A discussion forum between members of the Ethiopian Diaspora and representatives of government ministries and other institutions was held on Tuesday, April 24th at the Civil Service University Hall in Addis Ababa. The Forum was chaired by Deputy Prime Minister and Foreign Minister, Hailemariam Desalegn, and attended by hundreds of members of the Diaspora. Other senior officials from line ministries were also present to introduce the services they offered to the Diaspora. The forum, intended as an annual event, was held as part of the Government’s plans to exchange up-to-date information with members of the Diaspora on national issues including the status of the Great Ethiopian Renaissance Dam, and to discuss ways to help solve any problems that may affect members of the Diaspora and encourage and expedite the country’s development through the active participation of the Diaspora.
Addressing the forum, the Deputy Prime Minister defined the main strategic pillars of the country’s new Growth and Transformation Plan (GTP). These were: registering accelerated, sustainable and fair economic growth; sustaining the agriculture sector to continue to be the engine of growth over the GTP years; ensuring the industry sector plays a key role in economic development; expanding and improving the quality of economic infrastructure; fostering social development and ensuring its quality; developing capacity and enhancing good governance; and increasing the capacity and development effectiveness of women and youth. Other cross-sectoral elements of the GTP included expanding social security services, promoting population development, creating more employment opportunities, enhancing and expanding the culture industry and building a green economy.
The Deputy Prime Minister and Foreign Minister noted that every government institution had prepared short and medium term plans harmonized to the GTP targets. The Ministry of Foreign Affairs, for example, had made all necessary preparations to discharge its share of responsibility for achievement of the GTP with its priority targets sorted out and being acted on. The priorities in descending order had been identified as maximizing foreign direct investment inflows, strengthening technology transfer and technical assistance and boosting trade and image building. Low-interest loans, grants and development assistance, though important, were less relevant over the GTP period as the Government was embarking on an approach to development that depended upon sustainable and predictable sources. The Government recognized that the role of the Diaspora in achieving its priority targets was crucial. It was only with the active participation of the Diaspora that the Government could effectively promote the country’s growing investment opportunities; maximize technology transfer and technical assistance; boost its trade relations and create alternative markets to make the best of its export items and import goods at the most reasonable levels as well use the knowledge and expertise of the Diaspora most effectively for the benefit of the country.
Ato Hailemariam said a number of measures have been taken to encourage active participation by members of the Diaspora. There has been the provision of investment opportunities in labor-intensive capital investments in the country. Incentives such as tax relief, low-interest loans (7.5%), and one-stop-shop services are other measures. Anyone who wants to focus on processed and semi-processed manufacturing products are to be encouraged and loans made available for those prepared to invest in feasible projects. A lease-financing mechanism is already in place to assist people to get loans for equipment, allowing it to be used as collateral. Legal procedures to establish a “non-interest bearing bank” are also under preparation. Three kinds of saving accounts have been introduced. With the “Current Account”, any member of the Diaspora can hold up to 50,000 USD in foreign currency interest free for a few weeks. The “Saving/Deposit Account” provides for any member of the Diapsora to save a limitless amount in foreign currency for a period of 3 to 6 months with interest payable. Most importantly is the “Birr Account” which has a 10% interest rate to encourage people to save their foreign currency in Birr. This is double the interest rate offered for birr deposits in a Birr Account.
The Deputy Prime Minister noted that the introduction of the Millennium Bond was part of the Government’s plan to encourage citizens and the Diaspora to support development in a way that would mutually benefit both. The bonds offered an attractive interest rate to ensure members of the Diaspora would benefit themselves as well as contribute to development. The construction level of the Renaissance Dam had now reached 7% and it would be 13% by the end of the fiscal year. The Government was very pleased with people’s participation in buying the bonds, over 7 billion birr worth being sold in the last year. He thought there was still a huge potential market in the Diaspora and the Government would do everything possible to organize maximum contributions. The Ministry of Foreign Affairs had prepared a draft Diaspora Policy which will be made available in all Ethiopian missions abroad for discussions. The draft includes a number of mechanisms to better address the needs of the Diaspora.
During the discussion, participants raised a number of concerns. These included corruption and a lack of good governance, limited infrastructure, lengthy bureaucracy delays and the difficulty in getting loans for projects of their choice. They questioned why the Government insisted that foreigners or members of the Diaspora who had savings of over 200,000 Birr should have to notify the source. They asked when banking and insurance services would be opened for investment by the Diaspora. Other questions included a request for the establishment of a Government/Diaspora Appeal committee to be responsible for dealing with Diaspora problems and provide support where necessary. There were questions over details of the new Land Lease Proclamation; requests for duty-free privileges for the Diaspora to be reactivated, and for facilitation of Diaspora visits to the Renaissance Dam project site.
In response, officials noted that the Government was aware of effects of corruption and good governance and had put in place extensive capacity building programs to develop capacity and enhance good governance. It had now completed the registration of assets of over 27,000 government officials as part of a determined effort to reduce the level of corruption significantly. There had been significant improvement in infrastructural coverage throughout the country in a remarkably short time. Equally, one of the main pillars of the GTP is expanding and improving economic infrastructure. Over bureaucratic delays it was noted that all Government institutions now follow government directions aimed at improving bottlenecks and avoiding lengthy procedures. The process of Business Process Re-engineering had provided significant improvements, though the Government felt more could still be done. One-stop-shop services are now provided in many Government institutions, and the Government would continue to work hard to ensure service delivery mechanisms would be encouraged in all areas.
Participants were told that banks would now be providing loans equivalent to 70% of a given project if it met the bank’s feasibility assessments. Government officials pointed out that while they could encourage banks to set reduced interest-rates for loans to the Diaspora or offer tax-relief to Diaspora investments, they couldn’t force banks to give loans to projects that failed feasibility assessments. The issue of holding savings over 200,000 birr was related to the threat of possible money laundering which was an international problem. A mechanism of opening up the banking, insurance and telecom sectors to the Diaspora was under study. An official in the Diaspora Affairs Directorate General in the Ministry of Foreign Affairs had been assigned to deal with Diaspora problems and provide support where necessary. Detailed explanations were given about the new Land Lease Proclamation which had been implemented to put an end to illegal manipulation of land and make land available at a reasonable price for investment projects that could create job opportunities for the unemployed. Land is public property and the proclamation hasn’t changed this principle. The proclamation doesn’t contravene property rights. It rather creates the opportunity for the Government to use land revenue to fund pro-poor projects such as the building of condominiums or the new 40-60 housing scheme. Under the new housing plan, priority will be given to members of the Diaspora who have the capacity to pay the full cost of a house. Duty-free privileges had been heavily abused, and they would not be restored.
Source:http://www.mfa.gov.et/Press_Section/Week_Horn_Africa_April_27_2012.htm#4
