Dula's Blog

There should be a silver lining to the AGOA situation. Ethiopia can move from manufacturing to a high-tech country for more sustainable development. When France refused to sell planes and parts to Israel during the Six-Day War, Israel immediately opted to build its airplanes and technology not to be hostage again. Consequently, with a population of 9 million, Israel is a powerhouse of technology and one of the strongest economies in the Middle East.

Industrial Parks are not sustainable solutions
Industrial parks, as they are set up now, are transients. They are temporary solutions to unemployment. Ethiopia uses cheap labor to attract companies to establish cloth and textile-driven manufacturing plants. Manufacturing plants based on labor alone are transient and do not provide good or living wages or sustainable solutions; like rivers; they flow in one direction with cheap labor. Most of the manufacturing plants moved from China, Bangladesh, and other regions to take advantage of cheap labor in Ethiopia. I am sure they will move whenever such an opportunity arises anywhere else. The life expectancy of industrial parks can be cut short and leave people without Jobs and the area with environmental damages. Of course, the suggestion is not to dismantle such plants immediately but to transition to a long and lasting solution to Ethiopia’s economic woes.

 Ethiopia can be like Israel, China, and other Asian tigers in 10-15 years by planting the seeds for sustainable development bolstered by technology. Turning Industrial Parks into technology parks or hubs by fostering and promoting innovation for technology, where a high density of startup companies, engineers, and other innovators cluster together to produce goods and services driven by markets can be the solution. Besides technology parks, universities and cities can provide co-working spaces for technology hubs and incubators with funds supplied by diaspora, private companies, and the government for equity interest or loans. Alternatively, the Ethiopian government can issue bonds to sell to the diaspora or the diaspora can set up their own venture capital to fund these projects.

Moving to the Fourth Industrial Revolution is the Solution

 To catch up with the rest of the world, Ethiopia needs to leap to the fourth Industrial Revolution that focuses on robotics, AI, nanotechnology, blockchain, biotechnology, the Internet of Things, autonomous vehicles, 3D printing, and others without totally discounting manufacturing. The government should prioritize the introduction of the Fourth Industrial Revolution by opening up Internet access, broadband, and Research and Development in these areas.

To grow the economy, the current government is promoting manufacturing by inviting companies from China, Turkey, India, and others by enticing them with low wages and tax breaks. Dr. Abiy should prioritize direct foreign investment in high technology transfer jobs rather than low-wage manufacturing to provide a platform for sustainable economic development.

The typical trajectory of moving from agriculture to manufacturing is no more an option for Ethiopia. Because of TPLF’s fear of social media and denial of access to technology, Ethiopia failed to enjoy the full benefit of the digital revolution. Given this failure, Ethiopia has no time to go through these stages and catch up with the rest of the world technologically and economically. Jumping to the Fourth Industrial Revolution will accelerate its economic and technological development, save it from future famine, ecological damage emanating from manufacturing, and massive economic disruption that arises in manufacturing phase-out.

Manufacturing undertaken by Chinese and other companies will not save Ethiopia from its permanent third-rated status or fill empty stomachs. Huajian is one of the most celebrated Chinese Companies with over 5000 employees. According to AP “Amazing China” (May 2, 2018), Ebissa Gari, a 22-year-old employee of Huajian, earns 966 Birr ($35) a month. The average worker at Huajian factory earns $50 a month. According to Kuwait Institute for Scientific Research, a basic living wage was about 3000 Birr or ($109) a month in Ethiopia. On the other hand, Artificial Intelligence (AI) specialists with little or no industry experience can make between $300,000 and $500,000 a year in salary and stock. “Top names can receive compensation packages that extend into the millions” (NYT, April 19, 2018).

The increased productivity, efficiency, lower operating costs, and high wages are a product of access to technology. The Heritage Foundation recently reported that not all Ethiopians had enjoyed economic growth evenly. It argued that more economic freedom is needed to grow the economy and reduce civil strife.

Ethiopia will need 177 years to catch up with the U.S

Given the economy and the state of technology, Ethiopia is pre-industrial, where Britain was in the 1840s. Unless Ethiopia skips some steps, it will need hundreds (100) of years to catch up. Of course, this assumes the rest of the world will stand still and wait for Ethiopia. For example, at a reasonable growth rate of 5%, Ethiopia will need 177 years to catch up with the U.S. growing at an average of 2.5% holding everything constant. At a 10% rate, it will take 60.5 years. The calculation is derived using a per capita of $50,000 for the U.S and $700 for Ethiopia.

Technology has the potential to be a tremendous tool in advancing the well-being of humankind by improving the quality of life and lifting the standard of living. Leveraging technology allows us to work from anywhere and enhances productivity. The progress of the industrial revolution from the steam engine, electric power, and digital and information technology is the foundation for the fourth industrial revolution.

 Over 80% of the jobs will be AI and IT-driven in the next two decades.

Artificial intelligence will be pervasive based on autonomous products, from cars to robots. Over 80% of the jobs will be AI and IT-driven in the next two decades. AI will increasingly take over mundane tasks to the most sophisticated, including fabrication, surgery, and ground and space warfare.

 Ethiopia is 120th out of 139 countries in the Network Readiness Index (NRI)

According to Global Information Technology 2016, Ethiopia is 120th out of 139 countries in the Network Readiness Index (NRI), which measures access to the latest technologies to individuals, businesses, and government, ease of starting a business, the efficiency of the legal system, infrastructure, capacity for innovation and more. Ethiopia’s ranking could have been much better had it not been for TPLF’s fear of technology and lack of interest in advancing Ethiopia’s technological and digital capability.

Leveraging technology underpinning the Fourth Industrial Revolution will create a solid and sustainable economic foundation. The people who generate the wealth (the next Apple, Google, etc.), the carpenters, the risk-takers, and inventors should be appreciated much more than talking heads or politicians. After all, the hard-working and creative Ethiopians with strong work ethics will be the catalyst to propel Ethiopia to be an economic and technical juggernaut.

The technology revolution is taking place at a breakneck speed led by Artificial intelligence, the Internet of things, the cloud, and 3D printing. Ethiopians need to demand unfettered access to technology and the internet as a right for their survival and to avoid future famines.

Dr. Abiy needs to leapfrog Ethiopia to the fourth Industrial Revolution and unleash innovation to create a better future for Ethiopia. If he does not leverage the technology revolution, grow the economy with open competition, transparency, property rights, and unfettered access to technology and the internet, he will leave Ethiopia with a distressed economy and more hungry and angry people.

Dula Abdu, a retired banker, economist and is the founder of a non-profit that promotes access to technology to underserved communities. Currently supports underserved schools in the US and in Ethiopia by providing a STEM-based educational database that works without the internet. The article was adapted from a previous article entitled “Ethiopia needs to leapfrog to the Fourth Industrial Revolution.”

Ethiopians and the diaspora may have decided the winner in the senatorial race in Georgia. The margin of victory between senatorial candidates Herschel Walker and Senator Warnock was less than 96000. It was close to the number of Ethiopians living in the Atlanta metro and a lot less than the total African diaspora population in Georgia.

Even though there was controversy about whether to support Senator Warnock or not, it was obvious that many Ethiopians decided to support Warnock over Walker given his connection to the King’s legacy and lack of interest by the Republican Party in attracting diaspora and minority votes.

It is alleged that close to 100000 Ethiopian live in Atlanta alone. The total population of the diaspora that claims roots in Africa including Ethiopians, Eritreans, Nigerians, and People from the Caribbean is estimated to be over a quarter of a million.

Thus one can conclude the margin of victory in a swing state like Georgia may have come from the diaspora population. Ethiopians and their cohorts organized under an umbrella organization AEPAC (American-Ethiopian Political Action Committee) can have a strong impact and make a strong presence in politics in the USA. The political influence of AEPAC and the diaspora is bound to increase going forward in a number of swing states. It is also worth remembering that in 2020, President Biden won Georgia by less than 12000 votes.

Ethiopians have shown their power in recent elections. They played an essential role in helping flip the governor’s race in Virginia and in helping defeat representative Tom Malinowski, who drafted a very anti-Ethiopian Bill, HR6600.

Ethiopians are becoming an important player in American politics because of the formation of a PAC, the American-Ethiopian Public Affairs Committee (AEPAC). Through AEPAC, they have flexed their power in American politics by making a contribution and organizing Ethiopians and other Diasporas.

During the midterm election, most of the candidates AEPAC supported won. Out of 35 candidates, AEPAC supported 32 won their race. This includes 20 house members, four senators, and two governors.

The demographic situation and the political divide in the US empower organized groups like the American Israelis, Cuban and other groups.

The Ethiopians have a strong advantage given they are spread out exceptionally well throughout the US. Unlike Cubans who are concentrated in one state, Florida, Ethiopians on the other hand are located in major swing states like Georgia, Nevada, Ohio, Colorado, Virginia, and more.

Both the Democratic and the Republican parties need to be cognizant of this fact in order to control congress and the white house. Of course, the diaspora population needs to hone on this message to both parties so that they give due credence and acknowledgment to the diaspora, especially to AEPAC

Ethiopians are the new kingmakers in US politics. With their recent success in helping flip the governor’s race in Virginia and in helping defeat representative Tom Malinowski, who drafted a very anti-Ethiopian Bill, HR6600, Ethiopians are becoming a force to be reckoned with in the US.

Formation of AEPAC

Ethiopians are becoming a consequential player in American politics with the formation of a PAC, the American-Ethiopian Public Affairs Committee (AEPAC). Through AEPAC, they have become influential in American politics by fundraising and organizing Ethiopians to vote. 

Unlike Cubans, who had a concentration mainly in Florida, or Armenians in California, the Ethiopians are spread out exceptionally well. They have become a significant voting bloc, especially in swing states, by registering Ethiopians and other Africans, including Eritreans. Once Florida went red, Cubans lost their leverage thanks to Governor Desanto, whose success is based on oppressing minority votes and gerrymandering.

Ethiopians Versus Cubans

Ethiopians, unlike Cubans, reside in many critical swing states like Georgia, Virginia, Nevada, Wisconsin, Ohio, and more. By organizing Ethiopians, Eritreans, and other people of African origin, Ethiopians are making their presence felt financially and with their votes. Most of the candidates they supported in the midterm election won, which is essential for any political PAC. This includes 20 house members, four senators, and two governors. Tight races in Arizona, Wisconsin, Nevada, and other states show the importance of any organized group like Ethiopians that has the potential to deliver a bloc of votes. Their candidates include Republicans like Chris Smith of New Jersey and Democrats like Sheila Jackson Lee of Houston, TX.

Georgia is a Battle Ground and the Role of Ethiopians

Now that all eyes are on Georgia, the importance of Ethiopian vote for either party remains critical. In the midterm election, disappointed with Senator Warnock’s ambivalent position on Ethiopia and Hershel Walker’s lack of sophistication in foreign policy forced them to stay neutral. Their role remains critical in the presidential election, where Biden eked out a crucial win in 2020 with 11000 votes to win Georgia. Without the support of Ethiopians, who number close to 100,000, and cohorts such as the Eritreans, Caribbean, and other Africans, Democrats can lose the senate and the presidential races in Georgia. So far, neither Democrats nor Republicans realized the potential impact of the Ethiopian vote. In 2020 Ethiopians voted overwhelmingly for Democrats disgusted with Trump’s vulgar language regarding Africa and his support for the Egyptian dictator, who is acting as the new Gadhafi by aligning with dictators and supporting anti-government rebels in Ethiopia and elsewhere.

Ignoring Ethiopians can be Costly to Both Parties.

Until the demographic of the various swing states changes where Ethiopians reside, Ethiopians will potentially be the new kingmakers in American politics, dwarfing any diaspora organizations. Failure by Democrats and Republicans to realize this new Ethiopian political power could be costly, especially in swing states. 

Dula Abdu is a US-based writer on foreign policy and economics and chair for AEPAC-TX.