PIA’s latest lecture is yet another confirmation that Eritrea is further backsliding into economic obscurity – and the worst is yet to come.  It is baffling how self-respecting intellectuals and even those with basic school of life can support and regurgitate PIA’s circular reasoning.  Many cyber articles have already been written analyzing or satirizing PIA’s lecture.  This article analyzes PIA’s lecture from slightly different perspective.

First, PIA has one valuable asset – faking sincerity.  He tells us about our limited capacity, the need for accountability, transparency, wider consultations with senior government officials and with the public, socio-economic experiences of other countries, his concerns for human life, and his aversion towards giving false hopes (‘mitibar’) through unworkable socio-economic policies.  He tells us that we should work towards attaining sustainable development.  To add insult to injury, he tells us while addressing health issues that no medical expense should be spared to send patients, i.e. his top ‘yes men’, abroad for medical treatment because – hear this – ‘human life is precious’.  After telling us every Eritrean life is weighed in the hard/foreign currency it generates and knowing fully that he has imprisoned thousands of mothers, elders, and prisoners-of-conscious for no political motive other than out of vindictiveness and to instil utter fear into the population, it is mind boggling the audacity of making such blatant lies.   For a regime totally averse to transparency, PIA keeps telling us how important transparency is for economic growth.  Lies told often enough don’t become the truth!

But reality is totally different.  PIA tells us that there is no need to provide socio-economic data, except the regime is spending $320 Million USD on energy imports.  Indeed it is not important when ordinary Eritreans need no official data as they are experiencing it bitterly every day.  Prohibited from earning honest day’s wages, skyrocketing prices, no electricity or water, forced to attend Sawa Rape Factory, and imprisoned incommunicado, people are fleeing the country en mass – these are the only data they need.  On per capita basis, and even on absolute basis, Eritrea is the single biggest producer of refugees and human misery in the world.   If it is about sacrificing oneself for the future, then it is about equal sacrifice – not few living in luxury while most live in misery. It is about those in Diaspora who speak and campaign for Eritrean sacrifice – except sacrifice is meant for those in Eritrea, not themselves.  It is also about justice – not few above the law, while vast majority are being abused by the few who are above the law.  Today’s Eritrea is suffering a disconnect among idealism, hodgepodge politics and reality – just as PIA’s latest lecture clearly shows.

So what is PIA’s sustainable economic growth?  Mr. Kubrom Dafla’s interviews with demo.archive.assenna.com give us valuable insight into the state of economic affairs in Eritrea.   If we are to reduce PIA’s economic rationale, it would that if an economic activity doesn’t generate hard/foreign currency (such as US dollars) then the activity should not be undertaken. Yet again, PIA’s economic philosophy is deeply intertwined with his sadistic political philosophy.  After all, after telling us that economic growth must precede democracy, the sure way to extinguish any hope of democracy in Eritrea is to strangle its economy.  Moreover, PIA’s, as is true for other dictators, false campaign for self-sufficiency is designed more to avoid interaction through insular policies with the rest of world which may demand accountability, transparency, and the rule of law.

What are Eritrea’s Development Projects?  What does PIA mean by sustainable economic development?

In the nutshell, PIA’s circular reasoning goes like this – lack of electric power (energy) impedes us from realizing economic growth – then goes the circular reasoning – and we can not invest in electric power expansion because our economic growth doesn’t justify it.    It is like the chicken and egg question – which one comes first?

As stated above, PIA’s sole economic formula is that every activity must generate DIRECT hard currency.  Examining PIA’s logic, for instance, increasing fish export to generate hard currency and then using that to buy fuel for tractors to farm land for farmers is a waste of resources.  According to PIA, every non-hard currency generating activity in Eritrea – be it food, electricity, water, education, health, justice, etc… – is a waste if it doesn’t eventually lead to exports that generate hard currency.  Wow!  Eritreans in Eritrea who worth only in Nakfas are doomed!

Examining PIA’s underlying logic, his feigning of concerns for human trafficking beguiles a deliberate and cruel policy – which is to forcefully exile Eritreans to generate foreign currency.  For instance, Eritrean exiles in Israel have been remitting significant amounts to Eritrea which, according to PIA’s economic philosophy, makes them more valuable because they are worth in USD, not Nacka.

According to PIA, every penny of hard currency should be used to undertake sustainable economic development.  As such, electricity, water and other infrastructures that are currently available in the urban centres simply consume hard currency without generating any long-term economic benefits while exhausting dwindling hard currency.  As such tells us PIA, the urban population should not get any more benefits than the rural population.  In other words, Eritrea must regress first economically, socially, and politically before proceeding forward.  Equality in poverty first before prosperity!  It is a military equivalent of withdrawing or retreating into your base, or reverting from a conventional army to guerrilla warfare.  At least during the war of independence, everybody pretended that there was equality in sacrifice – but not in today’s Eritrea.

Throughout the lecture PIA keeps reminding us about Eritrean development projects.  Yet, one is forgiven if baffled at what point in his five hours of lecture he spoke in any detail of these projects.  One moment he tells us about agricultural projects, water reservoirs, roads, ports, electricity, etc…, and then the next moment tells us that most of these projects are worthless because they don’t generate hard currency. All these road projects don’t even meet anticipated demands.

The only ‘so called’ development project in Eritrea is PIA’ s pet project – Gerset/Farko, which is about 20,000 hectares.  Twenty two (22) years of independence later, we have one 20,000 hectares of commercial farming which is more used for ‘experimental’ purposes than any serious effort to meet the country’s food need.  In fact, following PIA singular obsession of hard currency, Gerset/Farko would only be considered a success if it can generate cash crops for export (such as cotton).  According to PIA, why should he waste hard currency to produce food for domestic consumption because ordinary Eritreans pay him in Nacka.  The self-sufficiency campaign, which we took to mean self-reliance to produce domestic food needs, is totally misguided.  Rather, self-sufficiency has a new meaning, which is to generate hard currency by producing cash crops for export, and which in turn is deposited in Fubon Bank.

Deciphering PIA’s ominous message:

1. The worthiness of people or consumers will be determined by their abilities to generate hard currency.  Exporting people, albeit through cruel policy of forcing people to flee the country by demoralizing, is a deliberate policy designed to generate hard currency.  In contrast, and as potential source of hard currency, Diaspora Eritrea should be courted in order to dip into their hard currency laden pockets.
2. Worse will be education, health, and any institution which will not be allocated hard currency.
3. Dwindling hard currency means that electric outages, water shortages and other urban services will deteriorate for years to come.  The biggest victim is the City of Asmara.
4. With cement factory unable to produce cement, and PIA telling us that there is no electricity to power the factory, the recently announced Housing Bank project might not be built or may take much longer to construct.
5. Without affordable housing, normal life for Eritrea’s youths is a pipe dream for the foreseeable future.

PIA Complimenting Ethiopia

Despite a broad range of issues addressed, albeit superficially, during PIA’s lecture, the underlying message was designed to demoralize the Eritrean population by, in his own words, not give Eritrean any false hopes.  At the same time, PIA made a conscious effort not to be compared to Ethiopia’s booming economy telling us that it is all illusion.

Probably no part of PIA’s lecture fell apart as much as when he talked about Ethiopia’s Millennium Dam (Grand Renaissance Dam /GRD).   When completed in 2017, it will produce up to 6,000 MW of hydro electricity.  PIA attempts to belittle GRD by comparing Ethiopia’s electric production to Israel and then to Europe – and that can only be a compliment when one starts comparing a third world country to First World Countries.  Why not compare Ethiopia’s progress with Eritrea, or other third world countries instead of first world countries?  Kudos to Ethiopia! 

Today’s Ethiopia is a thorn on the side of PIA’s Eritrea not so much militarily but because Ethiopia has managed to formulate short and long term economic policies (e.g. 2010 – 2015 Growth and Transformation Period (GTP) which incorporates the Millennium Development Goals), which enables it to slowly and in controlled manner to build its political and other institutions, and to transition into post-Meles Ethiopia.

During the 2010-2015 Growth and Transformation Period, Ethiopia will have added over 10,000 MW of sustainable hydro and wind power to its power grid.  In 2015, Eritrea will have lost most its 120 MW  of capacity to less than half – i.e. in PIA’s own admission that the existing electric generators are getting old and in much need of repair but that nothing can be done in the near future due to lack of hard currency.  Moreover, it is worth distinguishing between capacity and actual production.  Electric production is measured in MWh or mostly in GWh, i.e. how many hours the electric generators operated in a year.  In Eritrea’s case, due to lack of fuel and maintenance issues, the generators are operating less than 50% of the time (based on estimated electric blackouts in Asmara), thus the 120 MW of capacity at 50% operation is equivalent to 60 MW operating at 100% (theoretically, as no generators ever operate at 100% due to scheduled maintenance, but suffice for illustration purposes).  Instead of belittling Ethiopia over its 10,000 MW, PIA should answer how he can achieve sustainable economic growth with 60 MW.

Every project in Ethiopia’s Growth and Transformation Period is what PIA envies and talks about for Eritrea – infrastructure developments, generating hard currencies, balanced growth all over Ethiopia, etc…

Comparing the sufficiency of Ethiopia’s electric output to Developed Countries is highly deceiving:

1. Most developed countries are located in colder climates where electricity, along with gas, is used to heat homes in winter and air conditioning in the summer.  Most of Ethiopia is blessed with moderate climate that doesn’t require artificial air control.
2. Most households in developed countries have many kitchen appliances, washer/dryers, dishwashers, hair dryers, multiple televisions and many other electric goods.  Today’s Ethiopia needs basic electricity for households – mostly for lighting and electric stoves.  In today’s Eritrea, even urban areas aren’t served with basic electricity.
3. Significant portion of daytime electric consumption in developed countries is made by commercial and industrial establishments.  Ethiopia has not yet reached that level yet.

The 10,000 MW of electricity enables Ethiopia to:

1. Provide basic electricity to households which PIA can’t do for its own population other than to tell people to go and live in rural areas (sadistic),
2. Provide sufficient electricity to its growing commercial and industrial establishments.  As an Eritrean, it is embarrassing when Ethiopia is able to run 3 or 4 massive cement factories while PIA is complaining that he can’t even run one small sized cement factory – and we are endowed with so many raw materials for cement production.
3. Provide Ethiopia with a clear and well defined economic path that it can build on.  As they say, ‘Rome wasn’t built in a day’ and that incremental growth is what gets us to our destination. What isn’t here today surely won’t be there in 5 or 10 years.  PIA’s Eritrea has no plan to expand electricity in the near future, which means that Eritrea will remain in the dark for the next 10 years.
4. Provide Ethiopia with hard/foreign currency.  Although Ethiopia needs every MWh of electricity it produces for its domestic consumption, it must sell electricity to Djibouti, Kenya, and Sudan for the same logic that PIA took 5 hours to lecture us – i.e. every venture must generate hard currency just like his yet to produce development projects.  Ethiopia may buy crude oil from Sudan in exchange for electricity.  Ethiopia may pay Djibouti for its port facilities with electricity, and the same for Kenya.  What Ethiopia is doing is every bit consistent with PIA’s lecture – yet PIA has no qualms belittling Ethiopia.
5. Power Ethiopia’s rail system, thus alleviating its transportation system from relying on imported fuel, which in turn saves foreign currency (consistent with PIA’s philosophy).  The Addis Ababa-Djibouti, Mekele-Djibouti, and Addis Ababa LRT will all be electrified.

PIA’s Kamikaze Policies

First it should be noted whenever PIA says, “… Our policy/policies …”, or “…This government’s policy/policies…”, it should be taken to mean his policies.  There are no parliament, PFDJ Central Committee, or cabinet ministers to consult.

During his lecture, PIA keeps returning to a couple of deficiencies that are holding Eritrea’s economic growth.

1.     Agro-industry: when asked about agro-industry, PIA lectures us that selling raw agricultural products will not yield sufficient foreign revenues and that these products must be processed further to fully realize our potential.  The drawback: no electricity to run our factories.

2.     Mining:  after telling us mining isn’t producing sufficient income but then tells us that mining products can’t be further processed locally because of lack of electricity.

3. Alternative energy:  PIA tells us Eritrea must obtain alternative local energy resources to power its electrical outputs.  At the same time, PIA alludes to the fact alternative energy sources too expensive and can’t be justified under current circumstances.  Not satisfied with hydro and wind energy (Ashegoda Wind Generator alone in Tigray produced over 120 MW), Ethiopia is undertaking feasibility studies with Icelandic consulting company to explore geothermal power in Ethiopia which potentially produce over 5,000 MW.  Eritrea should have similar potential.

At the end of PIA’s lecture one is left with the impression that electricity is some supernatural phenomenon that is beyond the capacity of Eritreans to produce and that we, including PIA, must pray to Apollo or Ra (Sun gods) for our energy needs.  It appears that PIA’s pinning his hope, in his own words during the latest lecture, in eventually normalizing relationship with Ethiopia and buying electricity from them.  ‘Kab Seb Zitesebey bdewu beleye!

4. Port and Free Port:  For 22 years, PIA has been talking about expanding Eritrea’s two ports and developing free port.  Instead of reporting on his progress, PIA tells us that the world has been conspiring to render Eritrean ports useless.  It is a well known fact that a Norwegian company (negotiated by high ranking PFDJ official) had presented in 2007 a negotiated final proposal to develop the Port of Asseb but PIA dismissed the proposal without even looking at it saying that he is in talks with Chinese companies to develop it.  Six years later – nothing.

5. Road and transportation sectors:  After telling for so many that he has achieved so much in building road infrastructures in Eritrea, now PIA tells us that most of the existing road infrastructures are inadequate.  Moreover he tells us that train network must be established and that we should endeavour to connect Port of Massawa to Sudan through alternative routes in Eritrea.  But these are pipe dreams for a regime operating on few dimes of foreign currency. While PIA is dreaming for all us, Djibouti and Ethiopia just agreed to commence connecting the Djibouti-Ethiopia train line to Sudan at the cost of $ 600M USD.  PIA dreams, others do.

6. Housing Projects:  In 22 years of power, PIA has not built a single affordable housing for Eritreans.  As such, Eritreans haven’t been able to lead normal family life, which is the most basic building block of every society, and by extension a country.  In contrast, the Addis Ababa Administration alone has built and delivered to local residents over 80,000 apartments and houses in the last 10 years, and is currently undertaking another 130,000 houses within the Growth and Transformation Period – all again, for ordinary folks in Addis Ababa, not Diaspora Ethiopians with USD$.  Even the Dergue regime, with its limited resources, allowed local Asmara residents to build houses in Mai Chehot and many other areas.

7. Economy in General:  PIA’s argument is that natural resources are a curse (Resource Curse) unless some factors, only known to him – let us call them enabling factors, are put in place to fully exploit these resources.  Obviously, one can only deduce that these are enabling factors are non-economic factors, as PIA has done everything to destroy them, and must be some socio-political factors.  We can also deduce it is not about building social, economic, legal or political institutions.   After eliminating many factors, one is left with two factors:  maintaining power as he may think that his power survival is Eritrea’s survival (delusions of all dictators) and/or social re-engineering (yet another delusion of all dictators).  Throughout history people have tried to destroy religions, ethnicity and other sources of human divisions for greater good by attempting to homogenize their subjects.  All have failed without exception!  PIA is taking a path proven throughout history as failures.

PIA leaves us with the impression that Eritrea’s resources are insufficient to propel its economic growth.  When asked about mining, he tells us that it doesn’t generate sufficient foreign currency.  When asked about marine resources, agriculture, tourism and other endowments, PIA keeps reminding us that he doesn’t want to give us ‘false hopes’ by telling us that we can achieve economic growth by exploiting these resources.  Of course, we get no data.  In reality, a nation’s wealth is the aggregate of all the various activities, and no one sector is examined in isolation.  For instance, the Ethiopian government tells us that it earned $670M USD from tourism alone, and whatever amounts from coffee, hides and other merchandise exports (all data are available on its websites) all add up to significant hard currency earnings.  It is the aggregate of all exports that makes a country economically viable.  Eritrea, with its small population, should be rich with relative small efforts by exporting minerals (gold, silver, copper – not just from Bisha but other parts of Eritrea, marble, granite, etc…), fish, salt, agricultural products, port and bunkering services, tourism and many other activities.  Eritreans are resourceful enough to built Eritrea’s industrial sector and undertake business ventures in other countries, as they are doing now, and bring back the profits back home.

6. Non-economic Policies:  PIA can lecture all he wants about world politics but it is suffice examining PIA’s total failure pertaining to Somalia Policy.  Seven years after turning Somalia his proxy war, PIA & Eritrea are under world political and economic sanctions, and PIA is now forced to accept the current Somali government as legitimate.  PIA has allowed Ethiopia and the West to find an excuse to impose sanctions on him for gross violations of human rights in Eritrea.  Lifting the UN sanction will require more than just refraining from interfering in Somali affairs but will require PIA to accept full restorations of human rights in Eritrea.  It is difficult to pass UN sanctions because all five veto holders must agree, while withdrawing a UN sanction can be held up by one veto holder.  Even if Russia and China want to lift the sanctions, US, UK and France will ensure that PIA capitulates on many political reforms before they let him off the hook.  In other words, PIA can’t agree to political reforms because he has burned so many bridges behind him that it would be political kamikaze to agree to the West’s demand.  As such, Eritrea is headed for political, social, legal and economic abyss.  It is also mentioning that Eritrea and China’s diplomatic relationship isn’t as strong as Eritrea’s State media suggest.  China has allowed the UN to impose sanctions on Eritrea.  While Ethiopia has forged strong relationship with China by borrowing significant funds and granting most of the infrastructure projects to Chinese firms, Eritrea has slowly kicked out Chinese firms which were more involved in the first 15 years of independence.  Chinese firms built some of the road projects, Keren Pharmaceutical factory and the cement factory.  PIA needs China to stash away Eritrea’s hard currency reserves under his and his son’s name.

PIA belittling Private Sector

It is pure politics!  In reality, for those who heard Mr. Kubrom Dafla’s, PIA’s ventures have been utter failures.  Before blaming the private sector for PIA induced failures, it is worth reiterating Mr. Kubrom’s observations.  A regime unable to uphold the rule-of-law, to provide the most basic services, failed in diplomacy, and failed in business ventures can’t be credible enough to belittle the private sector as failure.

Some of PIA’s ventures have failed (besides failing to provide the rule of law, which is an utter breakdown of a civil society),

1.     Ghindae Marble Factory:  established with modern equipment and with millions of dollars, it has barely produced marble and granite although Eritrea is endowed with these resources.

2.     Nuovo Sasbre:  a brake lining factory is defunct.

3.     Gas Cylinder Factory:  is functioning at a loss and minimum production as there isn’t enough fuel gas to supply.

4.     Sawa Agro-industry: which had started to export to Italy was later scuttled.  Gerset/Farko is also a failure as a venture, except it is relabelled as an agricultural experiment to avoid the stigma.

5.     Eritrean Airlines:  its operations have scuttled due to PIA’s continued interference

6.     Keren Pharmaceutical Factory:  it is operating well below its capacity.  Compared to EPLF Pharmaceutical Factory in Sahel, Keren Pharmaceutical Factory is back-pedalling to insignificance.

7. Massawa Cement Factory & Hirgigo Cement Factory: are both failures.

But these are not the only failures:

1. Elaberid Agro-industry: which had been producing so many agricultural products is in ruins
2. Asmara Glass Factory: which was closed down to make way for new factory in Ghindae remains just a pipe dream
3. Coca Cola, Beer factory: are largely failures despite solid demands for their products.

PIA has failed not only operating industries that should be left to private sector must in every other endeavour:

1.     Education system is in ruins.  Despite new colleges, instructors are not fully qualified, no libraries, no modern electronic systems, and demoralized student population.

2. Health system is in ruins.  Despite Orotta Medical School (possibly the only success story), the new graduates are demoralized and prone to flee the country.  Inadequate mediation, lab and medical equipment, and absence of private clinics (which PIA berated), has meant poor health service in Eritrea.  PIA’s logic is that as the vast majority of rural Eritreans do not have access to health services, the urban population shouldn’t be ‘privileged’ with better health systems.  An excuse for failure!

Few years ago, a top North Korean official boasted that his country achieved equality – albeit through poverty.  Equality in poverty!  Instead of trying to pull people gradually into better living, easier to destroy the little one has.

1. Law and Order: before PIA belittles private sector which he deliberately destroyed, a government should do its primary job, which is dispense the rule-of-law, which the most basic building block of any civil society.  PIA has utterly failed!
2. Agriculture:  Despite 22 years of ‘government efforts’ to build the agricultural sector, we are no closer, in his own words, to becoming self-sufficient.  So what are we doing?  In fact, PIA tells us that food production for domestic production isn’t justified (cost of operating farming tractors in USD if a form of subsidy the regime can’t afford) because consumers pay in Nacka for their foods.   Moreover, as PIA pointed out, agriculture isn’t just about barley and wheat, but about growing fruits, vegetables, meat and dairy products.  Most of these are grown or produced in negligible amounts, and their prospects are even dimmer.

In the NUTSHELL, PIA is in a dire predicament that he can’t escape.  He needs investments and cash infusions from abroad (UN institutions, Western public and private investors, the Chinese, Indians, and Mining Companies) and others but doesn’t want to give any foreigners a political leverage to demand political reforms.  The UN sanctions WON’T be lifted unless PIA agrees to political reforms, address the exodus of Eritrean youths, and free all prisoners-of conscious.  But PIA can’t undertake political reforms without major political consequences for him as he had chosen to burn all his political bridges behind him.  It is catch 22!  It is a hole, or a nightmare, he can’t escape.  It is an irreligious person waiting for a miracle, waiting for a world political tsunami that will bail him out.

The latest news of PFDJ reorganization, shifting power to the youths (who are as much damaged from PIA’s cruel policies, Investment Conference, playing with names (from Eritrean Defence Forces, to Warsai Yikealo, to People’s Army), or any other shreds and dramas won’t change the PIA’s ominous predicament.  “Wecho Entegemtelkayo Wecho!”  PIA is still running a defunct liberation movement, NOT a nation!

A Nation, a people are born out of hope!  Hundreds of thousands of Eritrean’s sacrificed their lives for the hope of peaceful and prosperous Eritrea.  We don’t need anyone telling us about false hopes (or ‘mitibar’).  Eritrea was born against all odds.  We overcame everything because of our hopes – and we don’t let anyone take it away from us – be it colonizers or temberkektis.  We shall overcome!

September 18th, 2001 – lest we forget!!!

Berhan Hagos

September 22, 2013