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Doing Business had been discontinued for the last two months as our contributor Ton Haverkort was abroad on summer vacation. We are delighted that he is once again back at Capital with his column revolving around the peculiarities, conditions and joys of doing business in Ethiopia as perceived by non-Ethiopian observers.

Happy New Year

By Ton Haverkort

And so we have come to the end of another year, or better another thousand years. The New Year has just begun and let us hope it will be a good one.

The transition from one year to the next is normally anticipated eagerly and celebrated the world over. In Ethiopia we like parties, so we repeat most of the holidays following our own calendar. The long awaited millennium celebrations have now arrived and many look forward to them.

Quite a few happenings are planned for and visitors from abroad are expected to join the extravaganza. I suspect though that many others anticipate the new year celebrations with some apprehension as they will find it difficult to buy even the most basic ingredients that make up for the traditional holiday family meal. I was told that the price of “berbere”, an essential ingredient for “dorro wot” has shot up to some 60 Birr per kilo, making it difficult to come even close to the fiery sauce that makes the dish so special and so typical Ethiopian. Many people I meet complain bitterly about the skyrocketing costs of living, in economic terms referred to as inflation, the causes of which nobody has been able to satisfactory explain to me yet. Life is becoming expensive even though at the surface many people seem to be doing well. Sure enough, there are the “have’s” and the “have not’s” but I guess that even employees on an average monthly salary will not have much to spare at the end of the month.
Why we find it acceptable that millions are spent on the transition from one day to another, while the majority of the Ethiopians find it difficult to make ends meet, beats me but anyway. I suppose there is something special about moving into a new millennium.

What troubles me is that prices are hiked sharply and that there seem to be no measures to protect consumers against the inflation or a sudden increase in their monthly expenses.
House rent provides a good example here. It has become quite common now that tenants are given a sudden notice that the monthly rent of their house will be increased shortly and that in case they cannot afford this they are expected to vacate the premises. Landlords seem to have no problem in violating the contract while tenants have no choice but to pay up or look for another house. In this way, renters are pushed more and more to the outskirts of the city, having to find another school for their children and spending more time to commute to and from work. The entire family life and routine are upset to say the least. Tenants need to be protected in my opinion with legislation, which regulates the prices for rented houses and which sets limits to annual house rent increments. Tenants have their own responsibility as well of course in making sure they sign a contract, which is in their own interest as well. If the contract offered is not in their interest they have to make sure that clauses are included that protect them.

Prices can be controlled for basic food stuffs as well. Minimum and maximum prices can be set to make sure that citizens can afford to buy what is essential in the family shopping list and that producers get their fair share. The balance of the two doesn’t always work out and that is the basic reason why in some countries agricultural products are subsidised by the government.

Some people will argue that these are the consequences of the so called free market economy. Yes, that is true but only to a certain extent. Even in a free market economy where prices follow trends of supply and demand, the system operates in a certain policy framework which sets the boundaries within which the game is played. Thus, consumers, more especially those with minimum and average incomes, are protected and are relatively sure that they can feed their family and provide them shelter, without fear that they will be evicted next month.
Many people had a similar misconception about democracy in 1991 (Gregorian calendar) shortly after the change of power in this country. For some time, employees reported to work and left for home as they liked. Asked why, the answer was that we are now living in a democracy, assuming that in a democracy you can do as you like. While it often seems to be so that people in democratic countries can do as they like, in reality this is not so. Where there are rights and freedom, there are also obligations and responsibilities, set within the framework of a constitution. Outside that framework, citizens cannot do what they like and are held accountable for their violations.

Coming back to the title of this article I do wish everybody a happy New Year and I look forward to a year of millennium celebrations and activities as we have a full year ahead of us to engage in projects that can be of benefit for the more marginal sections of society and make a difference in the lives of the people who are left out.