Category: Commentary

Abdulmenan MohammedApril 15, 2018


One of the maladies the Ethiopian economy has battled over the past decade has been inflation. This economic ailment has created noticeable changes in the purchasing power of consumers. And though it was kept below double digits between July 2012 and June 2017, the past seven months has seen inflation hit the economy with renewed vigour. Headline inflation for January 2017 and February 2018 increased to 13.4Pct and 15.6Pct, respectively. To make matters worse, food price inflation soared to 18Pct in January 2017 and 20.9Pct in February 2018.

José Antonio OcampoApril 15, 2018


Over the past few years, leaks of documents such as the “Panama Papers” and the “Paradise Papers” have exposed the dark underbelly of globalization, and provoked indignant denunciations of tax avoidance from people around the world. Ordinary workers have no choice but to pay their taxes. But, apparently, multinational corporations and wealthy individuals can get away with paying hardly anything.

Sergei GurievMarch 15, 2018


At this year’s World Economic Forum meeting in Davos, Switzerland, participants did not question the basic building blocks of growth in today’s global economy: free markets, good governance, and investment in human capital and infrastructure. But they did criticize how unfairly the benefits of growth are being distributed. Rightly so: without a strong policy response aimed at building a more inclusive growth model, rising populism and economic nationalism will impair the functioning of markets and overall macroeconomic stability – potentially cutting short the current global recovery.

Urs RohnerMarch 15, 2018


Respected economists have long pointed out that gross domestic product (GDP) is an inadequate measure of economic development and social well-being, and thus should not be policymakers’ sole fixation. Yet we have not gotten any closer to finding a feasible alternative to GDP.


On October 11, 2017, the National Bank of Ethiopia (NBE) devaluated the birr by 15Pct against the basket of major hard currencies. According to the press briefing given by Yohannes Ayalew, vice governor of the NBE, the motive behind the devaluation was to encourage exports and attract investment.

As revealed later in the explanatory note attached to the bill introduced to parliament regarding federal government supplementary budget, this time around, the NBE’s measure was a means to raise money and contribute to windfall tax that was later earmarked to make significant contribution to the budget.

Zekarias AmsaluFebruary 1, 2018


Among the common risks investors interested in African countries like Ethiopia often mention are investment protection, dividend (profit) and capital repatriation. A typical concern investors bring up at deal sourcing discussions may include details of a ‘forex-crunch’ they had heard about either from local operators, or fellow investors. Whether these fears be real, perceived, or imagined, what matters is that they make an impact in investors’ minds.

Michael SpenceFebruary 1, 2018


Most of the global economy is now subject to positive economic trends: unemployment is falling, output gaps are closing, growth is picking up, and, for reasons that are not yet clear, inflation remains below the major central banks’ targets. On the other hand, productivity growth remains weak, income inequality is increasing, and less educated workers are struggling to find attractive employment opportunities.

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