Distrust Of Regime Places ECX’S Boss In Unenviable Position – By Genet Mersha

August 28th, 2009 Print Print Email Email

I read with great interest and sympathy Dr. Eleni Gabre-Madhin’s two articles “This is my Ethiopian story” and “An idea whose time has come” of August 8 and 25, respectively. (more…)

I read with great interest and sympathy Dr. Eleni Gabre-Madhin’s two articles “This is my Ethiopian story” and “An idea whose time has come” of August 8 and 25, respectively. However, I cannot hide my disappointments on two levels. To start with, I was dismayed by the focus of many of her critics on her presumed ethnicity. Equally disappointing was Dr. Eleni’s failure to make a convincing case for ECX’s independence and neutrality.

Let us treat separately these two issues. A record 440 Ethiopians have responded to her first article, both for and against, as did nearly twenty percent of that to the second one (nazret.com). The responses can be categorised into two broad groups. The first one focuses on Dr. Eleni’s presumed ethnicity and the second arguing from a position of strong its doubts about ECX’s neutrality in bringing together buyers and sellers to the market. In other words, the distrust is in the capacity of the Exchange to facilitate the emergence in the country of a modern trading platform that cultivates the practice and tradition of free market in the current political environment.

The ethnicity criterion

Some of those opposed to Dr. Eleni give the impression that her ethnicity is their primary concern. In so doing, they failed to address head on the substantive issues that for some time now are being debated. That has made them sound oblivious to the fact that the ethnicity criterion cannot help in either measuring her contributions or non-contributions to the country’s development. It is not sufficient criterion to accept or reject a person or idea. Nor could it show the degree of Dr. Eleni’s involvement in contributing to the unhappy reality of our country. In no way could ethnicity show whether ECX is relevant to the Ethiopian economy and the evolution of a well-functioning market.

Dr. Eleni’s frustration is understandable. The hounding she received because of the presumption of her ethnic origin was sickening. Based on name’s sake and association with the ethnic group of the core of the ruling party, she has been berated mostly by unwarranted presumption. That in the end has forced her to reveal her many blood ties with the various constituent elements of Ethiopian society (her first article). The revelations have not helped her; on the contrary, they encouraged more demands—this time her husband’s ancestry.
So what even if Eleni was what she was presumed to be ethnically! It should have been nobody’s issue so long as she is not partner in the crimes of those who loot the country, or continue to violate the human and civil rights of our people. Not all Tigraians should be condemned for the crimes of the few. At this point, it is worth mentioning that our Tigraian brothers and sisters need to take serious note of this. At the same time, it should be recognized improving inter-ethnic relations is a two-way traffic. Tigrayans should also traverse to improve their relations with other Ethiopians. If their response is mere finding a scapegoat to blame, it should be apportioned entirely to the TPLF regime, which has poisoned their relations with other Ethiopians.

There is no doubt that Dr. Eleni’s negative experience that forced her to reveal herself is symptomatic of our country’s continuing dilemma and unease with the increasingly poisoned and unhealthy state of inter-ethnic relations. Ethiopians are engulfed by fear and insecurity, two human emotions not known for forging human solidarity and societal cohesion. That is what the many conflicts in the country and the broken friendships and inter-ethnic marriages attest, even amongst the educated and high calibre professionals. In brief, at risk are Ethiopian-ness and the unity of the country, not individuals per se. The concern many citizens have is the fear that this phenomenon is threatening to weaken our country by diminishing the common bonds amongst Ethiopians and what we can do as individuals and groups for our country.

What is interesting in this process is that, Dr. Eleni’s revelation has put an implicit distance between her and the ethnicity of the core of the regime. Even then, some see it as a deliberate ploy perhaps to win acceptance through her aplenty blood ties from different ethnic groups. Looking at it dispassionately, however, one cannot help noticing her pleas asking her readers and her critics to think for once beyond ethnicity, if possible, or to leave her alone to carry on what she has been doing.

Dr. Eleni is in the most unenviable position. She finds herself in the suffocating vortex of a repressive regime. Should she reconsider her return to Ethiopia, she seems to have no place to hide from her nagging commitment to her country’s development. Although I cannot speak for her, Dr. Eleni’s various needlepoint—her ethnic tapestry and her professional commitment—are fused together as her driving force. After all, her decision to return to Ethiopia after three decades is obviously to give back to her country from which she has taken less than most of us did.

Thus, behind Ethiopia’s mismanaged ethnic policies is lurking a well-nurtured ‘ethnicities’, ethnic nationalism in its ugliest forms that the regime systematically encourages. For instance, we learned just recently about the ugly experience of a multi-ethnic opposition political party that officially was permitted to hold its meetings in Adama, as part of its effort to pull itself together for the 2010 election. Its meeting was disrupted no sooner than it started. The cadres of the ruling party opposed the use of Amharic allegedly showing preference to Afan Oromo, which many say is merely a pretext. The ruling party knows why these things happen.
Nonetheless, as government, it has failed in its duties. It has neither condemned it nor restrained its cadres, whose attributes are both thuggish and robotic. What more is there to speak of about the wrong-headedness of the regime’s ethnic policies? When it wants, it encourages narrow nationalism to fan division to suit its purposes. There have been several reports of similar disruptions of opposition meetings under different guises in Debre Markos, Hawassa and Mekelle, among others. I wish I could remember the person who finally confessed that he could not dismiss the evils he had summoned.

ECX’s independence and neutrality

Others critics of Dr. Eleni have seized the opportunity to condemn the TPLF regime’s ethnic polices with which they strongly disagree—some as a matter of habit others out of conviction evolving from principle. If one takes Abebe Gelaw’s response (http://www.abugidainfo.com/?p=10933) as a representative view, he cogently articulates that group’s misgivings about ECX, all that without resorting in any form to stinging Dr. Eleni’s because of her presumed ethnic origin. In fact, Ato Abebe stresses,

“The reason why Dr. Eleni’s scheme is overwhelmed by doubts and scepticism does not seem to be due her ethnic origin, as she suggested in one of her latest articles [!], but the unruly behaviour of the ruling Tigrian People’s Liberation Front, an ethnic party whose grand design has turned out to be to control, manipulate, dominate, stifle and monopolize the fragile economy through its monopolistic companies and fake NGOs like the Endowment Fund for the Rehabilitation of Tigray [EFFORT].”

The neutrality and independence of ECX is under severe questioning in view of the current political environment, whose governance is mostly characterized by parochial politics, policy and operations shrouded in mystery. Had Dr. Eleni dealt with a couple of issues upfront, she could have deflected some of the darts directed at her now. For instance, her article, “An idea whose time has come”, could have explained ECX’s role in the coffee debacle. This refers to the unfortunate and politicized marketing problems that at the beginning of this year ended up with the axing of a good number of dealers’ licenses and forced them out of the market. Recall in this connection that government had acknowledged and rewarded the brilliant performances of those businesspersons in the previous year. What transformed them from good businesspersons to enemies of the state is a territory in less than a year? Dr. Eleni could not and cannot thread safely into that, at least not now, perhaps not at any time in the future.
Instead, she made the mistake of turning to of injecting the panache of theory of “price discovery”, “supply and demand” and “monopoly” and the claim of EXC’s separation form government to seek cover from her vulnerability. For many, Dr. Eleni’s unwillingness to point at the regime’s excesses has only portrayed her, if not a co-conspirator, at least as an apologist for the regime. It conveyed her as someone on a mission to push under the rug the political intrusion and its cardinal sin of disrespect to property rights in connection with measures taken against the properties of those coffee dealers. At the same time, the untenable position she took now stands in clear contrast to the admission by the prime minister who at the time characterized the difficult choice the coffee dealers had made as hoarding. Dr. Eleni also echoed it, into which government read desire/attempt to unseat it. “Sabotage” was the exact word that was used at the time.

The coffee dealers were in a tight squeeze because of declining international prices. Even the domestic market situation that still is reeling from the severe macroeconomic dislocation had its appeals to some of the exporters as a lesser of two evils, as some of them had sold their beans there. A government desperate for foreign exchange was infuriated. That marketing strategy ended up in the expropriation of their properties and their delicensing. It does not end there. To cover up its misguided actions, the prime minister exercised his unrestrained powers and initiated trumped up ‘legal actions’ against those individuals.

This has worried many Ethiopians who reacted at the time, including this writer, who at the end of last March questioned the wisdom of the regime’s desperate actions in her article, “Troubled country and troubled times”. Government was in despair because of its depleted level of foreign reserves. Could it not have used incentives of some form to encourage the coffee dealers to export their beans? Unfortunately, bad habits do not die easily. Policy options in Ethiopia are examined not to address the reality of a given problem with open-mindedness and alternative solutions, but often to break an imagined conspiracy or defeat a non-existent enemy.

This in view, what guarantees are there to show ECX’s independence in a political environment that rigidly demands loyalty, even from schoolchildren through membership of the ethnically oriented ruling party? It seems to me that Dr. Eleni’s inadequacy to make her case on that has taken the wind out of her sail, irrespective of how important what she had to say. This is not to say ECX‘s time has not come. The problem is government’s lack of credibility has rubbed on the Exchange. The absence of rule of law and an outside regulatory body to ensure the Exchange’s transparency and fairness is a multi-pronged handicap.

Experience has shown that government’s guarantees of neutrality and support for free competition may sound good on paper. In reality, however, those laws, regulations or procedures are seen and being seen often overridden by the corruption of politics. That is what the latest World Bank report “Ethiopia toward the Competitive Frontier” (Report No. 48472-ET of June 2009) has attested. I know Dr. Eleni is distinctly familiar with the report as one of its peer reviewers. Presumably, she is acquiescent to the report’s findings.
In that report, the World Bank concludes that Ethiopia’s products remain “uncompetitive in international markets.” The report attributes that to low level of productivity, which partly is due to inefficient resource allocation across firms and at the country level. It is engendered by the lack of competition in the country, despite the existence of numerous laws and regulations supporting competition. Politely and delicately, the Bank since the 2006 Country Assessment Strategy is for the second time putting its fingers on the problem that it thinks is narrowing Ethiopia’s competitive frontiers, in the following words.

“Endowment-and State-owned firms confront an investment climate that is substantially different from that faced by private enterprises, which may partially explain the fact that they appear to have greater access to policymakers, government as a market, and the state-owned part of the financial sector. The investment climate limits or distorts competition [in] a number of ways, including through directed credit, industrial policy, state firms, and barriers to entry. Ethiopia has approved a competition law to regulate anti-competitive practices, but this regime was not used to address the significant questions of competition with state and endowment-owned firms.”

On the other hand, in her second article Dr. Eleni tries to assure her readers that all is well, not successfully though.

“Unlike any other publicly-owned enterprise in Ethiopia, the Board of Directors is composed in almost equal part of representatives of the owner (state) and the private members of the Exchange as well as the CEO as a non-voting director. The Exchange’s CEO is appointed by and reports to this Board of Directors. Thus, without any doubt in the law or in practice, the Exchange is managed independently of any government organ and is a service-providing entity to the private market actors. There is no interference or intervention in any aspect of day to day ECX operations, whether it is the warehousing and quality inspection, the dissemination of price information nationally and internationally (which relies mainly on the systems that ECX itself has developed), the financial systems, or the trading sessions


ECX regulatory board is accountable to the prime minister who is also chairman of the TPLF with its business empire EFFORT, two of whose corporations are founding members of the Exchange. As party members, the members of ECX board are also duty bound to accept instructions. For an intelligent woman, I would be hard put to believe Dr. Eleni was unable to see or feel what was not coming forth in her latest presentation of ECX, its functioning and the prospects of convincing our people, both at home and abroad, about the values of law protected free market operations that could contribute to national development.

ECX and the new investors in virgin agricultural lands

Our country is now at the forefront encouraging international investors to produce, among others, cereals, pulses and oilseeds on lands leased to them by government. ECX already trades in agricultural commodities such as maize, wheat and corn, to which sesame was added on 5 May. Five days, after trading in sesame began and one thousand quintals passed through the Exchange, Dr. Eleni was quoted as saying “the surprisingly strong trading of the produce has reaped enormous benefits for the ECX.” Moreover, it is estimated that, according to the Ethiopian Oilseeds, Pulses and Spices Exporters Association, the country aims to export “more than 720,000 tonnes of oilseeds, pulses and spices which translates into $715 million in earnings, a ninety-four percent increase in the previous years revenue” (AFRIK.COM 10 May 2009, Africa News Network, May 11, 2009).

Although dominant position in trading of sesame is held by EFFORT’s commercial farm in Humera (Hiwot Agricultural Mechanization Plc and trading by Guna), with improved productivity of small scale farmers, the hope was that Ethiopian farmers could benefit a great deal from the production and export of sesame. Guna’s general manager on 18 July announced that she “would export 30,000 tons of sesame worth 40 million USD in this fiscal year increasing both its export volume by 10,000 tons and the amount of foreign currency the nations gets by 13 million US dollars when compared with that of last year.”

In my article, “INTERNATIONAL AGRCULTURAL LAND DEALS AWARD ETHIOPIAN VIRGIN LANDS TO FOREIGN COMPANIES” of 12 August (ethiomedia.com), I had expressed my serious concern about the terms of the deals with international investors on land lease and how that would affect the livelihood of our farmers. We are aware that most of the farmland deals with international investors are not bilateral arrangements in the most with other governments but private companies. The likelihood is these companies would sell their produces in domestic markets in their respective countries or on the international market. It is not clear whether the agreement signed between the regime and these companies designates ECX as the gateway for their produces out of Ethiopia, or they can ship it out on their own.

I do hope in earnest that in her next article that Dr. Eleni has promised she would tackle this issue. This is very important for the country and for any future discussion on the matter and especially in giving us confidence in what she says about the independence and neutrality of ECX. Part of the problem is that the terms of farmland deals are hardly made public. Although a theoretical possibility exists in a few cases for some transfer of technology for agricultural development, as I mentioned in that article, risk also exists to peasant farmers who cannot compete with well-resourced commercial farms.

The major export destination for Ethiopia’s sesame has been China, although Israel, Japan, Turkey and Korea also import from Ethiopia in varying quantities. So far, Ethiopia has been first in Africa and fourth (after China, India and Burma) in the world in sesame production. India’s Business Standard says that of late, because of the natural quality of Ethiopian sesame—whitish Humera (TPLF owned) and Wollega—“the European Union and the US who buy sesame from India have already turned to Ethiopian sesame.” With unmistakable resentment, Suresh Chandarana, an Indian exporter says, “it is a fact that Ethiopia has broken Indian dominance for now” in sesame export (Business Standard, 2nd August).

Take, for instance, the case of barley and oilseeds producers in Ethiopia. China is given an unknown size of farmland to produce oilseeds, sesame especially. Saudi Arabia is also given unquantified land to produce barley and wheat. In the case of China, if our country’s experience to date were of any relevance, Chinese workers would be the ones to do the job. Not only would this deny Ethiopians the employment opportunities, but also minimize the transfer of experience and technology, if at all exists, which otherwise FDI is credited for usually.

China uses sesame for chocolates, biscuits, and extraction of oil for both its domestic and external markets. If China were to satisfy its enormous needs for oilseeds and its export revenues through its own production in Ethiopia, the marketing disadvantage would surely be to Ethiopian producers, mostly small-scale producers. There is also the possibility that this may drive prices down on two accounts. First, the major importer, china, may not need its share of Ethiopian exports. Secondly, Chinese possibility of over-production could drive prices down. On top of that, Ethiopia’s weak export capacities are undoubtedly a determent to competition with China, eventually on both the production and export fronts. It is obvious that this would hurt millions of small-scale farmers in Ethiopia.

For instance, land under oilseeds in 2008 fell to 707 thousand ha from its high of 797 thousand ha (CSA), because of price discouragements to small-scale farmers. With it also declined the export volume and foreign exchange earnings, at a time when international prices were still attractive and more countries were interested in Ethiopian production. Surprisingly, over the years small-scale farmers’ production of sesame has shown consistent but limited productivity growth.

Perhaps, decline in international prices was one of the factors affecting decline of sesame farmland sizes in 2008, compared to 2005/06. Land under sesame by small-scale framers in 2008 was 186 thousand ha, which is 26.3 percent of the total land devoted to oilseeds, down from 211.3 ha in 2005/06, according to the CSA. Therefore, the emergence of a highly competitive partner now in sesame production may end up being another discouragement to million of small-scale farmers.


Dr. Eleni Gabre-Madhin has been carrying out her job in an environment that is terribly constrained. Nevertheless, I remain convinced that, as an educated person who wants to help her country emerge out of poverty and backwardness, she would not be an accomplice to any crimes, or show obliviousness to the importance moving our country along the path of genuine equality and democracy in order to achieve meaningful development. The most dangerous enemies of Ethiopians today are corruption, absence of rule of law, the persistent collusion and machinations of institutionally backed emergent narrow-minded ethnic nationalism and ultra chauvinism the system has fed and bred as part of its policy actions or political jugglery to enable a few individuals stay in power permanently.

As far as Dr. Eleni’s commitment for Ethiopia’s development is concerned, I have no reason to doubt her sincerity. For that, I take her on her freely and publicly given words. She has noted on occasions that that is why she has abandoned the luxury of the developed world to return home to share what she knows best.

Response to the person who goes under Dr. Negaso Gidada

With due respect, I must say Dr. Negaso Gidada had little presence of mind when he read my article. Consequently, in his boiling response, he has chosen to indulge in senseless accusations not befitting his education and experience. The alleged offences he saw in my article are: (a) patronization of readers; (b) using “frivolous arguments” to show underhanded sympathy for Dr. Eleni”; (c) contempt for the Oromo people; and, (d) not recognizing the importance of ethnicity. To emphasize his point, the former president adds, “What matters most [to Elleni and I] is your insatiable GREED.” Therefore, his advice for both of us is “to join the crime family – Meles and Tigre thugs!”

I shudder at his use of ruffian language (two BSs), most of all coming as it did from a former president and now a parliamentarian and political activist. Thus far, he has made me believe he has been striving to make a difference by helping change our country’s violent politics. Unfortunately, I am not sure how he chose to exempt violent discourse, as his response to my article shows. Although I would not still deny Dr. Negaso of my higher expectation of him, I would have liked to see him bring forth decency to our conversation, instead of throwing sand into the gearbox of political discourse.

As to my “frivolous arguments”, I am afraid the former president has chosen to apply a legal concept. The way I understand it, “frivolity” refers to a condition or a case that is “insufficient as a matter of law.” In concrete terms, a claim is frivolous if it appears either insufficient or because it is not supported by fact or when the law recognizes no remedy. I am under the impression that Dr. Negaso has not finished his thought processes—something is missing. As far as I am concerned, there is no need for me to seek to justify my sympathy to Dr. Eleni. Nor is there any reason for me to do it underhandedly. I was upfront about that in my article, including in its title.

More importantly, if it is not clear to him, I do appreciate her commitment for her country’s development. Perhaps as you saw in the article, I do not know her in person; but still I am an admirer of her dream for Ethiopia’s transformation, including through her work at the ECX, until I find evidence she is in collusion doing that citizens do not expect of her. However, that does not stop me from telling her where I have concerns for what she intends to achieve and how she goes about achieving it in that political jungle. Clearly, the neutrality and independence of that important marketing platform is of vital importance and far greater than whatever sympathies I have for her.

Ethnicity is the central issue to Dr. Negaso. I have no doubt that ethnicity exists. If you read my article carefully, I never said it does not exist. How can I say that when it is my country’s reality? I happen to hold the view that the satisfactory resolution of its complicated problems could be Ethiopia’s strength as a multi-ethnic country. However, mutilating an individual, that is, Dr. Eleni, based on her presumed ethnic origin is wrong. That kind of irresponsible politics of ethnicity is what I was criticizing. I was not addressing the ethnic question at all in the collective sense.

To clarify what I said, I would refresh Dr. Negaso’s memory where I stated, “Some of those opposed to Dr. Eleni give the impression that her ethnicity is their primary concern. In so doing, they failed to address head on the substantive issues [ECX’s neutrality and independence] that for some time now are being debated. That has made them sound oblivious to the fact that the ethnicity criterion cannot help in either measuring her contributions or non-contributions to the country’s development. It is not sufficient criterion to accept or reject a person or idea. Nor could it show the degree of Dr. Eleni’s involvement in contributing to the unhappy reality of our country. In no way could ethnicity show whether ECX is relevant to the Ethiopian economy and the evolution of a well-functioning market.”

Out country’s experience of addressing the ethnic question has been through armed struggle and liberation front of so and so. In the last forty years all that it has done is to worsen our situation and deepen our country’s tribulations. Yes, with Eritrea gone, brotherly peoples are separated and Ethiopia’s territorial integrity injured. Yes, the ethnic question became a saddle for the TPLF to power, which has even betrayed the genuine interests of the unfortunate people of Tigrai. Yes, after victory the TPLF has wielded power for eighteen years now. In reality, separated from the Ethiopian people that it distrusts, the TPLF still lives in the trenches. To succeed in its objectives of permanence in power, it has divided the country into ethnic enclaves, while exposing the economy to brigandage and looting. Many Ethiopian groups have been tricked into a dicey situation of producing, like the TPLF, one ethnic political front after the other. As a result, neither our country is at peace nor our interethnic relations healthy. The evidence, is armed struggles continue in different parts of the country.

The OLF had its roots in “Mecha Tulema” in the late 60s to exert pressure to facilitate resolution of the grievances of the Oromo people. When that did not get satisfactory response over time, the OLF eyed independence that ever since has alienated it from the Ethiopian people. I bring these examples to make the point that the new template must be striving first and foremost to ensure the rule of law and democracy where the rights of the individual occupy a central place, and protected by all citizens. It is only within that political, legal and institutional framework that the rights of ethnic groups, their cultures, languages and development and governance could flourish and be guaranteed by law and practice. I am convinced that the path to that is working together as united people fighting against repression and build genuine democracy and full respect for fundamental human rights. This is true for every ethnic group in the country.

That is the only way to defeat narrow nationalism and ethnic chauvinism. The different Ethiopian groups need to work together. One needs to stop and ask why the TPLF has been thriving in a country of 80 million people. The answer is just because we have not been able to rid ourselves of the sting of the Stalinist model of the archaic ‘The National Question’ now reinforced under TPLF’s canonization. Until then, we cannot change our sad reality. At this point, I would stress that using ethnicity as a prism for everything, as narrow nationalists do, or forcing it through political manipulation, as the TPLF does, is no less than courting disaster. This is more so especially in a country where poverty is deepening against the backdrop of mismanagement of the economy.

Dr. Negaso alleged that I have contempt for the Oromo people. I cannot say where he got that. The only plausible explanation could be that he had two different articles by two different persons. If it is my reference to the disgraceful situation in Adama and I reiterated the demand of the meeting disrupters demanding the use of Afan Oromo, I hope he does not forget that he is the source of the information. I got it, like all other people, from his press conference of 16 August, in case he has forgotten it.

Here is what he said at the time, “Around 50 people started to disturb the meeting while Eng. Gizachew Shiferraw, Vice Chairperson of the UDJ was addressing the meeting. The disturbers were shouting, clutching and whistling from the rear of the hall. This mob came up running to the front and damaged a microphone while trying to grab it. They continued to shout: “This is Oromia,” “Oromo is our Language.” “You have to start the meeting by a blessing ceremony in accordance with Oromo culture.” “You can hold the meeting in Oromo language.” “If you do not speak in Oromo language, and you can not hold meetings in our country.”

As regards patronization, I have no idea where the former president got it, or where he saw it. That is neither in my bones, nor in my spirits.

Finally, like Dr. Negaso, I would close this note with a simple advice. There is every reason for him to be angry. However, I grant him that he cannot succeed pushing his political agenda with constant anger and a sense of vindictiveness.

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