CYBER CONVERSATION WITH THE
ECX BOSS
2 November, 2009 | By Genet Mersha
I am very pleased that Dr. Eleni Gabre-Madhin has kept the
conversation alive between her as chief of the Ethiopian Commodity
Exchange (ECX) and Ethiopians residing in different parts of the world.
In this article, I am reacting to her October 29 piece entitled “Will the
Real Poor Farmer Rise – www.nazret.com.
control over what happens “outside of ECX”, as her article has
indicated.
For me, the problem is her message mixes defence of her mission and
ECX as an institution, which takes away a lot from the mission many
Ethiopians are too happy to support. However, I cannot say that much
independence of the institution. Similarly, the predominantly negative
response against her is infused with opposition of the regime, and thus
has missed its target. Even then, it borders the irrational, if not, much in
the same manner as a spoiled child’s clutter for attention. Distrust is
healthy when there is possibility of exchange; attacking wrong or false
ideas is beneficial and helpful; but rudeness is no sign of either good
political opposition to unacceptable government policies or of maturity
of the individuals concerned.
Dr. Eleni’s main message, the way I understand it, is that ECX would
endeavour to reach the peasant farmer and would someday be in a
position to reduce the extent of his or her exploitation by intermediaries
and victimization by unfair trade practices. She explains this by saying,
If this dream of her is realized, I grant you, it would be a big
achievement for all Ethiopians. Unfortunately, Dr. Eleni’s dream, as
portrayed in her article and the reality of governmental practices are far
apart like ‘fyel wodih, Qzimzim wodiya.’ We have seen this occurring
repeatedly. Over the years, it has cost government its image and
credibility, not to speak of the economic and political costs to the
country. For instance, consistent was the action taken by six major
exporters, as the ECX boss was saying right within the reach of ECX,
six major coffee exporters ended up with the expropriation of their
properties and the suspension of their licenses in March. All that they
did with their coffee is exactly what Dr. Eleni says in her article—they
waited for better market prices and to whom to sell. They also saw that
the domestic market was more remunerating for them, given the
exchange rate factors and behaviour of the market both at home and
abroad.
Nonetheless, a government overwhelmed by its foreign exchange
problem interpreted that action of theirs as deliberate attempt to
undermine it. Thus, between November 2008 and March 2009, the
TPLF went on building a cobweb of lies to cover up its designs to
promote GUNA as Ethiopia’s coffee-exporter-in-chief. In November
2008, government first resorted to threatening to ‘cut the hands’ of
coffee exporters [metaphorically], if they did not export their coffees as
speedily as possible. Furthermore, the farce of this whole situation
came to the hilt in the allegation by the prime minister that these
merchants had tried to take the country back to the past it has rejected.
How ironic that Dr. Eleni Gabre-Madhin, the ECX chief, has now
decided to throw titbits from across that jungle of lies and denials to
confirm what we have known all along and have written about this
mafia style business by politicians in power. In her above-mentioned
article, Dr. Eleni wrote of the true reason for the expropriation of the
exporters finally confirming what for half of 2009 has been public
knowledge. In there she stated,
Stop for a moment and think, as to which Ethiopian would not be
enraged by the licensing of EFFORT’s GUNA by ‘government’ as the
country’s major coffee exporter, the news of which was made public at
the end of October? This came less than eight months after the TPLF
elbowed those six successful individual exporters out of the market
accusing them of alleged political crimes of undermining the regime. In
fact, their only crime was their decision to delay, to hold of like all
businesspersons, their export of coffee at a time of falling international
prices.
This writer does not deny the severity of the foreign exchange crunch
the government had faced. The idea here is to register disagreement at
its mistreatment of those exporters and its disrespect of private
property, for that matter under false pretexts. In other words, the
problem of foreign reserves was severe. However, the government
could have used other means of dealing with the exporters. It ought to
negotiate with the concerned owners, instead of using its muscles,
which even by present Ethiopian laws is illegal. The government’s
recourse should have been to offer them some incentives or by
covering part of their losses at a specified time or through tax
incentives—just to get the foreign exchange it needs. That would have
enabled them take the actions it wanted them with their properties.
Outside that, what the government has done is disrespectful of the
property rights of citizens. Its actions are no different from highway
robbery by government officials.
What is most troubling here is the fact that those individual exporters
were the very people whose good performances the TPLF had
acknowledged and given them awards during the previous years only to
make a turn around early this year and expropriate their coffees. Having
suspended their licences, it has now handed them over to GUNA,
EFFORT’s major arm for commodities exports. By this action, not only
TPLF has moved from political consolidation to foreign exchange
accumulation, but is also engaged in putting the major sources of wealth
of the country under its control, as is the case now with several
industries, mining, huge plantations and agro-processing enterprises,
agricultural mechanization, building materials and construction
companies, trucking and transit services, commodities exports, etc.
Against this background, I listened to what Dr. Eleni has to say time
and again, and thought carefully of what she has written in her latest
piece especially,
Already in the foggiest days of the recession in late 2008, this writer
was struck by the animated claims amongst people in leadership circles
in Ethiopia about their ‘I told you so’ about the presumed end of
capitalism, as we know it. Their stringers on government media and
agiaforum did try a few times to air out which way things are moving
under the guidance of government in Ethiopia. Unfortunately, with their
habitual barking at everyone left and right, they lost the message and did
a bad job of it. Consequently, the ultimate meaning of that cryptic
message from TPLF top bosses about the direction of the country and
extent of their swoop on the Ethiopian economy and its implications has
barely become full public knowledge, as it should have been.
Government is not the real driver of the Ethiopian economy. Ato Sebhat
Nega was forthright without meaning it, as usual to his detriment
though, when he proudly asserted on the Voice of America ‘EFFORT
controls key strategic sectors of the Ethiopian economy.’ We have
already been aware of that ever since seizing power that the history of
TPLF leaders is that of scrambling fiercely for every iota of political
power—through the EPRDF, their potted plants, and the army and
police—and economic power—through EFFORT, their huge business
empire that has gobbled up our national resources.
Consequently, EFFORT has become wealthy by illegal means taking
control of the country’s key economic assets and has grown
exponentially amazingly faster than the country’s weak, structurally
rigid and inefficient economy. At times, Ethiopia’s high GDP growth
figures, which they constantly drum up, have been puzzling or
confusing for many, against the background of such deteriorating
human conditions. The truth of the matter is that it indeed is a measure
of EFFORT’s performance, not the country’s economy. For this, the
reality speaks better in Ethiopian cliché that portrays ordinary citizens as
‘የበይ ተመልካች’, literally meaning, distant spectators of the jet-set
TPLF leaders and their collaborators feasting and dancing all over.
I admire Dr. Eleni’s strong faith in Ethiopian law, in spite of everything
that is happening in front of her against the law. There I part company
with her. She seems to have strong faith especially in the power of
ECX’s Article 18, which recognizes ECX as “an autonomous entity.”
What value is this to the peasant producers or commodity exporters in
the country, if a stroke of the pen from the prime minister’s office rolls
over everything? I am certain that it is not lost on Dr. Eleni that coffee
producers are headed into a more difficult time. They may be compelled
to change to different crops—perhaps khat. We never know that was
even in the mind of Tadele who could only disclose to her that if he
could get higher prices. Now with GUNA monopoly, the future of
coffee production may be threatened even more by both price factors,
as Ato Tadele had told her, and because of producers’ and associations’
resistance to what has happened as of the end of October.
I regret to say that Dr. Eleni, does not seem to be fully cognizant of the
speed and direction of TPLF movement to control Ethiopia from all
angles. Even then, she writes about the solid legal foundation on which
ECX is established, in a way that has missed the whole point. Dr. Eleni
believes,
I would like to remind Dr. Eleni that in August I wrote the article
entitled ‘Distrust of regime places ECX Chief in unenviable position’,
nazret.com) . I repeat again, while maintaining my personal respect for
Dr. Eleni, I stand by what I had written in that article. I would
especially like to refresh her memory of the following,
ECX BOSS
2 November, 2009 | By Genet Mersha
I am very pleased that Dr. Eleni Gabre-Madhin has kept the
conversation alive between her as chief of the Ethiopian Commodity
Exchange (ECX) and Ethiopians residing in different parts of the world.
In this article, I am reacting to her October 29 piece entitled “Will the
Real Poor Farmer Rise – www.nazret.com.
- However, I must first preface
this by stating it is regrettable
that this helpful effort by Dr.
Eleni in most instances is not
being received either properly
to support her ECX journey
where possible or disagree
with her because of x, y, z.
Instead, some seem (three to
one) so pleased with personal
control over what happens “outside of ECX”, as her article has
indicated.
For me, the problem is her message mixes defence of her mission and
ECX as an institution, which takes away a lot from the mission many
Ethiopians are too happy to support. However, I cannot say that much
independence of the institution. Similarly, the predominantly negative
response against her is infused with opposition of the regime, and thus
has missed its target. Even then, it borders the irrational, if not, much in
the same manner as a spoiled child’s clutter for attention. Distrust is
healthy when there is possibility of exchange; attacking wrong or false
ideas is beneficial and helpful; but rudeness is no sign of either good
political opposition to unacceptable government policies or of maturity
of the individuals concerned.
Dr. Eleni’s main message, the way I understand it, is that ECX would
endeavour to reach the peasant farmer and would someday be in a
position to reduce the extent of his or her exploitation by intermediaries
and victimization by unfair trade practices. She explains this by saying,
- The point is that Tadele, and many more like him, take their
red cherry or dry beans to the nearest market outlets, with just
the faintest idea of what their coffee is worth or what the world
out there, or even the national market, looks like. Our
challenge is that we need to figure out, as a country and as a
national marketing system, how to empower Tadele and others
like him to make meaningful choices of where to sell, when to
sell, at what price to sell, and to whom to sell, so that he can
maximize his returns and improve the quality of his life, send
his children to school, make sure they get health care, and
break the vicious cycle of poverty in which he is trapped.
If this dream of her is realized, I grant you, it would be a big
achievement for all Ethiopians. Unfortunately, Dr. Eleni’s dream, as
portrayed in her article and the reality of governmental practices are far
apart like ‘fyel wodih, Qzimzim wodiya.’ We have seen this occurring
repeatedly. Over the years, it has cost government its image and
credibility, not to speak of the economic and political costs to the
country. For instance, consistent was the action taken by six major
exporters, as the ECX boss was saying right within the reach of ECX,
six major coffee exporters ended up with the expropriation of their
properties and the suspension of their licenses in March. All that they
did with their coffee is exactly what Dr. Eleni says in her article—they
waited for better market prices and to whom to sell. They also saw that
the domestic market was more remunerating for them, given the
exchange rate factors and behaviour of the market both at home and
abroad.
Nonetheless, a government overwhelmed by its foreign exchange
problem interpreted that action of theirs as deliberate attempt to
undermine it. Thus, between November 2008 and March 2009, the
TPLF went on building a cobweb of lies to cover up its designs to
promote GUNA as Ethiopia’s coffee-exporter-in-chief. In November
2008, government first resorted to threatening to ‘cut the hands’ of
coffee exporters [metaphorically], if they did not export their coffees as
speedily as possible. Furthermore, the farce of this whole situation
came to the hilt in the allegation by the prime minister that these
merchants had tried to take the country back to the past it has rejected.
How ironic that Dr. Eleni Gabre-Madhin, the ECX chief, has now
decided to throw titbits from across that jungle of lies and denials to
confirm what we have known all along and have written about this
mafia style business by politicians in power. In her above-mentioned
article, Dr. Eleni wrote of the true reason for the expropriation of the
exporters finally confirming what for half of 2009 has been public
knowledge. In there she stated,
- regulatory actions were taken against some of the major
exporters of the country, largely prompted by the foreign
exchange crisis brought on by the global recession.” She then
continued, “It should be clear by now and has been stated
officially that the regulatory actions taken had nothing to do
with ECX but were based on illegal behavior discovered outside
of ECX, which the exporters have also acknowledged. In fact,
these export companies continue to be members of ECX and
interact with us regularly. They have continued to sell their
supply coffees through ECX, although they cannot buy export
coffees unless their export licenses are re-instated based on the
court’s ruling.”
Stop for a moment and think, as to which Ethiopian would not be
enraged by the licensing of EFFORT’s GUNA by ‘government’ as the
country’s major coffee exporter, the news of which was made public at
the end of October? This came less than eight months after the TPLF
elbowed those six successful individual exporters out of the market
accusing them of alleged political crimes of undermining the regime. In
fact, their only crime was their decision to delay, to hold of like all
businesspersons, their export of coffee at a time of falling international
prices.
This writer does not deny the severity of the foreign exchange crunch
the government had faced. The idea here is to register disagreement at
its mistreatment of those exporters and its disrespect of private
property, for that matter under false pretexts. In other words, the
problem of foreign reserves was severe. However, the government
could have used other means of dealing with the exporters. It ought to
negotiate with the concerned owners, instead of using its muscles,
which even by present Ethiopian laws is illegal. The government’s
recourse should have been to offer them some incentives or by
covering part of their losses at a specified time or through tax
incentives—just to get the foreign exchange it needs. That would have
enabled them take the actions it wanted them with their properties.
Outside that, what the government has done is disrespectful of the
property rights of citizens. Its actions are no different from highway
robbery by government officials.
What is most troubling here is the fact that those individual exporters
were the very people whose good performances the TPLF had
acknowledged and given them awards during the previous years only to
make a turn around early this year and expropriate their coffees. Having
suspended their licences, it has now handed them over to GUNA,
EFFORT’s major arm for commodities exports. By this action, not only
TPLF has moved from political consolidation to foreign exchange
accumulation, but is also engaged in putting the major sources of wealth
of the country under its control, as is the case now with several
industries, mining, huge plantations and agro-processing enterprises,
agricultural mechanization, building materials and construction
companies, trucking and transit services, commodities exports, etc.
Against this background, I listened to what Dr. Eleni has to say time
and again, and thought carefully of what she has written in her latest
piece especially,
- But our system is not just for Tadele. Exporters benefit too, a
lot, because now they don’t have to incur the risk of getting the
wrong quality or quantity of the coffee they have paid for, with
an ECX delivery system that guarantees that Tadele’s coffee
will get to the exporter-buyer on time, in the right quantity and
quality. That is why we are closely working with our exporters
association to ensure that their needs are met too.
Already in the foggiest days of the recession in late 2008, this writer
was struck by the animated claims amongst people in leadership circles
in Ethiopia about their ‘I told you so’ about the presumed end of
capitalism, as we know it. Their stringers on government media and
agiaforum did try a few times to air out which way things are moving
under the guidance of government in Ethiopia. Unfortunately, with their
habitual barking at everyone left and right, they lost the message and did
a bad job of it. Consequently, the ultimate meaning of that cryptic
message from TPLF top bosses about the direction of the country and
extent of their swoop on the Ethiopian economy and its implications has
barely become full public knowledge, as it should have been.
Government is not the real driver of the Ethiopian economy. Ato Sebhat
Nega was forthright without meaning it, as usual to his detriment
though, when he proudly asserted on the Voice of America ‘EFFORT
controls key strategic sectors of the Ethiopian economy.’ We have
already been aware of that ever since seizing power that the history of
TPLF leaders is that of scrambling fiercely for every iota of political
power—through the EPRDF, their potted plants, and the army and
police—and economic power—through EFFORT, their huge business
empire that has gobbled up our national resources.
Consequently, EFFORT has become wealthy by illegal means taking
control of the country’s key economic assets and has grown
exponentially amazingly faster than the country’s weak, structurally
rigid and inefficient economy. At times, Ethiopia’s high GDP growth
figures, which they constantly drum up, have been puzzling or
confusing for many, against the background of such deteriorating
human conditions. The truth of the matter is that it indeed is a measure
of EFFORT’s performance, not the country’s economy. For this, the
reality speaks better in Ethiopian cliché that portrays ordinary citizens as
‘የበይ ተመልካች’, literally meaning, distant spectators of the jet-set
TPLF leaders and their collaborators feasting and dancing all over.
I admire Dr. Eleni’s strong faith in Ethiopian law, in spite of everything
that is happening in front of her against the law. There I part company
with her. She seems to have strong faith especially in the power of
ECX’s Article 18, which recognizes ECX as “an autonomous entity.”
What value is this to the peasant producers or commodity exporters in
the country, if a stroke of the pen from the prime minister’s office rolls
over everything? I am certain that it is not lost on Dr. Eleni that coffee
producers are headed into a more difficult time. They may be compelled
to change to different crops—perhaps khat. We never know that was
even in the mind of Tadele who could only disclose to her that if he
could get higher prices. Now with GUNA monopoly, the future of
coffee production may be threatened even more by both price factors,
as Ato Tadele had told her, and because of producers’ and associations’
resistance to what has happened as of the end of October.
I regret to say that Dr. Eleni, does not seem to be fully cognizant of the
speed and direction of TPLF movement to control Ethiopia from all
angles. Even then, she writes about the solid legal foundation on which
ECX is established, in a way that has missed the whole point. Dr. Eleni
believes,
- The law is even further explicit that certain key
management decisions cannot be made by simple majority
but by two-thirds majority, preventing the government side
to override by its slight majority number. One of such key
decisions is the decision when to recommend the sharing of
ownership of the Exchange with the private sector, which is
stated as an objective in the preamble of the law. So the
idea that the government aims to permanently own the
Exchange or to act as a monopoly trading entity or that the
Exchange is an arm of government is simply false, both as a
matter of law and in practice.
I would like to remind Dr. Eleni that in August I wrote the article
entitled ‘Distrust of regime places ECX Chief in unenviable position’,
nazret.com) . I repeat again, while maintaining my personal respect for
Dr. Eleni, I stand by what I had written in that article. I would
especially like to refresh her memory of the following,
- … What guarantees are there to show ECX’s independence in
a political environment that rigidly demands loyalty, even from
schoolchildren through membership of the ethnically oriented
ruling party? It seems to me that Dr. Eleni’s inadequacy to
make her case on that has taken the wind out of her sail,
irrespective of how important what she had to say. This is not
to say ECX‘s time has not come. The problem is government’s
lack of credibility has rubbed on the Exchange. The absence of
rule of law and an outside regulatory body to ensure the
Exchange’s transparency and fairness is a multi-pronged
handicap.
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