Country emerges as an Abyssinian Tiger, writes Matein Khalid

By Matein Khalid |

As a global strategist for a Saudi family office with vast interests in East Africa, I am fascinated by Ethiopia. Ethiopia once broke my heart in my college days at Penn. I befriended Amharic refugees who were the sons and daughters of executed nobles from the court of Emperor Haile Selassie, Bob Marley’s Rastafari. The Emperor was overthrown in a bloody military coup led by a Marxist-Leninist cabal called the Dergue who launched one of the bloodiest reigns of terror in modern Africa. Haile Selassie was murdered, his court officials gunned down or hanged, hundreds of thousands of poor peasants starved to death in famines. Soviet and Libyan petrodollars turned Colonel Mengistu Haile Mariam into Africa’s most ruthless Marxist dictator until his regime fell in 1991.

Yet Ethiopia under Meles Zenawi and his successors has evolved into an Abyssinian Tiger, with a decade of 10-12 per cent annual GDP growth. This ancient Coptic Christian empire, literally a “virgin economy”, the site of ancient Axum, Lalibela and the medieval fortresses of Gondar, is Africa’s fourth largest economy, a nation of 97 million that is a rising power in Est Africa, a magnet for the Gulf’s agro-investing elite. Blackstone just invested $200 million in Afriflora, the world’s largest producer of roses. Roses are 11 per cent of exports, dwarfed by coffee, 24 per cent of exports.

It is tragic that 137 years after Thomas Alva Edison invented the light bulb, 600 million Africans have no access to power, that 600,000 people die from cooking fire smoke inhalation each year, that Spain produces more electricity than the entire continent. Ethiopia’s $5 billion Great Renaissance Dam could be the model for Africa’s new hydroelectric paradigm, with new projects in wind power, solar and geo-thermals. A nation once enslaved by Mussolini’s colonial fascists and Mengistu’s Marxists, has now been reborn. Grains of rice, not barrels of oil, will define the Ethiopian-GCC relationship and the Indian Ocean will replace the Atlantic as the focal point of Great Power rivalries. That is why we invest in Djibouti, the Red Sea Dubai.

Ethiopia’s “development state” has built the most profitable, highest margin airline in Africa. Ethiopia has 400,000 students enrolled in 32 new universities and the Addis Ababa government spends 22 per cent of the national budget on education. Ethiopia is also the potential food supplier to Saudi Arabia, the strategic rationale behind Saudi billionaire Shaikh Mohammed Al Amoudi’s $200 million 10,000 hectare commercial farm Saudi Star in the Gambella lowlands. Saudi Star could one day produce 140,000 tonnes of rice slashing Addis’ rice import bill by $100 million and exporting rice to the Saudi kingdom across the Red Sea. Industrial agribusiness is the wave of the future in a nation where children starved to death only a generation ago. Now this is a new fairy tale.

Africa utterly bewitched me on my numerous trips – from the marble palaces of Marrakesh to the gold lion’s hide Savannah of Kenya, from the emerald green rainforests of the Congo to the Gallic charm of Abidjan and the megacity chaos of Lagos in the armpit of West Africa. I grew up on Osibisa, Femi and Paul Simon’s Graceland. I dreamt about Joseph Conrad’s heart of darkness, Robert Ruark’s something of value, Wole Soyinka’s country called Biafra, Graham Greene’s Liberian journey without maps and Chinua Achebe’s Igbo bush folklore as things fall apart. As an international banker, I met a military dictator in Lagos and a kleptocratic petro-billionaire in Luanda and saw the high priests of the oil curse loot the wealth of Angola and Nigeria.

But I also remember an eerie twilight in a slaver’s fortress just outside Luanda and wild parties on the rooftop terraces of Lagos hotels with the expat jeunesse dorée. I remember the croaks of the tree frogs and the groans of a dying cheetah. I remember the Angolan wall where Colonel Callan and his white mercenaries were shot and the vastness and timelessness of the Great Rift Valley, the snow capped Atlas or the desert wadis outside Sharm Al Sheikh (listening to a Nancy Ajram concert. Akhas mak Ah!). Africa just seeped into my bloodstream, my nervous system, my soul even when it horrified me and broke my heart, as in Rwanda, Somalia, Algeria and Sierra Leone. Cape to Cairo, the long dead Victorian sahibs dreamt. So do I.■

Researched and compiled by Matein Khalid. Mr Khalid is a global equities strategist and fund manager. He can be contacted at: matein@emirates.net.ae

Source: Khaleej Times
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