Why the Developmental State Failed in Ethiopia

Giday Gebrekidan

 

Polarized Background

In May 1991 the Derg regime collapsed and the Eritrean People’s Liberation Front (EPLF) took over Eritrea and the Tigray People’s Liberation Front (TPLF) with its new coalition of national fronts, the Ethiopian People’s Revolutionary Democratic Front (EPRDF), took over Ethiopia. The Eritrean problem was solved by formally accepting Eritrean independence in 1993. What remained was finding solutions to the rest of Ethiopia’s problems short of granting independence to the other nationalities.

As Clapham (2019, p. 45) describes it, one major issue of Ethiopia’s political economy is the structural “imbalance between the sources of political and economic power”. The main areas of economic activities are the areas acquired in the late nineteenth century, the Southern and Western parts; while the political power is mainly in the hands of elites from the Northern area.

The EPRDF together with other representatives formed the Transitional Government of Ethiopia and accepted a “charter” where its reform agenda for transition was set. Vaugham (2015) describes three trajectories of fundamental reform: decentralization, democratization and liberalization. By establishing regions with national boundaries and granting of self-rule the state was to be decentralized; with the introduction of multi-party electoral system the politics was to be democratized; and with the introduction of market economy and liberalization the productive potential of the people was to be released.            

This was easier said than done because for one the first thing needed was national consensus or trust among the people and between people and the leadership. This was in non-existence. On the one hand the Unitarians opposed accepting Eritrean independence and thought of the national federation as posing a danger of fragmenting Ethiopian unity; on the other hand national fronts like the Oromo Liberation Front (OLF) and the Ogaden National Liberation Front (ONLF), that were denied from exercising the right to secession, thought of TPLF as only giving lip-service to national rights in order to widen its political base by garnering support from the hitherto oppressed nationalities of Ethiopia.       

 

Top-Down Modernization

In the face of such polarization and lack of any common ground, democratization and liberalization doesn’t look feasible. But overlooking this limitation and imagining a radical top-down reform isn’t a new phenomenon either. From the very start of any thought of transformation or modernization in Ethiopia, it is first thought in terms of state power. Clapham (2006) attributes this to the hierarchical nature of the society and the resulting consciousness of power relations, in addition to this he also mentions the European states that the Ethiopian rulers envied were powerful as a result of their modernity, this power is also seen as a means to realizing modernity.

One important factor Clapham overlooks is the need of power in maintaining an empire, because empires aren’t built with the consent of the populace. As Clapham (ibid, p. 109) notes for Ethiopians modernity isn’t “something brought on the back of colonialism”, as it is for most of Africa; he says for Ethiopians modernity is something brought by attempts of ‘modernizing’ Ethiopians which he terms ‘the politics of emulation’. 

The prize for these modernizers is state power, but modernization by its nature empowers the populace and thereby the path for further modernization is paved. In Ethiopia’s case this was unthinkable because there wasn’t a populace that could initiate such a transformation, which is why it remained a top-down affair. The public was divided and kept under control with a pervasive and extractive state. As John Stuart Mill (1993 [1863]. pp. 392) puts it:

“Free institutions are next to impossible in a country made up of different nationalities. Among a people without fellow-feeling, especially if they read and speak different languages, the united public opinion necessary to the working of representative government cannot exist.”

Clapham (2006) as well observes that from the very start in Ethiopia development is seen with different kinds of ‘state power’ models. Ethiopian leaders at different periods have taken as their model Russian, Japanese, British, Soviet and Asian tiger economies’ experiences. One example that is conspicuously missing is the liberal model, which proves Mill’s quote mentioned above.

What these emulations have in common is their failure. Clapham (ibid, p. 110) attributes the failures to “the inadequacies of state power as an instrument of development”.

So, we can see the EPRDF’s attempt of transformation in this line. It started with the promise of decentralization, democratization and liberalization and in practice introduced different mechanisms it could supersede them. The EPRDF has to promise these things because it knows their opposites have been tried and have failed. But whether because of its ideological background, i.e. Marxism-Leninism, or other political aims, it was committed to maintaining the Derg’s policy of state ownership of land. It was also the Derg’s invention, the kebele administrative unit that was maintained and strengthened (Clapham, 2019).  In a poor country like Ethiopia, land is one of the main sources of capital, the other being labor, so maintaining control over land access is a critical issue. Meanwhile the kebele is, as we saw it, where the government’s tentacles reach the people, or where basic social and civil services are delivered. This means the government maintains monopoly over land and over decision making over delivery of services (Vaugham, 2015).

 

Regional Autonomy and Centralized Planning  

The national regional states established by the federation were supposed to have autonomy, but in practice the economic policy that took Ethiopia as a single unit encroached on their autonomy. The developmental state model the EPRDF chose needed big and centralized government.

According to the framework of Hauge and Chang (2019), who wrote on the developmental state experience of Ethiopia, developmental state is one that is mainly inspired by the Asian experiences, has state-private partnership led by the state, prioritizes economic development through industrialization, is legitimized by its economic performance, and has independent professional bureaucracy.

Hauge and Chang (ibid) identify three main areas where Ethiopian developmental state deviates from their framework: the public support for development projects is ethnically fragmented; the bureaucracy lacks power and independence; and in manufacture the domestic private sector is small.

 

Watershed Moments

It is easy to see these shortcomings are symptoms of a polarized state. For the EPRDF, just like its predecessors, the response to the challenges was making the state even more ubiquitous. There were two major watershed moments in EPRDF’s experience before it was dissolved by elites from within the Front and replaced it by Prosperity Party in 2019. The first is the Ethio-Eritrea border war of 1998-2000 and the second is the 2005 countrywide election. The first made the EPRDF lean towards a more pan-Ethiopian rhetoric for a countrywide military mobilization; and the second one made it seek a more aggressive industrialization policy to achieve performance legitimation from the urban population following its unexpected loses in the 2005 election.     

The border war with Eritrea created pressure on the leading member of the EPRDF, the TPLF, over differences on Eritrea and spilled over to the other members as well. The Prime Minister’s, Meles Zenawi, faction won over the dissident faction. The dissidents were ex-communicated in a truly socialist fashion and arrested over charges of corruption. 

After the division the party started reforms of the state by modernizing, professionalizing and bureaucratizing it with a focus on capacity building, education and urban development (Vaugham, 2015). The TPLF as a guerrilla fighter that came to power never seem to accept the separation between state and party. It feels entitled to rule because the party has sacrificed so much for the “liberation”. On the other hand the population at the center felt the TPLF is a usurper that took power by force instead of consent. One Amhara elite, Tekle Yishaw, even wrote a book about it listing TPLF along all historical Tigrayans starting from the imperial times that happen to become powerful as usurpers who scrimmage for power. The title of the book literally says “Tigrayans who Scrimmage for Power” in Amaharic (romanized): Seltan Teshami Tegrewoch.

In absolute opposite of this the TPLF was completely at home ruling in Addis Ababa. In fact it felt so entitled to rule that it doesn’t even seem to see itself as an alternative political party operating under a constitutional rule. It wants to run the government just as it ran the liberation struggle, as a sole representative of the will of the people (except now the people are no longer as homogenous as in its liberation struggle days). It described itself as vanguard party and its ideology of revolutionary democracy was to serve the people until full democracy could be viable. This domination of the party over the state at all levels was undermining any form of democracy at the individual or group level, neither individuals as citizens, nor national regions as members the federation were to exercise the rights guaranteed by the constitution.  

The border war weakened the TPLF in two ways, one the split has resulted in the reform and strengthening of the state at the cost of the party and two the pan-Ethiopian nationalistic rhetoric gained strength at the cost of the national right to self-determination of the nations within Ethiopia (ibid.). To this we might add the “cold war” that continued between the two states was a burden on its base region of Tigray which was turned into a far north peripheral state by the close of borders with Eritrea and the resulting loss of trade route that leads to the port of Massawa through the region. 

These changes were exposed by the 2005 countrywide elections, which resulted in unexpected loses to CUD, a party that claims to advocate a pan-Ethiopian “civic” nationalism. This lay bare the fact that there was no national consensus on the federal structure of the state; it was a threat not only to the ruling party but to the state itself as well. Election results were rejected by the opposition and this resulted in violence and arrest of opposition politicians. This made the EPRDF to work in strengthening the party’s hold on the society and strengthen its investment for a better performance legitimation.

 

Looking for Performance legitimation & Earning the Opposite

A new wave of party cadre appointments were made to manage kebeles and kebele representative council members were expanded, Vaugham (ibid.), says this was done to improve either service delivery and accountability, or strengthen political control. EPRDF obsession with control is manifestation of any empire state’s control syndrome. In addition to the administrative control the EPRDF used monopolizing the economy as a political tool. This was achieved via direct control of private entrepreneurs, large party owned enterprises and large state owned enterprises (Wassihun, 2020). As we saw earlier Clapham (2019, p. 39) used the term “socialist gigantism” to describe Derg’s policies, in a similar fashion we could say EPRDF’s policies could be seen as manifestations of “state gigantism”.   

The new capital investments saw massive infrastructural expansions in road and telecommunication networks, industrial parks, condominium housing constructions and hydroelectric power generations.

The crown jewel of these investments was the Grand Ethiopian Renaissance Dam (GERD), the biggest of its kind in Africa and among the top ten in the world, but the EPRDF would be dissolved before the dam’s completion and the TPLF would be reversed back to a guerrilla fighter and its base region Tigray would host the biggest war of the 21^st Century with the deaths of hundreds of thousands of soldiers and close to a million civilians.

Ironically, the dam was a double whammy for the TPLF. First it invited international relations challenge by angering Egypt whose view of the Nile waters is stuck in colonial era treaties. This made Egypt to double down on its effort of sabotaging the EPRDF regime (Maher, 2013). Second after the downfall of TPLF, according to Verhoeven and Michael (2022, p. 639), because of the ““schizophrenic”—pro-Egypt on the GERD and pro-Abiy in Ethiopia” approach of the U.S. policy, the Trump administration embraced Abiy’s domestic policy even more and increased their support for his consolidation of political power and (ibid., p. 641) blaming any other concern on “vestiges of the old regime”. This means the dam instead of bringing the TPLF any performance legitimation, if anything it hastened its downfall and after its downfall it garnered U.S.’s support for Abiy’s war on the TPLF.

The EPRDF, however dysfunctional its system might have become, did bring impressive transformation of the economy. Between 2000-2013 GDP grew at a rate of 9.5% annually, which was exceeded only by Angola (11.1%) in sub-Saharan region, of course Angola’s growth could be ascribed to hydrocarbons while Ethiopia has very little minerals (Clapham, 2018). By 2013 the number of Ethiopian millionaires doubled to 2,700 since its 2007 level; this rise of millionaires is closely associated with growth in GDP which rose by 93% over the same period (Smith, 2013). In 2000 Ethiopia had one of the highest poverty rates in the world (44% of the population), by 2011 share of households living in poverty fell to 30%, which is a 33% reduction in households living in poverty (World Bank, 2015).

Real GDP per capita grew from US$258 to US$744 in 2018 as measured by constant 2015 US$ (WDI 2024). Export of manufactured goods grew 21-fold from US$21m to US$436m in the period 2004-2015; in the same period total merchandise export grew from US$503m to US$3.8b (Hauge and Chang, 2019, p. 837). Agricultures share of total GDP declined to 31% in 2018 from 45% in 2008 (WDI 2024).

What drove this growth is large government spending on infrastructure and construction. Infrastructure projects mainly transport and power generation took more than 40% of federal budget (Hauge and Chang, 2019). On the human development side education and health saw significant changes. Net primary school enrollment in 2014 rose by 19% from a 1994 level covering 79%; while life expectancy reached 64 years with an increase of 12 years from the year 2000 (Arkebe, 2015).

This economic boom raised so much hope among economists that it made Hauge and Chang (2019, p. 837) say, “If any African country will become an industrial power-house, it is likely to be Ethiopia.” But as we saw it above they do notice the support for the developmental efforts was ethnically fragmented (ibid.).

The group within EPRDF that brought Abiy to the leadership position was popularly referred as Team Oromara (an amalgamation of the names Oromo and Amhara, in reference to the base regions of the team). This is a clear demonstration of mobilization of cultural units (i.e. nations) for political ambitions and the cycle of conflicts that we saw at the beginning of this part. While the U.S. in their support for Abiy were thinking of “democratic transition”, there was only “the personalization of power and the deinstitutionalization of the party-state” Verhoeven and Michael (2022, p. 640).

Once again the vicious circle of conflict is being observed kicking the hope of building modern institutions further. Today the country’s defense forces are being deployed in all regions to quell conflicts and rebellions. Internally displaced people passed 28 million at the height of the political crises in 2018 (WDI 2024). 

 

References

Arkebe Oqubay. (2015). Made in Africa: Industrial Policy in Ethiopia. Oxford: Oxford University Press.

Clapham, Christopher. (2006). Ethiopian Development: The Politics of Emulation. Commonwealth and Comparative politics, 44(1), 108-118.

Clapham, Christopher (2018) The Ethiopian developmental state. Third World Quarterly, 39(6), 1151-1165.

Clapham, Christopher. (2019). The political Economy of Ethiopia from the Imperial Period to the Present. In Fantu Cheru; Cramer, Christopher; Arkebe Oqubay (Eds.). The Ethiopian Economy. pp. 33-47. Oxford: Oxford University Press.  

Hauge, Jostein and Chang, Ha-joon. (2019). The Concept of ‘Developmental State’ in Ethiopia. In Fantu Cheru; Cramer, Christopher; Arkebe Oqubay (Eds.). The Ethiopian Economy. pp. 824-841. Oxford: Oxford University Press.

Maher, Ahmed. (2013, June 4). Egyptian Politicians Caught in On-Air Ethiopia Dam gaffe. BBC News. Retrieved October 26, 2024, from http://www.bbc.com

Mill, John Stuart. (1993 [1861]). Representative Government. In  Williams, Geraint (ed.). Utilitarianism, on Liberty, and Considerations on Representative Government. London: Everyman.

Smith, David. (2013, Dec. 4). Ethiopia Hailed as ‘African Lion’ with Fastest Creation of Millionaires. The Guardian. Retrieved October 28, 2024, from http://www.theguardian.com

Verhoeven, Harry & Michael Woldemariam. (2022). Who lost Ethiopia? The unmaking of an African anchor state and U.S. foreign policy. Contemporary Security Policy, 43:4, 622-650.

Vaugham, Sara. (2015). Federalism, Revolutionary Democracy and the Developmental state, 1991-2012. In Prunier, Gérard and Ficquet, Éloi (Eds.). Understanding Contemporary Ethiopia. pp. 283-311. London: Hurst & Co. 

Wassihun Gebreegizaber Woldesenbet. (2020). The tragedies of a state dominated political economy: shared vices among the imperial, Derg, and EPRDF regimes of Ethiopia. Development Studies Research, 7(1), 71-82.

WDI (2024). World Development Indicators online database, World Bank, Washington, DC. Retrieved October 2024.

World Bank Group. (2015). Ethiopia Poverty Assessment 2014. Retrieved October 2024. http://hdl.handle.net/10986/21323