Friday, July 12, 2024

PM lauds results, braces to address forex, deficit


This week, Prime Minister Abiy Ahmed (PhD) gave his second press conference since he came to power a year ago.
To the surprise of few, the economy was the first issue addressed. From his perspective, the economy was a mess when he came but is now on the right track. Not everyone agrees with this assessment as some business consultants say economic indicators remain dormant.
“A week after I came to office we could not settle a 20 billion birr salary payment, and countries that provided loans were asking for the settlement but we were unable to pay the debt or access fresh loans,” he said.
“There are two other major challenges, the hard currency shortage and the budget deficit. There are also delays on projects like sugar which have cost us a lot of money,” Abiy explained.
Without investment or other supports, we were able to secure USD three billion including the World Bank concessional loan, for direct budget support, according to the PM.
We have secured commercial loans, from China for several projects. China wanted us to start paying back loans now; however, we have convinced China to extend the payment to 30 years or a concessional loan agreement instead of the previous ten-year agreement.
“We have agreed with China on several loan extensions, allowing us to pay about 100 million USD instead of the expected half a billion,” he explained.
Our economic problems are structural and they will require several years to improve, but the short term problems have been addressed, according to the PM.
However, there are still other issues that need attention. Private companies, particularly in the manufacturing and construction sector say they have been stuck for over a year.
Representatives in the private sector and economic experts argue that dried up hard currency is affecting the economy along with stagnating government projects.
Industry leaders say they have been unable to access hard currency to import raw material, and most heavy industry is operating at less than 10 percent.
He then took this opportunity to review diplomatic, economic and political achievements.
The reform we have begun is seeing results, in the diplomatic sphere with major allies and regional powers. The US has reduced its support for the African continent generally but it has improved its support for Ethiopia. China has also provided additional assistance including a quarter of the total funds to develop the rivers in Addis Ababa, he said.
Germany is expected to announce new support in the coming weeks. Across Europe in France, Italy, and the Scandinavian countries, the reform has been met with applause.
When he came to power, the PM stated that, after renovation, he would open the historical Atse Menelik II Palace to the general public and tourists including people transiting at the Bole International Airport.
On Thursday March 28, journalists visited part of the 40 hectare Menelik Palace compound. Officials at the Office of the PM indicated that the area will likely be opened to visitors around the beginning of the next Ethiopian New Year in September, 2019.
Currently, renovation work at the old Menelik Palace and establishing recreation parks, a zoo, a kids’ playground area and other facilities is in progress.
The coming World Economic Forum on Africa 2020 is also expected to be held in the over a century old Menelik palace Hall, that stands in the same compound. While the upcoming Sheger Grand Dinner, which will gather do-gooders willing to fork over five million birr for a plate to help rehabilitate rivers in the city will be hosted in the same hall this May.
The renovation project of the palace is financed by anonymous donors. There are rumors that UAE financed the USD 130 million spent on the renovation of the palace and that the renovation is also done by UAE companies.
French President Emanuel Macron, who visited Menelik Palace during his recent visit said that his country will support the government’s effort to rehabilitate the Menelik compound and the Jubilee Palace of Emperor Hailesilase and make them open to the public. France is also expected to manage the renovation work of the Lalibela Rock Churches.

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