Is Ethiopia Really Ahead of Eritrea?

Snow-like hail blankets Asmara, Eritrea 

Is Ethiopia Really Ahead of Eritrea?

During a speech made in Washington D.C., Dan Connell, one of the many self-proclaimed leaders of the so-called Eritrean "opposition" groups, boldly stated Ethiopia is growing at an extraordinary rate while Eritrea is stagnant:

"Ethiopia is growing by leaps and bounds at an extraordinary rate. It’s modernizing its infrastructure, expanding its trade, growing businesses, becoming a regional powerhouse. It’s no model of democracy, for certain, but it’s internally stable and playing an ever larger role on the regional and global stage while Eritrea is stagnant."

Like most claims Dan seems to make about Eritrea, the reality couldn't be further from the truth.Statistically speaking, not only is Eritrea doing better than Ethiopia in most health, education and economic indicators; it's doing so by 'leaps and bounds'.

Categories	Eritrea	Ethiopia	SS Africa
Adult (15+) Literacy Rates	80%	39%	63%
UN MDGS	6/8	3/8	N/A
2014 GDP Forecasts	8.0%	7.0%	4.5%
Wealth Per Capita	US$1,037	US$192	N/A
HIV/AIDS Prevalence Rate	0.6%	1.4%	4.6%
Access to Electricity	32%	22%	24%
Internet Penetration Rate	6.2%	1.1%	15.6%
Sources: EIU, UN, WHO, World Bank, Credit Suisse

While politics is certainly blinding Dan from the facts, there are two main reasons why some people buy into this narrative. One is because the regime in Addis Ababa has been aggressively and successfully promoting its economy has been growing by double-digit figures for the last 10 years. But as William Wallis of the Financial Times points out, Ethiopia's double-digit growth claims are based on dubious statistics.

"In Ethiopia, the same is almost true but with a disturbing caveat. It is an open secret that the double-digit growth of recent years is supported by dubious statistics. Yet the same figures are bandied around by development experts arguing that a trade-off between growth and civil liberties is inevitable."

Similarly, the Economist finds Ethiopia's double-digit growth claims to be false, and believes the country's annual GDP growth is around 5-6%.

The government claims that the economy has been growing at an impressive 10% a year since 2003-04, but the real figure is probably more like 5-6%, which is little more than the average for sub-Saharan Africa. And even that modestly improved rate, with a small building boom in Addis Ababa, for instance, has led to the overheating of the economy, with inflation moving up to 19% earlier this year before the government took remedial action. The reasons for this economic crawl are not hard to find. Beyond the government-directed state, funded substantially by foreign aid, there is--almost uniquely in Africa--virtually no private-sector business at all.

Hypothetically speaking, even if we were to take the 10% GDP growth per annum at face value, Ethiopia's economy would still be moving backwards. With over 2.8 million Ethiopians being born annually, the country needs a GDP growth rate of 20% per year or more to offset the detrimental effect rapid population growth has on its fragile economy. In other words, Ethiopia's economy needs to run just to stand still.

The other reason as to why some believe Ethiopia is advancing ahead of Eritrea is the building boom in Addis Ababa. Since 2006, dozens of buildings have been developed in the capital. The problem is most of these buildings do not meet international safety standards and are poorly built; even by African standards, which has earned it some criticism. For example, an Ethiopian friend recently returning from Addis described the new buildings as "state-sponsored eyesores", while the the Economist described them as "ugly steel-and-glass tower blocks".

In contrast to Addis Ababa, the Eritrean government has chosen quality over quantity when it comes to developing its capital, Asmara. In November, the government quietly launched one of the largest urban housing projects in the Horn of Africa that will feature the construction of 1,680 modern homes and shops. These homes and shops will meet or exceed international standards, something Addis Ababa, for all the construction hype it has received, has yet to do on such a scale.

Despite the unwavering hostility shown by Ethiopian bigwigs, the Eritrean government still understands its in their interest to see their hostile neighbor to the south develop. After all, home owners know the value of your own property can increase or decrease based on your neighbor's home. So sabotaging or not supporting their development only hurts the overall value of your own country (home). Unfortunately, the Ethiopian regime does not see it this way, and continues to occupy sovereign Eritrean territories in order to weaken Eritrea's economy. The irony is, it is Ethiopia's economy and people that are paying a heavy price for its aggression.

Even with all the external challenges against Eritrea, the country is not only ahead of Ethiopia in just about every health, economic and education sectors but most of sub-Saharan Africa too.With over tens of billions of dollars in resources still underground, and with a manageable population of 6 million, Eritrea's future is certainly looking brighter than that of its neighbor to the south, regardless if Dan Connell accepts it or not.

Peace!

Construction of 1,680 modern homes and shops underway in Asmara

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