During a recent panel discussion organized by the Addis Ababa Chamber of Commerce and Sectoral Association (AACCSA) at Hilton Hotel economic experts said unless significant reform takes place, including restructuring the National Bank of Ethiopia (NBE), Ethiopia’s economic growth and progress will be hindered and a recession may occur.
Alemayehu Geda (Prof), Kebour Ghenna, Eyob Tesfaye (PhD), and Seid Nuru (PhD) expressed concerns about the country’s economic situation and the process being implemented to privatize state owned enterprises. Meanwhile, economists, Alemayehu and Seid questioned the validity of economic statistics the government has used to claim Ethiopia’s economy has been consistently growing by double digits.
During their presentation the two economists argued that there is little empirical evidence to suggest the country did in fact register double digit economic growth. For example the government claims that poverty has declined, but they pointed to data indicating that 60% to 70% of the Ethiopian population is currently living below the poverty line. This differs from the government’s data which says only 22 percent of the population lived below the poverty line in 2016.
The panelists expressed fears that growth would stagnate followed by a recession if reforms did not take place soon.
“First a common consensus [about economic policy] between the government and public has to be reached,” Seid Nuru (PhD), from the Ethiopian Economists Association, said.
Eyob Tesfaye (PhD), a former senior economic official and expert in international organization, said the (NBE) should be reformed.
“Policies have to be changed and the finance sector needs comprehensive restructuring,” he added.
He added that a person with experience in commercial banking must be hired at the central bank (NBE). “The duty of the central bank is different from business,” he argued.
Others who spoke at the event said the developmental economy has not done enough to boost exports, which have declined to 4.4 percent of the GDP from 5.5 percent in the past.
The developmental economy has been exclusive, unequal and featured unemployment.
Another concern, in addition to declining exports is a widening balance of payment gap; (the overall record of all economic transactions of a country compared with the rest of the world).
Unemployment also remains high in the country. The government estimates a rate of 25 percent but Alehayemu says that figure is much higher especially when underemployment is taken into account.
“No country has grown without the private sector playing an active role,” Eyob said. He went on to say that we need to work together to create a private sector that can change the country.
Kebour countered, however that the government needs to play a significant role in transforming the economy. He said youth need to come together and sacrifice to build the state as occurred in China. Privatization of public enterprises is not advantageous for the country, he argued.
Eyob recommended that the government float shares internationally, while at the same time having the public be the complete owners of the enterprise. This has been done successfully in other countries with large companies.
The panel also wants a stronger focus on professionalism in all sectors. This would greatly improve economic performance, they said.
Finally they were unhappy about the recent 15 percent devaluation of the birr. The government did this partially to improve export earnings but they argued that without a surplus and competitive output there is no positive effect of the devaluation other than increasing the price of import items, which contributes to inflation.
Economists fear looming recession, calls for NBE restructure
Kassa Kebede joins the movement in Addis
Kassa Kebede (PhD), foreign policy chief during the Mengistu Hailemariam administration arrived in Addis Ababa following the new Prime Minister call for reconciliation. Kassa was greeted at Bole International Airport by Minister Ahmed Shide, Head of Government Communications Affairs Office and other officials.
More students fail law exit exam
The rate of law students who failed their exit exams trended upward this year.
Capital spoke with representatives at several universities including the University of Gondar (UoG) which has 85 candidates. They had six students fail which is five higher than the past year.
Jigjiga had a whopping 58% of their students fail and Sodo had 25% failure. Four percent failed at Hawassa, and 3.3% at Mekele. Areas where there is unrest appear to have the highest failure rates.
The regular student’s failure ratio reached 3% last year with an increase of the cumulative mark achieved, according to Seid B Mohamed who is a researcher at the Higher Education Strategic Center (HESC). Also, 74% non-regular students failed which has been a concerning issue for the government.
There were a record number of candidates this year, 4,005 students registered to take the exam and 37 lecturers participated in the evaluation.
The exam was given at the beginning of May which is a month later than normal.
“We prepared our students to take the exam at the normal time but the Ministry of Education (MoE) convinced us to extend it,” said Abebe Assefa, Dean of School of Law at UoG and the Chairman of the National Law schools Consortium (MLSC).
Students Capital talked with agreed with Abebe.
“We went to the externship program prior to taking the exam, but previously every law student would start preparing after the end of their fourth year until they take the exam then they will go out for an externship,” said a student.
Also, another student said that the change of schedule also frustrated him. “We missed different classes whenever there are protests and that is not only for the last year but also for the previous three years”.
Tadesse Tilaye and Gemede Banata were at the compound of National Education Assessment and Examinations Agency (NEAEA) to seek if there is any way to re-evaluate their exam.
Tadesse rationalized that the current year’s exam was taken with a month delay and he believes that teachers evaluated the exam in a rush.
“There is no law which allows the re-evaluation, and we are just an executive of different manuals issued by MLSC,” said Yosef Abera, Director at the Agency.
But Abebe said there is no law which prohibits re-evaluation. “The manuals are silent”.
According to the manual issued by the consortium, which is a forum of every school of law deans, last year students which failed to get a passing mark will be able to take the test an unlimited number of times. Previously they were allowed to take it five times.
Seid argues that someone who spends five years in the University must not be sent out of the system because he failed to get a pass mark five times. He said the exam aimed to raise the competence of the students but not to boot out any candidate from the system.
“The decision is made by the deans, which represents the school,” Abebe said in agreement with Seid.
The HESC conducted research on the performance of the exam and concluded that it is meeting its plans. The research also reveals 76% of students who took the exam believe it is necessary.
The exam, which has been given for the past seven years, has four categories: Private, Public, Procedural and Miscellaneous, they review most of the material the students learn during their enrollment.
Fire damages 57m birr around Anwar Mosque
A blaze that destroyed shops on Thursday at 1:30 am damaged 57 million birr in property and 140 shops near Grand Anwar Mosque in Mercato .
The cause of the fire, which took four hours and 147 fire fighters to control, is still under investigation.
The Addis Ababa City Fire and Emergency Prevention and Rescue Agency used 18 fire trucks and 548,500 liters of water and 900 liters of foam for the rescue operation and managed to save 65 million birr.
Three ambulances were also available for emergency services but no person died nor injured in the fire.
Electronic devices like mobile phones, tapes, televisions, clothes and food like butter, and honey were in the shops.
Solomon Mekonen, Communication Director of the agency told Capital that the cause is still unknown but rumors were spreading after the incident.
“Our job to is to save human life and property, the police investigate the cause.” According to Solomon the sheet iron which the shops were made of helped the fire to spread.
Eye witness who were near in the incident said many people were looting and stealing from the shops.
