Anchor of stability


The German Ambassador to Ethiopia, Lieselore Cyrus, speaks on a wide range of issues and referred to Ethiopia as an anchor of stability in an exclusive interview with Capital’s Pawlos Belete. She also spoke about horn politics, the euro zone crisis and, above all, the bilateral relations between the two countries.

Capital: Can you tell us how you became a diplomat?
Lieselore Cyrus:
I joined the diplomatic service of Germany in 1981. By profession, I am a Psychologist. But at a certain point in time, I thought that I should do something in cross-cultural areas and thus I submitted my application. I entered the diplomatic service, not only because I am interested in intercultural interaction, but also because I am interested in political issues. I believe I have combined the two together. Since politics is the creation of human beings, every human being interacts according to social, political and cultural norms. 
Capital: When and how was diplomatic relations between Ethiopia and Germany established?
We officially started diplomatic relations in 1905. It all started with the first German Archeological Mission to Ethiopia which came to the Northern part of the country for excavation purposes, but socio-cultural relations date back to the 17th century. Since then, we have a long standing and friendly relationship that is deepening through the course of time.

Capital: Do you think that the more than a century old diplomatic relations between the two countries is that strong in terms of investment?
Germany’s bilateral relations with Ethiopia have many pillars. It has political, economic, social and humanitarian pillars. I am confident that the foundations these pillars are built on are quite solid. Of course there are rooms for further improvement which can be achieved through high ranking political dialogue. The political dialogue has been intensifying over the years. If you look back over the years, you will understand that. Whenever, a high ranking political delegation comes to Ethiopia, we had a regular meeting with the Prime Minister, Minister of Foreign Affairs and other relevant ministries. We are also planning for high ranking political dialogue between the two countries in a bid to further strengthen our bilateral ties. The economic pillar is very important but it isn’t as strong as it should be. In terms of Foreign Direct Investment (FDI), German companies are waiting for the right moment to make investments. This is because our economy is mainly based on middle-sized businesses which are very cautious when they assess investment risks, but still I think we can improve the FDI flow from Germany to Ethiopia. Presently, we are trying to encourage German companies to come to Ethiopia and invest. But in regards to Ethiopian goods export to Germany, we still are the largest importer of Ethiopian coffee, importing more than 30 percent of Ethiopian export coffee. We, in turn, export technical and mechanical equipment like machines to Ethiopia. Another important pillar to our bilateral relations is cooperation. In many ways and in terms of priority, Ethiopia is an important partner for Germany. We have signed a three-year cooperation agreement in 2011. It focuses on sustainable land management and education. Education is our main focus area since it is the building block for development. We are also involved in the area of quality management. These are important pillars for our bilateral engagement. All in all, in 2011 and 2012, we have offered 150 million Euros to Ethiopia apart from the three-year program we have signed. We also have an agreement and work on humanitarian issues. And for sure we have a very strong cultural pillar. We have celebrated the 50th anniversary of the German cultural center in Ethiopia, Goethe institute, and the 40th anniversary of the German Church School in Ethiopia. These are the most relevant and important cultural projects run by Germans. In addition, we have an archeological project office at Axum University. Actually, we have a very longstanding and friendly relationship in the academic field with Ethiopia where we have more than 100 university cooperation programs that are running. I believe that such programs in the academic and research areas are burgeoning and continue to do so, starting from over the last four to six decades.
I would like to stress that the German Cultural Center, Goethe Institute, deals with cultural aspects of our relations and the German Church School concerns itself primarily with education. Therefore, they are separate entities. This is what our relationship with Ethiopia looks like in a nutshell.
Capital: As you know, one of the fascinating areas in which tangible change is being observed in the present day Ethiopia is its economic success story. The Chinese, the Indians and the Turkish are investing in Ethiopia in a bid to reap the benefits of an emerging economy. According to my observations, it is a well known fact that Germany is the economic powerhouse of the European economy. In general, you have mentioned some of the reasons why German companies are at present cautious in investing in Ethiopia. Can you please elaborate further on the reasons why don’t we see much development of such economic ties, in terms of foreign direct investment, from Germany? 
There is a certain interest from German companies, but as I tried to explain earlier on, the backbone of the German economy are the Small and Medium Enterprise companies. They conduct meticulous risk assessment before committing to any kind of investment. I agree that Ethiopia is a country that has huge economic potential. Unfortunately, compared to other markets, the conditions are not yet favorable for our small and medium business enterprises. They are exploring other economies where they do better business. I believe, together, we have our work cut out for us in order to convince them that conditions are favourable for investment. The Ethiopian government needs to market Ethiopia in that respect as well. It needs to provide all the necessary information they require and explain in detail the favorable conditions here in a bid to attract German investors. We at the embassy also explain the conditions that exist as we have a continual interest in informing potential investors about the possibilities this country has to offer.
Capital: Can you explain what you mean by favorable conditions?
For sure, Ethiopia is a huge market and worth looking into a little bit deeper. As a point in fact, the labor cost in Ethiopia is fairly low. There are some attractive offers made by the government for investors to come, but if you look a little bit more into the details, you see, for example, a shortage in foreign currency which makes it difficult to import the necessary goods for production. Now, we have the congestion problem at the Port of Djibouti. Such a problem with the multimodal system is something small and medium size investors cannot afford. Such investors need very clear and reliable conditions regarding the availability of foreign currency and import of necessary goods for operations to run smoothly. One stop service is a very important thing for any starting investment venture. We are quite confident that the situation will improve. As you might have heard, we have set up a European Business Forum where grievances could be put forward collectively as one voice to the respective authorities. We, the European Business Forum as well as other interested parties had a meeting with the Prime Minister. He was very open minded and listened to all the grievances and promised to look into them. So things are moving forward; therefore, I am fairly confident that conditions might improve fairly soon.
Capital: What is your impression or take on the political cooperation between Germany and Ethiopia, in terms of regional and international issues?
Ethiopia is a strategic partner not only for Germany but also for the European Union (EU) as a whole, because of its strategic location in the Horn of Africa. It is the anchor of stability in the region. If you look around at neighbors of Ethiopia like the Sudan, Eritrea and Somalia, they are nations that are still struggling for stability. Therefore Ethiopia, for us, is an important and reliable partner in providing and keeping regional stability. Thus, political dialogue with Ethiopia is most important and we have a very open dialogue. If you remember last month’s news where the EU had discussions with the Prime Minister, we touched upon regional issues and what Ethiopia can do and what our approach should be. That is how we cooperate both on regional and international issues. 
Capital: You were asking when Ethiopian forces might withdraw from Somalia at a briefing given by the  State Minister of Foreign Affairs, Birhane Gebrekristos, on Somalia. Why were you so curious about the withdrawal of Ethiopian troops from Somalia?
If you are referring to the briefing at the Foreign Ministry about Intergovernmental Authority for Development (IGAD) on Somalia, it is certain that Somalia has got a window of opportunity to stabilize itself. Now, they have a new president and government which is legitimate. We have to do everything as part of the international community. Somalia’s neighbors are helping it to take ownership of its own affairs. Ethiopia is a strong partner to Somalia in stabilizing the Somali political crisis. In regards to stabilizing military measures, it is an issue of how far the tension in Somalia will reduce and calm down. There is the issue of arms embargo, will it be lifted fully, partly or not at all. This is an issue that will be discussed with the Security Council in the future. Thus, I am not in a position to talk about it now. This is an issue that will be addressed after this month or a little bit after the African Union assembly, I think. Later, the United Nations will release a report on arms on foreign lands and the situation in Somalia. That is what I can say at this point in time.
Capital: What about the situation of the two Sudan’s?
The situation is very difficult. I think the African Union has shown commendable leadership in pushing both partners to negotiations. I think everybody was very happy that at the end of September both sides signed an agreement. Now, we are in a difficult situation because the principle is that nothing is agreed until everything is agreed. That has the potential to cast doubt over the past achievement. The political leadership in both countries has to push for common and lasting peace. Both the South and the North, I think can push forward the negotiation. I am very much hopeful that Ethiopia will continue to play the important role it has been playing in helping both sides to come together to solve their difference through political dialogue.
Capital: The other country in the spotlight whenever one discusses issues related to horn politics is Eritrea. What can you say about the political situation of Eritrea in relation to Ethiopia?    
Ethiopia and Eritrea are living in a kind of cold peace, the Ethiopian Prime Minister, Hailemariam Desalegn, has called the political administration of Asmara to a roundtable dialogue. He even expressed his willingness to go to Asmara if that is what it takes to have a lasting peace. Germany as well as the European Union is devoted to come together and talk about the outstanding issues between the two countries. The European Union Special representative of the Horn of Africa is travelling in the region, if the European Union could contribute to the peace process, it will be happy to do so.
Capital: What can you say about the cause of the financial crisis in Europe?
You cannot just explain the core of the problem in one sentence. One very serious issue is that all of us spent more money than we earned or produced. We made our country dependent on the banking system. Therefore, all the countries have now become hugely over indebted. We have to answer through an economic reform process because our economies are no longer competitive. If we have a strong and competitive Europe, then you have to orient yourself not to the weakest partner but try to find a way to find the best possible solution. Without the global  economic exchange and without a competitive economy, you will weaken your position. We have to be able to compete with emerging economies like China. That is our homework.  
Capital: How does Germany turns out to be the strongest nation to bail out countries heavily hit by the crisis?
If you look ten years back, Germany was considered to be the laying duck of the European economy. Everybody complained about Germany because our economy was no longer competitive and everybody pushed us to do something. It started with a very painful reform process. Germany is known for its social welfare. We had to introduce a very painful cut into the welfare system. I remember at that time, every Monday we had a demonstration in Berlin against the reform. The reform we had introduced ten years ago regained its dynamics and pulled out of that crisis. The second aspect is like everybody in Europe, we spent more money than we had. So we introduced a law that limits debt. This is one of the major issues now. The process we started earlier than others saved our economy today.