A journey from the abstract to the tangible
Ewnetu Haile
The rapid economic growth of the past dozen years is one of the most popular stories about Ethiopia entertained by local and international media. The double digit economic growth has become a cliché in its own right. Up until five months ago, the government of Ethiopia raised the topic as often as possible and bragged about the success incessantly. In the process, the country’s GDP was said to have increased by various folds. The trading economics website states that Ethiopia’s GDP averaged 20.32 billion USD from 1981 to 2017, reaching an all time high of 80.56 billion USD in 2017 and a record low of 6.93 billion USD in 1994. The website further indicates that GDP per capita in Ethiopia averaged 262.69 USD from 1981 until 2017, reaching an all time high of 706.76 USD in 2016 and a record low of 163.60 USD in 1992. Other reports of previous EPRDF governments also included the creation of millions of jobs a year.
Although the above stated concepts and parameters are internationally used standards to measure performance within a specified period of time, their stature feds with lack of accountability and transparency. These figures can be easily manipulated by the state to depict a rosy picture of national conditions as has been evident over the past dozen years. Despite the tremendous strides made over that period, cooking figures was always perceived to be a major issue for the Ethiopian authorities.
In a situation of little or no transparency and accountability, there is no guarantee that the figures are real. It is also difficult to pinpoint what the figures really mean. For instance, how are the people in a country undergoing a double digit growth supposed to lead their lives? Are their lives expected to be easier? They are definitely expected to have more income but does that mean they are wealthier than before? Such questions push the concepts to the realm of the abstract.
For most public servants, the past dozen years have been a period of stagnation at best in terms of personal income. Apart from a couple of small salary adjustments that are utterly incomparable with the rate of inflation, the salary is still unlivable. On the other hand, the exchange rate of the birr has been devalued from 2 birr for 1 USD to 27 birr to 1 USD. On top of that, the government adopted a no subsidy policy about a decade ago. In the absence of strong regulatory bodies, the adoption of market economy also granted the power to set prices to businesses.
The result has been an ever increasing cost of living in which prices rise up arbitrarily from week to week. Once they rise for a certain reason, they are likely going to stay there even if the factors that pushed it up are not there anymore. For instance, the price of a kilo of beef was 29.33 birr twelve years ago. However, it has soared to a maximum of 400 birr nowadays. The price of Teff, Ethiopia’s staple food, was between 365 to 470 birr twelve years ago while it has shored up to 2400-2700 birr currently. The rent for a one bed room condominium house was one thousand birr twelve years ago while that figure has risen to 4,500 birr currently. Considering the large majority of public servants have a salary lower than the rent stated above and that rent has generally soared, there could be homeless public servants in the near future.
The point to note here is that the living standard and income status of public servants has suffered a great deal over the dozen years of double digit growth. The double digit growth further indicates a sharply rising GDP per capita. The reality, however, is that the Ethiopian middle class made up mainly of public servants is losing its ground and joining the lower class. After all, Ethiopian public servants had better lives when their income levels were lower. The rapidly plummeting purchasing power of the birr, however, made it imperative that the small increase in their incomes brought them lots of misery. This inversely proportional relation between rising GDP and living standard clearly shows that the abstract concepts of GDP and GDP per capita stand in stark opposition to the reality on the ground.
As active members of a prospering economy, public servants want to raise their standards of living proportionally with the level of national success. However, that has been impossible to attain. A visible improvement on the quality of social services could also be used to explain the national success on an individual level. However, the provision of water, electricity and other social services has probably gone worse for a considerable section of city dwellers.
The solution, in my opinion, is to describe the achievements made in a more tangible way. For instance, stating the number of people and localities that have come to access tap water and electricity in a year would give the data more credibility. Cutting down on power outages and regulating illegal price fixing measures could also help a lot towards making the people sense the rapid economic growth. It is such actions that have the capacity to slowly turn the inversely proportional relation between the GDP growth and the standard of living of the majority of the population.
By suppressing the level of abstraction and building on the state of concreteness, the new government led by PM Abiy Ahmed (Ph.D.) can get the country’s rapid economic growth closer to the people. The revamped sense of hope in the country would also benefit a lot from a more tangible measure of economic success.
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