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Ethiopia Eritrea Somalia Djibouti COUNTRY REPORT Ethiopia Eritrea Somalia Djibouti 2nd quarter 1996 The Economist Intelligence Unit 15 Regent Street, London SW1Y 4LR United Kingdom The Economist Intelligence Unit The Economist Intelligence Unit is a specialist publisher serving companies establishing and managing operations across national borders. For over 40 years it has been a source of information on business developments, economic and political trends, government regulations and corporate practice worldwide. The EIU delivers its information in four ways: through subscription products ranging from newsletters to annual reference works; through specific research reports, whether for general release or for particular clients; through electronic publishing; and by organising conferences and roundtables. The firm is a member of The Economist Group. London New York Hong Kong The Economist Intelligence Unit The Economist Intelligence Unit The Economist Intelligence Unit 15 Regent Street The Economist Building 25/F, Dah Sing Financial Centre London 111 West 57th Street 108 Gloucester Road SW1Y 4LR New York Wanchai United Kingdom NY 10019, USA Hong Kong Tel: (44.171) 830 1000 Tel: (1.212) 554 0600 Tel: (852) 2802 7288 Fax: (44.171) 499 9767 Fax: (1.212) 586 1181/2 Fax: (852) 2802 7638 Electronic delivery EIU Electronic Publishing New York: Lou Celi or Lisa Hennessey Tel: (1.212) 554 0600 Fax: (1.212) 586 0248 London: Moya Veitch Tel: (44.171) 830 1007 Fax: (44.171) 830 1023 This publication is available on the following electronic and other media: Online databases CD-ROM Microfilm FT Profile (UK) Knight-Ridder Information World Microfilms Publications (UK) Tel: (44.171) 825 8000 Inc (USA) Tel: (44.171) 266 2202 DIALOG (USA) SilverPlatter (USA) Tel: (1.415) 254 7000 LEXIS-NEXIS (USA) Tel: (1.800) 227 4908 M.A.I.D/Profound (UK) Tel: (44.171) 930 6900 Copyright © 1996 The Economist Intelligence Unit Limited. All rights reserved. Neither this publication nor any part of it may be reproduced, stored in a retrieval system, or transmitted in any form or by any means, electronic, mechanical, photocopying, recording or otherwise, without the prior permission of The Economist Intelligence Unit Limited. All information in this report is verified to the best of the author’s and the publisher’s ability. However, the EIU does not accept responsibility for any loss arising from reliance on it. ISSN 1352-2922 Symbols for tables “n/a” means not available; “–” means not applicable Printed and distributed by Redhouse Press Ltd, Unit 151, Dartford Trade Park, Dartford, Kent DA1 1QB, UK 1 Summary Ethiopia, Eritrea, Somalia, Djibouti 2nd quarter 1996 May 21, 1996 Ethiopia Political and economic structures Pages 3-4 Outlook: Given the stable outlook for food availability, the official target of 7-8% for real GDP growth in the current fiscal year looks attainable. Reforms of the taxation system and a liberalisation of the investment code are expected. Pages 5-6 Review: Limited UN sanctions have been imposed on Sudan in the context of the attempted assassination of the Egyptian president in Addis in mid-1995. Relations along the border with Sudan remain tense, but in this uncertainty Ethiopian ties with the USA have become still closer. An EPRDF member has been appointed to head the state assembly in Region 2 (Afar). The belg rains appear adequate. The federal government has raised fertiliser subsidies. Coffee exports have fallen below official targets. Further mining concessions have been awarded. External debt has continued its steady rise. Pages 6-14 Eritrea Political structure Page 15 Outlook: The easing of tensions with Yemen and administrative reforms augur well for investment prospects. Page 16 Review: Peaceful resolution of the Hanish dispute with Yemen beckons. IGADD has been reformed. The cold war with Sudan has deepened, stalling the official programme for the repatriation of Eritrean refugees. The PFDJ has set a date for its second conference. The IDA has approved a loan for community development. Coca-Cola has formed a joint venture with the government. The first round of mining licences has been successfully concluded. Ties with Italy have been strengthened. Pages 17-23 Somalia Political and economic structures Pages 24-25 Outlook: General Aideed’s determination to overcome his clan rivals by force leaves little room for reconciliation. In the Somaliland Republic, international recognition is as remote as ever. Pages 26-27 Review: General Aideed is gaining territory in the west and the south. Fierce fighting has erupted again in Mogadishu. The UN, the OAU and the Arab League have maintained their efforts at national reconciliation, but without success. The capital has yet another radio station. Cholera has broken out in the south. In the Somaliland Republic, the EU has pledged to fund rehabilit- ation at Berbera port, and there have been fresh clashes between government forces and opposition clan militia. Pages 27-34 EIU Country Report 2nd quarter 1996 © The Economist Intelligence Unit Limited 1996 2 Djibouti Political and economic structures Pages 35-36 Outlook: Political intrigue over the succession to the president will continue to weaken the government. Divisions within the ruling party will widen. Progress on economic reform is unlikely to be smooth. Pages 37-38 Review: The president has returned home from France. Two leading ministers have been sacked, including Moumin Bahdon Farah who has created a splinter group. The pro-government faction of FRUD has been recognised as a political party. Djibouti has accused Eritrea of aggression on its northern border. The IMF has granted Djibouti a stand-by credit. The French cooperation minister has visited and announced new project assistance for Djibouti. Pages 38-43 Statistical appendices Pages 44-46 Editors: Gregory Kronsten; Kristina Quattek All queries: Tel: (44.171) 830 1007 Fax: (44.171) 830 1023 EIU Country Report 2nd quarter 1996 © The Economist Intelligence Unit Limited 1996 Ethiopia 3 Political structure: Ethiopia Official name: Federal Democratic Republic of Ethiopia Form of state: federal republic Legal system: the federal constitution was promulgated by the transitional authorities in December 1994. Representatives were elected to the institutions of the new republic in May 1995, which formally came into operation in August 1995 National legislature: the 548-member Council of People’s Representatives is the federal assembly. Nine regional State Councils have limited powers including appointing the supervisory Federal Council Last elections: June 1994 (Constituent Assembly); May 1995 (federal and regional) Next elections: 2000 (federal and regional) Head of state: president, Negaso Gidada, largely ceremonial and appointed by the Council of People’s Representatives National government: the prime minister and his cabinet (Council of Ministers), appointed in August 1995 Main political parties: the Ethiopian People’s Revolutionary Democratic Front (EPRDF) is the coalition of armed groups which seized power in May 1991. It includes the Tigray People’s Liberation Front (TPLF) and the Amhara National Democratic Movement (ANDM, formerly the Ethiopian People’s Democratic Movement). The Oromo Liberation Front (OLF) withdrew from the transitional government in July 1992 and was subsequently banned. Several urban opposition parties boycotted the last elections. A myriad of exiled political factions exists Prime minister Meles Zenawi Deputy prime minister & minister of defence Tamrat Layne Deputy prime minister for economic affairs Kassu Illala Key ministers agriculture Teketel Forsido education Guenet Zewde finance Sufyan Ahmed foreign affairs Seyoum Mesfin health Adem Ibrahim information & tourism Wolde-Mikael Chamo justice Mehetema Solomon labour & social affairs Hassan Abdullah mines & energy Azedin Ali planning & economic cooperation Girma Biru public works & urban development Haile Aseged trade & industry Kassahun Ayele water resources Shiferaw Yarso transport & communications Abdul Mejid Hussein Governor of National Bank of Ethiopia Dubale Jale EIU Country Report 2nd quarter 1996 © The Economist Intelligence Unit Limited 1996 4 Ethiopia Economic structure: Ethiopia (incl Eritrea) Latest available figures Economic indicators 1991 1992 1993 1994 1995 GDP at factor costa Birr bn 19.4 24.5 25.3 n/a n/a Real GDP growtha % –8.7 12.3 1.4 5.6 n/a Consumer price inflation % 35.7 10.5 3.5 7.6 10.0 Populationb m 49.4 50.9 52.4 54.1 55.7 Exports fob $ m 168 170 199 405 n/a Imports fob $ m 471 993 706 937 n/a Current account $ m 103 –120 –52 n/a n/a Reserves excl gold $ m 55 232 456 544 772 Total external debt $ m 4,179 4,363 4,703 5,059 n/a External debt-service ratio % 17.9 13.4 11.7 11.7 n/a Coffee productionc ’000 tons 184 210 222 228d n/a Exchange rate (av) Birr:$ 2.07 2.81 5.00 5.09 6.15 May 17, 1996 Birr6.32:$1 Origins of gross domestic product 1992a % of total Components of gross domestic product 1993a % of total Agriculture & forestry 54.3 Private consumption 84.0 Trade, hotels & restaurants 10.1 Government consumption 11.3 Manufacturing 4.6 Gross fixed capital formation 15.0 Public administration & defence 7.1 Exports of goods & services 11.7 Banking & insurance 6.2 Imports of goods & services –22.0 GDP at factor cost incl others 100.0 GDP at market prices 100.0 Principal exports 1994a $ m Principal imports 1993a $ m Coffee 320 Food & live animals 111 Hides & skins 68 Crude petroleum 79 Gold 23 Petroleum products 64 Chemicals 44 Main destinations of exports 1993a % of total Main origins of imports 1993a % of total Germany 18.0 Saudi Arabia 13.3 Japan 13.3 Italy 11.6 Djibouti 10.4 USA 10.2 Saudi Arabia 7.7 Germany 9.1 a Fiscal years starting July 8. Fiscal years are widely used by national statistical sources, while calendar years are favoured by international publications. b Excluding Eritrea, based on a Ministry of Planning estimate of 54.1 million in 1994.
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