Significant role in economic integration
Gemechu Tussa 07-04-16
Ethiopia’s effort to create strong economic integration in the Horn Region is compatible with the African Union’s goal to create African Free Trade Zone. Due to its tremendous efforts and results it achieved so far, the international community has recognized Ethiopia and recommended other African countries to follow Ethiopia’s exemplary deeds.
One of the most significant indications is the efforts that Ethiopia has exerted in creating trade, infrastructure and security cooperation with Djibouti, Sudan, Kenya and South Sudan, which is a good start to benefit the people in the region as it could integrate them economically. Some economic analysts argued that Ethiopia’s all-round efforts to create regional integration are a realistic manifestation for the African Free Trade Zone that the African Union has planned to meet. Ethiopia’s leading role in expanding infrastructure has especially been contributing to the boosting of the credibility and trustworthiness of the country.
For instance, the Ethio-Sudanese trade balance has grown from 3 million to 300 million USD during the past 7 years. The two countries have not only signed various memorandums of understandings but also they have been speeding up infrastructural works in order to boost trade and investment.
It is also evident that the investment relationship between the two countries has been strengthened. Available documents indicated that among 800 Sudanese investors licensed to do businesses in Ethiopia, 200 have began operation so far. Besides, Ethiopia’ has been exporting to Sudan a large amount of sesame.
Road and electric supply projects between Ethiopia and Kenya are being speeded up in a bid to transform their cooperation in trade and investment. The cooperation treaties signed by the two countries to improve the low level of economic relation are being implemented. Common market centers are also being established along borders not only between Ethiopia and Kenya but also between Ethiopia and countries other countries in the Horn Region.
Road and railway works between these countries are well in progress. It is also evident that the economic relation between Ethiopia and Djibouti has almost reached at an exemplary stage. The construction of the Ethio-Djibouti railway would enhance economic integration of the two countries is undergoing without any snag. Djibouti, the major outlet for Ethiopia’s exports, has during the past nine months imported over 100 million USD worth items from Ethiopia.
The efforts that Ethiopia has been exerting to create a huge economic integration among countries in the Horn Region are so recommendable. Besides, the country has been working hard to ensure peace and stability in the region as peace has a direct effect on the economic development of any country.
It is also evident that the efforts in creating strong economic integration and peace in the region could play to foster a significant role in creating social integration of the people in the region. The country’s effort to expand road networks, electric power supply and other infrastructural development in the region attest to this sincere endeavor.
Ethiopia has been providing Electric power to Djibouti and Sudan so far. It has also been doing its level best to connect all countries in the region. So far, Ethiopia supplies 175 and 100 megawatts of electricity to Sudan and Djibouti respectively. Besides, Ethiopia has also signed a memorandum of understating with Kenya to provide electricity.
The country has also been working closely with neighboring countries to create stable and terror free region as well as to settle conflicts between boarder people of neighboring cpuntries.
The efforts Ethiopia exerted could contribute a significant role to the regional block that is carrying out extensive activities to realize the economic vision of the continent. The Intergovernmental Authority on Development said it has been implementing various activities that could be exemplary for other regions in enhancing economic integration.
The ongoing constructions of cross-border roads and railways as well as electricity connectivity are among the manifestations of IGAD's efforts for economic integration.
IGAD region has the highest rate of roads to asphalt standards that connect capitals and countries in IGAD region than any other. Energy connectivity to Sudan, Djibouti and now to Kenya from Ethiopia is there. The growing trade relations among IGAD countries further cited the trade exchanges between Ethiopia and Kenya, and Ethiopia and Djibouti as examples.
Ethiopia shares borders with Djibouti, Eritrea, Kenya, Somalia, South Sudan and Sudan. It has been working day in day out to integrate the region. It changed its own history of diplomatic isolation.
The country has maintained a long diplomatic history and extensive experience in foreign relations. It formulated an inward looking foreign policy geared towards promotion of national interest reconciliation and peaceful co-existence. The country provided basic infrastructure in four industrial cluster zones, renewing focus on natural resource and raw material industries.
Ethiopia has also built a 682 kilometer long standard gauge rail network connecting Addis Ababa to Djibouti. It has also worked industriously to increase power generation capacity from the existing 2,000 to 10,000 megawatts. In connection to this more than 37,500 kilometers of new power distribution lines were constructed.
Documents also indicated that more than 2181 kilometers of existing power transmission lines were also rehabilitated. The government, through its embassies in various countries, had also exerted a considerable effort in seeking investment in renewable energy projects.
The first growth and transformation plan has accelerated the development of the country. It laid the bases for the well implementation of the second Growth and transformation Plan, which could play a significant role in economic integration of the region.
In the past five years period of the first growth and Transformation, the share of industry in the GDP grew from 11 percent at take off stage to 14 percent in 2015 while the service sector grew by 46 percent in the same period.
The country has planned to make a leap forward from its previous 2310 MW to 10,310 MW by 2017. It then will be a hub for supplying sustained electric power to Djibouti, Kenya, Sudan and Somalia. The country has also planned to expand it to Rwanda, Tanzania, South Sudan and other countries in the region.
Ethiopia is already contributing to Africa’s economic integration through its Airlines Business Enterprise. Ethiopian on one hand connected African countries to each other and to the world promoting fast investment and trade interactions in the continent. Besides, it has been helping African Airlines through training and capacity building.
Ethiopian Aviation Academy is the largest aviation academy in Africa. It has been supporting African countries in capacity building. It recently has graduated more than 201 professionals in various fields including pilots, aviation maintenance technicians and cabin crew. In general, Ethiopia’s contribution to economic integration, bringing lasting peace and stability is so significant.
In fact, the country is strict to realize the economic integration as it envisioned to join the middle income countries in the shortest possible time. This could be done if all countries in the region are integrated economically. This is possible if and only peace and stability is guaranteed. Recognizant of that fact, the government of Ethiopia has been exerting a consolidated effort to integrate the region.