The views, statements and opinion in the article reflects that of the writer’s , NOT borkena.com ‘s
By Samuel Estefanous
(estefanoussamuel@yahoo.com)
By God’s good grace or the dictates of the Bretton wood Conference these past few days we have become monetary policy experts of some sort. We have subscribed to telegram channels of commercial banks to look up the daily exchange values of birr against the dollar and other currencies of real value.
Almost everybody I know quotes some obscure youtube economist or a gumtu familiar expert on the subject and vents his/her frustration and damns public broadcaster’s declaration of ‘happy tidings in the pipe’.
Why is the public on tenterhooks, you might wonder. The answer is simple- without prior notice the government has bailed out on us and exposed us to the savagery of the market. I don’t think higher officials in government really know the fact that the overwhelming majority of the multitude expects the government to “serve and protect” it in the literal sense of the term.
1-The War that has squeezed us Dry
The government did pass the hat around to collect contributions to finance the last major war in Tigray. The generosity of the public was irreproachable. But that hardly covered a tenth of the costs of the ‘dollar we have burnt’ mindlessly. It is a hardly veiled truth that the government printed money recklessly to finance the war.
In practical terms we have been contributing to the war effort, dishing out close to half our regular income. It is simple arithmetic. When you pay ten thousand birr for a quintal of teff that used to cost under five thousand birr before the war- know that on every quintal of teff you are paying more than 25% as የእናት ሃገር ጥሪ መዋጮ፤፤
Yes, in practical terms we have contributed a hundred times more for the war coffer than we did for the GERD.
The sad thing is one can wear the GERD bond certificate as a badge of honor but our contribution to the war- however much the war was pressed on us -will keep our heads down for years to come. This isn’t double jeopardy it is triple, nah, quadruple jeopardy. I am not even talking about the regrettable loss of lives and maiming of innocent souls. Just imagine this-every time government drones took out TDF’s tanks and armors it is like a self-inflicted wound and vice versa. One season you are heroically taking out ‘enemy’ infrastructure and the next season you are mobilizing all the meager resources at your disposal to build it up from scratch.
We can’t begin to reckon the costs of any kind of civil war. We would rather fight foreign invaders on four fronts than fight a single civil war at home turf. War is a testament of leadership failure on all sides. We don’t need a leadership that plays false notes on our patriotic super sensitive hot chords. እንዲሁም ነገር ነገር ይለናል፤ አይደለም ‘አበጀህ በለዉ’ ተብለን፡፡
2- Is this some kind of a Brest-Litovsk Settlement?
Let us get this straight. Did the government choose to adopt the free floating market determination of the value of birr or was it forced down its throat by the sharks of world financial players?
We aren’t stupid. The war, the capital projects, the exploding population, the state capture and corruption etc have dried up the government’s coffer. Though we aren’t in the government, we hear and read that the Chinese wouldn’t bail us out and the best the government could is to try to re-negotiate terms of the previous debt payment (We hold our fingers crossed that the Chinese will convert the commercial loans to concessional ones). However the government tried to save face, it is an open secret that it has defaulted on the bonds Excellency Sufian had sold a couple of years ago following the incredible Sovereign Credit rating score we got from the likes of Fitch.
Under these compelling circumstances, it isn’t surprising and it is actually expected that the FDRE government should knock on the doors of the IMF and the World Bank.
This kinda reminds me of the war treaty the Soviet Russia government was forced to sign to end the First World War at Brest-Litvosk. It was the most humiliating term the Central Powers headed by Germany imposed on Soviet Russia. The former claimed close to 35% of the population of Russia and half its European territory. The fiery Revolutionary, Leo Trotsky, swallowed hard and signed the Treaty. You know why? ‘cos he had no other alternative! That infamous treaty has since become to characterize a situation when a tough bargainer freely dictates terms to the weak one.
What I am trying to say is the government might as well come out clean about it and tell us-we are forced to settle for a Brest-Litovsk terms, damn those Central Powers!
That way we will gallantly brace up to shoulder the dire consequences. Only for God’s sake spare us the hallelujah.
3- Economics – so it isn’t one of the exact sciences after all
I have tried to sample the views of distinguished scholars on the subject beginning from Constantine Berhe to one featured by reporter tv. The latter-I don’t think he knew he was on air- he kept saying it is none of the business of the public. The people of Ethiopia are living happily ever after, why does the government bother it like this? Some happiness!
Except for a handful, Economists in opposition didn’t even bother to try to explain to us why the Imperial government adopted the policy way back, how such a system has functioned just fine even in Sub-Saharan countries etc. I don’t even want to talk about the views of government experts-I mean Honorable Ato Shisema had the audacity to tell us that this is the best that has ever happened to the end line consumer. In the event he didn’t read it the World Bank has made it crystal clear that hard times are coming and it has earmarked a substantial sum to mitigate the consequences.
Thank God Constantine Berhe and Ermas Amelga are talking in some sense.
God Bless.
Editor’s note : Views in the article do not necessarily reflect the views of borkena.com
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