Promoting Stability and Development in Africa: How to Foster Cooperation between Public and Private Sectors

(Mehari Taddele Maru and Abel Abate Demise)

During his meeting last year with Prime Minister Haile-Mariam Desalegn of Ethiopia, President Barack Obama pointed out the enormous progress in a country that once had great difficulty feeding itself. It’s now not only leading the pack in terms of agricultural production in the region, but will soon be an exporter potentially not just of agriculture, but also power because of the development that’s been taking place there (White House 2014).

Referring to Ethiopia’s economic performance as “one of the fastest growing economies in the world,” he dubbed the country as exemplary of the “bright spots and progress” in Africa. Recent promising mega trends in economic growth and relative stability in the region, coupled with an expansion of both middle class and market fueled by a fast growing population have created a surge of interest in trade and opportunity for investment.

Both internal and external factors and driving forces will have significant bearing on Ethiopia’s future peace and development and thus its regional integrative and security role. Although successful in dismantling the old unitary State of Ethiopia, the EPRDF is still struggling for a clear vision around which Ethiopia and its diverse people can rally.

Dominating the political space for two decades, the EPRDF has been striving to build a new federal developmental State. What is more, the country’s recent successes have come with a price.

Public-investment driven growth has marginalised the role of the private sector in the national economy, reducing the space for innovation and entrepreneurship required for a globally competitive economy, and for sustainable productivity-based growth. And while Ethiopia’s growth trajectory has auspiciously avoided increase in inequality, inflation – particularly food inflation – has been among the highest in Africa. The opening of opportunities for education, especially higher education, has not been met with job opportunities for a better educated youth.

From 1995 to 2009, total primary school enrolment rose by a staggering 500 percent (from 3 million to 15.5 million) (Engel and Rose 2011:7). The ripple effects of rapid mass-ification at the elementary level are felt at higher levels of education and vocational training, bringing immense challenges to educational quality and employment opportunities that match the numbers and skills of graduates.

Despite the existence of comprehensive legislative and institutional frameworks, corruption also remains an invasive social ill that could undermine Ethiopia’s development (Transparency Ethiopia 2009).

Infrastructure development, land administration, procurement, judiciary, enforcement and other organs of the State and government are the most corrupted (Tsegaye 2012). Rent seeking in the form of nepotism and corruption has been identified by the ruling party EPRDF as a grave internal challenge to the party and the Ethiopian political system.

However, given that constitutional accountability is weak under the dominant party, and the only existing accountability is intra-party, the EPRDF may not be able to combat corruption effectively.

To put it under control, corruption will require a cutthroat struggle. If not combated swiftly and effectively, corruption could easily become the most fatal political gangrene for the legitimacy of the ruling party.

In spite of all the country’s progress (World Bank 2015), extreme poverty will remain Ethiopia’s main source of threat to peace and security for decades to come.

Looking into the future, the main challenge will be maintaining the pace of transformation by scaling up and deepening reform. So far the main drivers of economic growth have been public sector investment and public service reforms. Both have their limits in terms of bringing about economic transformation.

With high population growth and demand for consumable goods, Ethiopia will be even more dependent on the security of its neighboring countries with access to the sea. Peace and security in the region will become increasingly intertwined as Ethiopia’s population and economy surge, and demand for consumption increases. The private sector will be vital in contributing towards bringing this transformation.

Regional priorities in the area of peace and security are: (1) common transnational threats to peace and security such as terrorism and piracy; (2) troubled neighbourhood due to State failure or poorly performing States; (3) nation-building based on animosity; (4) secessionist movements; and (5) rivalry surrounding geopolitical issues such as access to the sea and secure port services, including the security of trade and oil supply routes.

Ethiopia has shipping lines that are vulnerable to piracy. Any threat to Ethiopia’s secure access to the sea and port services will gravely endanger the peace and security not only of Ethiopia but also of the region.

The external context, particularly in the neighbourhood and the Nile riparian countries (especially in Egypt), will have a significant influence on Ethiopia’s future peace and development. These developments will determine whether the promising mega-trends in economic growth and relative stability in the region will continue.

Coupled with the expected expansion of the middle class (Heeralall and Ben Abdelkrim 2012) and a market fuelled by a fast growing population, Ethiopia’s role in regional integration and security will create a surge of interest in trade and opportunity for investment.

In regional diplomacy and integration, Ethiopia’s pivotal role within the IGAD and to a significant extent in the AU will continue to grow.

This paper has discussed the following six factors as the basis for Ethiopia’s contribution towards internal and regional stability and integrative development:

(1) Ethiopia’s inward-looking foreign and national security policy and efforts to address longstanding internal political instability and extreme poverty;

(2) Ethiopia’s recent promising economic performance, which offers hope for its people and attracts aid, trade and investment;

(3) Ethiopia’s military strength and role in regional peace and security;

(4) Ethiopia’s trusted mediator role in IGAD and at the AU level;

(5) Ethiopia’s role in combating terrorism and its strong counterterrorism capabilities; and

(6) A Pan-Africanist historical legacy and Ethiopia’s increased and effective use of multilateral platforms.

On a global level, Ethiopia’s overlapping interests with dominant and emerging powers such as the US, the EU, China and India, its geographic location, and traditionally strong military create demands for long-term partnership and alliance. International actors including the UN, EU, US, China and others actively endorse Ethiopia’s role in the IGAD region.

Ethiopia carries significant clout in IGAD decisions, AU endorsements and interventions, and the UNSC resolutions with regard to the region. The US, EU and China are in close consultation with Ethiopia on issues related to Sudan, South Sudan, Somalia and even Eritrea.

Read the full paper, entitled “Promoting Stability and Development in Africa: How to Foster Cooperation between Public and Private Sectors” at Istituto Affari Internazionali (IAI).

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* Mehari Taddele Maru, Lead Member of the African Union High Advisory Group, Chief Strategist of IGAD, International Consultant.

* Abel Abate Demissie, Senior Researcher, Ethiopian International Institute for Peace and Development (EIIPD).