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Reasons Why Ethiopia Won’t Sell Its Large Institutions

By Sara Belay
Tigrai Online, October 22, 2013

It’s within the memory of the public domain the fact that liberalism politico-economic philosophy has been enforced on countries, since the end of the cold-war. After the Japanese-American Francis Fukuyama heralded the ‘end of history’ claiming ‘Liberalism is the end of history” -Liberalism and its brainchild Neo-liberalism has been ignited like a wild-fire around many continents and countries. Especially Africa before 30 and 40 years has been the victim of the ideology by being forced to swallow neo-liberalism politico-economic philosophy without reservation. I think it’s obvious that the continent’s dormant economy and stagnant development has to do with this scenario. Despite Africa’s immense natural resource, the fact that the continent is embroiled in a vicious circle of poverty resulting in civil war, regional warfare and the likes attest to this reality.

Ethiopian Telecommunications Corporation
The Ethiopian Telecommunications Corporation (ETC) is the sole telecommunication service provider in Ethiopia. Based in Addis Ababa, it is one of the largest companies owned by the state.

Understanding this predicament, many African countries by shrugging off Fukuyama’s baseless “intellectual prophecy”; which halted history at a standstill, and withstanding the continuous political and economic pressures (influences) thrown from Neo-liberal institutions, they’ve chosen a path which is compatible to their realities. With this, they have proven including to the ideology’s proponents that there are ways to development outside of Neo-liberalism.

However, Neo-liberal pressure (influence) of ‘why do you develop outside our ideology’ still persists. So, when the ideology proponents and supporter institutions decides to give any kind of support to developing countries, they officially ask them to employ this same ideology which is showing signs of failing in their own country (world financial meltdown). And our country is one of those countries.

As it’s known Ethiopia without has the third fast-growing non-energy based economy in the world after china and India by recording an average of 10 % growth for the last nine consecutive years.

Although Neo-liberal financial institution and its proponents don’t deny our country’s fast and continuous economic growth, they try to give advice in improving the number (which they have cooked-up to serve their own purpose in the first place). And their advice happens to notify the government to privatize large public institutions like Banks, telecommunication, Airlines… etc and further develop the country’s economic growth. What this directly means is that as long as Neo-liberal politic-economic ideology isn’t enforced in Ethiopia, the economic wouldn’t grow (any better).

As it’s known Neo-liberal ideology’s core belief revolves around an extremist outlook which beliefs ‘everything should be left to the market and the private sector’, and the government should only involve in enforcing law and order and stay out of the economic sphere’. Neo-liberal strives for an ineffective and incapable (tiny-sized) government. It works for the very few wealthy to dominate the country’s economy by limiting the government from involving in developmental projects and leave the rest of the people to stand aside and watch. It strongly beliefs the government should only play a role of a guard in the country’s economic sphere. This is why they compel our government to sale the aforementioned big (public) institutions to private investors (on every opportunity they get.

However in my opinion our country cannot afford to take in Neo-liberalism thinking (without any reservations) for three reasons. One is, basically Neo-liberal is not a fit to Ethiopia’s realities. If the country is to wear the ideology ‘cloth’, it will get either stuck or be sloppy. The second has to do with the fact that there are many things that can’t be done by the private sector considering our country’s reality on the ground; while the third has to do with its outdated ‘any country won’t be able to develop outside of our thinking, and if they do they’ll surely encounter problems’ ideology which is facing condemnation and problems even in the country of its loyal followers, and has no benefit. So in order to understand deeply why our country’s government and people don’t want to sell their large cooperation’s, we’ll see these three reasons thoroughly.

Generally, Neo-liberal politico-economic ideology is not fit to our country’s realities on the ground. As its known Neo-liberalism-imaged democracies enforced on many countries all over the continents, end up creating competing splintered groups bent on rent-seeking behavior instead of establishing a nationally-reconciled government, in their respective countries.

Inversely, the developmental and democratic system that is being built in our country has been able secure a fast and thriving and a sustainable (for future) economic development. With this it has already started and will further continue to strengthen national-reconciliation in the country. Therefore I believe considering this, Neo-liberal thinking is unfit for us. Also with regards to the democratic order, even though it hasn’t been able to go completely free of Neo-liberalism influence, it’s going well with own path and pace.

As it’s known liberalism has always been concerned itself with individual rights, but not group rights. Its brain-child Neo-liberalism has stretched this individual right ‘narration’ to the brink. This has led (forced) the ideology and its proponents to reflect only on individual right. For this, it’s enough to mention the one time comment of the former British Prime Minister Margaret Thatcher in which she claimed, “There is no such thing as society, but individual men and women”. This implicates that Neo-liberalism doesn’t accept the unbreakable working bond that exists between individual and group rights.

The reality is different. A given sect of a given society in a given country cannot be individually free, if their group right isn’t respected. Let me raise the female equality struggle to further illustrate my point. The women cannot be completely free if gender inequality issue is not solved as a group, despite the fact that their individual rights are respected. So it’s obvious that their gender equality rights are best respected (upheld) as a group as oppose to seeking it individually. This is more obvious considering our country is home to more than 75 nation, nationalities and people which had been demanding for generations their rights. In our country human and democratic rights will only be respected through and as a group rather than individually or privately.

Here I would like my dear readers to understand that I’m not saying that individual right should not be upheld. What I’m saying is that even though individual and group rights are independent entities, they cannot work without each other. This implicates that if we are to take-in neo-liberalism thinking without any reservation, we will most likely face with problems.

It’s not surprising that the Ethiopian government is asked by Neo-liberals to sell (privatize) its large and major governmental and public institutions considering the ideology adheres to ‘everything must be left to the market and the private sector’ market – fundamentalism thinking. This is because it sees everything from its own perspective. However, we don’t have to accept that everyone must follow the same thing as ‘birds of the same feather will fly together” entails, as everything is relative. It doesn’t mean what worked on one country, will also work on another. Our country doesn't have to accept and conform to a given ideology, even if that ideology has worked on many other countries, let alone a politico-economic thinking that has shown its frailties and imperfection by stuttering at every possible problem.

All in all it would be behoove of the Neo-liberalists and their institutions to know why the developmental state and people of Ethiopia are not willing to sell their large (public) institutions – even though the ideology proponents already know the reasons. A developmental country like ours has to mainly pool its own capital, knowledge and labor in order to develop its economy. It need not be completely dependent on foreign capital. It has to be local (domestic), considering this, we can see that our country’s economy is both budding and feeble. Although the private sector is playing the necessary role to develop the economy, we can’t say that its capability is strong enough. It’s capability will be fully grown and developed along with the economy in the future, but not now.

Thus, this situation forces the developmental government to selectively enter in the economy to fill up the void left unfilled by the private sector (as a result of its capability). The government plays a crucial role in filling the market gaps (imperfection). This is because they are issues more than market gaps (imperfections); they are issues of survival, as development for our country’s people and government is a life and death issue. The government needs capital to undertake developmental projects. Thus those aforementioned large public institutions must stay under the control of the government and people as a source of money. The money generated from these institutions has played and will continue to play its role in enabling the public to move in a developmental and progressive path. So since we cannot fill the market imperfection with the private sector like the neo-liberals do, these institutions should stay under the control of the government until our capabilities are strengthened. They are playing their own important part in our struggle against defeating poverty, which has been strangling it for years.

I don’t think the Neo-liberals themselves would deny that this approach formulated by the developmental and democratic government which is responsible for the policies and strategies and the that has shown for the last nine and ten years that it can win against the struggle with poverty. In fact they are witness to the fact that this developmental country is taken as a development model (benchmark) for sub-Saharan non-energy based economies.

So if the truth is this, what is the Neo-liberalist and their institutions are asking Ethiopia to do? Why are they insisting the institutions; which are helping the government achieve great things within its developmental approach, be sold? In order to help give a reply to this question, it’s helpful to gaze into Neo-liberalism's background history. As its known Neo-liberalism politico-economic system reached its current state through exploiting African and other poor countries resources during colonialism period. As far as I can understand Neo-liberalism doesn’t concern itself with African or other countries development (progress). In fact they are the cause of these countries' failing (misery) – by enforcing values upon them which are different from the countries’ tradition, nature (characteristics) and outlook.

No matter bad the outcome, Neo-liberalist still doesn’t have any remorse about their former actions. In fact they like the colonialism days, they still want to exploit (benefit themselves) by calling the shots on those poor countries' natural resources. Since the system adheres to market fundamentalism ideology which gives everything to the market and the few wealthy, it strives to benefit these wealthy who are the only one capable of buying these (public) institutions. I believe this is the alpha and omega of the ideology’s interest. The ideology has engulfed many poor countries with its philosophy storm by creating very few wealthy and millions of poor. Its storm has created few wealthy by drowning millions of poor. Today the ideology is not only rejected by many but also controversial. so, many African countries are forced to reject Neo-liberalism and establish a system in sync with their own history, tradition and their countries’ reality. And they are bearing fruit.

What drives Neo-liberalists and their institutions to anger and complain at every chance they get, is the fact that the new African thinking (philosophy) is fast becoming at the expense of their own out-dated ideology. This new and modern ideology closes the door on exploitation that may be incurred from foreign wealthy. It also limits fertile grounds in which developing countries’ untapped labor and land resources are exploited. So Neo-liberalist doesn’t like this new thinking. Still, the ideology and its proponents are struggling to stretch its dominance, although it’s to no avail. Its struggle is not done directly, but indirectly– like the proponents' recent statement ‘Ethiopia in order to further develop, it must sell its big institutions’. This is an obvious modern indirect colonialism. Since any kind of colonialism is still colonialism, I don’t think it will be accepted.

I believe since the ideology has failed its African experiment, it’s fast becoming extinct in the continent – just like a sunset. Not only is the ideology’s African sun setting, but it’s also hosting a crisis in its conceived countries. We are also seeing that Neo-liberalism political thinking is also condemned and rejected by its loyal following countries and people. The ideology’s core fulcrum is the very few wealthy, as its thinking is based on those section of the society. Also since its governmental base are these people, its democracy works to protect these same people. I think mentioning the American people cry for justice during the day of the '08 financial crisis is enough to illustrate my point.

The people occupied the financial district wall-street shouting “we are here to save the 99% (the lower and middle class people) from the 1% (wealthy)”. Anyone who saw or heard this, will definitely understand the ideology’s victimizing millions of people by failing to create a fair politico-economic benefit for all. Conversely, I believe the fact that this kind of ‘we are not able to fairly benefit’ demand is not raised in developmental democratic states, speaks high volume of this same ideology’s failure. I think it can be said that the Neo-liberal failure has attested to this fact.

Although Neo-liberalism enforced it’s political and market fundamentalism 'the government should not interfere with the economy' thinking's on other countries (including their own), it can't escape events like those that took place during the financial crisis from happening. Here, what's surprising is the fact that Fukuyama's incorrect 'end of history' prophecy with regards to the ideology is not taken as the 'final curtain call' even in the countries where it started. This is baffling.

A few years back following the mess the ideology's benefactor wealthy controlled banks and big corporations’ created; worldwide financial crisis was ignited. Be that as it may, the governments instead of helping the majority of people get out of the crisis (those people created), they were seen working hard to bailout those same people created. This government has slowed job creation while at the same time increasing the number of unemployed people, increase the tax and stop the pension of citizens who are shouting for social justice and has also inflicted huge social crisis on the majority of the public

This has allowed for demands like '' Tax the few wealthy, create jobs, the middle class is not justly benefiting from the system when it comes to wealth distribution...etc'' to be heard. This has cast light on the fact that Neo-liberalism is losing its acceptance even in its birth place, let alone be in a position to help other countries. This reality has also confirmed countries who believed 'there are options other than Neo-liberalism' will not have their economic progress stutter, if they continue down with their own path of economic and democratic order which is built in-sync with their own realities.  

The fact that it’s possible to develop outside of Neo-liberalism has been attested both by the country's successful developmental path and the recent Neo-liberal failings. As there is no more truth than the reality we see with our own eyes, it’s worth mentioning countries (other than Ethiopia) that are developing through their own developmental and democratic thinking, like BRICS countries (Brazil, Russia, India, China and South Africa).

It’s obvious the reason behind giving contradictory advice like 'sale your big institutions' to a country which is having successful achievements by choosing a developmental program which is in-sync with its own people identity, is ludicrous to say the least. However, we can't and won't accept an anti- majority and dying politico-economic ideology, which will nullify and retract the successful strides we made by following our own and new economic path. After all, one that cannot help itself won’t be in a position to benefit others.

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