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Abiy Ahmed’s Economic policy has similarity to Deng Xiaoping than Mao Zedong: A response to Dr. Yonas Biru      

Ethiopian Politics _ Abiy _ Economics
The author

   

Tibebe Samuel Ferenji 

It is tragic to see how low some people can get in their delusional hope to score a political point. Dr. Yonas Biru is hoping to get the attention of “his Masters” by invoking Mao Zedong’s name and painting Dr. Abiy Ahmed as a “Maoist”. However, his attempt has miserably failed. In his article titled “Abiy’s Economics Has Similarity with Mao Zedong’s China in a Bad Way,” published on Borkena.com, Yonas could not show any factual comparison between Mao’s and Abiy’s economic policies. To begin with, Mao believed in confiscation of private properties while Abiy Ahmed is paving a way for privatization. Thus, Yonas is comparing Lemon with Apple. 

Yonas’ article betrays the basic principle of economics and begs a question whether his vengeful mindset has clouded his ability to analyze and understand the basic economic concept. In his “voodoo economics analysis” Yonas misses the point of Ethiopia’s mega projects’ contribution in creating jobs and initiating economic development. Yonas, a person who constantly brags about his “knowledge in economics” missed this basic economic principle of the contribution of building public infrastructure in Ethiopia’s economy. According to the World Bank “…. Among other factors, growth was led by capital accumulation, in particular through public infrastructure investments” negating Yonas’ point. Furthermore, in his voodoo economic analysis, Yonas tells us “Under Abiy, Ethiopia’s industrial base shrank. In 2023 alone over 500 manufacturing entities were closed. The government’s agricultural report is rejected by experts as fabricated. The US Department of Agriculture (USDA) estimated MY 2023/24 wheat area is approximately the same as the previous two years.” (Emphasis added). It is true that about 500 out of 5,000 manufacturers have closed shops and left the country. What Yonas intentionally failed to disclose in his claim is the fact that the closing of these manufacturers has nothing to do with Abiy’s economic policies. According to UNDP “There has been an exodus of foreign firms from many of the industrial parks, mainly due to the conflict, the Africa Growth and Opportunity Act (AGOA) suspension, and the security situation.” Most of the manufacturers left Ethiopia because anti-Ethiopia elements like Yonas Biru advocated for sanction and the pro-TPLF US policy led to the suspension of AGOA causing the manufacturers leave Ethiopia. Yonas intentionally omitted this material fact hoping to support his point. 

Contrary to Yonas’s fabricated assertions, the World Bank April 4, 2024, report gives a different picture about Ethiopia’s economy. According to the World Bank, “Ethiopia’s strong growth rate builds on a longer-term record of growth over the past 15 years where the country’s economy grew at an average of nearly 10% per year, one of the highest rates in the world. Among other factors, growth was led by capital accumulation, in particular through public infrastructure investments. Ethiopia’s real gross domestic product (GDP) growth slowed down from FY2019/20 to FY2021/22 due to multiple shocks including COVID-19, with growth in industry and services easing to single digits. However, agriculture, where over 70% of the population is employed, was not significantly affected by the COVID-19 pandemic, and its contribution to growth slightly improved compared to previous years.” (Emphasis added). Will continue.

Mao Zedong, in his attempt to lift China from poverty made mistakes in his economic policies. The record shows Mao’s First five years policy was a success. Mao’s treaty with the Soviet Union gave China technical support, money, and manpower to transform China from agrarian economy to industry. The Soviet Union provided 10,000 engineers to boost China’s effort to transform its economy to industrialization. According to Yasmin Uzykanova, Chief Executive Officer of OhMyEcon article titled “The initial phase of China’s economic planning, characterized by the First Five-Year Plan, witnessed remarkable growth. The economy expanded at an impressive annual rate of 16%, consistently surpassing industrial output targets.” According to Uzykanova, the subsequent Second Five-Year Plan further bolstered China’s development; however, Uzykanova states “The economic policies pursued within the framework of the first and second five-year plans, even with notable successes, are not without limits. In the first five-year plan, there were challenges such as declining agricultural production leading to food shortages to support a growing urban workforce. Quality often comes after quantity, as many factories prioritize achieving production goals over maintaining product quality. In addition, a significant portion of the Chinese labor force is poorly educated and has limited basic skills, which not only hinders short-term economic growth, but also hinders long-term development. The inexperience in organization and management of Chinese managers leads to a lack of coordination between sectors and central planners, often causing bottlenecks in the production process. The second five-year plan, which promoted the Backyard Furnace program, was plagued by neglected agricultural products for kiln maintenance. The Great Leap Forward, an integral part of this plan, contributed to the Great Famine of 1958-1962, which resulted in the tragic deaths of some 30-50 million people. The unrealistic goals set by Mao, coupled with a lack of pursuit of profit, created an environment in which millions were overworked to the point of exhaustion or starvation. Furthermore, Mao’s belief in mobilizing the masses to overcome economic challenges proved overly optimistic, and ill-advised projects such as the Three Doors Gorge Dam resulted in environmental damage that made farmers’ careers become more difficult. These boundaries illustrate the complex and multifaceted nature of China’s economic development during this period.”

China’s economy faced many challenges including the1950s Korean war. There are several factors that led to its disastrous results. The question is what does this have to do with Abiy Ahmed’s economic policy? The simple answer is nothing other than an attempt to paint a dark picture of Ethiopia’s progress by a vengeful “voodoo economist” who has declared “economic war” on Ethiopia. There is an old adage among lawyers that says, “If you have the facts on your side, pound the facts; if you have the law on your side, pound the law; if you have neither the facts nor the law, pound the table.” Hoping to sale this rubbish, Yonas chose to pound the table and failed to present any facts to support his assertions hoping his Western master’s will use this as a stepping stone to “punish Ethiopia” and that his gullible followers will spread such sensational lies to promote their fake news and restated their political agenda that is on its deathbed. 

What is true in this time and age is Abiy Ahmed’s home-grown economic policy is working and getting support from the likes of the IMF and the World Bank. Abiy did not get FAO’s award for nothing. He got this prestigious award because Ethiopia made significant progress in wheat production and because of Dr. Abiy’s commitment to food security in Ethiopia. This is a fact that hateful political elites are unable to swallow. Abiy’s home grown economic policy has ushered a new era of economic progress despite all the challenges Ethiopia has faced. 

Anyone who took Economics 101 understands how investing in public infrastructure creates jobs and fuel economic progress. One must wonder how in the world a man who takes enormous pride in his PhD in economics says “Abiy’s policy is focused on building vanity projects, including palaces, parks, museums, siphoning resources from farmers. In the Oromo tribal land farmers were forced to sell their produce below market price to the government to meet the nation’s unrealistic export quota.” (Emphasis added. 

What Yonas dubbed as “Vanity projects” have created thousands of jobs and these projects are poised to create more jobs and contribute a great deal to the tourism industry. As Yonas knows, the money did not come from the government, or the farmers, the money is raised by the Prime Minister from a fund-raising effort under the banner of “Gebeta Lehager.” The claim that farmers are forced to sell their produce below market price to meet export quota is also a false claim and not supported by any facts. 

Yonas twisted a different fact to fit his devilish agenda. According to the Addis Standard May 15, 2023, publication, the government decided to purchase wheat directly from farmers after the Wheat price shot through the roof, trading at 4,700 birr per quintal, up from 3,200 birr the previous day in February 2023. According to the report, the price hike was the result of the wheat market sabotage among stakeholders that resulted in shortage of supply and skyrocketing of price. The government decided to intervene to stabilize the wheat market.

After Mao Zedong’s death, Deng Xiaoping replaced Mao and changed China’s economic trajectory. Deng initiated economic reform that has transformed China into a market economy that we see today. In addition to economic reform, Deng embarked on a serious political reform. Just like Deng, Dr. Abiy Ahmed’s economic reform has brought enormous economic change and a change in attitude, work culture, and mindset that has awakened the new generation. Given the current economic status and the bright future in Ethiopia’s economy, Dr. Abiy’s economic policy can be viewed as more similar to Deng Xiaoping than Mao Zedong. When Dr. Abiy took power, Ethiopia’s GDP was $84.2 Billion dollars; but, in 2023, Ethiopia has reached an estimated GDP scale of 156.1 billion dollars. This is the true picture of Ethiopia’s economy.


        According to the African Development Bank Projection, Ethiopia’s economy will grow by 6.2% in 2024, and it is projected that inflation will decline to 20.1% in 2024. These are the facts that the likes of Yona’s Biru don’t want you to know by spreading their false assertion and intentionally demonizing Ethiopia. 

Fortunately, Ethiopia will move forward despite fake news, naysayers, and disgruntled elites’ delusional false predictions.

Editor’s note : Views in the article do not necessarily reflect the views of borkena.com

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6 COMMENTS

  1. Is Samuel Ferenji from Jimma? It is unimaginable that someone living in the free world in a wealthy country and enjoying those benefits would paint a rosy picture of the Ethiopian economy. I am not sympathetic to most of Dr. Yonas Birru’s political analysis and undertakings, but on the economic point, he is dead right so far. GDP means nothing, especially when compared to the Ethiopian population size. Let’s talk about per capita income. Our neighbor Djibouti is far better in that regard. Not only that, you have to adjust it for inflation. Ethiopian business people are losing 50% of their wealth due to inflation. The so-called middle class during the Derg and Weyane era no longer exists under Abiy. Everyone has been reduced to rubble. Ethiopia is now a hell for its citizens. Even hope is not on the list for its citizens.

  2. I think Brother Yonas had amended his first opinion about PM Abiy’s economic policy being similar to Mao’s. His followed up article dealt more on Deng’s economic policy. But I still don’t know how the current government headed by PM Abiy has its economic policy tailored along that of Deng’s. I really don’t. Red China had abolished market economy up to the time Deng came to office. But in Ethiopia that was not the case when Abiy came to power. Private ownership was legalized already and the push for market economy was going well before 2018. In Deng’s China Guangdong was the seat of his ‘New Economic Zone’ but in Ethiopia ‘Industrial Parks’ were being built and operating in different regions of the country allowing foreign and domestic investors to come in and set up factors years before PM Abiy came to office. I wish Brothers Yonas and Tibebe dwell more in stead on the politics side. I strongly believe that these two patriots have the intellectual horsepower to educate us on the politics sides of things. They should post their opinion devoid of silly and fruitless arguments. They should stop and completely avoid using terms like ‘Oromummaa’, Neftegna’ and ‘Woyane’ to denounce and denigrate others. Using such terms as pejoratives has not helped further the accord for that gem of the colored we still hold very dear to our hearts and its upright and harmonious people. I would like to see them hit hard at these bigoted elements in Oromia, Amhara and Tigray regions there and here in our communities who have been fanning the flames of bloodshed and destruction from their safe and comfy homes. I like to see them bedeviling these conniving rabble rousers.

    Keep plugging away brothers. Blessings to you and your families.

    • Make that:
      …..but in Ethiopia ‘Industrial Parks’ were being built and operating in different regions of the country allowing foreign and domestic investors to come in and set up factories years before PM Abiy came to office.

  3. I hope Dr. Yonas, in all his caliber and wisdom, does not lower his acumen to respond to this junky reaction from a customary PP or PP wannabe sleazball.

  4. Thank you again for another great article. The fact of the matter is Yonas Birtu is a perfect fit for the old adage “an idol mind is the workshop of devil”, his judgement is clouded by his vehement hate to Abiy Ahmed and his luck of mental clarity leads him to negativity and see things as they are not. Yonas’s and his elk have neither the mental capacity nor willingness to see any positive changes in Ethiopia out of fear and false ego. These days, almost all of his articles luck evidence, exaggerated to the point to lull people into a surface understanding of the multiple problems the country encountered and to pursuance of self-interest. Otherwise, how on earth an “intellectual” failed to recognise that war brings nothing but misery and destruction. But again, to an egotistical with an inflated view of his self-importance, to weaponize everything against perceived enemies to give himself a boost shouldn’t surprise us.

  5. “I got annoyed by Borekena. Why did you publish such a baseless and rubbish article that advocates PP’s devilish agenda?”

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