Ethiopia-China relations

Ethiopia-China relations

Why has the China-Ethiopia relationship become so important and so close over the last ten years? From the Chinese government’s viewpoint, this country of about 85 million people is largely devoid of raw materials and other wealth above or below the ground, unlike the two Sudans, Nigeria, or Angola. It does have some oil and gas in the eastern desert, the Ogaden, but that is a danger zone: in 2007, nine Chinese workers from the Zhongyuan Petroleum Exploration Bureau were killed (and seven others kidnapped) by the Ogaden National Liberation Front (ONLF). Its minerals are largely unexploited if not unexplored. Moreover, Ethiopia is among the poorest of the least developed economies, standing 157th (out of 169 countries) in the UN human development index, with a per capita GNP of a mere 350 US dollars: even mild drought leads to famines mitigated only by of the state’s ability to scramble a response. The effects of the 2008 economic crisis are still felt despite an annual GNP growth rate of 8 to 10 percent between 2000 and 2011 and 11.4 percent in 2010-2011. Further, Ethiopia stands at the heart of the Horn of Africa, an area of high unrest, consisting of a failed state (Somalia), an isolated problem neighbour (Eritrea), a quasi-state (Somaliland), and a newly independent state that has yet to achieve stability (South Sudan).

For Ethiopia, however, partnership with China mainly serves the internal political and economic purposes of the regime that has been in place since 1991, under Prime Minister Meles Zenawi for 20 Among China’s reasons are Addis Ababa being the seat of the African Union’s (AU’s) headquarters as well as that of the United Nations Economic Commission for Africa (ECA); Ethiopia’s position as the second most populous country in the continent after Nigeria, expected to have a population of 170 million by 2050; its regional, even continental role; its strategic location, especially its control of the Blue Nile’s source (Lake Tana); the size of its needs in terms of development; and finally its political stability, the government’s authoritarian character, and the state’s economic centrality. Ethiopia’s interest is that China is actively engaged in its economic development and, as elsewhere in Africa, helps opening the game: its loans and infrastructure projects, its accessibility, its affinities with Prime Minister Meles’s “Colbertist” development model – all these factors also nurture the partnership.

History of diplomatic relations

In October 1995, following his victory in the first democratic elections in Ethiopia, Prime Minister Meles  visited China, and President Jiang Zemin stopped over in Addis Ababa as part of an extensive Africa tour six months later. An ambitious Agreement on Trade, Economic and Technical Cooperation (ATEC) was signed. Automatically renewed every three years, the agreement led to the creation in 1998 of a Joint Economic Commission, which meets every other year. The agreement confers “most favoured nation” status on Ethiopia and covers the whole bilateral economic cooperation, be it in the matter of investment promotion through the formation of SinoEthiopian joint ventures or private entities, maritime transport, or exchanges of “technical personnel.” Since then, Sino-Ethiopian links have continued to strengthen. During a meeting in Beijing of the first Forum on China-Africa Cooperation (FOCAC) in 2000, Addis Ababa was chosen to host the second forum in December 2003. Ethiopia thus found itself in a privileged position, which the Meles regime used to promote a close diplomatic partnership between Beijing and Addis Ababa. At the summit attended by Premier Wen Jiabao, several supplementary agreements were signed. In 2005, Sino-Ethiopian relations genuinely entered a new phase of close diplomatic, political, and economic partnership.

This evolution has a direct link to the Meles regime’s hardening as well as the strengthening of his powers following the 2005 elections, during which the opposition managed to take a third of the parliament seats, and in the face of rising Western criticism. The election was tainted with numerous irregularities and was accompanied by much violence (at least 200 dead), and led to a rapid deterioration in relations between Ethiopia and its traditional donors (the United States and European Union), which began to attach conditions to, if not suspend, their assistance. Meles then adopted a veritable developmentalist state agenda. And this authoritarian direction was confirmed during the May 2010 elections: the now muzzled, intimidated, and marginalised opposition won just two of the 547 seats in a parliament almost entirely controlled by the EPRDF, which was accused of having established a “one-party state.”

Since 1995 and even more so in the last ten years, Ethiopia and China have forged a much closer political partnership. Although the term “strategic partnership” has never been used, the relationship does clearly resemble one. For the Ethiopian government, it is a “close relationship” that is bound to play a major role in the country’s ambitious development and poverty reduction projects launched in the same era. Moreover, from Addis Ababa’s viewpoint, Beijing is more than that: it is a partner that could also share its economic experiences and extend technical assistance as well as diplomatic support.  For his part, Meles made many political gestures. In 2006, the Ethiopian parliament lent its support to China’s anti-secession law (regarding Taiwan), and as a member of the UN Human Rights Council until 2007, Ethiopia (along with other African countries) helped defeat all motions criticising the Chinese regime. There are frequent exchanges of leaders’ visits. Meles visited China four times, the last in August 2011, and as during his previous visits (1995, 2004, and 2006) was received by top Chinese leaders, including President Hu Jintao. As noted earlier, Premier Wen Jiabao visited Addis Ababa for the second FOCAC session in 2003. Other visits included those of National People’s Congress Chairman Wu Bangguo in 2008, Commerce Minister Chen Deming in 2009, and the Chairman of the Chinese People’s Political Consultative Conference and no. 4 in the Party, Jia Qingling, in January 2012 for the opening of a new AU headquarters financed and built by China (at a cost of $200 million). The two countries’ foreign ministers meet regularly, almost once a year. It may be noted, however, that Hu Jintao, who was to have taken part in this inauguration, has never visited Ethiopia. Exchanges of visits are not limited to the two sides’ top leaders but also include delegations of all kinds – commercial, cultural, medical, military, and increasingly visits from provinces, all of which highlights the diversity of cooperation.

Key Areas of cooperation and trade

Commercial ties have become institutionalised the most rapidly. In 2006, the Ethiopian government signed a major framework agreement on financing with the China EXIM Bank, leading to a rapid rise in the number of Chinese infrastructure projects (discussed later). The framework agreement requires all exports to China to be overseen by the Commercial Bank of Ethiopia, the largest state-owned financial institution. Ethiopia intends export earnings to help pay back Chinese loans and is adopting an “Angolan model” of financing its development, despite its lack of oil wealth.  Exchanges have also extended to inter-party relations, especially between the Chinese Communist Party and the EPRDF. They began in earnest during the Ethiopia visit in February 2000 of Dai Bingguo, then director of the Party’s International Liaison Department. They grew further notably with the China visit in May 2002 of Kassu Ilala, then vice-president of the Southern Ethiopian People’s Democratic Movement, which joined the EPRDF in 2005. Ilala was also the minister in charge of infrastructure. More recently, in September 2010, Zhang Xuan, deputy secretary of the Party’s municipal committee for Chongqing (which established special economic ties with Ethiopia with the opening of a Lifan car factory in Dukem, near Addis Ababa, in 2007), took part in the 8th organisational congress of the EPRDF. A month later, Ai Ping, vice-minister of the Party’s international liaison department, led a delegation to Addis Ababa, where the two parties signed a “memorandum on exchange and cooperation between the CPC and the EPRDF.” Highlighting their policy convergences, the two parties have developed exchanges on issues such as ruling party organisation and succession strategies. China’s embassy in Addis Ababa is particularly active and has direct dealings with most Ethiopian ministries; every year, more than half of the cabinet, led by the prime minister, takes part in the October 1 Chinese national day festivities, a privilege not accorded to any other mission. In another symbolic development, Seyoum Mefsin, who was Ethiopia’s foreign minister from 1991 to 2010, was named ambassador to China this year. Relations with China are thus essential for Ethiopia. From Beijing’s perspective, Addis Ababa is a valuable regional launch pad. The Chinese Commerce Ministry (which maintains offices independent of the embassy in several countries) and the China-Africa Development Fund (but not the China Exim Bank) have independent representation in Addis Ababa. The Xinhua News Agency, which is very active in Ethiopia, has its regional headquarters for the Horn of Africa in Addis Ababa. Several Chinese scholars, especially from the Institute of African Studies of Zhejiang Normal University, live in the country on a permanent basis. In 2003, during the 2nd FOCAC summit, China decided to accord Ethiopia the Approved Destination Status for Chinese tourists, although visitors are predominantly traders or immigrants rather than visitors with tourism in mind.

 

Profile written by Charles Matseke