Open Letter to WB and IMF from two Former Members of Ethiopia’s ‘Economic Advisory Council’

By: Yonas Biru (Ph.D.) and Seid Hassan (Ph.D., Professor Emeritus)

To: David Robert Malpass

President, World Bank

Via – [email protected],

and,

Kristalina Georgieva

Managing Director, The International Monetary Fund

Via – [email protected]

Re: IMF’s and WB’s Role in Laying the Foundation for an Impending Ethiopian Genocide

Dear Mr. Malpass and Dr. Georgieva:

By way of introduction, the writers of this letter were members of Prime Minister Abiy Ahmed’s Economic Advisory Council, until our resignation. One of us was Deputy Global Manager of the ICP that is housed in the World Bank and cosponsored by many international agencies including the IMF. We write with a reasonably sufficient knowledge of the Ethiopian Government and your institutions.

The subject line is a borrowed and modified hybrid of two old articles “Background to Rwanda: IMF and World Bank laying the foundations of genocide” and “Rwanda: The World Bank and IMF role in the 1994 genocide.” We are gravely concerned that the IMF and the World Bank are in negotiation with Ethiopia for a new round of concessional financial aid while Prime Minister (PM) Abiy Ahmed is recklessly triggering a genocidal civil war. The negotiation is taking place just a month after the PM made death threat towards Ethiopians, especially the Amhara, and warned them of destruction that is “deadlier than dictator Mengistu Hailemariam’s red terror of the 1970s.” The Human Rights Watch has called the red terror “one of the most systematic uses of mass murder by the state ever witnessed in Africa.”

Additionally, one of the PM’s advisors and bosses of the Oromo Prosperity Party (Oromo-PP) made a statement on April 3, 2023, stating: “Today’s Ethiopia is at a juncture similar to that of Rwanda when it found itself at the dawn of genocide.” It needs to be remembered that the principal authority coordinating the Rwandan genocide was the government. There are, indeed, similarities between Rwanda in 1994 and Ethiopia in 2023, as depicted in the next page.

As people of Ethiopian origin, we had hoped for healing and peacebuilding after the war ended. Instead, the PM chose to stage a grand military parade, showcasing newly acquired Chinese-built 155 mm SH15 wheeled, self-propelled howitzers, according to The Defense Post and Military Africa. This is a new addition to the Prime Minister’s recent collections of advanced weapons from Turkey, Iran and North Korea.

Sadly, he is using the weapons not to defend the country from outside invaders but to threaten Ethiopians – particularly the Amhara whom the President of Oromo region has publicly declared “Neftegna [invader]” (May 2022) and “Enemy of Oromo” (April 2023).

The President of the Oromo region is not alone in targeting the Amhara. We feel obliged to note that the PM’s threat of repeating the red terror with a multiplier is not a one-off threat. In a July 2019 televised speech, he talked about unnamed extremists who are trying to overthrow his government by force and warned his opposition that there will be “tragic” consequences where “hundreds of thousands of people would be slaughtered overnight.” This, too, was targeted at the Amhara.

Allow us to give you the full picture to help you understand the magnitude of the impending human tragedy. This is critical to document so your institutions are aware of the impending genocide.

In Ethiopia, each region has special forces and militia. The PM abruptly declared to demobilize these forces and integrate them with federal forces. This is different from what your institutions call disarmament, demobilization, and reintegration (DDR) that focuses on disarming combatants, removing them from military structures, and socially and economically integrating them into society.

The demobilization that the government announced involves reintegrating regional military forces into the federal defense structure. There are at least 250,000 regional special forces and militia members. If the federal government plans to absorb them, it will have significant implications for the government’s total budget for the upcoming fiscal year. Once the demobilization process is complete, the regions will have no responsibility in the salary, training, healthcare, weapons, administration, support, logistics, etc. funding calculus.

The Parliament has never discussed the budgetary implications for the federal government. One would assume the nation’s military expenditure will be of interest to you when you discuss the government’s fiscal policy. If the Ethiopian government has not been fully transparent, it means it is not truthful to your organization or to the people of Ethiopia. There are no two ways about it.

The Amhara region that is the primary target of the disarmament project has legitimate reason to question the transparency and motives of the government’s disarmament plan. What the people of Amhara want is confidence building measures to address the security concerns of their region. They have many legitimate reasons.

First, the government has denied the Amhara access to Addis Ababa, using a false pretext that the Amhara is conspiring to overthrow the Oromo-led government. This pretext is baseless. First, the only illegal armed group in Ethiopia is Oromo-Shene operating in the Oromo region. The group has been killing government forces and civilians in thousands. Yet, the only people denied access to Addis Ababa under the pretext of security are people coming from the Amhara region.

Second, according to the Pretoria agreement that was signed on November 3, 2022, the TPLF was supposed to disarm. More than four months later, it has not complied with the agreement and the federal government has not taken any action against them. In contrast, just a week after the government instructed the Amhara to disarm, federal forces have resorted to use lethal force, resulting to numerous deaths this week alone. Considering the contested area between Tigray and Amhara, the Amhara has legitimate reason to resist being the first region to be disarmed.

Third, it is worth remembering that the government had been negotiating with the TPLF to retrieve 70% of the nation’s weapons that the TPLF had refused to return from 2018 until November 2020. This never took place.

So, why is the Prime Minister so quick to act when it comes to the Amhara? The answer is simple. Oromo-PP bosses including the PM, the President of Oromo, and the Addis Ababa mayor see the Amhara as “the enemy of Oromo.” That is why the Amhara continue to be victims of repeated mass murders in the Oromo region. That is why they are evicted in mass not only from the Oromo region but also to a lesser degree from Addis Ababa, particularly since the current mayor came to power. The Amhara are now being threatened with a wrath worse than red terror for requesting to live in their own region with guaranteed security.

PM Abiy’s Autocratic Leadership Includes Economic Crime

On November 22, 2022, the PM announced to the Parliament a new palace he is building. Le Mond, the French flagship newspaper, described the project as pharaonic and gigantic. When completed it “will include the PM’s office, three artificial lakes, a zoo, a waterfall and a real estate project of luxury villas.” The newspaper added: According to “several Addis Ababa City Hall officials speaking on condition of anonymity, the total cost of the Project could reach around 800 billion birrs.” This is equivalent to $15.6 billion or 13.5 percent of Ethiopia’s GDP.

Furthermore, Le Monde noted that the PM “bypassed” the Parliament, stating: “I did not come to Parliament with the intention of asking you for money to build it.” He is supposedly mobilizing resources from both local and international sources. The terms and condition are known to him only. This stands in gross breach of one of the most important pillars of the Constitution encapsulated in Article 50, Section 3: “Supreme power of the Federal Government shall reside in the Council of Peoples’ Representatives which shall be accountable to the Ethiopian people.” This includes “Approving general economic, social development policies and strategies” (Article 55, Section 10).

The pharaonic palace is a concealed line-item expenditure at the PM’s exclusive discretion. Can the IMF and WB turn a blind eye when 13.5% of the nation’s GDP is a discretionary spending of an autocratic PM? Would this not be a dereliction of your institution’s duty to undertake a regular health check of the economic and financial policies of member countries?

There is also a plethora of questions your organizations must respond to. If the PM can afford to pay $15.26 billion to build a pharaonic palace, why should international taxpayers bear the cost of the reconstruction of war-torn areas? Why should international taxpayers be burdened to cover the cost of restructuring Ethiopia’s debt? Why should they finance new rounds of concessional loans at or near zero interest rate? These are questions we ask of you and of our US Senators.

Furthermore, it would not be unduly prejudicial to assume that you know the PM is printing money to finance his palace. The result has been sky-high inflation that has not shown a sign of ebbing six months after the war had ended. The PM and the Governor of the National Bank attribute the 28.6% inflation to an international economic shock. Countries with far more exposure to external shock than Ethiopia have single digit inflation – Djibouti (1.9%), Uganda (6.4%) and Kenya (6.1%).

Furthermore, we would also like to note that corruption has gotten out of hand to a point the PM felt helpless enough to throw in the proverbial towel and promised on TV not to prosecute corrupt officials if they agree to use their loot to open business and hire the unemployed youth. The running joke in government offices is that they will continue to loot until they have enough money to open a five-star hotel.

The Addis Ababa mayor, one of the three top Oromo-PP officials, next only to the PM and the President of Oromo region, was caught with 40 million Birr deposit in her personal bank account. When the media exposed it, she said she did not know who deposited it and claimed to have distributed all of it to the poor. Considering that the poor in Ethiopia do not have electronic bank account, she must have distributed the money on the street corner. At 1000 Birr per poor, it will take 40,000 souls to line up.

And then there is the 59% drop in gold export ($600 million) that was the result of gold smuggling to international markets through a corrupt network known to the PM. Furthermore, the PM is on the record saying land is supposed to be owned by the government, but it is now controlled by corrupt officials. Hundreds of millions of Birrs worth premium land lots are bought and sold under the table every month. Ethiopia is a poor country. Sadly, whatever it has is looted by political oligarchs.

Cynics of international aid say, “financial aid is all about taxing the poor in rich country and transferring it to the political oligarchs in poor nations”. The Oromo-PP led government bears witness to this.

As we finalize our letter, the Reuters reported that the Ethiopian government is in talks with the IMF to borrow at least $2 billion “under a reform agenda.” We know the PM’s economic agenda. We are curious to know what reform the IMF is using to justify disbursing such a huge loan. If the Reuters story is true, it will be a case of an Ethiopian crime and an IMF nourishment.

Sincerely,