Recommendation 1

Policymakers need to reevaluate their regional security and development strategy related to Ethiopia and the wider Horn of Africa

For years, Ethiopia has portrayed itself as the primary security actor and regional hegemon, and positioned itself as an important pillar underpinning many donors’ security strategies in the region. Ethiopia has been an active and fundamental partner in various peace missions – e.g., African Union Mission in Somalia (AMISOM), United Nations Mission in South Sudan (UNMISS) – and counter-terrorism efforts (mostly targeting Al Shabaab). As well, it has been a relevant actor in mediation (e.g., the Sudan Constitutional Declaration of August 2019) and several regional multilateral organisations, e.g., Intergovernmental Authority on Development (IGAD), African Union (AU).[205]

With the onset of the civil conflict in Ethiopia, the security context in the country and Horn of Africa region has dramatically changed. In recent months, Ethiopia has withdrawn peacekeeping forces, faced clashes between ethnic groups within its own armed forces, become more confrontational towards regional multilateral institutions seeking to mediate in its civil conflict, and come under sanction from the US (its main counter-terrorism partner). At the same time, emboldened ethno-nationalist groupings have reignited long-standing disputes with neighbouring states (notably with Sudan over al-Fashqa).[206] Further externalised impacts may be expected, but are hard to predict as the political settlement within Ethiopia and its federal states is still in flux. As a consequence, many donors active in the region – including the EU and its member-states, the US, and China – have lost a key partner underpinning their regional security and development strategies. Simultaneously, geo-political actors active in the Horn are likely to ratchet up their efforts to explore the new opportunities created by the developing conflict, as can be seen for instance in the renewed Egyptian and Turkish efforts.[207]

The changes outlined above result in a rapidly changing and unstable political economic context, both within Ethiopia but also impacting the states surrounding it. Hence, donors active in the region would do well to reevaluate their regional security strategy, as well as their development approach to the extent it relies on a modicum of (Ethiopian-supported) stability (for instance in Somalia and South Sudan). While doing so, it is key to avoid viewing the civil conflict in Ethiopia as a conflict solely between federal and Tigrayan interests, that could potentially be resolved through bilateral mediation. As shown in the previous chapters, the political transition ongoing in Addis Ababa involves a rebalancing of power between a wider range of ethnic groupings as well as pan-Ethiopianist groupings, and is leading to tensions in many areas across the country as well as over state institutions. The resolution of this situation requires a renegotiation of the political settlement between a wide range of groups, and is likely to require significant efforts even if hostilities between the Tigrayan forces and the Federal aligned forces cease. Additionally, if dwindling resources are increasingly used to maintain the political coalition in the center, increasing fragmentation in the periphery may be expected as state services decline. This may hamper a sustainable renegotiation of the political settlement.

Recommendation 2

Policymakers implementing economic pressure should consider the humanitarian implications of such measures

The Abiy administration is facing significant pressures from a variety of sides. The administration has gone ahead proactively to break up EPRDF-era clientelistic networks in order to gain control of the state apparatus and secure space to make and implement its own policies and overcome significant pushback. Yet, the core grievance which played a key role ushering in the transition of power, i.e., insufficient growth in livelihoods for the growing population and exclusions from the benefits of the economic growth achieved, remains highly relevant today. Although Abiy’s homegrown economic reform agenda has sought to rebalance Ethiopia’s economy to promote further job growth, in practice the administration is facing a severe economic crisis, major expenditures related to the civil war – and therefore a dramatic cut in foreign investment, aid inflows, and reduced trade, leading to sliding exchange rates and significant inflation. The civil war has led to large-scale human suffering as a direct consequence, but also indirectly as the economic impacts have hurt livelihoods of individuals across the country. The Ethiopian government has sought to implement significant budget cuts across the board, delayed the privatization process of several SOEs, and is struggling to restructure its debts.[208] In this situation, job creation and improving livelihoods as popularly demanded is a far-off prospect at best.

Given the dire economic straits the Abiy administration finds itself in, economic measures may prove an effective pressure point for the international community. Some steps have been taken in this regard, including the US sanctions regime, the cutting of budgetary support, the removal of Ethiopia from the African Growth and Opportunity Act, and the stalling of discussion surrounding debt restructuring. Yet, the humanitarian costs of implementing significant economic pressure may be severe. Ethiopia has been heavily reliant on aid and subsidising imported food in order to ensure food security for decades, not just in the areas affected by the civil conflict but across large sections of the country.[209] In 2018, food imports equalled about 2 billion USD per annum, a significant expenditure for the Ethiopian government.[210] These expenditures are likely to rise sharply, given expected price rises on wheat following the Russian invasion of Ukraine. Economic pressure is hence likely to significantly affect livelihoods across the country. Although some attempts have been made to implement humanitarian exceptions in for instance the US sanctions regime on Ethiopia,[211] it should be kept in mind that any measure driving a further slide in Ethiopia’s foreign exchange or restricting trading opportunities of commercial food imports will still have a substantial humanitarian impact. Thus, policymakers considering economic sanctions on the country should carefully consider the humanitarian impact of these measures before their implementation, and should not limit their humanitarian considerations to the delivery of aid in the areas affected by the civil conflict alone.

Recommendation 3

Developing a new modus operandi for Ethiopia

Under the EPRDF regime, Ethiopia functioned as an important hub in many donors’ aid and development programming. The Ethiopian state was able to absorb significant volumes of aid, implement programming in a reliable way on short notice, and present respectable results in terms of developmental indices and GDP growth.[212] As a result, many donors’ development aid policies have come to rely to varying degrees on the Ethiopian state’s implementation capacity in order to meet their own internal institutional goals and targets (e.g., volumes spent, beneficiaries reached, timely implementation).[213] This dynamic largely ignored the fact that the Ethiopian state maintained strict control over the scope of aid programming, including the disbursement of benefits as well as the selection of beneficiaries, and implemented programmes solely through state-controlled channels. Effectively, this allowed the EPRDF administration to leverage aid in its internal political financing dynamics.[214] Such dynamics have been reported since the politicized famine relief efforts in the 1980s across various regimes.[215]

With the change in administration, control over the resources of the state has become an important point of contestation; this includes aid rents.[216] Additionally, the eruption of the civil war and ensuing aid blockages have made the topic far more controversial for donors as well. Meanwhile, administrative structures internal to donors’ and multilaterals’ administration favouring disbursement through the Ethiopian state remain, in defiance of changing political imperatives. In a telling anecdote, one policymaker related blocking a project by an inter-governmental organisation seeking to implement a COVID-19 vaccination drive in Tigray, as the project had selected the ENDF as its logistical partner citing its access and efficiency.[217] Examples such as these show the need for a new modus operandi in engaging with the Ethiopian state for humanitarian and aid programming still ongoing or potentially resuming. The recalibration of this relationship between donors and the Ethiopian state should reflect the weakened negotiating position of the Ethiopian government due to its internal fault lines and weakened international legitimacy, allowing donors to push back on the state’s political usage of aid programming. This raises the dilemma to what extent donors are willing to disburse aid through the Ethiopian state, thereby reinforcing centralised power structures, or if they opt to implement outside state structures potentially reinforcing the fragmentation in Ethiopia. On the donor side, efforts should be made to realign institutional and administrative reliance on the Ethiopian state for major segments of aid disbursement and implementation.

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