A Next Step to Green Growth

Ethiopia is an economic success story with impressive growth over the last decade. However, changes in climate put some of these hard-won gains at risk. Further, floods, droughts and soil erosion threaten continued economic growth, especially from agriculture.

The country is addressing these risks through the Climate Resilient Green Economy (CRGE) initiative, led by the ministries of Finance & Economic Development (MoFED) and Environment. Now it is set to take the next step.

Ethiopian leaders and researchers have joined with their counterparts from Europe, Asia and South America to set a path towards creating global economic growth, while significantly reducing climate risk. The past week saw the launch the New Climate Economy (NCE) project in Addis Abeba. The project presents a unique opportunity to share Ethiopia’s story with the world, helping other countries to increase economic growth and reduce climate risk.

Many political leaders believe that acting more strongly on climate change will cost more than their economies and their public support can bear. The Ethiopian experience can make this seem like a false dilemma.

Ethiopia’s pledge to create the economic growth needed to become a climate resilient middle-income country by 2025 without a net increase in greenhouse gas emissions is a bold move. In addition, other countries with large rural populations at risk from climate change can learn from Ethiopia as it seeks to increase resilience.

Participation in the NCE project will also provide an opportunity to learn from other leaders – countries, nations and businesses, as well as the best and brightest researchers. World-leading economists will share insight into how to provide additional finance for the economic transition Ethiopia is aiming to achieve.

Lessons will be shared from countries, including India, China and Brazil, that have moved from highly agricultural economies to increase gross domestic product (GDP) from industry and services. As Addis grows and introduces new forms of public transport, like the light rail transit (LRT) system, insight from cities that have introduced their own rapid transit systems, like Bogotá in Colombia, will prove useful.

Ethiopia will share with the world and receive insight in kind. Ultimately, these developments will have real benefits for people. For instance, better public transport can cut the cost of living for the urban poor.

Research for the project in Ethiopia will be conducted by the Ethiopian Development Research Institute (ERDI) alongside the Global Green Growth Institute (GGGI). It will examine opportunities to deliver faster economic growth, provide new employment opportunities and eradicate poverty.

This will help to ensure the welfare of Ethiopian people, while dealing with the day-to-day risks of climate variability and change. Researchers will present an honest picture of the opportunities and challenges of pursuing this course of action, including highlighting where others can learn from what does and doesn’t work.

Ethiopia has historically played a constructive role on an international stage when dealing with climate change. In 2009, the late Prime Minister Meles Zenawi helped broker the Copenhagen Accord. Prime Minister Hailemariam Desalegn and his government will continue to play a similarly significant role in promoting a transition to a new climate economy.

Insight from research conducted in Ethiopia will shape the recommendations made by a Global Commission on the Economy and Climate. This Commission is led by the former President of Mexico Felipe Calderón and is composed of other former heads of state, finance ministers and business leaders, including Trevor Manuel, the former finance minister of South Africa, and is advised by leading global economists, including Benno Ndulu, the Governor of the Central Bank of Tanzania. The Commission will present findings to a special United Nations summit on climate change this September, organised by Secretary-General Ban Ki Moon.

But, becoming a global leader in this economic transition has benefits beyond diplomatic prestige. A new climate economy should provide opportunities for Ethiopia to export renewable energy to its neighbours and for Ethiopian entrepreneurs to build on their experience to export to other countries.

An Ethiopian-American company – dVentus Technologies – already engineers renewable energy technologies, including smart meters and wind turbines, in Addis. As Ethiopia develops and invests in renewable energy, we should see more of this sort of foreign investment.

Through participation in the NCE project, Ethiopia can help bring low-carbon climate resilient economic growth to the world, creating new opportunities for the country and its citizens as it grows and develops.

By Getachew Yoseph and Jeremy Oppenheim.
Getachew Yoseph is director of programs at the Ethiopian Development Research Institute (EDRI). Jermey Oppenheim is program director at the New Climate Economy (NCE) project.

Published on March 16,2014 [ Vol 14 ,No 724]



With a reformist administration in charge of the executive, there has b...


The new electricity tariffs that became effective on December 1, 2018,...


Who it is that midwifed the rapprochement between E...


Egyptian companies are about to sue the federal government over their i...


A recent photo between Prime Minister Abiy Ahmed (PhD) and George Soros...


The future is bleak. Millennials and younger generations who will inher...

View From Arada

There is heated debate on the propriety, decency and morality of breast...

Business Indicators


Editors Pick