The Primacy of Good Governance for Development in Ethiopia :  A Message to the President of the World Bank

Ethiopians in the Diaspora and within the country have been urging Mr. Paul Wolfowitz, President of the World Bank, to recognize the important roles that multi-party democracy, the rule of law, protection of fundamental human rights, freedom of the press, public engagement and participation, accountability, private sector development, land reform, property rights, the separation of powers, peace and reconciliation play in Ethiopia’s development and growth. The critical and singular role that good governance plays in any country’s development and growth is now universally acknowledged and accepted. The principles applies to Ethiopia as much as it applies to Afghanistan , Ecuador or the Philippines

Without good governance and accountability, state sponsored graft, corruption, waste, nepotism, favoritism and exclusion will continue. For example, in a recent report, the Ethiopian Auditor General advised the Government that 7.2 billion birr was “unaccounted for.”  It is reported that the Ministries of Finance and Economy informed the Auditor General that it is not his responsibility to “check where the money went and what it was spent on.”  Over the past 15 years, the donor community has offered the Ethiopian Peoples Revolutionary Democratic Front (EPRDF) Government led by Mr. Meles Zenawi more than US $21 billion, with large amounts from the World Bank. There is no evidence to show how and where these funds were used. There is no evidence to show that the poor in rural or urban Ethiopia benefited from these loans and grants.

 Therefore, without good governance and public accountability donor assistance would have little if any impact in Ethiopia ’s development and growth. There is actual economic data from donors that shows that the status of the Ethiopian poor has either remained the same or gotten worse.

In a provocative Los Angeles Times article entitled “Africa: the corrupt continent” and dated May 23, 2006, Michael Holman states that “Every year, about US$15 billion pours out of Africa , a sum that equals international aid. As the money comes in, capital flows out into Western Banks. Every year, 70,000 of Africa’s brightest and best leave to work abroad, and 100,000 foreign “experts” come to work in Africa .” The cost of this “expertise” to Africa is about US$ 4 billion a year. Same time, donors tell Africans that they need “capacity building” in almost every field. Ethiopians identify with the statistics because they know the effects of poverty and lack of freedom on their families, relatives, themselves and more important on their society.

Over the past few decades, donors have spent more than US$550 billion on African development. As Holman says in his article, these loans and grants have “left Africans poorer than before.” As in Ethiopia , Africans have become more and more dependent on foreign aid to meet their basis needs like food. Continued dependency robs Ethiopians of their honor; their dignity; and their humanity. The donor community’s reluctance to face the structural and policy issues in Ethiopia contributes to the lack of confidence and credibility.

We are informed that the World Bank’s Basic Services Program that was approved recently----a source of debate & tension between Ethiopians in the Diaspora and the Bank’s representative in Addis Ababa--- is intended to meet the basic needs of the poorest of the poor in health, education, sanitation etc.  Our sources now inform us that since then, the Bank has approved additional projects in the areas of financial sector management (capacity building), rural project (capacity building again), rural access to electricity and roads.  According to these sources, the Bank’s new commitment stands at US$ 500 million, among the largest commitments in Sub-Saharan Africa.

Under the current political situation in Ethiopia , including the lack good governance and accountability, one wonders about the justification for restoring Bank assistance to Mr. Meles Zenawi’s Government at this time?  Ethiopians have begun to question the messages being given to the Ethiopian people who have been struggling for freedom, democracy, and the rule of law, human rights and peace?  They wonder who will benefit most from these loans and grants? They ask what independent monitoring and auditing systems the Bank has put in place to prevent misuse of funds?  They question whether Mr. Mr. Wolfowitz is fully informed by his subordinate about the potential reputation risk to the Bank and to him as President?

A number of Ethiopian intellectuals, civic and political leaders contend that the Bank cares neither about the current political crisis nor about gross violations of human rights in Ethiopia .  They say that its primary interest is to continue business as usual and to lend. On the other hand, it is hard to reconcile this view with Mr. Wolfowitz’s strong commitment to good governance, the rule of law, freedom, free press, democracy and anti-corruption. Many observers believe that he wants to leave a legacy, especially in Africa .

In an editorial piece in the New Republic on June 16, 2006, Joshua Kurlantzick noted that “Under Wolfowitz, the Bank has put real teeth into the fight against corruption---corruption that hinders aid and undermines democracy and good governance across the developing world.” The President of the Bank is fully aware that there cannot be accountability without freedom. He is aware that there cannot be empowerment and public engagement in a country where a single party dominates all aspects of life. He is aware that there cannot be transparency without a free press. We believe that he is fully aware that there cannot be democracy and peace without a multiparty system.

Mr. Wolfowitz’s thinking about governance is similar to that of the Commission on Africa that stated in its report, “Without progress in governance, all other reforms will have limited impact” in Africa . Good Governance is therefore a precondition to fighting poverty and backwardness in Ethiopia . In today’s Ethiopia , press freedom is non-existent. As a result, no one checks the actions and behaviors of government officials. Violations of human rights have become routine. Jailed leaders of opposition parties, civic organizations, youth, the emerging free press and others cannot expect justice as the judiciary system simply complies with the dictates of the ruling party.

 In our view, the suspension of civil liberties, the jailing of opposition group leaders, the non-existence of free and vibrant civic organizations and the lack of press freedom make it easy for corruption, graft and nepotism to be routine. It is therefore hard to imagine that Bank funding can benefit the poorest of the poor without good governance, a free press, a strong civic society, a vibrant opposition, freedom and democracy.

 As the celebrated Nigerian Author and philosopher Chinua Achebe said, “An individual tyrant or a small clique of looters in power can destroy the lives and the future of whole countries and whole populations by their greed. The consequences of these actions can be of genocidal proportions.”  Development, growth, peace and stability are therefore directly linked to good governance. By any measure, Ethiopian society cannot and will not be the exception to the reality that Chinua Achebe pointed out.

Mr. Wolfowitz’s upcoming “official visit” to Ethiopia is therefore an opportunity for the Bank to send an unambiguous signal to Mr. Meles Zenawi and his “small clique” that Ethiopia cannot achieve real progress without good governance. Since he is publicly committed to freedom, democracy, anti-corruption, the rule of law and accountability, he can show the Bank’s commitment by emphasizing to Mr. Meles Zenawi and his “clique” that:

1.      The rule of law and good governance are good for business and for development;

2.      The distorted politicized environment prevents private sector participation;

3.      The privileged status enjoyed by companies and individuals connected to or owned and run the ruling Party shut out others from contributing to the country’s development and to the principle of fair play in the market place;

4.       State control over land  is an obstacle to private sector development, security and preservation of the environment

5.      Regulatory burden, arbitrary administration and nepotism keep private companies from operating on a level playing field; and prevent the Diaspora from returning and investing in the development of their society;

6.      Financial and credit services that favor politically loyal firms and individuals prevent others from access to credit and licensing;

7.      A command and control mentality in the economic sphere prevents Ethiopia from the benefits of globalization and regional integration;

8.      Lack of freedom and violation of human rights create a traumatized generation of Ethiopian youth that is beginning to lose hope in the future; and that this is not in the country’s long term interest;

9.      The neglect of girls and youth and total disempowerment of the poor and women prevent the country’s human capital from being fully used;

10.  Window dressing by Mr. Zenawi’s Government concerning change, with the sole intent of securing Bank support is no longer acceptable;

11.  Ethnic division and polarization do not promote development, peace, security, national reconciliation or regional stability; and,

12.  Continued repression of democratic groups, including imprisonment of opposition and civic leaders does not create mutual trust, confidence; and that dialogue and national reconciliation are vital for Ethiopia’s development and growth; and

13.  It is time for all Ethiopians to be full participants in the development of their society; and to rely more heavily on their own potential and creativity.

In short, Mr. Wolfowitz has a chance to translate what he says into action in Ethiopia . In doing this, he will restore the confidence of the Ethiopian people, and particularly the young, in the Bank’s sincere and non-political role to help fight endemic poverty in Ethiopia by tackling the core issue of governance, the rule of law, peace, national reconciliation, freedom and multiparty democracy.