The current democratic movement that has engulfed Ethiopia must be supported by economic reforms and democratic system. The two are intimately connected: you can’t have one without the others. Democracy is the best form of government for economic progress. But if the economy is not improving, the flag-bearers of democracy among the populace will make U- Turn. The Ethiopian youth do not “eat democracy”; at the end of the day they need jobs, income, food and housing for themselves and their dependants.

The Ethiopian economy has been at the same level of growth and productivity for the last four decades. Economic growth, transformation, and development could not keep up with the speed and pressures of population growth. Unless population takeoff is backed by economic takeoff at the same time, the consequence is dire crisis. The population of the country has grown fast in these decades making Ethiopia the second-most populous country in Sub-Saharan Africa with a population of over 100 million. Currently, the Ethiopian population is increasing by over two million people a year.

Thinking Exponentially

Ethiopia is the second most populous country in sub-Saharan Africa after Nigeria. Current population is about 112 million and is expected to surpass 137 million by the end of 2037. During the twentieth century, the growth of the Ethiopian population quickened tremendously. It had grown more than ten times since 1900, five times since 1950 and had doubled since the early 1990s. The rate of population growth increased from less than 2% in the 1950s to a peak of 3% in the late 1980s and early 1990s. Since then the population increased at a decreasing rate reaching a minimum of 2,3% during the 2015-2020 period. Each year, an estimated 2 million persons are added to the population.

The Fundamental, Missing Issues in the Debate

Industrialisation is the process of building up a country’s capacity to convert raw materials into new products. It involves a growing complexity of production systems, reliance on primary or secondary economic activities and an increase in output.

Issues for Debate

Ethiopia now stands at a defining moment whether or not to develop the private sector economy, if at all. The institutional inefficiency of the state economy, the low productivity trap of the population economy, and a growing surplus of labor underline the need for a long-term strategy of private sector development in Ethiopia. The economy cannot operate as usual and massive strategic change is inevitable. One of the core strategies and policies of private sector development in Ethiopia is the launching of institutional reform in the area of property rights. In political economy, there is a consensus that property rights matter a lot for investment incentives, efficient resource use, and economic growth.

The Need For A Paradigm Shift

The policy and institutional framework for regional development plays an important role in the solving of massive unemployment, provision of greater and diversified volume of production, better infrastructure (soft and hard), improved community services, rising average wealth, and improved quality of life. A region is a constituted social order with people engaged in distinct political, cultural and economic practices. These practices are embedded and developed historically and sustained and reinforced within networks, processes and infrastructures.