Ethiopia, already among the poorest countries, has suffered a series ofrecent economic setbacks, forcing officials to take drasticcountermeasures to avoid a financial meltdown. Economic growthprojections have been slashed amid shortages of critical items,including foreign exchange, electricity and food.
The roar ofgenerators echoes through the streets of Addis Ababa's fashionable Boledistrict. It is another "power out" day, an energy saving scheme thatleaves people without electricity for as much as 14 hours, three days aweek.
But places like Bole that can afford generators comprise less than half of one percent of Ethiopians.
Toshopkeepers without generators, like laundry operator Tewodros Haile,no electricity means little or no profit. He says if this keeps up,he'll soon be forced to close.
"Business has decreased by atleast 50 percent almost," he said. "Whenever we don't have the power wehave to put our staff, we have to pay overtime. Our expense isincreasing because of the overtime. We cannot continue like this."
Thepower outages have aggravated Ethiopia's critical foreign exchangecrunch. Exports of coffee, which last year accounted for nearlytwo-thirds of the country's $1.5 billion export earnings, are down asmuch as 40 percent this year.
With hard currency reservessagging to just enough to cover a few weeks imports earlier this year,the government had exempted major exporting industries from the powercuts. But conditions deteriorated when the hoped-for rains failed,leaving the country's hydroelectric power plants without water. So thestate-owned Ethiopian Electric Power Corporation last month notifiedexporters they too would face cuts.
The grim outlook isforcing economic planners to dramatically scale back growthprojections. Initially, they predicted an increase of as much as 20percent in export revenues. But in a report to parliament last month,the Trade and Industry Ministry conceded revenues might miss the $2.5billion target by more than $1 billion.
Tewodros Mekonnen of the Ethiopian Economic Policy Research Institute says that could mean zero export growth this year.
"Sincewe are a developing country, our exports grow a bit rapidly, so we haveexports growing at 18 to 20 percent each year. this year comparing ninemonths exports ... comparing it to last year, the growth is almostzero percent, which is considered serious for us," said Mekonnen.
PrimeMinister Meles Zenawi earlier predicted Ethiopia's economy would growmore than 11 percent this year despite the global economic slowdown.The International Monetary Fund's projection was a more modest sixpercent, at most.
Economist Tewodros Mekonnen says the IMF figures look more realistic.
"Theeconomy has been growing 11 percent, and the government is maintainingthat 11 percent will continue. but there are some people who saybecause of the crisis, 11 percent growth is considered a miracle," saidMekonnen.
For average Ethiopians, the falling growth figuresand power outages are just more in a long succession of hardships thathave kept their country at the bottom of the world's development index.For the educated young along Addis Ababa's Bole Road, like shop clerkHayat Mohamed, it means scaling back dreams of taking part in theglobal IT (information technology) revolution.
"At first it wasall about we want a faster Internet connection and I wish I could havethis and that. But now it has come down to, I wish I could haveelectricity. We're just hoping for some improvement," he said.
Ina country where a fewer than 20 percent of the people have electricity,the economic concerns of most Ethiopians are about simpler things, suchas food.
The June 1 U.N. Humanitarian Bulletin for Ethiopiasuggests food shortages and malnutrition rates may be as bad as lastyear, when officials clamped a lid on publicity about starving childrenafter some news reports compared conditions to the famine of themid-1980s.
The U.N World Food Program estimates the nationalrelief program will fall nearly 178,000 metric tons short of assessedneeds for the second quarter of the year.
