Ethiopia remains mired in poverty in spite of progress

LOS ANGELES, CA (Catholic Online) – As an example, Ethiopia’s economy has been percolating at an annual rate of nearly 10 percent for the last seven years. However, a third of the population still lives below the poverty line.

Economic advisor for the United Nations Development Program in Ethiopia, Samuel Bwalya says that the nation has to be patient while waiting for a trickle-down effect to lift more people from poverty.

 

“Ethiopia is starting from a very low base in terms of development, so it should actually take much longer for this impact to take root,” Bwalya noted. “So I think we are too much in a hurry to see seven-year growth to start asking questions about how many people are out of poverty. Ethiopia is still very poor. But if you look where Ethiopia is coming from, it has made significant progress in reducing poverty.”

While the late Ethiopian Prime Minister Meles Zenawi was praised for his outreach to his nation’s poor, the nation is still one of the largest donor recipients worldwide, receiving over $3 billion annually.

Ethiopia ranked 174th out of 187 countries in the UNDP’s 2011 Human Development Report. Life expectancy here is estimated at just 57 years. Twenty-six percent inflation remains a problem for most people and there are over 12,000 street children in the capital city alone.

“Ethiopia is spending over 40 percent of its budget on infrastructure development, public works, schools, health and roads,” Bwalya of the UNDP says. He reiterates that ongoing measures by the Ethiopian government will benefit the whole of the Ethiopian population in the long run.

“That is extremely important in the initial period and these are investments that bring impact, slightly, in the medium- to long-term. We don’t see the impact of actually constructing a road today, to take impact on the lives of people the next day. It may take a couple of years to do that.”

There remain many challenges to make sure the economic growth helps all Ethiopians.

The International Monetary Fund’s (IMF) resident representative in Ethiopia Jan Mikkelsen says that the Ethiopian private sector should be able to help the economy overcome some challenges, such as the large number of unemployed young people.

“We believe that most of the employment in the long haul will be generated in the private sector,” Mikkelsen noted. “So this will be more dynamic, new jobs in new areas – IT (information technology), trade manufacturing and so forth. That’s where sustainable high value jobs will be.”