It is crystal clear that war is one of the worst hindrances of social and economic development. Furthermore, economic mismanagement can result in various forms of aggression. Owing to the fact that the terrorist TPLF has opened an economic war against Ethiopia and Ethiopians, the government jointly with the investors and other stakeholders is undertaking different measures to overcome these hurdles.
It is believed that the government needs to take various measures to prevent economic warfare. Scholars also say that financial institutions need to be especially vigilant in identifying areas of economic instability during the war to counter the problem. Financial institutions play a key role, especially in combating the problem related with the possibility of money laundering during war.
The months-long conflict which has been started in the northern part of the country has escalated to other regions, causing severe damages against human and property. Apart from looting public property, the atrocious acts of the terrorist group manifested itself when destroying financial institutions like banks. To mention some, it has evacuated and destroyed branches of Commercial Bank of Ethiopia, looted and demolished hospitals and factories located in the areas it invaded. In addition, scholars pointed out that there are conspiracies being hatched to provoke general crisis towards the country by the TPLF through aggravating the existing problems of the people and the government via committing various economic atrocities.
It is well known that the economy that is closely linked to social and political activities will suffer greatly if the politics is not stable. Thus, in times of conflict and war, economic mismanagement is rampant. The reality what the Terrorist TPLF and its ilk Shene have brought in Ethiopia today is the best manifestation. The country’s ailing economy is hurting the country and the government is taking various measures to prevent it.
On top of confronting the terrorists’ destructive acts in the war front, one of the measures that the government has taken is preventing banks from lending money for investors through taking houses, land, buildings or anything else as collateral for the time being. According to the Ministry of Finance, the government is aware of the ongoing artificial economic crisis in Ethiopia due to the conflict.
While the National Bank of Ethiopia (NBE) announced the above direction to banks, it explained that some investors were being using the loans for the black market. As a result, security agencies, banks and all stake holders have begun working together to stabilize the market, which is being disrupted by the deliberate economic fraud.
For the questions forwarded from The Ethiopian Press Agency regarding the government’s action towards the problem and what can be expected from the concerned bodies to prevent the general economic fraud that is taking place, Gemechu Ararsa (PhD), President of Oromia State University, shared his view that the government should take various steps and the current measures to prevent banks from lending should be encouraged except its delay.
The war that Ethiopia is currently waging is not limited to armed war. Underscoring that the ongoing war is an economic, diplomatic, and psychological war in addition to the battle, he suggested that the government and the people of Ethiopia should give high emphasis for the economic warfare as it is far more serious than the armed conflict.
Although the temporary decision on banks by the government is delayed, the direction is valid and necessary step to mitigate the current artificial inflation. This is one of the few steps the government is taking to prevent economic warfare. Because the ongoing economic scandal is going to stretch and disintegrate the country in all directions, the government has to take further steps, he recommended.
It is not just an armed conflict that can lead the country into crisis. Rather, the economic war is so dangerous that the government needs to do more than the current actions it has taken. Gemechu further explained that if the government can take additional actions and decision, the economic war can be stopped easily.
In particular, it is easier to the people in financial institutions to often involve in economic fraud starting from the top management entities to their lower staff members. They may also be engaged in selling of foreign currency illegally. This is one indication that the foreign exchange is being traded on the black market in a way that is significantly different from the regular market, and that financial institutions need to be closely monitored, he mentioned.
According to Gemechu, the terrorist TPLF group has declared war on the people and is working vigorously to dismantle the country. Adding to the point, he said that this multi-faceted war that includes economic war declared against the people, the government and the country resulted in more destruction than the war in the battle.
As to him, the government was aware of the seriousness of the economic war and has been taking various repulsive measures, but it has to be strengthened more. He added that every citizen should be prepared to fight the war declared against the people, the country and the government.
In particular, it is important to focus on basic food items needed for daily consumption, neglecting luxury goods or non-essential products that highly consume the limited amount of forex the country earns especially these days. While summing up his view, he stated that in order to increase production and productivity, it is necessary to work harder than ever to save the country from jeopardize it faces.
Meanwhile the Addis Ababa City Administration Trade Bureau announced that it has taken steps to prosecute business organizations that were involved in economic fraud in the city following the economic war raised by the terrorist TPLF, Abdulfetah Yesuf, Bureau Head said.
While pointing out that extensive discussions were held with the trade community on the current situation of the country, he said better product supply and market stability have been improved to some extent due to the agreement reached to improve product supply and avoid unnecessary price increment.
Accordingly, he disclosed that the Bureau has banned 1,866 businesses organizations that were caught engaged in making economic fraud. Additionally, while licenses of 647 trade organizations were cancelled, 64 were charged convicted of committing economic fraud.
Appreciating the measures that have been undertaken by the City’s Administration towards illegal traders, Mekonen Abera, an economist suggested that the metropolis should also work with the federal government in debunking the greedy traders and handing over to the concerned public offices than cooperating with them.
Mekonen further stated that the government should carry out strong action among the trade communities that are hoarding different products in their warehouses. According to him, the current artificial economic inflation can be curbed if the government, the trade community and the people at large work in unison.
He also emphasized that this economic war will seemingly harm the country unless the government can take appropriate and remedial measures among those who are knowingly or unknowingly supporting this illegal traders and the terrorist group as well.
One of the legal traders at Merkato anonymously told to The Ethiopian Herald that he is delightful by the action that the City Administration has taken against the illegal traders currently. He explained that this time needs a high demand of unity in supporting the national economy.
According to him, the terrorist TPLF has deliberately opened an economic war against Ethiopians. This group with its ilk at different parts of the country is trying to create terror among the community through bringing artificial economic inflation.
All in all, scholars encourage the government to continue and strengthen the intervention as the country is going through a time of war, adding that the government must exploit all of its authority in order to regulate the market.
BY HIZKEL HAILU
The Ethiopian Herald 9 September 2021