Prime Minister’s Parliamentary Tit for Tat with Sole Opposition MP

Prime Minister Hailemariam Dessalegn appeared to the House of Peoples Representatives on October 16, 2014, to listen to the amendment and support motion of Parliament on the speech of Mulatu Teshome (PhD), President of the FDRE, to the joint house on Monday October 6, 2014. It would be a day dominated by the lone opposition MP, Girma Seifu, and a counterattack by the Prime Minister, who dedicated most of his time reacting to what Girma said.

Only 15 of the 352 parliamentarians raised questions to the Prime Minister. Hailemariam would begin by building on a comment from Girma, which seemed to have a positive tone as he appreciated the President for unusually apologising for the frequent power failure in the country.

“There are questions that emanated from not understanding the behavior of the party, the EPRDF; it is not a new thing to see us apologizing and this is not a courage that we brought today,” he said, responding to a positive comment from the opposition MP from the Medrek party, Girma Seifu, appreciating the President for apologising for the frequent power failure.

The PM then answered questions raised mainly from Girma, beginning from the four years performance of the Growth & Transformation Plan (GTP). He criticised that the President’s speech had focused mainly on the successes of the GTP, leaving out the failures, except in export and water supply.

One example that Girma raised was related to the railroad construction, which was planned to reach 2,395km, but has not even achieved 100km up to now – the President focused only on the 34kms of light railway construction taking place in Addis Abeba. The sugar factories, which were also said to bring 662 million dollars in revenue, could not even meet the domestic demand, which the government is having to meet through import, he said.

Hailemariam defended his government, saying that the national railroad construction needed a lot of resources for which the government wanted to get support from other countries – a decision which depended on the position of other countries.

The railroad construction is being conducted in two corridors, with a total length of 1,500kms. These will now be carried out following deals for loans from China and Turkey, after which contracts have been signed, Hailemariam said. The investment on these two corridors is 6.2 billion Br, from which 20 to 30pc is to be covered by the Ethiopian government, according to the Prime Minister. He kept emphasising the size of the deal, 120 billion Br, and the government’s share in it, 30 billion Br.

“The total agreement signed is 120 billion Br, from which 30 billion will be covered by the Ethiopian government,” Hailemariam said.

Regarding the question on the sugar factories, which were planned to be operational by the end of the GTP period, Hailemariam repeated that the Sugar Corporation’s report that stated seven could start production this fiscal year. He added that three more could begin production in the first half of 2015/16.

“The export level is a plan for when these plants begin production and we expect this to commence this year,” he said.

The Sugar Corporation planned to produce 1.22 million tonnes of sugar in the fiscal year, out of which 665,438tns is for export, according to the corporation’s report, generating 311 million dollars in revenue. The Tendaho Sugar Factory, which has the capacity to produce 619,000tns of sugar annually, has lagged because of financial constraints, and a lack of infrastructure and capacity of the constructors.

Girma challenged government’s manufacturing aspirations, saying that there was not enough infrastructure, particularly power, to accommodate the needs from these factories. Hailemariam defended this, saying that the sector still grew 18pc in 2013/14.

“The base for the manufacturing sector in the country is too narrow, therefore, it could not go along with the country’s economic development,” says Hailemariam.

Even more than this, Girma condemned the government for not providing sufficient support for the manufacturing sector, raising the examples of major projects, like the Hiber Sugar Factory and Habesha Cement.

Regarding the support for the manufacturing sector, a report from the Ministry of Industry (MoI) shows that the need to engage in manufacturing is very much limited and the engaged companies are not effectively utilising their capacity to maintain quality, which is the major competitiveness element.

“The work done from our [MoI] side is loose,” admits the Ministry’s report.

But the Prime Minister did not seem to take the same stand, especially on the specified factories. Although he believes that the support from the government side needs to be strengthened, the major hindrances for him are an unhealthy trade system that is not dependent on competition and the gates of rent seeking not being closed.

“For Habesha Cement, we have done the maximum we can with regards to allowing foreign loans, which are not permissible to private companies. The Development Bank of Ethiopia (DBE) has given them a loan of 600 million Br and we have allowed equity financing for them to have a foreign company,” reasoned the PM, adding that the Hiber Sugar Factory did not ask for a loan from the government because of internal problems within the company.

While there was no room for MPs to react to the Prime Minister’s responses in Parliament, Girma later said that he disagreed with Hailemariam’s answers.

“The DBE has allowed a loan for Habesha Cement and, because of some change in the system of the Bank, the disbursement was not realised,” he refutes.

Girma, who dominated the question time, also criticised the land lease in Addis Abeba.

“The reason for the high price of land lease in the city is the provision of land in small amounts,” says Girma. “It is difficult to imagine what is to be traded on land that one buys for 65,000 Br a square metre.”

The Addis Abeba City Administration provided a total of 135,475sqm of leasable land in the ninth round auction for a total of 987,003,551 Br. But, in the 10th round, the amount decreased by 52,356sqm, with the revenue also decreasing by 415,368,394 Br.

The PM says that land has both economic and political implications and needs to be handled carefully.

“When we lease land, we need to get revenue and we have to balance the price with the value of the plots,” he says.

About the issue of saving, the question was that the major story of success on the saving front is that the major contributors are the housing savings and the Great Ethiopian Renaissance Dam (GERD) construction bonds, which is not the contribution of the wider agrarians of the country.

“Millionaire agrarians are seen only being offered awards and we do not see those paying taxes,” says Girma.

The defensive PM says that the major saving of the country is expected to be from the farmers, and it is so. But, even if the housing and the GERD have significant parts, there will be no problem as this is one of the saving policy strategies, according to the Prime Minister.

The Prime Minister also blamed the opposition political parties for not providing alternative policies for the failures that the government has seen in the performance in repeated remarks during his response. But, this stand does not seem acceptable for the opposition parties, only one of which is represented in the House with just one person.

“This stage is not for the provision of alternatives, but to provide the improvements we see fit to the president’s speech as a motion,” says Girma. “To see that we have alternatives to provide as our policy, one can visit our website that states the line we intend to follow.”

Another opposition member from the Ethiopian Democracy Party’s (EDP) Executive Committee, Wasihun Tesfaye, says that the generalisation made by the PM is not correct in the presence of only one opposition in Parliament.

“We are outside and we are not represented in Parliament,” he says. “We have better alternatives that we can suggest.”


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