The Future of Ethiopia: Developmental State or Political Marketplace?

Does Ethiopia have a pro-poor agenda?

Question (2) of the developmental state is the social agenda. The developmental state is also a state with an ambitious welfare programme, with an eye to protecting the poor and vulnerable, developing human capital, and easing the transition to a capitalist society.

Economic growth at the pace experienced by Ethiopia brings accelerated social changes. It brings migration, urbanization, disruption to livelihoods and social mores, and societal upheaval. New classes emerge associated with the booming sectors. Tax collectors, local government officials, police officers and statisticians struggle to keep pace with the changes. There are losers too: those whose livelihoods and social status are damaged, and those whose worldviews and value systems are upended. Some are objective losers, left destitute as their skills or assets are no longer needed or because they have been defrauded of their land or inheritance because of their illiteracy or powerlessness. Some are subjective losers, finding themselves lower down on the ladder of social esteem.

Ethiopia is just at the beginning of managing the traumas associated with this accelerated transformation. The new administration should have no illusions that there are any quick fixes to the socio-economic disruptions associated with this transition to capitalism. Despite Ethiopia’s rapid growth there are still tens of millions of desperately poor and vulnerable people: and there will be for the foreseeable future.

There are the traditional poor: the peasants. One of the most important, but least celebrated achievements of Ethiopia was averting a national food crisis in 2015/16, following the most widespread drought and crop failures in history. The government responded quickly and expeditiously to the problem, putting its own resources up front for a massive humanitarian and food security programme. Meles’s fear that a 50 percent rise in food prices would bring political crisis was not tested: food prices rose by 30 percent at most, and although there were very widespread protests in small towns and rural areas, food prices did not become a political issue, and the areas affected by the riots were not the same as those afflicted by the food crisis. That was an object lesson in the insight that food security is national security: the EPRDF survived the political crisis, which it might not have done without its massive food security programme.

Food crisis was the dog that didn’t bark in the night. Will PM Abiy’s administration keep the national food security plans and mechanisms intact? He would be well advised to do so.

The fact that Ethiopia weathered this major adversity without losing growth shows that external factors have not been entirely favorable: Ethiopia’s economic performance cannot be attributed to good luck.

There are the new poor: the newly urbanized and landless, the high-school graduates without jobs, the people whose low-skilled employment is insecure because of the volatility in the global market for their goods. Ethiopia has pioneered various forms of social welfare safety nets. They are less comprehensive, advanced and effective for these new categories of poor people, but the government has been making impressive efforts. This is a strength that the new administration should seek to build upon.

Ethiopia possesses a welfarist component to its developmental state model, embedded in its institutions for food security, public services and national planning. If these institutions remain functional, a central pillar of the developmental state will remain intact. Moreover, maintaining these essential functions will be pivotal to social and political stability.

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Instead of democratizing, these countries tend to transform either into political markets or authoritarian systems or descend into civil wars.

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What kind of state institutions is Ethiopia developing?

The third component of the developmental state question focuses on the state: what kind of state institutions are being developed? Can they endure?

One reason why PM Abiy’s reforms command such popular enthusiasm is that a wide variety of different political philosophies support an agenda of transforming institutions that are seen as corrupt, repressive or undemocratic. However, dismantling institutions is much easier than rebuilding them, and de-institutionalization can have seriously adverse consequences.

Many liberals, neo-conservatives and alt-right advocates of disruption share a philosophical premise that government’s bureaucratic institutions do more harm than good, and lifting their dead hand from economics and politics will unleash the creativities of the people and the productive power of market capitalism. Experience has shown that this does not hold in countries that have not yet attained a certain level of economic development, and/or those in which the political ‘rules of the game’ are not settled. Instead of democratizing, these countries tend to transform either into political markets or authoritarian systems or descend into civil wars. (The central Asian republics of the former USSR after 1993, Iraq after 2003 and most Arab Spring countries after 2011 are examples.) In such countries, if political transformation is to be achieved without societal breakdown, then institutional continuity is advisable.

Ethiopia possesses an important asset in that its people have historically had a high regard for authority. The relative smoothness of the 1991 transition was partly attributable to this factor. However, with the rapid socio-economic changes of recent years, the orderliness of Ethiopian society is not guaranteed.

The likely impacts of rapid changes to institutions can be understood in a more nuanced way by reference to institutional theories of the state.

Dominant political science theories of the state emphasize its institutional nature, either in the sense (following Max Weber) of being a set of impartial, rule-bound governing bureaucracies for the administration of public affairs, or the new institutional economics’ sense (following Douglass North) of it being a set of ‘rules of the game’ for political life. Weberian and new institutional economics share the premise that a state is developed when its institutions are sufficiently consolidated that they are respected by political elites, who play within the rules, and a change in administration or leadership does not result in wholesale changes to institutions or the political rules of the game.

It is a testament to the institutionalization of Ethiopian politics that the national bureaucracy continued to function for the last six years following the death of its pre-eminent figure, and the rules of the political game were respected to the extent of two peaceful power transitions. However, the political crisis of the last three years, the growth of corruption in the public service, and the growing disputation over the fundamentals of the constitution suggest that the institutionalization is not sufficiently consolidated.

All institutions can be reformed without losing their fundamental socio-political functions. A certain degree of turnover of senior post-holders is to be expected, and indeed is a necessary part of the life of an institution. Some of the rhetoric of PM Abiy appears to go further, in terms of hinting at the delegitimization of important national institutions such as the military, using words such as ‘terrorist’. Government departments and parastatals are all undergoing accelerated senior staff turnover and moreover are being publicly discredited as corrupt, partisan or bankrupt.

The crisis within the EPRDF structures is particularly significant because as the dominant political party, and one that has become extensively coterminous with the state, its institutional transition demands special care. Although EPRDF structures have decayed seriously, there is no alternative but to maintaining them in some form, lest a political vacuum develop. The weakness of EPRDF leadership is enticing for those who would like to sweep it away and build anew, but this would come at the cost of de-institutionalizing politics (in both senses of the word).

PM Abiy is also unclear as to the theory of democracy and developmentalism that impels his institutional reforms. Dismantling institutions because they are unpopular is a tactic not a strategy. It would be very easy for him to cater to the diverse interests and political philosophies that share a common programme of dismantling institutions, and find that he no longer possesses effective institutions of state with which to implement national policy.

PM Abiy’s supporters are not entirely consistent in their position on whether they came to power through the ‘rules of the game’ or are intending to disrupt those rules. This provides political ammunition to their critics who claim that the correct procedures have not entirely been followed. The test of this will be the adherence to the rules of procedure for the upcoming EPRDF Congress and the preparations for the elections of 2020.

If the ‘rules of the game’ are indeed disrupted and institutions of government are indeed weakened, the likely outcome in Ethiopia will be a political marketplace in which money combines with populist agendas (identity politics) to rule.

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