical prerequisite for good governance and development as well as for attracting foreign investment. Unfortunately, Ethiopia, unlike Ghana, was a victim of internal conflicts and external aggressions. The period comprising the second half of the 18th century and the first half of the 19th century was known as Zemene Mesafint when the warlords fought one another. Although Emperor Tewodros II ended this era his rule was not, unfortunately, that peaceful. Emperor Yohannes IV was totally engaged defending the country from many foreign aggressions and occupations of Ethiopian territories by the Turks, Egyptians, Italians and Mahdists of Sudan. Emperor Menelik II was preoccupied with extending his empire and fighting the Italian invaders. There was relative peace for part of the long rule of Emperor Haile Sellassie I. It was punctuated by uprisings in parts of the country and fighting the Eritrean liberation fronts and Somali aggression. The Mengistu regime was mired in the so-called red terror, in fighting liberation fronts and in defending Somali invasion.

 

In addition to skirmishes with liberation fronts the EPRDF government had to ward the Eritrean aggression off. It responded to the Somali government for military help and to threats from Somali extreme elements who declared jihad on Ethiopia. During the first half of its administration the government was preoccupied bringing peace and stability, introducing and implementing unity in diversity (federal structure) that saved the country from disintegration, renovating damaged infrastructures, reversing the communist economic system, liberalizing trade and investment, planning and implementing social and economic activities, etc. It is obvious that there is no country in Africa that had had to face peace and stability related complex conditions not conducive for development spanning over two centuries.

 

3. Natural calamities

The natural calamities that devastated Ethiopia are known worldwide. Recurring drought with increasing frequencies was/is the most devastating. This state of affairs coupled with high rate of population increase (population doubling during the rule of the current government) is the root cause of poverty of the people, especially in the countryside where about 85% of them lives. This is, among other reasons, why the government accorded the highest priority to eradication of poverty.   

 

4. Resources

The colonial powers in Africa carried out researches, surveys, explorations, prospecting, etc. to find and exploit raw materials to feed their industries. By the time African countries got independence, most of them had agricultural products and minerals that earned them foreign currency. Ghana, for instance, had a huge foreign currency reserve in the hundreds (about 600) of millions of British Pounds. Ethiopia had practically nothing to export, both agricultural and mineral, excepting coffee and gold, albeit earning relatively small foreign currency. Unlike other African countries its resources were, therefore, unknown for the simple reason that nothing was done to determine its potential. It, therefore, lacked the resources it needed to develop.

 

Based on the above impediments it is crystal clear that the author has compared oranges with apples.  Three of the six indicators he presented as “evidence gathered by independent organizations” to prove his point demonstrate that Ethiopia has shown progress whereas Ghana stagnated. These that he ignored relate to government effectiveness, regulatory quality and rule of law, evidently, important indicators.

 

As for rates of economic growth highlighted in the title of his article in which Ghana trails behind Ethiopia, the author claims Ethiopia’s is not real growth rate. My understanding as a non-economist is that real growth takes into account inflation. If this is true then with the high to very high inflation the country experienced the real rate of growth should have been negative and not “much lower rate” (than the double-digit) the author claims. Besides his assertion implies that the Ethiopian and Ghanaian figures in his table represent normal (not adjusted for inflation) and real growth rates respectively. In other words, he is telling us that his source of information (CIA World Face Book) is responsible for such unprofessional blunder.

 

The author repeats what his likes have been saying ad nausea, i.e., the double-digit growth rate did not translate into poverty reduction. Of course it did unless they mean 100% reduction that is not possible even in developed economies. Donor countries and international organizations testify to the poverty reduction and predict that Ethiopia is likely to reach the United Nations Millennium Development Goals by 2015. The latest affirmation comes from the IMF Resident Representative in Ethiopia. “The lifestyle of the people is getting better as compared to the past decades” is one among his several expressions praising the fast economic growth in Ethiopia.

 

Let me quote myself in support of the above fact: “Another factor indicative of the relative well being of an increasing number of people is the reduction of the number of people below the poverty line. Despite population pressure, the level of poverty fell from 59% during the 1990s to 38.7% in 2005 (United Nations and the World Bank). As this happened before the fast economic growth started it is quite likely that the level is substantially lower at present. In fact, according to Mr. Wondimu Asamnew, Charge d'affair, Ethiopian Embassy in DC, it now stands at 27%. (UNBELIEVABLE DENIALS AND IMPRACTICAL PROMISES By Mathza, May 10, 2010.)  (more in  http://www.waltainfo.com/index.php?option=com_content&task=view&id=21409&Itemid=82). According to another source, in 1995, 61 percent of the population was below the poverty line meaning people survived on $1.25 or less a day. This figure had already declined to 39 percent by 2007 and has continued to decline.

 

The author and his likes deny the authenticity of statistical figures on Ethiopia when it is not to their liking; they are quick to accept and exalt figures from the same or other sources that paint dismal pictures of Ethiopia. The latest example that is being quoted left and right is Ethiopia is the second poorest country in the world, according to the Oxford University’s new Multidimensional Poverty Index (MPI). The author tells us the MPI is a replacement for the United Nations Human Poverty Index (HPI). Has the United Nations representing the world community announced its adoption? I am not aware that this is so.

 

Let us anyway assume this is true. Why do such Diaspora Ethiopians pretend to be shocked to hear such news when they are very aware of the obstacles reviewed above? Why do they ascribe the abject poverty and backwardness of Ethiopia to the EPRDF government? Is it not such pathetic situation that lead the EPRDF government to declare poverty the number one enemy of the Ethiopian people?

 

It should be noted here that the MPI for Ethiopia is based on 2005 data that the author did not dare to reveal. In view of the double-digit growth starting in 2004 it is not likely that the ranking reflects the current situation. In fact, the successes achieved in education and health, two of the same three components of the MPI and HPI since 2005 must have catapulted the Ethiopian MPI ranking to a substantially higher level. There is no doubt that the improved standard of living (the third component) of a segment of the population has contributed to this as well.

 

Let us now look at other recent rankings. According to recent issue of Newsweek magazine, “Ethiopia ranks as the 94th…in the World's 100 best countries list.” The ranking is, among others factors, based on “quality of life, economic dynamism, education, health care, transparency and political environment.” It is apparent that Newsweek contradicts the MPI despite the fact that both the MPI and HPI seem to have used a number of the same factors for their rankings. It is possible that the Newsweek ranking is based on more recent data. Another ranking relates to World's Happiest Countries. A Gallup World Poll conducted in 2005-2009 in 155 countries ranks Ethiopia 108th. This, by the way, manifests the  good will of the people towards the EPRDF resulting in its landslide victory in the last elections.

 

Another argument the author resorted to is that the “economic growth was achieved at the cost of greater inequality” Now, that he inadvertently admits that there was economic growth of such magnitude, how did this growth come about? Growth implies expanding demand for products and services. Difficulty keeping pace with demand for electricity and telecommunication services and acute shortages of sugar and cement in the country as well as increasing transport inadequacy in Addis Ababa—all resulting from dramatic development (see video on Addis in 24 hours)—come to mind. These show that the number of Ethiopians who can afford to buy goods and services is increasing at a fast rate. In other words, more and more people are finding their standard of living improving. As a result, both local and foreign investors have been and are investing to take advantage of very fast growing demand for products and services. One could have an idea of the magnitude of flows of foreign direct investment by referring to Turkish investors. According to the Turkish Ambassador to Ethiopia—who finds “Ethiopia’s economic growth is very impressive for sure”—Turkish investors are currently implementing 149 projects with an investment outlay of US$819 millions.

 

It is obvious from the above four adverse conditions that comparing Ethiopia with Ghana is like comparing apples and oranges. It is sad and nauseating on the part of the author and the hate-monger miniscule vociferous Diaspora Ethiopians who day in day out would say, write and do anything to tarnish the image of Ethiopia and Ethiopians. They have the audacity not only to endlessly repeat negative information on Ethiopia no matter its origin (including theirs), authenticity or relevancy but also to side with foreign countries and groups working against Ethiopia. Why? The main reason is obsessive selfish desire to reverse the federal system to their dream of nostalgic unitary rule with them at the helm. It is futile. As in the past, the only result of their subversive activities, including begging donors to deny aid to Ethiopia, may, perhaps, temporarily slow down progress in peace, good governance and development. No wonder, the Ethiopian people whom they continue to humiliate held them responsible for such traitorous behavior and acts by overwhelmingly denying their votes in the recent elections.