Winning Ethiopia Elections is Least Arduous of Abiy’s Challenges

Source:Bloomberg

By Simon Marks and Fasika Tadesse11 July 2021, 05:00 BST

• Prime minister needs to reunite country, end Tigray conflict
• Turmoil has spooked investors, drained government coffers

Ethiopian Prime Minister Abiy Ahmed’s party coasted to victory in last month’s elections, making his reappointment a formality. Now he faces the far thornier challenges of reuniting his conflict-ridden nation, repairing its scarred international reputation and rebuilding investor trust.

Abiy’s Prosperity Party won 410 of the 436 seats in the House of People’s Representatives that were contested on June 21, results announced by the national election board on Saturday showed. The legislature chooses the premier, meaning he has the numbers to retain his post. The vote was delayed in some of the 547 constituencies due to security concerns and logistical problems.null

The PP’s widespread appeal should help reinforce Abiy’s authority and counter doubts about his legitimacy, despite key opposition parties having refused to participate in the vote. While the widely respected electoral board highlighted several irregularities during balloting, it said it remained proud of the work it had done, despite having faced numerous challenges.

Among Abiy’s biggest hurdles will be to quell political tensions that have exploded since he took office in 2018, unbanned opposition parties and rebel groups, and indicated that states would secure greater autonomy. Hundreds of people have died in ethnic and inter-communal violence.

A civil war has also raged in the Tigray province for eight months that’s pitted federal troops against forces loyal to the dissident northern region’s former ruling party.

While the government initially overran most of the territory, the rebels hit back last month, recapturing the capital, Mekelle, and other towns. Thousands of people have died in the conflict, and the United Nations has warned that more than 400,000 people in Tigray are experiencing famine conditions and another 1.8 million are on the brink of joining them.

Abiy declared a unilateral ceasefire in Tigray last month, but the rebels said they wouldn’t lay down their weapons until all his troops withdrew from their territory. The premier’s other detractors say he needs to embrace reconciliation and engage his foes, failing which the nation of 110 million people will slip deeper into the abyss.

“If he doesn’t move fast to create an all-inclusive government through national dialog, we are heading to a much more serious crisis,” said Merera Gudina, leader of the opposition Oromo Federal Congress. The party boycotted the recent elections in protest at the continued detention of two of its senior members on charges of stoking ethnic violence and treason.

Opposition Criticism

Dessalegne Chanie, a leader of the opposition National Movement of Amhara, said the Prosperity Party was proving itself no different from the past government dominated by the Tigray People’s Liberation Front, in terms of vote rigging, and intimidating and harassing its opponents. He also called for inclusive talks to ease the tensions.

In May, U.S. President Joe Biden’s administration imposed wide-ranging sanctions on Ethiopia and urged the International Monetary Fund, World Bank and other multilateral lenders to halt their engagement with the east African nation in a bid to pressure Abiy to end the Tigray conflict. That could scupper plans to restructure Ethiopia’s debt under an initiative devised by the Group of 20 leading economies to help poor countries cope with the coronavirus pandemic.

Investors who’d piled into one of the world’s fastest-growing economies, have grown increasingly skeptical about Abiy’s ability to contain the turmoil.

Yields on the nation’s $1 billion of Eurobonds are at their highest level in more than two years and its currency has slumped 12% against the dollar this year — the worst performer among 20 African currencies monitored by Bloomberg. Gross domestic product, which grew an average of more than 9% annually over the past decade, is likely to increase just 2% this year, IMF projections show.

Economic Prospects

Abiy’s administration said he’s repeatedly sought to engage the Tigray region since coming to power, traveling to Mekelle to meet with local authorities and protecting its officials’ retirement benefits.

And despite the government finances being under strain due to the conflict and the coronavirus, it says the nation’s economic fundamentals remain sound. Foreign direct investment, which had been on a downward trend since 2017, rose 7.3% in the nine months through March compared to the year-ago period, while exports surged almost 19% and income tax collections 31%, government data shows.

The prime minister struck a reconciliatory tone after the election results were announced and indicated he’s open to making his government more inclusive.

“Although elected parties form the government, the administration of the country is not limited to those parties and their leaders,” he said in a statement. Opposition politicians that participated in the elections “will be included in the executive bodies, the courts and other federal and state institutions in a meaningful way,” he said. 

The International Crisis Group said securing a ceasefire in Tigray is a top priority and the country’s prospects are bleak without one.

“The authorities say they are already holding a national dialog among groups and citizens, but with so many disgruntled opposition elements, this initiative is unlikely to calm the waters,” the Belgium-based group in a report this month. “A recent statement on the campaign trail by the prime minister vowing to destroy what he calls the country’s internal enemies also undermines efforts to narrow divisions.”