Could you please give to our readers a brief historical background about the relationship between Ethiopia and the United States?
In fact our official relationship began in 1903. However, our commercial relationship began in the late 1800's. The United States was the primary supplier of white cotton sheeting or cloth to Ethiopia. During the first 20 years of this century the United States provided so much cotton cloth that it became known as Marekani, a local trade name. It was only in the 1920/1930's that the Japanese and Koreans managed to produce the cloth more cheaply. That was the end of the U.S. market. The relationship has been pretty much consistent since 1903, but with some interruptions. We did not agree with the Italian invasion and did not have any one here during most of the occupation years. We have had continuous representation since 1944. We had a very close relationship during the Haile Salassie period which lasted until 1974. When the Derg government came to power our relationship deteriorated significantly, and was very poor until 1991 at which point the improvement began again. I think it has been generally upward since 1991. There have been occasional differences of opinion but it has been a very solid relationship since 1991. The percentage of Ethiopian imports from the U.S. is relatively small, but it is a modestly growing commercial relationship. We normally have a balance of payment surplus with Ethiopia, but the difference is narrowing.
There is a very important Ethiopian community in the United States. Some of them did come back here to establish their companies, and were successful. How do you evaluate relations between that community and Ethiopia?
It is a very important relationship, particularly on the investment side. We do not know for sure how many Ethiopian-Americans reside in the United States but there are at least 250,000. the largest community is located in the Washington, DC metropolitan area; probably at least 50,000 are residing there. The other cities that have a large concentration of Ethiopians are Houston, Dallas, Atlanta, Boston, Los Angeles, Minneapolis and Seattle. Politically this community has been quite active. We are seeing that manifested at the present time in terms of the Eritrean-Ethiopian conflict. The Ethiopian-Americans have also been active in the investment side. We are seeing increasing numbers of Ethiopian-Americans who have done well in the United States and now want to invest in Ethiopia. A number of these people are coming back to invest in small industries. The government of Ethiopia has realized the potential impact of this community, not just in America, but in Europe and other countries too. Ethiopia has liberalized the investment requirements for persons of Ethiopian heritage; in effect they come in as domestic investors rather than as foreign investors.
Q. Foreign companies started to give more attention to Ethiopia. But still, it seems that there are suspicions and they are coming step by step. In your opinion what should be done to make the country more attractive, especially for American businessmen?
In the first instance, there has to be an assurance of political stability and predictability. Anyone who is going to invest money, particularly a small investor who is operating on a very narrow margin, must expect a reasonable return on their investment. They are concerned about the stability of the country and the region more generally. This is a region which has had security problems, so they are going to be reluctant to invest. That is step number one. The Ethiopian government also needs to make it more attractive in terms of the investment code. Ethiopia has to compete with the entire developing world. Another issue that I have talked about many times in the past is the bureaucratic environment. It needs to be used more friendly for investors, basically less bureaucratic. This is not an unusual situation in developing countries, but it is an area that requires more work in Ethiopia.
| In your opinion which are the best investment opportunities in Ethiopia?
Agro-industry is the primary area that I would encourage investors to enter. Import substitution is another area and mining has some possibility. Both American and Canadian companies were interested in gold mining. There is a large gas field in the Kalub area. I am not quite sure where it stands at the moment, although Kalub has a lot of potential. The marble industry is a very good industry. It is already developed but I suspect a lot more can be done.
Privatization is underway, and the government should be given credit for what has been privatized so far. These are steps in the right direction but more needs to be done.
As a personal issue, what did you learn from Ethiopia in the past three years?
The first thing I learned is that Ethiopia is more complex than any other country that I am familiar with. The diversity of the country is enormous. There is a highland culture and a series of lowland cultures, which are quite different. You have to comprehend the distinctions.
The importance of Ethiopia for the Horn of Africa needs to be fully comprehended. In my view, Ethiopia is the key to the Horn of Africa, and perhaps to East Africa, not in a commercial sense, but in terms of its population, its borders and its physical size. If you do not understand the complexity of the regional relationship, you will not understand Ethiopia. Anyone who does not make an effort to learn something of the history of Ethiopia is going to be at a total loss in this country. You need some appreciation for the history to comprehend this culture.
Ethiopians are hard working, intelligent, principled and serious. Those living in the highlands also tend to be stubborn, quick to criticize and reluctant to praise. When they set their mind on something, they hold to it; they are reluctant to admit fault. I find them to be a delightful people; they can be very warm and friendly but not necessarily when you first meet them. Ethiopians are very hospitable.
As a final issue, what will be your final message to our readers?
Ethiopia is a beautiful country with a rich ethnic diversity. It has a strong economic potential, which is not realized yet. I think the potential can be realized once conflict with Eritrea is ended. It is a country with unique historical offerings such as the rock hewn churches in Lalibela. The Blue Nile Falls are spectacular. If you put it all together, you have quite a unique country. |
