The ruling coalition, Ethiopian People’s Revolutionary Democratic Front (EPRDF), has concluded the highly anticipated 11th Congress at Hawassa town, the capital of SNNP region.
During the three day event from October 3, the coalition representatives comprised of 250 voting members from four parties talked about several issues in addition to a report going over achievements of the 10th Congress and proposed agendas to be undertaken in the next two years.
During the closed sessions the participants raised several issues including the current reforms in the political, social and economic sphere.
Sources who attended the closed session told Capital that participants expressed their concern about the border issues between Sudan and Ethiopia and internal border issues. The coming of opposition leaders from abroad and handling the growing ethnic based political instability was raised during the congress. The economic policy and strategy and achievement on regional policy including the progressing peace condition between Ethiopia and Eritrea, Sudan and South Sudan and Djibouti and Eritrea was appreciated by the participants, according to Fekadu Tesema, the congress spokesperson.
He said during the first day of the closed session the congress gave priority to the current affairs and the report of the 11th Congress.
The participants encouraged the move of the new leadership that amplified hope in the country. Opening of the political space and allowing opposition leaders to enter to the country besides influential figures were also stated to be positive achievements over the past few months.
The national reconciliation which improved the multi-party system is also stated as a success registered in the past few months. The collation communiqué also amplified that the multi-party system will be the next move of the country.
The coalition has also agreed to work together to support the current change.
Political party reform was also intensely discussed. Capital was unable to confirm for sure but sources said the party’s political ideology was expected to be debated.
The party document distributed at the congress stated that the ideological development would be undertaken.
The congress discussed improving VAT collection. Documents show that VAT revenue has declined. One reason for this is that people are hiding their VAT tax returns. Meanwhile, other tax payers declare bankruptcy to avoid paying taxes.
These are problems that the government plans to work on changing. The IMF recently released a report saying that government revenue has not improved compared with GDP.
The government planned for tax collection to be 17 percent of GDP by the end of the current five year plan. However tax collection compared with GDP has hovered at around 12 percent.
VAT collection and the general tax collection by the Ethiopian Revenue and Customs Authority (ERCA) only achieved three fourths of targets this past fiscal year. This is the highest gap between expectations and reality in history.
For the 2017/18 budget year ERCA planned to collect about 200 billion birr, but in reality they collected 150 billion.
The party promised to take legal action against people who break the tax law, trade in contraband and beak investment laws.
They announced plans to reform the tax system, something which has been talked about in the past but not applied.
The party continues to want farmers to transition from subsistence farming to growing crops to be sold at the market. As it has been since the first GTP in 2010 developing irrigation will be one of their top strategies. Other programs like mechanized farming, bio technology, strategic crops and specialization in farm areas will be implemented in the next two years.
The diversification of the agricultural input suppliers and quality supply in addition to an organized financial scheme are new strategies for the coming two years. Horticulture development, improving technology and aquaculture development are other new programs. The report stated that technological transformation and research and extension works will be applied in aquaculture and livestock production. Hopes are that more hard currency will be earned from livestock sales.
Industrial parks will be pushed to begin producing as soon as possible. Special support for those who are expanding production and export will be given. Even though the government has attempted to transition to a manufacturing economy since the first GTP the actual performance has been very poor.
To tackle the problem, the government has engaged in developing the parks. The Hawassa Industry Park has been a pioneer in this regard. However several well-known international have come to open shop at the park, although it has not been as much as hoped.
Hard currency revenue from Hawassa Industry Park has not exceeded USD 25 million, while projections indicated that it would take in USD one billion per year.
One of the major reasons for this has been that starting production has been delayed at the factories; as a result the government plans to support investors that begin production right away.
Plans are for the import substation to be a priority as has been the case previously. The report stated that there are around 5,000 products that are being imported which can easily be produced here, such as powdered milk. Every year the country allocates a significant amount of hard currency to importing basic food items like wheat, oil and sugar, while 4/5 of the total population works in agricultural production.
The document noted several plans for getting more foreign exchange into the country in addition to increasing earnings from exports. It called for new studies to be undertaken to expand the amount of hard currency individuals bring into the country.
Remittances actually bring in more foreign currency into Ethiopia than export earnings. Although, that figure declined when there was a boycott by the Diaspora and a problem with illegal remittances. However, since PM Abiy came to power and reformed the political arena remittances have increased.
Another plan to bring more foreign currency into the country is to privatize some public enterprises which would secure cash that would then be invested. In addition the report lists strategies like stopping contraband trade, under invoicing and illicit trade methods, as well as suspending and postponing some government projects until hard currency earnings improve.
The document announced several plans to improve living conditions. The party is looking to the mining sector to improve wealth and contribute to local economies. Since many people are migrating from rural to urban areas, job opportunities and an urban development program must be created.
The condo housing project has made housing more accessible over the last decade. Recently the government in Addis Ababa introduced a saving scheme through the 20/80 and 40/60 programs for condominium homes. However there is still a huge housing shortage, prices are skyrocketing and many are not able to afford their monthly saving plan.
Now, the government is coming up with a new housing strategy.
They will facilitate a plot of land and a loan program for private home developers. The document stated that unlike the previous policy land and finance will be facilitated for house developers. “The government will minimize its role and directly engage with home developers to develop houses,” it added. In addition foreign real estate developers will be able to engage in the housing scheme in addition to local investors.
At the end of the congress eligible voters which are usually known as central committee members elected their chair and deputy.
The central committee (CC) is made up of 45 people from 4 parties. According to the information Capital obtained, 178 CC members out of 180 participated on the last day of election.
Except for Muferiat Kamil, chair of Southern Ethiopian People’s Democratic Movement (SEPDM), Demeke Mekonen, chair of the Amhara Democratic Party (ADP), Abiy Ahmed (PhD) chair of Oromo Democratic Party (ODP), and Debretsion Gebremichael (PhD), chair of the Tigrayan People’s Liberation Front (TPLF) competed for the chairman and deputy positions.
According to the election result 177 members have voted and Abiy, who come to power in March was re- elected with 176 votes to chair the party for the coming two years. One vote went to Demeke. For the deputy chairmanship Demeke who is currently Deputy Chair beat out Debretsion. He secured 149 votes for the deputy chair position; while Debretsion got 15 votes, 13 did not vote.