Ethiopia’s economy continued healthy, says PM Hailemariam

Addis Ababa, March 10, 2016 (FBC) – The House of Peoples Representative (HPR) has held its regular meeting today.

Prime Minister Hailemariam Desalegn presented his government’s 6-month performance report as well as responded to queries raised by the MPs.

According to the Premier, construction, service and manufacturing sectors have witnessed growth during the past six months. Investment also increased by three fold compared to the same period last fiscal year, he said.

Effort will be consolidated in the second half of the budget year to add momentum on the success gained in the construction and service sectors.

Export-Import

Some 5.3 billion US dollars has been generated from export trade in the first half of the fiscal year. However, the performance is low compared to the plan due to global financial crisis and less contribution from the manufacturing sector, he said.

In contrast, the country imported 8.3 billion US dollar worth of goods, showing a wide gap between import and export trade, he said. Hence, in order to ease forex shortage, the government utilized the foreign currency secured from money transfer, foreign direct investment (FDI) and from its deposit, he said.

The government collected 65 billion birr from tax, showing a 10.7 per cent increase compared to the same period the previous year, the Premier stated. In general, the country’s economy has continued healthy, he told the MPs.

Inflation

Inflation remained at 10 percent on average during the past six months, which is the lowest after 14 months, he said.

The target to raise gross domestic savings to more than 22 percent will be achieved following the expansion of banking service and improvement in savings for the housing program and sale of Grand Ethiopian Renaissance Dam (GERD) bonds, he said.

Agriculture

The Premier, who underscored the need to modernize the agriculture sector, said the current El Nino weather is likely to affects the overall agricultural productivity of the country.

However, the country is working to minimize its impact and compensate the crops lost by the drought through expanding existing farmlands, distributing select seeds and fertilizers as well as by undertaking watershed management.

Industry

The efforts being made to expand small and medium industries in urban areas will be strengthened to address unemployment and generate more income from the sector.

The construction of various industrial parks is underway across the country, he said, citing the Bole Lemi phase one project, which has already gone operational, and the Hawassa industrial park, as a case in point. Preparations have also been completed to commence the construction of agro-processing industrial parks in four regional states, he said.

Energy

The construction of the Grand Ethiopian Renaissance Dam is well in progress and is now half completed, he said.

Preparation has been underway to start a study on the impact of the dam on the lower riparian countries as per the agreement reached with the countries, he said.

Gibe-III hydropower is generating 540 MW and through process, the plant will begin generation with its full capacity, he said. According to him, Tekeze, Melka Wakena, Koka, and Gibe-I are currently generating only 10 per cent of their capacity due to the impact of the drought. Gibe-III contributed a lot to compensate this shortage.

He said negotiations are underway to let investors engage in geothermal, wind and solar energy development.

Transport

In order to address the transportation problem in Addis Ababa, more trains will be imported, in addition to the deployment of more than 1, 100 metro taxis and 500 city buses.

El Nino induce drought

The government has so far spent 8 billion birr to mitigate the impact of the drought. The response from the international community is very slow.

Recent violence

The recent violence in some parts of Oromia and Kimant community in north Gondar zone, Amhara regional state, were occurred due to lack of rapid response from the government for the question raised by the people.

The people raised questions for good governance and jobs, which are expected questions as far as a demanding society is emerged, he said.Anti-peace forces tried to divert these legitimate questions of the people for their own goal. But their attempts were foiled by the public.

Eritrea

Responding to the question raised by the MPs “if there is a new policy on Eritrea,” the Premier said the country has no new policy towards Eritrea. Ethiopia won’t cease working to restore the people-to people relations between the two countries, he added.

The Premier further stated that Ethiopia will respond to any attack from the Eritrean regime in accordance with international law. Eritrea released Ethiopians it kidnapped recently as it clearly understood the consequence from the Ethiopian government.