G-7 “Rules-Based Order” Meddling in the Horn of Africa for No Good

Watch Lawrence Freeman’s interview with Addis Assefa, OBN Horn of Africa, April 23, 2024

May 4, 2024

In this interview, I presented the fallacy of thinking by the so called rules-based international order, demonstrated in their G7-Foreign Ministers Statement. The G7 statement fails to articulate any policy promoting economic development for the nations of Africa. Rather, it shamefully,  merely lists the concerns and the condemnations of the G7 for several  African nations.

Major topics discussed included:

  • The involvement of forces outside the region meddling in the affairs of the Horn of Africa for geopolitical control; usurping the authority of  sovereign African nations.
  • The absence of motivation for any nation in the Horn of Africa to initiate military engagement with neighboring nations.  
  • The ongoing process of regional economic integration in the Horn of Africa.
  • The potential for increased physical economic growth in the region resulting from the Memorandum of Understanding between Ethiopia and Somaliland for port access.
  • The lack of a policy by the G7 rules-based order to promote physical economic growth.
  • The use of “climate change” to prevent African nations from using their sovereign natural resources to produce electricity for the purpose of improving the standard of living for their citizens.

Read my earlier posts:

Anglo-American Elite Continue Threats to Break-up Ethiopia

Stop Foolish Talk of War in the Horn of Africa-Promote Economic Growth Instead

Lawrence Freeman is a Political-Economic Analyst for Africa, who has been involved in economic development policies for Africa for 35 years. He is a teacher, writer, public speaker, and consultant on Africa. Mr. Freeman strongly believes that economic development is an essential human right. He is the creator of the blog:  lawrencefreemanafricaandtheworld.com, and also publishing on: lawrencefreeman.substack.com, “Freeman’s Africa and the World.”

Energy Poverty Is Killing Africans-Renewables Are Insufficient

Access to electricity for sub-Saharan nations is abysmal. A leading factor in the prevalence of poverty and hunger. (Courtesy of researchgate.net)

W. Gyude Moore published a useful article on the vital need for African nations to produce more energy: On the question of Africa’s Energy Poverty

However, I extend the implications of his analysis of energy poverty to its full impact on the lives of hundreds of millions of Africans. To wit: energy poverty is the leading cause of preventable deaths in Africa. Western political-financial elites are using their pseudo concern to “save the world” from climate change, to prevent African nations from producing vital energy from their abundant natural resources of hydrocarbons. In effect, attempting to deny nations suffering from a dearth of electricity, the right to develop their own energy sources sufficient to industrialize their economies. Hunger and poverty will not be eliminated on the African continent without nation-wide grids providing abundant and accessible electrical power.

Renewables are not capable of powering an industrialized economy. Their low energy flux density, the concentration of heat-power needed to transform minerals, is inadequate. Intense levels of heat and energy are required to convert ores into working metals. Nuclear power is orders of magnitude superior to other forms of energy in satisfying these requirements. Oil, gas, and hydro are energy sources that can be used in transition to nuclear energy. Yet, African nations are given diktats to not develop their sovereign resources and instead rely on inferior energy sources, displaying their disdain for their sovereignty and the welfare of their citizens. Thus, ensuring that African nations will never be able to become manufacturing based industrialized economies capable of eradicating poverty and hunger. One can make the argument that denying African nations this required energy capacity is a new form of colonialism, to keep them undeveloped. It is the effect, if not the intent.

Excerpts from Moore’s article: In Resolving Africa’s Energy Poverty – ALL Options Remain on the Table

Africa’s energy poverty is now a national security crisis. The region’s large and growing population places relentless pressure on small and dwindling resources, exacerbating the crisis of diminished state capacity. The specter of social and political disruption haunts regional stability, from coastal West Africa to the Great Lakes. Africa’s poverty translates into weak economic resilience and heightened vulnerability to shocks – internal and external. The recent spate of global crises has only worsened the problem. After decades of improvement, the World Bank reports that inequality is rising – that the global poor bore the brunt of the economic scarring of the pandemic, with incomes falling in the poorest countries more than they did in rich countries. “As a result, the income losses of the world’s poorest were twice as high as the world’s richest, and global inequality rose for the first time in decades.” These losses are most pronounced in Sub-Saharan Africa where “incomes are falling further behind the rest of the world.”  

Nothing aggravates this condition more than the continent’s persistent energy poverty. It is thus a positive sign when at this year’s IMF/World Bank Spring meetings, the World Bank and the African Development bank agreed to invest in providing electricity to 300 million Africans by 2030. But the announcement raises a lot of questions, including Todd Moss’s: “What will the Bank do differently?” If the idea is to double down on renewables alone, this only accentuates the glaring divergence between what Africa needs and the “solution” the Bank is offering. In times of existential crises, no options are left off the table. Unless Africa increases the diversity and complexity of its exports, its poverty will persist…

Moore makes the decisive point below that even when African nations establish policies to process their own resources, to ban the export of raw resources: they don’t have the energy for smelting, transforming the ore..

No Balanced Energy mix, No Industrialization

Africa’s export diversification is inextricably tied to its infrastructure – mainly power – endowment. Namibia, Zimbabwe, the DRC and others have all passed laws banning the export of unprocessed minerals. The legitimate attempts by these governments to ensure that their minerals are extracted and processed “in a way that helps [them] realize the full economic benefits of their resources’, should be applauded.”

But the viability of these bans remains contested, and these efforts are very likely to stall, since insufficient smelting capacity has led to repeated issuance of waivers for similar bans in the DRC.

About 80% of global energy consumption is tied to transport and heating (residential and industrial). This focus here is industrial heating (100 to 2000 C). The absence of adequate power supply to smelt ores in a commercially viable way has condemned the continent’s commodity exporters to ship their raw ore to China or India. South Africa, the continent’s most complex commodity exporting economy exports its chromite ore to China for processing into ferrochrome, which is used to manufacture corrosion, acid and heat-resistant steel.

Or take aluminum – the metal that is produced from bauxite. Guinea has the world’s largest bauxite reserves at over 7 billion metric tons. However, aluminum making is one of the most energy-intensive processes in the world. “Only paper, gasoline, steel, and ethylene manufacturing consume more total energy in the United States than aluminum. Aluminum production is the largest consumer of energy on a per-weight basis and is the largest electric energy consumer of all manufactured products.”[xv] In Guinea and Sierra Leone, converting raw bauxite into intermediate metals will require prodigious amounts of installed and dispatchable power. Renewables have struggled to be cost competitive with burning fossil fuels to smelt ores. Even the most basic levels of beneficiation (removing impurities and improving the grade of the ore) often require electricity endowment that many commodity exporters lack. Unless Africa is able to increase the availability of cost-competitive energy at a scale, adding value to its mineral exports will remain a pipe drain. If the average Ethiopian continues to consume a mere 79.25 kWh per year, Ethiopia will struggle to match Bangladesh (497 kWh per year) in apparel manufacturing. If the average Nigeria consumes only about 150 kwH per year, Nigerian firms will struggle to compete with their Vietnamese counterparts  (2450 KwH per year)

Ethiopia’s Grand Renaissance Dam (GERD) will be a game changer for East Africa; generating 5,150 megawatts of electricity

Fossil Fuels (Including Coal)  and the Existential Question:

While Europe, China and India pursue increasing coal as an energy source, African nations are intentionally denied lending for development of coal powered plants, even though coal is abundant on the continent.

At this year’s Spring Meetings,  “The Big Shift Global”, a global movement against fossil fuels, protested against the Bank’s financing fossil fuels. Their best intentions notwithstanding, this activism condemns Africa and Africans to indigence, since the countries adding the most fossil fuel capacity do not borrow from the World Bank. This earnest, but misguided, activism simply provides a convenient cover for rich countries’ World Bank executive directors who want to push the bank away from financing natural gas in Africa.

Increasing Africa’s energy per capita consumption is an existential question – from keeping South Sudanese children alive in extreme heat to earning more from African exports. African governments ought to understand that outsourcing existential questions to outsiders whose intentions are, at best, ambivalent is a dereliction of duty to their people.

When coal-powered electricity is rising in prominence in the world’s largest industrial countries, it is unreasonable to expect Africans to “save the world”, by sacrificing their poverty reduction and industrialization goals on the unrealistic “hope” of an all-renewable energy mix. Every form of energy generation must remain on the table. Where viable, nuclear energy ought to be pursued too – whether the partner of choice is China or Russia, especially since Rosatom and the African Commission on Nuclear Energy (AFCONE) have approved a plan for cooperation. China has made progress on small modular reactors; this option and all others must remain on the table...

Both the World Bank and some private capital are hesitant to extend financing for new fossil fuel. Because this is a national security imperative, African governments should be prepared to make hard choices about using domestic resources, making cuts to spending elsewhere to fund these plants.

For economies where coal power plants are viable, governments must make demonstrable efforts – setting aside land, conducting feasibility studies, and mapping the coal value chain for these plants. For countries where the option is natural gas – the same processes should be set in motion.

Read my earlier posts below:

South Africa Energy Minister Rejects Western Dictates & Hypocrisy Against Africa’s Use of Energy Resources

“Electricity is the lifeblood of a nation” Nuclear Energy Can Be A Solution To The Continent’s Dearth of Electricity

GERD: Utilizing the Blue Nile to Create Energy for Development in Ethiopia & The Horn of Africa

Lawrence Freeman is a Political-Economic Analyst for Africa, who has been involved in economic development policies for Africa for over 30 years. He is a teacher, writer, public speaker, and consultant on Africa. Mr. Freeman strongly believes that economic development is an essential human right. He is also the creator of the blog:  lawrencefreemanafricaandtheworld.com that has hundreds of articles for you to review.

Anglo-American Elite Continue Threats to Break-up Ethiopia

Ethno-nationalism is Ethiopia’s most serious security threat (map courtesy of Wikipedia)

April 16, 2024

The publication of Alex da Waal’s article, Ethiopia Back on the Brink, in Foreign Affairs, on April 8, is a clear indication that the Anglo American Establishment intends to continue the destabilization of Ethiopia and the Horn of Africa. (Foreign Affairs/ Da Waal)

How Do I Know?

I come to this conclusion as one who comprehends strategic global dynamics, which elevates my thinking above those who live in the world of empiricism. It is elementary for me, who understands the world view of those indoctrinated in the “geopolitical zero-sum” ideology, to know what is intended for Ethiopia.

I know two crucial pieces of evidence.

One, Alex da Waal supported the Tigray People’s Liberation Front (TPLF) in their treasonous endeavor to overthrow the government of Ethiopia. It was a military attempt at regime change in a destructive war that lasted for two years. He was an active supporter in the war to destroy the Ethiopian nation. When Da Waal writes or talks about Ethiopia, his hatred and rage against Prime Minister Abiy Ahmed, gushes out.

Two, Foreign Affairs is a quarterly publication of the Council on Foreign Relations (CFR), the most prominent and influential think tank in the United States that has direct impact on all branches of the United States  government.The CFR was founded in 1921, as the American branch of the British Royal Institute for International Affairs, otherwise known as Chatham House, which was created two years earlier. Chatham House was created by Lord Alfred Milner, then acting as Secretary of State for the British Empire’s colonies, through a vast trust funded by the estate of race-patriot Cecil Rhodes.

One should ask him or herself: why would the most prestigious U.S. establishment magazine publish an article on Ethiopia by someone who not only hates the current government of Ethiopia, but actively supported its attempted overthrow.

Da Waal is no ordinary academic. He is an advocate for the geopolitical establishment that believes they have the authority to decide who is an acceptable leader of a nation. That is, one that is acceptable to their rules-based international order, which does not respect the legitimacy of decisions made by the citizens of sovereign African nations.

The intent of the continuous destabilization of Ethiopia in the eighteen months following the negotiated end of the war in November 2022, is to produce a weakened, fractured, or balkanized nation. One can grasp the significance of the type of evidence I am presenting, providing one has not become a victim of ethno-nationalism ideology. Given Ethiopia’s political and economic dominance, along with its sheer size, if these efforts were to succeed, the Horn of Africa would be thrust into decades of war and chaos.

Before I was shunned by the Ethiopian diaspora, I was praised for my insightful assessment that the intent of the TPLF instigated war was regime change. Unfortunately, many of my former allies, who know well of Alex da Waal’s nefarious role in Ethiopia’s destructive war, reject my analysis today. Nor do I have any direct indication that leaders in Ethiopia understand who is waging war against Ethiopia, and why. However, it would serve the best interest of Ethiopia and the continent, for people to heed and understand my analysis.

Ethno-nationalism Weaponized

The Council on Foreign Relations, dominated by their geopolitical outlook that the world is composed of victors and victims, disregards the significance of the concept of a sovereign nation state. Instead, they see countries as mere pawns to be manipulated to accomplish their goal of western hegemony. Poor Alex da Waal is simply a tool whose erroneous academic analysis is used against African nations. He serves the interests of his master, the rules-based international order.

Da Waal shows his contempt for a unified sovereign nation of Ethiopia through his constant support of ethno-nationalism, which remains today, the most serious threat to the existence of the Ethiopian nation. He fails to understand that the most important objective of a “national dialogue” is to affirm the superiority of Ethiopian citizenship over ethno-nationalism. This will also require major alterations in the flawed Ethiopian constitution, rather than perpetuating it . He praises the decades of rule by the TPLF that is responsible for dividing the nation into ethnic conclaves, which he claims was undone by Prime Minister Abiy.

Ethiopia’s failed Constitution, which promotes ethno-nationalism, is in urgent need significant change.

Da Waal writes:     

Under the previous regime, Ethiopia’s various regions have been held together by a federal formula that aimed to maintain the country’s complete complicated ethnic mosaic…this federal system undergirded a quarter century of stability.

This “mosaic” that promoted ethnicity over citizenship of a nation, has made Ethiopia vulnerable to external intervention, and is the root cause of Ethiopia’s recent war and violent conflicts today.

Da Waal consciously refuses to acknowledge that the TPLF initiated the war with an armed attack on the nation’s military defense force in Mekelle, Tigray. He supports the legitimacy for a province to initiate armed conflict against the central government. (An act that President Lincoln did not tolerate). He can barely conceal his enthusiasm for the TPLF’s march to capture Addis Ababa, the nation’s capital, in 2021. He praises the existence of ethnic armies and complains that FANO was not given a seat at the peace talks in South Africa. Why should they be there? FANO, nor any ethnic militia does not represent the nation of Ethiopia and is not a substitute for the elected  government.

War Mongering in the Horn of Africa

Da Waal joins the war mongering chorus working overtime to instigate armed conflict in the Horn of Africa. Displaying his ignorance or disdain for physical economic growth, he dismisses Ethiopia’s need for port access to the Red Sea and Gulf of Eden. Da Waal shows no concern for improving the living standards of millions of people residing in the Horn of Africa. Insisting that Prime Minister Abiy is only interested in the prestige of building a navy. Similarly, he exposes his lack of concern for improving the lives of Ethiopians and its neighbors by demeaning the Grand Ethiopian Renaissance Dam (GERD). He complains that it is 95 percent complete, despite opposition from Egypt. What kind of an “Africanist” does not support the injection of 5,150 megawatts of power, generated by the GERD, into a continent dying from lack of electricity? Conspicuously, Da Waal never discusses the critical need for economic development of the region.

In his Foreign Affairs’ essay, Da Waal asserts without any evidence that “the standoff between Addis Ababa and Mogadishu threatens to develop into a larger conflagration. There will be no conflagration unless Da Waal and his ilk deliberately ignite one, intending to set the East African region ablaze.

Da Waal blames the crisis in the Horn of Africa on Prime Minister Abiy’s so called expansionist plans and predicts a future that would lead to the  disintegration of Ethiopia. His scenario includes the Sudanese armed forces threatening the GERD, while the insurgency in Amara escalates. Da Waal has fantasies of an uprising that will threaten Prime Minister Abiy’s control of Addis Ababa, this time succeeding, unlike the TPLF’s earlier failed attempt. He then predicts that: In the coming year, Ethiopians could also face food riots, mass hunger-induced migration, and a broader social and security breakdown. That is quite a prophecy or is it his aspiration for the future of Ethiopia. If any of Da Waal’s evil imagination were to become true, hundreds of millions of Africans living in Eastern Africa and across the continent would suffer unspeakable hardship.

We should judge this ominous prediction by da Waal, to be a desired outcome, or at the very least, a threat to Ethiopia and the existing government of Prime Minister Abiy.

Da Waal’s solution is having the rules-based international order intervene, to tell yet another African nation how to behave. According to him, the United States and its partners should curb Prime Minister Abiy’s authority and maintain the structure of zones of ethno-nationalism. This would ensure that Ethiopia will be permanently fractured, instead of becoming a unified nation-state. Thus, deliberately leaving the second most populace nation in Africa, open to future destabilizations.

Hence, the significance of the publication of this article by an institution such as Foreign Affairs.

Read all my earlier posts on Ethiopia: lawrencefreemanafricaandtheworld.com/analysis/Ethiopia/

Soon I will be publishing from lawrencefreeman.substack.com

Lawrence Freeman is a Political-Economic Analyst for Africa, who has been involved in economic development policies for Africa for over 30 years. He is a teacher, writer, public speaker, and consultant on Africa. Mr. Freeman strongly believes that economic development is an essential human right. He is also the creator of the blog:  lawrencefreemanafricaandtheworld.com

Stop Foolish Talk of War in the Horn of Africa-Promote Economic Growth Instead

March 16, 2024 

If Ethiopia is going to have access to a port, then there must be long term agreement, Lawrence Freeman explains why

With around 120 million people, Ethiopia is said to be the most populous land locked country in the world. Since the separation of Eritrea with a declaration of independence in 1991, Ethiopia has been using the Port of Djibouti for about 95 % of its import export trade.

But with the rapid growth of its economy its import export trade has also grown exponentially calling for the increase of the number of ports, upgrading of the capacity of the ports as well as securing its right to access sea outlet.

“If Ethiopia is going to make investments, which they have to do in infrastructure to make the port profitable and efficient, then they need to have a long term lease agreement.” Says Lawrence Freeman, an American political economic analyst for Africa (www.lawrencefreemanafricaandtheworld.com ).

In his brief stay with The Ethiopian Herald, Freeman has reflected his insight about how vital for Ethiopia is having a sea access with a guarantee of long term agreement, the need to access multiple ports to accommodate its rapidly growing economy and respond to the needs of its large population, as well as the benefits other countries of the region can secure from the Ethiopia – Somaliland Port access deal and the role of the regional countries. Enjoy reading!

It has been two months since Ethiopia and Somaliland signed the MoU for a port access. How do you see the progress of the agreement and what has been unfolding around the issue so far?

There appears to still be concern by Somalia about this Memorandum of Understanding (MOU). which I haven’t seen the actual complete agreement. There was also a report in the news that in the meeting that Prime Minister Abiy Ahmed had with the president of Kenya, as a softening of the Prime Minister’s position.

However, much of the discussion is just poorly informed, and not helpful to the Horn of Africa to any of the nations in the Horn of Africa: Somalia, Somaliland, Djibouti, Kenya, Eritrea, Ethiopia. The problem is the countries are reacting in a less than informed manner. If they understood physical economic growth, they would understand that Ethiopia needs multiple port access for its growing economy, number one. Number two, Ethiopia is the largest economy in East Africa and has great deal of potential for growth. Number three, this will benefit all the countries in the region because they will benefit from the expansion of trade and commerce. Number four, if Ethiopia is going to have access to a port, then they need to have long term agreement. It can’t be a one year two year; we’ll do it when we want. It can’t be capricious. If Ethiopia is going to make investments, which they have to do in infrastructure to make the poor profitable and efficient, then they need to have a long term lease agreement. Otherwise, they will not make the investments; nobody would. And number five, the reactions of many of the countries and leaders in the region represent a legacy of the colonial mentality of who owned what going back many, many years, or decades. And they represent what I would say ignorance in physical economics and are dominated by old grudges, rage and anger, all of which is inappropriate at this time. If you want to see Africa grow, if you want to see the region grow, if you want to see all the nations of the Horn of Africa develop and grow, then it’s ABCs. Very easy for me to see the purpose of having long term access to multiple ports. The argument for an access long term access to port is valid. And we should put aside all his other commentary and focus on what will help improve the lives of Africans living in that region.

How do you think could diplomatic approach help reach consensus among the countries that signed the MoU and others?

Well, the fact of the matter is, if the Somali government was more thoughtful, the eloquent solution would be simply. Say we consider Somaliland part of Somalia, if Somalia government is, is looking to the future, they would say okay, Somaliland is part of Somalia, and therefore we accept the agreement, because it’s an agreement between Ethiopia and land considered part of Somalia. So we will benefit, Somalia, and will benefit our neighbors. That would be the most thoughtful, eloquent solution in Somalia to say ‘we agree that this will be helpful to all our people.’ Now that that eloquent solution is not being pursued by Somalia, and Somalia, has made all kinds of threatening statements, which are really, in my view, kind of silly to think that Somalia is going to go to war with Ethiopia. It is silly, but it also dangerous. And Ethiopia has been defending Somalia with its treasure and blood with troops in Somalia, going back to the early 2006, and they’re still there. So the idea that you would be able to mobiliser a war against Ethiopia, it’s just silly, but dangerous. Then you have other countries coming in, and aligning themselves, for and against Ethiopia for and against the Somalia. This is also dangerous. They should keep their nose out of the Horn of Africa, they should study physical economics, they should listen and understand that this is beneficial to all the nations. Now I don’t know where the MOU stands two months, over two months after it was initially signed, but my advice is, we should go ahead with it. And this will help all of the nations and all of the people in the nations. We have to get away from anger, and historical rage, and historical pettiness and look to the future. What kind of economy are we going to have? What kind of economic growth are we going to have in the Horn of Africa and eastern Africa? That depends on the economy of Ethiopia.

What do you think can leaders of the region including Ethiopia,  Somaliland  and Somalia can do to reach a win win solution?

I think that the leaders of sovereign nations should be able to sit down and discuss calmly, without anger. Without ancient rhetoric, they should sit down and discuss how we can benefit all the people of our nation. Now, I don’t know where the memorandum of understanding is at this point, because of it’s been a long time–it’s been 10 weeks since it was signed. But I would think this pursuit is a viable alternative to Ethiopia having access to this waterway, the Red Sea, the Gulf of Aden, the Indian Ocean … etc. And , there could be other ports that could be pursued. The main thing, from my standpoint as a physical economist is Ethiopia should have a modern port. And, without a long term agreement, they’re not going to make the investment in a modern board, nobody would. And Somalia should not call this annexing their land. It’s not annexing any part of Somalia. They’re making an agreement. It’s not annexation. Now, I believe, personally, that there outside forces that are manipulating the situation, because there were forces that don’t want to see a strong, independent sovereign Ethiopia. And these outside forces are trying to weaken Ethiopia, just like they did in the war with Northern Ethiopia.

What kind of role do you think Ethiopia would play in the peace and security of the red sea region if it sets up naval force?

Actually, in Ethiopia, he’s also getting, I believe, several, maybe 12 miles of area, of land along the water way. That’s good. Because the whole  Red Sea area is insecure, as we’ve seen with these recent attacks. If you have another Navy, that helps you provide more security. So it’s not a bad thing is a good thing. And I believe, it is manipulated by geopolitical forces, who don’t want to see peace, who don’t want to see prosperity in the Horn of Africa. But a port in a navy military base, could help the situation in the Red Sea, I don’t see it as a negative, it could be a positive.

Many countries from diverse corners of the world show interest in the red sea region. As a result they my show concern on the new development like Ethiopia and Somaliland MoU. But is there any way they can also contribute in settling the issue smoothly?

I think you see some countries trying to help the situation. The visit of the Prime Minister [Abiy Ahmed] to Kenya probably was a positive diplomatic trip, and it may improve the situation. I think it’s reasonable for countries in that region, have discussions with Ethiopia, have discussions with Somalia, and other countries in the Horn of Africa. That’s how problems should be solved. They should be solved by African nations, Sub Saharan African nations involved in that region, who keep care about the future standard of living of their citizens. And among them, there should be discussion. I’m sure there are many private discussions going on among people in the African Union, and IGAD and other platforms for African nations. And that should be going on and they should be the ones to resolve this. There is absolutely no reason for conflict, none zero. And anybody who’s talking about that is being foolish, and also hurting the wrong people by even promoting a discussion of war. This can be resolved by leaders of nations calmly talking among themselves.

Prior to the signing of the MoU between Ethiopia and Somaliland many countries from different corners of the world have come all the way to Somaliland and leased the port there. Why do you think does it cause so much uproar when Somaliland signed similar agreement with Ethiopia?

That gives you a clue as to the fact that somebody wants conflict, because as you pointed out, other countries think the UAE and the international port company have had agreements in Somaliland. So as you pointed out, this is not the first time and therefore, why now, it you get this stupid talk about war. So that’s a clue. That tells me that somebody wants conflict, that somebody doesn’t want good negotiations between Ethiopia and Somalia. Some geopolitical force, doesn’t want Ethiopia to become a dominant growing economic power in East Africa. These are clues to people like me, who understand the way the world operates. And since the beginning of the Prime Minister’s taking the position as prime minister in 2018, there have been one after another attacks on Ethiopia that are trying to prevent Ethiopia from fully developing, and other people who forces who are also using the internal situation Ethiopia, where you have this ethnic nationalism, which is an attack on the nation state, and its attack on Ethiopian citizenship, and that ethnic nationalism is also being supported by outside forces. So I have seen Ethiopia being a victim of many different operations over the last six years now, it’s quite possible that the government could handle this situation better. If I were advising them, I would tell them things to do that could help. But their pursuit of economic growth for their country is right. And it’s to the benefit of all the nations in the region. In fact, implicitly it’s a benefit for the entire continent of Africa.

What do you think would be the way forward the MoU signed between Ethiopia and Somaliland?

I think the best way to handle it is to handle it through private, nonpublic discussions with the leaders of the countries in the region. I mean, you could have a conference. And you could have a conference that discusses economic growth for all the countries of the Horn of Africa, and the importance of development, and present information on how the country would grow with another port, with advanced Infrastructure Transportation to that port. We certainly can reduce the cost of what Ethiopia is paying to Djibouti now, which is a billion and a half dollars. Not Birr, but dollars or other hard currencies. Ethiopia is using up a large a portion of his foreign exchange to maintain operations in Djibouti. And I think there’s a lot of people meddling in. And I would have the leaders of the region meet on their own and discuss from a thoughtful standpoint, from my standpoint, what are the potentials for economic growth, and reason for the necessity of Ethiopia having a port.

Thank you very much

by Zekarias Woldemariam, The Ethiopian Herald

Read my earlier posts:

Live in the Future to Foster Regional Integration With Ethiopia in the Horn of Africa

Ethiopia Access to Seaports Benefits All People of East Africa

“Ethiopian Seaport is Win-Win for East African Nations”: Physical Economic Analyst Freeman

Lawrence Freeman is a Political-Economic Analyst for Africa, who has been involved in economic development policies for Africa for over 30 years. He is a teacher, writer, public speaker, and consultant on Africa. Mr. Freeman strongly believes that economic development is an essential human right. He is also the creator of the blog:  lawrencefreemanafricaandtheworld.com

Freeman: “Most Significant Accomplishment for Ethiopia in Foreign Policy was Joining the BRICS”

Ethiopia’s Evolving International Relations

Below are excerpts from my interview with ETHIOPIAN BROADCASTING CORPORATION The Voice of Pan-Africanism. For the entire article by Wegayehu Muluneh, read: Ethiopia’s Evolving International Relations

Excerpted sections follow:

According to Lawrence Freeman, the most significant accomplishment for Ethiopia in foreign policy was joining the BRICS. As of January 1st, 2024, Ethiopia has become one of ten nations that comprise the BRICS, and also one of three nations on the African continent that belonged to the BRICS. Freeman believes this solidifies Ethiopia’s diplomatic position as a leading nation in sub-Saharan Africa, East Africa, and the Horn of Africa.

The analyst underlined that the formation of the BRICS and its growth institutionally over the last decade is extremely important, because the western-dominated political and financial institutions are suffering in terms of their control of the world’s politics and finances. This gives an opportunity for developing nations or emerging nations like Ethiopia to have their own institution and promote their own policies, independent of the dictates of the western geopolitical financial elite.

Lawrence Freeman said Ethiopia’s influence in Africa in general and in East Africa in particular will grow as the BRICS itself continues to become a weightier institution providing an alternative to the western political financial establishment. Whilst, this puts Ethiopia in an important and unique position on the African continent and also globally.

Ethiopia’s economic growth also instantly linked with activities the nation has carried out on its foreign relations. Prior to the emergence of COVID-19 and the onset of the war in northern Ethiopia in November 2020, Ethiopia was one among a few African and world nations with fastest growing economies. This of course was slowed down by the above-mentioned causes, Freeman explained. “However, we should expect that Ethiopia has the potential to become a leader once again in economic growth in Eastern Africa and the African continent.”

Freeman elaborated that the near completion of the Grand Ethiopian Renaissance Dam (GERD) will advance Ethiopia’s economy over the years ahead. The diplomatic activities that Ethiopia has been doing on the global stage while constructing the Dam, Africa’s flagship project, has been significant. The completion of GERD is a game changer to boost Ethiopia’s say and diplomatic bargain in the region and beyond. The GERD with only two turbines operating is already strengthening Ethiopia’s export of clean energy to Sudan, Kenya, and Djibouti. As the GERD reaches its complete potential of 5,150 megawatts, it will not only supply more energy to Ethiopia but also expand export of electricity to neighboring nations in Eastern Africa. Thus, the GERD and Ethiopia have already started causing the most demanded regional economic integration, which will expand and provide a potential model for regional economic integration.

With its electricity potential Ethiopia has the potential to become a major economic powerhouse on the continent. Thus, Ethiopia is expected to emerge as one of the most dynamic economies in the world.

Reflecting on Ethiopia’s audacious step towards regional relations, Freeman commended Prime Minister Abiy Ahmed’s motivation and courage in 2018 of settling past grievances over land with Eritrea, which won him the Nobel Peace Prize. However, there is no reason for anyone who understands the region, to claim that Ethiopia’s policies towards achieving a port that would give the nation access to the Red Sea, is a cause for war in the Horn of Africa. This is blatantly untrue and those who are participating in this war-mongering event may have ulterior motives for promoting this kind of scenario. War should not be on the table because it is in no country’s interest.

Ethiopia doesn’t need war to access seaports that it can develop to expand its export-import trade. Hailing the recent agreement signed between Ethiopia and Somaliland, Freeman said the agreement will enhance regional integration. The agreement speed up the growth Ethiopia’s landlocked economy by providing access to Red Sea ports, potentially boosting trade and fostering closer economic ties in the Horn region, he added.

For the entire article by Wegayehu Muluneh, read: Ethiopia’s Evolving International Relations

Read my earlier post: BRICS Offers New Potential for Africa & The World: The Human Race Will Benefit

Lawrence Freeman is a Political-Economic Analyst for Africa, who has been involved in economic development policies for Africa for over 30 years. He is a teacher, writer, public speaker, and consultant on Africa. Mr. Freeman strongly believes that economic development is an essential human right. He is also the creator of the blog:  lawrencefreemanafricaandtheworld.com

Live in the Future to Foster Regional Integration With Ethiopia in the Horn of Africa

WATCH Interview with OBN Horn of Africa, January 10, 2024

January 16, 2024

Let us work to make the Horn of Africa and East Africa a model of regional economic integration. This process has already begun, with the Grand Ethiopian Renaissance Dam exporting electricity to Sudan, Kenya, and Djibouti. Ethiopia having long term port access to major shipping routes through the Gulf of Eden and the Red Sea, will expand Ethiopia’s economy and has the potential to develop the regional economy of East Africa. There are three primary conceptual obstacles that people have in understanding how to develop this region, which I discuss above in the video interview with OBN, and below in the written interview with ENA.

One, the majority of people do not understand the physical scientific principles to economic development, having been miseducated by our schools and society.

Two, the legacy of colonialism has perverted the thinking process of many Africans, leading to fixed prejudices that prevent one from seeing what is possible.

Three, most people live in the past, or at best in the present. I try to live in the future, where my mind can see the fruitful potential of that which we humans can create but does not yet exist.

Ethiopia-Somaliland MoU Model for Economic Development of Africa: American Analyst

Interview with Ethiopian News Agency, January 2, 2024

Addis Ababa, January 4/2024(ENA)- The current MoU signed by Ethiopia and Somaliland could become a model for economic development of the continent, Political-economic analyst for Africa Lawrence Freeman said.

In an exclusive interview with ENA, the analyst said that the Memorandum of Understanding signed on Monday could be a “useful example for the rest of the African continent.”

Moreover, the MoU for Partnership and Cooperation inked by Prime Minister Abiy Ahmed and President Muse Bihi Abdi includes wide scopes of cooperation in social, economic, political, and military fields.

It is also intended to serve as a framework for the multisectoral partnership between the two sides, and shall pave the way to realize the aspiration of Ethiopia to secure access to the sea and diversify its access to seaports.

In this respect, Freeman believes the agreement is a breakthrough that could accelerate regional and global trade.

“If you look at it optimistically, the situation in the Horn of Africa could actually become a model for economic development and in the whole African continent. Now, this is what we’re looking for, regional integration, economic-regional linkage into international trade among nations, instead of exporting everything outside the nation. So this could be a useful example for the rest of the continent.”

However, there are political forces within the Horn of Africa and around the world who would like to continue destabilizing the region, the American analyst noted.

He particularly pointed out that there are manipulators and political forces screaming war constantly.

When the prime minister talked about the port in October 2023, dozens of articles were published predicting war. But, there was no indication of war, he stated.

According to Freeman, the historic MoU was signed in a peaceful manner and has the potential to bring other countries to cooperate with Ethiopia in this geopolitically strategic part of the world.

He advised specifically Somalis to refrain from inflammatory statements and resolve the issue calmly.

Given the conflict between Somalia and Somaliland for many years, Somaliland has been conducting its affairs differently in the spheres of currency, economy, governance and others.

The MoU “can offer economic growth to actually both nations because if Somaliland is growing, Somalia is growing too…. Statements like ‘we’re not going to give one inch of our territory’ is the kind of talking that is not helpful. We’re going to have to move forward. We can’t stay the way we are. We need to have a resolution between those two between Somalia and Somaliland.”

Beyond that the problems in the Horn of Africa are very complicated and emanate from a whole bunch of leftover problems from the days of colonialism, he noted.

There is a lot of antagonism and complications that come from colonial history.

“As for the amount of anger and hatred that I see from people against one country versus another, we’re not going to give up. We’re not going to let them know that you’re stuck in the mind of the old colonists picture. My message to people is to move forward,” the analyst underscored.

For Freeman those people who are screaming about war are either fools or they’re being manipulated by other forces in the wrong way.

In general, the American analyst stated that the MoU is very important for Ethiopia to realize the advancement of import-export trade and allow the nation to have greater access to the rest of the world.

Ethiopia also being the largest economy and population, the area can make perfect sense to build a naval capacity it once had when it accessed the Red Sea, he added.

More importantly, Ethiopia is also now going to play a major role as the country has become a new member of the BRICS, the leading institution of the global South, with a new paradigm for development of emerging nations.

That gives Ethiopia a great deal of an opportunity to begin to deal with all the political-economic frailties and create a new level of regional cooperation in the region.

Read my earlier posts:

Ethiopia Access to Seaports Benefits All People of East Africa

Economic Development Can Bring Peace to the Horn of Africa

Lawrence Freeman is a Political-Economic Analyst for Africa, who has been involved in economic development policies for Africa for over 30 years. He is a teacher, writer, public speaker, and consultant on Africa. Mr. Freeman strongly believes that economic development is an essential human right. He is also the creator of the blog:  lawrencefreemanafricaandtheworld.com

GERD Talks Must Shift To Higher Level: Developing the Nile Basin

Lawrence Freeman being interviewed by the Ethiopian Herald on Dec 23, 2023 about the 4th round of talks on the Grand Ethiopian Renaissance Dam

December 27, 2023

The colonial mentality has to give way to the mandate for development –

BY ZEKARIAS WOLDEMARIAM, THE ETHIOPIAN HERALD

“I didn’t expect that these discussions would lead to anything because you have to change the topic of the discussion” says Laurence Freeman, American Political Economic Analyst for Africa (www.lawrencefreemanafricaandtheworld.com), asked about the outcome of the 4th round of the latest series of tripartite talks on the first filling and operation of the Grand Ethiopian Renaissance Dam (GERD).

The negotiation which took place from 17-19 December 2023 in Cairo, Egypt was held to deal on the final rules and regulations for the filling and operation of the dam. Unfortunately, the talks ended up with no deal concluded following which Ethiopia and Egypt issued statements expressing their stance during the negotiations and why they blame the other side for the failure to reach agreement.

Ministry of Foreign Affairs of Ethiopia says that Egypt’s efforts to maintain it historical rights based on the colonial period agreements were the impediments to reach agreement. “During these four rounds, Ethiopia endeavored and keenly engaged with the two lower riparian countries to address the major issues of difference and reach an amicable agreement. Egypt, in contrast, maintained colonial era mentality and erected roadblocks against efforts toward convergence.” The statement read.

Freeman on his part argues that the topic of dialogue among the riparian countries, i.e. Ethiopia, Sudan and Egypt should not be to maintain historical rights, but to plan future cooperation on how to use the water together. “It should not be how do we guarantee so much water which the Ethiopians can’t do. But how do we proceed on a development program that would advance the standard of living of all the people living in and now basic. If there’s going to be another round of discussion that should be the main topic.”

Here is the detail of the brief interview with Lawrence Freeman on the latest development around the GERD talks. Enjoy reading!

Could you tell me your reflection on the 4th round of GERD dam talks which took place recently in Cairo?

When Prime Minister Abiy was in Egypt in July, he suggested to President El Sisi, that they continue the discussion was another round of talks on the implications of the GERD, which just occurred last week was the fourth round of these talks, which, from what I read in the media, nothing really happened that changed the position of either country. And I didn’t really expect that it would. I think that both countries now have made very clear what their positions are. Ethiopia claiming the right of sovereignty over its river systems and energy production. And I don’t think much is going to change from that. 

And I don’t think there’s anything Egypt is going to do that’s going to change it. And the Egyptians have maintained that they must have so much water guaranteed for them every year, which is impossible for Ethiopia to do. I don’t think anything more is going to happen. Hopefully, there is no political or other escalation in this disagreement.

(Curtesy of researcgate.net)

After the conclusion of the talks with no deal Ethiopia and Egypt are trading blames for failing to reach agreement. How do you see the stance of the two sides in this regard?

I think the Egyptians are motivated by a type of ideology, rather than an understanding of the implications of the Grand Ethiopian Renaissance Dam, the GERD is a dam for producing hydropower for development. I mean, electricity is ready to be exported to Djibouti, Kenya and Sudan. And we should look at the potential of this increase injection of 5150 megawatts as a potential to develop nations in the Blue Nile and the White Nile. Well, now basically, the Egyptians do not want to have I believe in Ethiopia as a major economic competitor or see Ethiopia as a major economic competitor, which is a false way of looking at the potential rather than countries uniting together for economic development. I think Egypt was caught up in trying to suppress economic progress in Ethiopia.

And of course, the Egyptians claim that the historical rights now and they don’t have historical rights, nobody has historical rights. Plus the fact that the dam is on the Blue Nile, not on the White Nile, so there’s no real argument there. I think the Egyptians want a guaranteed amount of water that will flow to the Aswan dam and that cannot be delivered and the Ethiopians would be remiss and wrong in my view if they guaranteed it, because they can’t. But there can be joint collaboration and Egyptians for the moment are rejecting it.

This tripartite talk on GERD has failed after progressing for four rounds starting from August 2023. Do you think it is being influenced by internal and external factors, or Egypt is intentionally changing its stance every time?

I don’t think the Egyptians have changed their stance at all; this has been their policy going back to 2015. I think the Egyptians have to accept the fact that this, as we say, is a fait accompli. This has occurred, the dam is at proximately 41 billion cubic meters of water filled. I think it’ll go up to 47 or so around there. 

And then that’s the level of which we’ll be operating on. Each year, it will go down to that level as it’s filled up to 74 billion cubic meters from the rain. And this will produce electricity, which can be used for the development of the nations of the Nile Basin; the Egyptians have a different view. But it’s not going to happen; it is not going to work. There’s no way of Egypt, challenging a dam for energy development. And it’s already been built. So it can’t be unbuilt. So I don’t really understand all the political motivations for Egypt. 

Except what I said earlier, I think they want to maintain the dominant position and retard Ethiopia’s economic development  potential. I didn’t expect that these discussions would lead to anything because you have to change the topic of the discussion. It should not be how do we guarantee so much water which the Ethiopians can do? But how do we proceed on a development programme that would advance the standard of living of all the people living in and now basic, if there’s going to be another round of discussion that should be the main topic.

Egypt has insisted on safeguarding its interest which is a vestige of colonial period agreements. Do you see any possibility of coming to terms with a negotiated deal where one of the sides is insisting on colonial era agreement?1

Well, if you look at the reality of this of the situation, one is Sudan, only gains from the GERD and I think the Sudanese before the crisis that began several years ago, and I believe even now, they’ve made statements to the effect that they’re not suffering at all from reduction of the flow of the Nile through the country in Khartoum. I don’t think Sudan is part of this at all at this point. I think that they were early on, I think they were pressured by the Egyptians. 

The problem that the Egyptians have and people who support their position is that the water that flows into the White Nile, I mean, 80% of it comes from three rivers in Ethiopia, the largest Blue Nile but then you also have two other rivers that contribute to the White Nile. And the power plant; The hydroelectric power plant is on an Ethiopian soil and Ethiopian rivers I visited myself I also visited Blue Nile falls, I’m very familiar with it. And fact of the matter is there is more potential. A designated site is three mores sites for dams that have been revealed in a survey done many years ago, that could be also hydroelectric dam.

So there’s a potential in the Blue Nile Basin for more power beyond the 5150 megawatts that the GERD is producing. It would be in Egypt interest to let’s discuss this type of potential for the future. The problem is colonial rights. The Egyptians believe that the British gave them control of the Nile. Because in the history, the British controlled Egypt and Sudan under the 1899 agreement, the Anglo Egyptian condominium, and they think that they have this right. No, they don’t have a right to other people’s waters, especially since the headwaters for both the White Nile and the Blue Nile do not originate in Egypt. 

Now, Egypt built the Aswan Dam, which was their right to provide electricity for their population. But they can’t demand that other countries cannot build on the Blue Nile, what is that lead into the white Nile and that’s the problem is you had a colonial agreement in 19, it was 1929 with British and the Egyptians and the Sudanese that’s, that stipulated no blockage of the water could be no blockage of the water was permitted to the white nile. 

Now, Ethiopia wasn’t at that discussion, even though it was an independent country in 1959. If the Sudan and Egypt became independent, they had another water agreement. And this water agreement, we affirmed the 1929 agreement. And again, Ethiopia was not at that discussion. So the Egyptians really don’t have any legitimate basis, despite claiming colonial rights that have given to them by the British Queen. 

They don’t really have any historical basis for telling Ethiopia what to do. And in fact, the British and other Neo colonial powers never wanted Ethiopia to develop this dam. They wanted to use Lake Tana as a giant water tank to feed their agriculture in Sudan and Egypt. So they’ve always been opposed to this. I mean, this goes back 300 years to the present. 

They’ve been opposed to the development of the Blue Nile Basin, they’ve been opposed to electricity and that position cannot stand up to the needs of providing electricity, employment, agricultural development, for not only Ethiopian people, but from the neighboring nations, which the good will provide. So the colonial mentality has to give way to the mandate for development.

Blue Nile Basin has potential for more hydro-electric dams for development of the Nile Basin (Courtesy sierrarios.org)

How do you think could the two sides break the stalemate and strike a deal in the future?

As I said earlier, we have to change the subject. The topic of providing a guaranteed amount of water to the Aswan Dam each year is a dead issue. That cannot happen. It’s over. The dam has been built as only a small amount. More has to be collected in the first phase up to I think 49 billion cubic metres. 

We have to leave that subject and we have to go to a higher plan; we have to go to a different thinking; a different manifold no longer discussing water guarantee to the Aswan Dam, but discussing how do we use the GERD and potentially other developments of more dams in the Blue Nile Basin for the benefit of all of the downstream nations in the Nile basin. This requires a higher level of thinking. It requires a level of thinking where your concern is the future development of all the people. 

Those who are living in the Blue Nile, basically, that’s several 100 million people over I think, 10 countries? How do we get together and improve the standard of living of our people? How do we end poverty? How do we use this energy, which is a potential 5150 megawatts, and more energy potential. 

So we have to stop thinking about my country’s historical right. And the same thing comes up in discussions in the Horn of Africa. We have to get beyond that. And think about what is the benefit for the futures of our people in the next one to two generations, like we have to expand our thinking, improve our thinking, to this level, and get away from this is mine. This is yours. You can’t take mine. This petty, geopolitical mentality is really stupidity. And I and the leaders of African nations on many different fronts have to learn to rise above this and think about the future. What is going to help their people in the future? And how do we work with other nations? Not how do we demonize other nations. That’s what’s discussion has got to be. 

The Ethiopian should be actually promoting this discussion. Go beyond where they’ve been at this point, and actually promote a conference have let’s have a conference in Addis Ababa, on the future development of the Nile basin, and which then we can discuss how to cooperate with each other for the benefit of our people.

Thank you very much for your collaboration!

Read my earlier posts:

GERD: Utilizing the Blue Nile to Create Energy for Development in Ethiopia & The Horn of Africa

Freeman Speaks On The GERD: An Engineering Marvel-A Necessity For The Nile River

New Book on Ethiopia’s GERD: Historical Battle of the Nile-Colonialism vs Development

Lawrence Freeman is a Political-Economic Analyst for Africa, who has been involved in economic development policies for Africa for over 30 years. He is a teacher, writer, public speaker, and consultant on Africa. Mr. Freeman strongly believes that economic development is an essential human right. He is also the creator of the blog:  lawrencefreemanafricaandtheworld.com

“Ethiopian Seaport is Win-Win for East African Nations”: Physical Economic Analyst Freeman

November 19, 2023

In my interview above with OBN (11/6/2023), I discuss the importance of understanding the concept of physical economy to competently analyze the future of the Horn of Africa. Sadly, the vast majority of Africans, like Americans, do not chose to look into the future. It is only by knowing what physical economic inputs are necessary to sustain an expanding population 20-40 years into the future that one can determine the best policies of their nation in the present. Claims of “my nation first” or “my ethnicity first,” express a short sighted mentality that is detrimental to the interests of the nations of the region. Full economic integration of the Horn of Africa, driven by investments in infrastructure, is the most reliable path to achieving peace, stability, and economic growth, and avoiding conflict.

Read my comments in the Ethiopian Herald: Why Ethiopia CDjian No Longer Ignore Interests On the Red Sea – allAfrica.com

Read my earlier posts:

Ethiopia Access to Seaports Benefits All People of East Africa

Economic Development Can Bring Peace to the Horn of Africa

Lawrence Freeman is a Political-Economic Analyst for Africa, who has been involved in economic development policies for Africa for over 30 years. He is a teacher, writer, public speaker, and consultant on Africa. Mr. Freeman strongly believes that economic development is an essential human right. He is also the creator of the blog:  lawrencefreemanafricaandtheworld.com

Ethiopia Access to Seaports Benefits All People of East Africa

Potential Ports for Expanded Ethiopian Trade

November 4, 2023

In his new article, Ethiopia needs a reliable seaport and a navy, Ken Opalo provide a great deal of useful information on the necessity for Ethiopia to have access to a sea port to continue its progress towards of industrializing its economy. It is imperative for all the nations in the Horn and East Africa to understand, it is in their self interest for Ethiopia, East Africa’s largest and fastest growing economy, to have access to a reliable port. A prosperous Ethiopia benefits the African continent.

Excerpts below from Ethiopia needs a reliable seaport and a navy

Ethiopia’s economic case for reliable and cost-effective seaport access is strong. In order to secure its economic future, the country must minimize or completely erase the economic costs associated with being landlocked. Overall, landlocked countries tend to be 20% less developed than they would be if they had access to the sea. This is partially due to cost of trade, with transportation costs being between 50%-262% higher for landlocked countries.Subscribe

Given the significant economic costs associated with being landlocked, it is a no-brainer that for Ethiopia to achieve its ambitious developmentalist agenda — which will necessarily require export-oriented industrialization and improved agricultural productivity — it needs to have more control over trade-related costs and policy (or procure stability on both fronts from its neighbors). According to the Ethiopian government, transportation costs gobble up 16% of the value of international trade (which seems really high). Foreign trade currently amounts to 24% of GDP, and needs to grow by orders of magnitude. With an annual output of US$127b, Ethiopia is already Eastern Africa’s biggest economy (Kenya is second at US$113b) but with lots of low-hanging opportunities for even bigger trade-driven output.

Last year Djibouti cut stay of cargo days from 45 to 8 days. In addition, the port is more expensive relative to neighbors, often lacks storage space, and suffers from untimely availability of empty containers for exports. These factors have are the motivation behind Ethiopia’s aggressive port diversification initiative. As of early last year, Djibouti City’s share of Ethiopian trade cargo had declined from 95% to just under 86%, with the Kenyan border Moyale dry port (0.02%), Somaliland’s Berbera (5%), and Djibouti’s Tadjoura (9.6%) emerging as alternatives. These latter routes, however, lack the infrastructure (roads, petrol stations, service and repair stops, etc) to support bulk haulage logistics.

His careless bluster notwithstanding, Abiy has significant leverage over Djibouti (population 1.1m). Ethiopia is Djibouti’s leading revenue generator, ahead of the naval base leases by China, France, the United States, Saudi Arabia, Italy, and Japan. Ethiopian trade reportedly generates more than US$1b each year for the Djiboutian economy. Rents from foreign military bases estimated to be at least US$120m per year. The service sector accounts for nearly 80% of Djiboutian GDP (US$3.5b in 2022), much of it related to ports and logistics. Ethiopia accounts for upwards of 85% of all cargo passing through Djibouti.

Source: World Bank data

II: The economic case for securing reliable seaport access

As shown below, over the last decade Ethiopia has quintupled its industrial output and is quickly catching up with its regional neighbors. If these trends are to continue and if Ethiopia is to attract both domestic and foreign investments into its manufacturing sector, the state must guarantee investors that they will be able to access global markets at reasonable prices. The same goes for investments in the agricultural sector, which still has a commanding share of exports. Agriculture accounts for nearly 38% of GDP (including 50% of manufacturing production), 80% of employment, and about 90% of forex earnings.

Ethiopia’s planned rail network (see below) reflects the country’s industrialization agenda (the same goes for the overall transport masterplan, including road infrastructure). The proposed lines are all designed to serve specific industrial parks. Currently the main rail network (red) terminates at Djibouti City (Doraleh Multipurpose Port), with a planned alternative route to the opposite side of the Gulf of Tadjoura (in Tadjoura). While the rail network will certainly serve domestic production and distribution of goods once completed, an equally important objective should be to guarantee high-enough international traffic volumes to pay for its construction and ongoing maintenance.

As revealed by the planned railway network below, Ethiopia’s seaport options are largely limited to Djibouti — which is cause for believing that Abiy’s comments, if he really meant them and was not just carelessly thinking out loud that he is the latter day Ras Alula Abanega, were a negotiating tactic vis-a-vis Djibouti. Given its importance for Ethiopia’s maritime trade, is also likely that Djibouti is Addis Ababa’s first choice for the location of the planned naval base.

Ethiopia’s industrial parks are in Jimma, Hawassa, Adama, Dire Dawa, Bole Lemi, Debre Birhan, Semera, Kombolcha, Bahir Dar, and Mekelle. Source: Wikipedia

Read my earlier post: Economic Development Can Bring Peace to the Horn of Africa

Lawrence Freeman is a Political-Economic Analyst for Africa, who has been involved in economic development policies for Africa for over 30 years. He is a teacher, writer, public speaker, and consultant on Africa. Mr. Freeman strongly believes that economic development is an essential human right. He is also the creator of the blog:  lawrencefreemanafricaandtheworld.com

Economic Development Can Bring Peace to the Horn of Africa

Develop the ports on the Red Sea and Gulf of Aden to promote regional economic growth in the Horn of Africa. (curtesy of dawn.com.news)

October 31, 2023

Horn Leaders Urged to Consider Ethiopia’s Quest for Access to Red Sea 

Addis Ababa, October 31/2023 (ENA)- Leaders of the Horn of Africa nations have to consider discussing Ethiopia’s quest for having access to sea as it would increase the physical economic growth of the East African region, the American political-economic analyst Lawrence Freeman told ENA.

Prime Minister Abiy has given geographical, historical, economic backgrounds to initiate discussion about Ethiopia’s right to access sea through peaceful means.

The American analyst stated that access to sea not only reinforces the steadily growing import-export trade of the second Africa’s populous nation, but will also ensure development in the region.

For him, Ethiopia’s quest for coastal access to sea outlets “is essentially correct” as it would enable to increase physical economic growth of the people in the Horn of Africa.

“If people understand more about physical economic growth, they would understand that this is not only very reasonable, but it’s correct. If you want to raise the standard of living for 200 million people living in countries in the Horn, then you would benefit from the trade that could be increased in Ethiopia by having a port on the Red Sea.”

In this regard, the analyst urged leaders of the Horn of Africa nations to have discussion to consider Ethiopia’s quest for having access to sea.

Prime Minister Abiy has suggested potential areas like the Ethiopian Airlines, the Grand Ethiopian Renaissance Dam (GERD) and other offers for concession, Freeman stated.

This is perfectly reasonable for the growing Ethiopian economy, he noted.

“The Prime Minister is putting these issues on the table now. (He says) let’s discuss how we are going to bring this about. And I think that’s the approach of a statesman and I would agree with it.”

Access to port is critical to accelerate the growth trajectory of the country and contribute to regional physical economic growth.

Lawrence Freeman, a physical economist, interviewed by Ethiopian News Agency-ENA

“If we look at how we increase the physical economic growth of the people in the Horn of Africa, it is going to depend on Ethiopia. Ethiopia is going to be the dominant economic growth center. And this will benefit all the other countries.

“It’s (therefore) natural to work this out. And I believe this is now an important discussion that has been raised by Prime Minister Abiy. This will be worked out over the years ahead,” Freeman noted.

He also stressed the need for discussion about a regional economic approach since there are several ports in the Horn.

Mentioning about distorted media reports that Ethiopia is claiming access to sea using force if necessary, Freeman noted that this is a very divisive policy that has been used in Africa for hundreds of years.

“We need political leaders and statesmen who rise above this and understand that these are political operations. Some are carried out externally or internally. And the purpose is to prevent the development and sovereignty of African nations. I think the leaders of the nations in the region can sit down and discuss how the region will grow economically.”

“If we concentrate on putting forth the long-term economic growth program that benefits all the nations of the region, the leaders would come to agreement.”

We should also be able to counter those media and other internal and external enemies trying to create tensions between the neighboring countries.

There is no objective reason for countries in the Horn of Africa not to work together for common aims.

Discussions should, therefore, be considered among leaders, experts in the area, including economic experts, water experts and transportation specialists on access to the Red Sea, the analyst stated.

Freeman hopes that this can be done through discussion among sovereign leaders of nation states, including presidents and prime ministers, to deal with the problem.

Lawrence Freeman is a Political-Economic Analyst for Africa, who has been involved in economic development policies for Africa for over 30 years. He is a teacher, writer, public speaker, and consultant on Africa. Mr. Freeman strongly believes that economic development is an essential human right. He is also the creator of the blog:  lawrencefreemanafricaandtheworld.com