It Is All A Big Lie

One of the distinguishing features of the Meles oligarchy is its predilection to engage in an endless series of lies. For sure, from time to time most governments and government officials lie or otherwise engage in the dissemination of misinformation in pursuit of strategic advantages. For example, in the course of just three years, we in the U.S. were blessed with the “I did not have sexual relations with that woman, Ms. Lewinski” lie and “Saddam has illegally accumulated weapons of mass destruction” lie, to name two particularly notorious lies. We can go back in history and point to heinous lies such as Mussolini’s lie about his purpose of occupying Ethiopia (to eradicate slavery and to civilize the wild and crazy Ethiopians), Hitler’s lie about his plan to exterminate the Jews and Stalin’s lie about his death gulags. What sets the Meles oligarchs apart is not that they lie but that, without exception, all of their public utterances meant for foreign consumption (which is nearly everything) and most of those meant for their nationals are laced with lies.

The key report coming out of Addis today was one more example of how the Meles gang has mastered the art of the lie. One Sufian Ahmed, Minister of Finance within the oligarchy was reporting the great news about economic developments in Ethiopia. Never mind that we have been reading how the Ethiopian economy is being ravaged with unsustainable price inflation arising from the escalation in the price of food grains on the one hand and the price of imported oil on the other. Set aside the story which was reported only a few days earlier that the Ethiopian balance of payments and foreign currency reserve position had deteriorated dangerously and might choke off the last breath of the Ethiopian economy. Just ignore the story about commercial banks drowning in excess liquidity because businesses were in no mood to borrow and expand their operations. So much so that private commercial banks were pleading with the government to be allowed to buy government bonds and bills so that they might earn with some of this extra cash that is sitting in their volts.

I can go on and list dozens of reports mauling over an economy which is anything but well. Yet Minister Sufian had the temerity to declare that “The end of poverty in Ethiopia is in sight!” The occasion was the announcement of a revision in the projected growth rate of the economy for the fiscal year which runs from July 7, 2005 to July 6, 2006. The essence of his report amounts to a projected growth rate of 5.6% in real GDP at factor cost during the current fiscal year. If the projection holds, it would be the third year in a row that the economy would have grown. The average growth rate over these three years would amount to 7% per year.

According to Reuters, “Finance Minister Sufian Ahmed told journalists that sub-Saharan Africa's second most populous nation could jump to the ranks of middle-income nations if current growth was sustained through coming decades.” He is further quoted saying that “if the trend continues for the next 20 years, Ethiopia would come out of poverty and be among middle-income nations.” This is big talk for a country which has been unable to feed itself, much less jump to the ranks of middle income countries. Strip away all of the hoopla and spin, what you still have is a desperately poor country hardly able to maintain its dismal economic condition which could easily deteriorate even further.

Look at that impressive statistic closely and you would note that its notoriety rests entirely on the unusually high growth during 2003/04. That year, according to government statisticians, the economy grew 11.6%. That growth followed a year when the economy declined 3.9%, a fact that Minister Sufian chose to set aside. Clearly, neither the decline during 2002/03 nor the spectacular growth in the year which followed were on the normal growth path of the economy. The phenomenal growth in 2003/04 can only be explained as a return to normalcy recovering what was lost in the major decline during 2002/03. So, if you look at the average annual growth rate over the last four rather than three years, you will find that it is a more realistic 4.75% instead of more than 7% the minister sought to spin. Whoever said that “there are lies, damn lies and statistics” must have come across something like this.

Of course 4.75% growth rate in GDP in the face of 2.3% growth in the population of Ethiopia leaves you with only a pedestrian 2.4% growth rate in per capita real GDP. At that rate, neither Mr. Sufian nor I would be around to cheer our compatriots as they join the ranks of the middle income citizens of the world.

Let us look at the numbers a bit closer. According to the International Monetary Fund, an institution which is on very friendly terms with Mr. Meles and his oligarchs reports that Ethiopia’s annual per capita real GDP (the closest indicator we have to what an average Ethiopian soul earns in a year) averaged a dismal US $120 during the 1980-85 period. Six more years of Mengistu and another ten years of Meles later, the average during 1993-2001 years had declined to US $100. (Every time I relate this information to my American friends, they always think I am kidding -- $100 per year for every living Ethiopian is a very difficult number to comprehend). The IMF also reports that the average for all low income countries during 2001 was U.S. $430, 430% of the Ethiopian average. So, the Ethiopian people do not have a prayer to even enjoy the average income levels for low income countries.

Regrettably, the IMF does not have per capita data for Ethiopia beyond 2001. The data we have is enough to show to all who care to consider such things, the ridiculous nature of Mr. Sufian’s pronouncement that Ethiopia will soon be joining the ranks of the Middle Income Countries. World Bank data shows that by 2004 a country needed to have per capita real GDP of between U.S. $826 and $10,065 to be classified as a middle income country. The wide range between the high and low ends of the group notwithstanding, it remains that even the lowest level for this group is more than eight times as high as our current per capita GDP. If we can sustain the average growth rate of the last 4 years, it will take 31 years for us to just double the current $100 per capita to $200. It will take another 31 years to approach the $430 average (actually $400 but I will give the minister the difference) for all low income countries. At current growth rates, we have to work at it for 93 years to get to the $826 mark which, according to Mr. Sufian, we are destined to get in 20 years. Of course, all of this is based on two major assumptions. The first assumption is that the other countries will stay where they are with out making any progress in the mean time. The second assumption is that we can sustain the average growth rate attained over the last 4 years. If either of these assumptions does not hold, then it will take centuries, not 20 years for us to join the ranks of the middle income, if at all.

The rhetoric of Ethiopia coming out of poverty in 20 years is just that: an empty rhetoric. It is not meant to inform the reader. Instead, it is meant to mislead the reader and to buy credit where credit has not been earned. I only wish this was a slip of the tongue or an unusual exaggeration; but it is not. This is the norm for the EPRDF. The operating assumption has always been that no one will take the time to check the facts. Therefore, their modus operandi has been to tell the sweetest tale possible, regardless of whether or not it jives with the truth. The minister’s pronouncement that twenty years hence we will no longer be among the poor is not a technical error. It is a statement manufactured with full deliberation to achieve two specific ends. On the one hand, the statement is expected to mollify the Ethiopian people who have lost ground over the last 15 years (going from $120 to $100 in annual per capital GDP). It is also meant to reassure the donor community, a key constituency about which the EPRDF has been concerned as more and more countries question the sustainability of Meles’ revolutionary democracy.

The thinking in the palace goes as follows. If people believe that there is a reasonable chance of moving in 20 years from the bottom of the low income group even to the bottom of the middle income category, many would pause to reevaluate their critical comments about Mr. Meles’ frequent outbursts of butchery and his refusal to step aside even when the people loudly ask him to. After all, hunger and poverty have now been our national shame for more than a quarter a century. As such, if the EPRDF could indeed eradicate poverty in 20 years, perhaps many among us and certainly most outsiders would view the sacrifices justifiable. At least that is the thinking which under girds this lie, and that thinking reflects the low regard the EPRDF has for its audience – thinking that the people will believe anything, especially if it is repeated often enough.