Governments in peruse to earn Foreign exchange subsidize the cost of production and services to the benefit of the urban élites, set the stage for official corruption at any cost. We believe that, it is one of the major reasons African countries became a primary commodity exporters on the expenses of the producers and service providers resulting in the long overdue lack of the indigenous economic reform. The following paragraphs argue the problem of government’s subsidizing one area of services at the cost of national long term interest. As coffee commodity, the celebrated Ethiopian Airline (EAL) is another cash cow for the Ethiopian regime. Since its birth, the EAL like many of the public institutions that generate lots of hard cash has been serving the authoritarian regimes we are fated to be ruled under. If one observes carefully everything the current regime does, be it operating EAL, entreating the donors, export of cash crops, luring the Diaspora for investment or receiving remittance...etc. has been in search of hard currency, but nothing to do with the wellbeing of Ethiopians.
Not long ago, the CEO of the Airline was on the media telling us how he is running the Airlines to profitability…. won award and all. Off-course, he cannot talk about the highly subsidized operational cost of the Airline such as the free rent and airport services. Given Foreign Minister Seyoum Mesfin of TPLF is his boss as the chairman of the Board of Director of the Airline; the CEO’s comment is not surprising. It would be politically incorrect even may be deadly for the CEO to mention any truth to the operation of the Airline and the subsidy it receive from the government.
What is relevant and out of the ordinary about the Airline is that, even though it provides services to the public; it is owned and highly subsidized by the government without much competition just because it earns hard currency. Furthermore, no one actually knows where the generated revenue goes and who is accountable to the tax payers due to lack of independent oversight.
In terms of revenue, we have been hearing recently the Airline has made record profits. Such report was uttered by the CEO through the government media and by other Medias parroting the same source. Since the CEO is working for the regime and the source of the news is also the regime itself without independent media to verify, it could be a cheery-pick report. Strangely, the supposedly independent press in the country is mimicking the same source without being aware what the source meant by profit.
Here is where it gets humorous; the ‘profitable’ airline practically does not pay rent for the 100s of offices it ‘rents’ in the country. It merely pays a ‘symbolic’ rent for the government run Housing Authority that holds on to thousands of properties confiscated from private citizens during the brutal Derg regime on the bases of Marxist revolution…the exploiters…, Ethiopia Tekdim and all.
We know for fact, there are half a dozen offices in the center of town the Airline rents for less than 1000 birr per month from the Housing Authorities. It is unthinkable in the world of business that, a commercial Airline paying an equivalent of less than 100 us dollar to rent an office space in a commercial district of an urban center anywhere but only in Ethiopia whose slogan is drummed “Abiyotawi democracy…progress…free market and record profits”…,etc. If profit making was so much easy as it is claimed (one can pay practically no rent to run an Airline and claim to make a record profit) then, everyone would have started an airline business. Actually, according to the regime’s law no one can operate an Airline business in Ethiopia but the regime let alone not pay rent.
What is oxymoronic is that, the property the regime holds to subsidize the Airline – not to pay the appropriate rent belongs to someone who probably spent all his/her lifesaving to build it. But the regime feels it can rent it low to an Airline who made millions of dollar (not birr) ‘record’ profits. What is new in “Abiyotawi democracy” and its version of free market is that, it is free market only to the regime and its affiliate.
In terms of others, how many subsidized rent the regime offers to keep its extortion going? We do not know. But we have discovered an owner of a busy café who pays a mere 500 birr rent per month and turn around to built a six story building and rent it for thousands of dollars per month to a foreign entity. That is what the regime calls free market…progresses…growth, etc.
There are also commercial and residential properties the regime rents to ‘selected’ few that pays so little rent. They spent more for electricity than they do for rent. Some people we encounter even fly first class on EAL paying birr to an overseas 'business' conference to lecture about investment opportunities in Ethiopia, and spent more money on a dinner than they do for a government subsidized rent they pay on their residence back home. Such practice is a slap on the face of the original owners, who have been told not to apply to recover their properties by some cooked-up technicalities of the regime’s making.
In such system political cronyism and corruption is a standard procedure to acquire a confiscated commercial and residential properties for dirt cheap rent and lease land for foreign investors for dollar. Even the gullible Diasporas are lured to invest in building their dream homes; justifying their ill deeds as it is good for progress…the ‘economy is growing rapidly…, etc.
For political consumptions, the above situations are hipped up as progressive events by the regime. The fact is, progress itself is a questionable proportion, and the question is who is progressing and at what cost? For example, we know some of the regime’s right hand-men live in the government confiscated villas practically for noting and build a villa of their own and rent it for thousands of dollars for foreigners (not birr). How about the regime affiliated businesses? Do they pay rent? Do they pay taxes? Do they even allow any one to compete with them? Is this Abiyotawi democracy at work? Going back to the EAL profit making, one cannot help but raise the question, why does the Airline get subsidy? This question itself can get one in trouble, but we can assume it is a cash-cow that generates hard currency for the regime.
There is much more about the dollar curse than any one can imagine. For instance, coffee export is one of the main one. Facilitated by the new established Commodity Exchange - the exchange, we were told was “to transform the agriculture market of the country for the benefit of the poor farmers”.
Coffee has always been the #1 foreign exchange earner for the country. The country exports the raw coffee through the many traditional private exporters outside the control of the ruling regimes. In the past the Coffee Board facilitated coffee export and coordinated its effort with the coffee exporter until the new commodity exchange came disguised as an agriculture commodity market reformer; shortly after it went out looking to control coffee and recently sesame seed (more to come) armed by the regime’s proclamation.
Another cash cow for the regime unknown to the average person is Sugar export. The few sugar producing companies still owned by the government has high ranking TPLF’s leader as the Board of Directors of the factories. For example, like the Ethiopian Airline Wonji is under Foreign Minister Seyoum Mesfin. What is even bizarre is Ethiopians pay an equivalent of five to ten times more for sugar produced in the country than the exported sugar that is sold in the international market for dollar. Accordingly, the regime made it illegal to sell “export designated sugar” in the local market as it is illegal to sell export designated coffee. What it means is dollar is what the regime seeks not birr. Incidentally, many merchants were jailed and lost their commodities for selling ‘export designated sugar’ in the local market in the past, just like coffee traders were not long ago. Thus, smuggling exported sugar back to the country became a profitable venture itself for many merchants because it is illegal to import sugar in the country.
Other areas the regime targets for foreign currency earning are selling Bonds to the Diaspora to ‘provide electricity in the rural Ethiopia’
In Ethiopia, everything leads to the appetite of the regime for hard currency regardless of the cost to the Ethiopian people. Even building dams is intended to do with dollar earning like ‘exporting electricity’ to Sudan and Kenya while the population is living in darkness. There is unprecedented compulsion to earn hard currency on the expenses of the indigenous economy.
In conclusion, there is a lesson to be learned by all; in peruse of dollar there is a lots of ill gained wealth through corruption and cronyism by the regime’s affiliates and others. This ill gained wealth must be tracked, confiscated, and returned for the people of Ethiopia. And those who are involved in corruption must be punished and shamed. To accomplish such accountability for the sake of the Ethiopian people; political parties, civic societies, religious institutions and the independent media must create a coalition and establish an institution that demands the rule of law for good governance.
It must be recognized that, the root causes of poverty, underdevelopment and the associated tyranny and absence of freedom are directly related with corruption of officials and business that are sustained by colliding with the officials. Therefore, we urge Ethiopian intellectuals to come forward to lead and challenge their peers who are involved in corruption, and the so called ‘businesses’ who collide with the regime on the expenses of Ethiopians and make them accountable for conspiring to be part of the elaborate crime of corruptions against the Ethiopian people.
Independent media and civic institutions must investigate individuals and their affiliate’s who facilitate corruption and expose the responsible persons. At the Individual level, Ethiopians must demand transparency and make sure not to get involved in corruption for short term benefits. Transparency at all level of governance is a must to free the Ethiopian people, and for good governance to flourish and move forward.
