FenKil II towards Economic Emancipation

Busy and vibrant Massawa Port

FenKil II towards Economic Emancipation

From the outset, the Eritrean national struggle spearheaded by the EPLF was conducted with two objectives in mind.

1. The total liberation of Eritrea and
2. The economic emancipation of the Eritrean masses with social justice at its core.

Operation Fenkil is one of the major military feats in the history of the Eritrean national struggle, if not in the annals of the history of the last century’s national liberation struggles. It did open the door for the total liberation of Eritrea from the yoke of atypically colonialist / neo-colonialist domination by successive foreign dependent regimes sitting in Addis Abeba. Indeed, a year and three months after the Operation, the gallant EPLA—Eritrean People’s Liberation Army--- marched to Asmera realizing the first goal of the EPLF. On top of that, before certain insidious neo-colonialist interests regressively got involved, its leading role in the coordination and support to the anti-Derg coalition unleashed a new spirit of freedom and liberation among the Ethiopian masses.

Not many appreciated or may have overlooked the fact that with the official declaration of the hard won independence in May 1993 that the EPLF was only half way through or less to its final goals. Now, looking back into the last quarter of a century since independence, one may also include a third objective or a combination of the original two: the safeguarding of the Eritrean sovereignty from a myriad of hostilities essentially aimed at rolling back the hard won independence and the gains made by the Eritrean national struggle spanning for more than half a century.

In its totality, the Eritrean liberation struggle which is rich with elements of surprise--- pleasant only for those with real sense of justice--- be it in military or political terms, has not given respite to those quarters who have been miscalculating ever since. The biggest surprise, so far, came with the realization of the total liberation in 1991 and the meticulously and efficiently run referendum which led to the official declaration of the independence of Eritrea in 1993.

Those quarters who think Eritrea stands on the way of their insatiably greedy and exclusive self interests, did not learn from their past miscalculations and no sooner did they started to instigate conflicts with bordering countries; they instigated early on, the so called Hanish crisis with Yemen; by and large, it got resolved faster. Then they found yet another dependent group sitting in Addis ready to do their bidding to try again a historically proven impossible mission of reversing and denying the Eritrean people of their sovereign right.

A preposterous calculation with a set time table was projected whereby the Eritrean economy was supposed to stop to a grinding halt THREE MONTHS after the mercenary state sitting in Addis Abeba opened war under the pretext of Badme in May 1998. Well, despite all the negative consequences of the renewed aggression by their client state in Addis, literally with the full support and direction of its handlers , Eritrea is neither subdued militarily nor its economy came to a grinding halt. Instead, to the directors and actors of this untenable drama that runs over a span of 18 years, it turned out to be a frustrating 200 plus month long episode.

Their frustration comes for two reasons: despite all the hostilities, as Eritrea stands its ground, the client state in Addis is finding itself in an increasingly dangerous state of implosion with unpredictable consequences to the integrity of Ethiopia itself and also to the perceived interests of its sponsors. Nevertheless, as a matter of principle and also self interest, Eritrea always does its part to the stabilization of the region; it could have done more if its rights and dignity as a sovereign nation were respected by those ever miscalculating quarters. Well, is there any other option, or has there been any?

Now, are the typically Eritrean elements of surprise gathering momentum on Eritrea’s march towards its national development goals? There may not be a total surprise there, however the recent announcements and measures taken on the issuing of a new currency has taken many by surprise. The move by the Eritrean government represents only one aspect of the unfolding program for economic restructuring.

In an extensive interview given to the national media, President Isayas Afewerki spoke on the extent of the program without going into specifics. Can one draw some parallels between some aspects of Operation Fenkil and the tone and contents of the interview? Obviously, at least at these initial stages, it cannot as yet claim with certainty that victory is imminent. Following the Operation in 1990, when Eritrea’s liberation became more apparent and the then Secretary General of the Eritrean People’s Liberation Front, tegadalay Isayas Afewerki, had said in an interview: “Eritrea’s independence is only a matter of months”. However, there are some aspects of the operation from which one can draw some analogies to the efforts and achievements being made by the Eritrean people and its leadership as they surmount the prevailing challenges and hostilities.

Operation Fenkil was planned to be conducted in four phases. The first two mainly targeted the Western flank where the command center of the 6-th Division was located. Overlooking enemy fortifications had to be first dismantled making sure that the rest of the Derg divisions and its navy come to a total encirclement and finally subdued. Accordingly, within the first two days since the start of the operation, units from 61-st Division, routing the first enemy defense lines and clearing the GaHtelay- ShebaH road for mechanized units, advanced south to Semienawi BaHri escarpments and secured new defense lines. At the same time, after destroying all area fortifications like the strategic “taba” Kentibay and Degdegta, units from 85-th and 70-th Divisions stunned and surprised the targeted Derg 6-th army command at Ad-Ele and brought the whole Western flank under total control, thus cutting the Asmara-Massawa road at GaHtelay, thereby paving the way for the other phases of the operation that lead for a quicker and efficient liberation of Massawa.

The disproportionately well armed and manned Derg armed forces and the then 35 years experienced navy was with astounding defeat made to leave for good the pearl of the Red Sea, the port city of Massawa and its environs.

After the GoE issued Legal Notice Number 124/2015 by which the new NaKfa currency was issued and the old outstanding notes were collected in exchange of the new notes, the general public started to wonder and make many interesting observations. Why a very significant number of merchants and businesses been keeping/ hiding and hoarding cash, to the extent that in some cases, tens if not hundreds of millions were kept somewhere away from the Eritrean banks? How did it all started and are there some “invisible hands” directing and/or encouraging such conspiratorial practices?

Well, part of the answers can be found in the first segment of President Isayas’ New Year’s interview as he identified the main causes of the economic distortions and anomalies.

The first cause can be attributed to external subversion that has been going on for the past 18 years. These include obstacles to our saving and development programs, rendering monetary policies ineffective, instigating unwarranted depreciation of the NaKfa, establishing Banks for illicit transactions, weakening local financial institutions, encouraging illegal and cross border trading and the like. These subterfuges fall within the general scheme of external subversion and constitute the first factor that has impacted negatively – with variably intensity –on our economic growth.

The second factor is speculative practices by few players who have exploited and profited from prevailing difficulties and aberrations inculcated by external subversion. These practices have resulted in spiraling price hikes, a rise in the cost of living, deprecation of the NaKfa etc. with deleterious consequences on the country’s economic growth and the well being of the general population. This phenomenon must be accurately identified and appraised, in tandem with the first factor, in order to gauge the damages that it has entailed. 

Generally speaking, these two factors are interrelated and reinforce each other if left unchecked before they inflict heavy and irreparable damage to the targeted societies. The “economic hit men”, so to speak, do employ the criminal services of the few greedy speculators who do work independently or in tandem with servile institutions or client states which are under their control; it is now becoming more clear to the general public who the directors and actors have been behind the fast depreciation of the NaKfa, to say the least.

Dedicated cross border banks were established in the client state and elsewhere to hoard billions of NaKfa enabling them, to a certain extent, the control of the money supply and deprive the GoE the ability of tracking funds against tax evasions and other security concerns. Certain merchants and businesses benefitting from such criminal operations turned out to be like branch operators. Besides, they spread rumors against putting money in the legally established banks across Eritrea, thereby creating an atmosphere of suspicion discouraging the general public from carrying out proper economic activities using normal bank services.

During the short time given to redeem the old NaKfa notes, banks were overwhelmed by long line-ups of people with large sacks stashed with cash. Overwhelmed banks started to demand that their clients-mostly, clients-to-be- use boxes. Within a week the cost of the boxes spiraled and Medeber—historic location of artisanal shops---got a new booming business. Sections of banks stacked with boxes looked like warehouses and employees assigned to handling the storage and the counting of the old notes had their hands full. Besides, it did not escape from their attention, the presence of several clients, normally taken for granted as ordinary farmers or workers were bringing in disproportionate amount of cash to be redeemed.

Even if it is too early to expect any official account, if not on its effect to the value of NaKfa, at this stage, one thing is evident about the outcome of the launching of the program. The special banks established in the client state and elsewhere, along with their operatives, now find themselves isolated from pursing their criminal activities further; they are now left hanging dry with billions of hoarded unredeemable old NaKfa notes; hundreds of millions of the old notes got into the hands of the authorities with the “owners” names tagged in the boxes which lead to further inquiries into the networks engaged in the systemic sabotaging of the Eritrean economy and other criminal activities like human trafficking.

Just imagine for a moment a cross border Asosa type op. is taking place; some of the now unredeemable old NaKfa billions collected to be displayed in the war museum in Asmara? ... (Prior to the initiation of Op. Fenkil, units from 70-thinfantry Division and some mechanized units made a spectacularly major diversionary attack in the heartland at a town called Asosa, south of Addis)

By and large, this part of the calculated move by the Eritrean government can be compared to the surprise attack and the capturing of the command post of the 6-th Division at Ad-Ele with all its top commanders, documents and weapons; as described above, the Eastern flank was isolated and paved the way for the rest of the successful liberation of Massawa.

Are there other analogies that we can draw from Operation Fenkil to the present move by the GoE in restructuring the Eritrean economy? Well, as the move is barely at its initial stages with only few official pronouncements after Legal Notice Number 124/2015, one may find useful directions concerning the organizational and motivating values which made the rest of Operation Fenkil successful. In that respect, it doesn’t make it different from other successful military victories of the EPLA. The success of the operation was made possible with astounding speed and efficiency because of the thorough preparation in terms of surveillance, training, and above all, the leadership provided by dedicated, resilient and tactful commanders who mobilized and motivated the fighters and the populace with values of resistance and resilience that produced miraculous feats.

The post independence challenges mostly originate from external hostilities which have also been impacting institution building efforts. The Eritrea house, so to speak, with its foundation solidly intact, has also cracks here and there. Consequently, such shortcomings and deficiencies factor in among the causes of the economic distortions and anomalies. President Isayas Afewerki put it as the third main factor:

The third and principal factor is the subjective or internal factor that has ensued from the policies and practices of government institutions. Poor institutional performance, starting from budgetary implementation to the lack of proper tax collection have aggravated the problems of inflation and weak currency, thereby providing operating space for the destructive two factors cited above. 

In a nation subjected to continuous and systemic hostilities “poor institutional performance”, small scale or not, does present a weakest link within the government operations by which the hostile elements try to exploit or even push to make it worse. Apart from the insidious acts of the rare but eventually inconsequential Trojan horses, “poor institutional performance” is basically caused by negligence and/or incompetence.

Institution building has been one of the primary objectives of the GoE. To that end, in-staff training and facilitating various continued education opportunities to government employees has been going on for years. More has to be done though to fill in gaps and correct deficiencies including assigning at appropriate postings more of the motivated and educated youth.

There can be several causes of negligence; over a long haul, the pressure that comes from financial hardships because of inadequate remunerations can negatively affect the behavior of an otherwise diligent employee. Addressing this shortcoming unleashes new energies within the workforce. So, as part of the economic restructuring program, the civil service is expected to benefit from the on-going salary increases and adjustments. That timely measure, among other things, may increase the productivity of the workforce.

After taking the necessary measures, tackling the causes of “poor institutional performance” may reach a new level whereby the government will have less of an effort and hesitation to taking decisive steps against those involved, at all levels, in conspiring against the Eritrean economy; as President Isayas has put it with an unwavering tone:

“But one thing is certain; distortions and anomalies will not be entertained anymore.”

As the economic restructuring program unfolds, the hostile elements and their emissaries are not expected to stop their regressive ploys and may come with various new ways of creating new conditions to regain back their lost ground where, among other things, they had hoped to breed and spread greed destroying community values that carried Eritrea through thick and thin.

The Derg and its backers did not give up easily once Operation Fenkil was completed with a stunning victory. They blanket bombed Massawa with Napalm followed by a fierce life and death counter-attack which lasted three months, causing more causalities and material damage than in the Operation itself. But how and why did the counterattack eventually fade and the EPLA moved to the next step, finally liberating Eritrea? Simply put, it was the shield inside Tegadalit/ay Freedom fighter - clad with armour of higher values of dedication and sacrifice for the common good.

That is where one has to explore other dimensions of nation building besides developing government and state institution and what not. In that realm, it is imperative that the Front gets reinvigorated, to effectively mobilize the Eritrean masses. By using innovative means to building more awareness for optimal level of participation, it ought to take the lead in the second phase of our national struggle for economic emancipation, all firmly rooted in social justice.

Haileab Luul Tesfai

Feb. 16, 2016

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