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Ethiopia: Five opportunities for the United States in 2019


An open memo for Sec. Pompeo

Michael R. Pompeo U.S. Secretary of State.

by Daniel Runde*

The United States must support the reform-focused Abiy Ahmed government in Ethiopia. Ethiopia has 80 million people and will double its population. It has one of the fastest growing economies in the world.

The year 2019 presents not just challenges, but opportunities to the United States. Here are five critical opportunities that Secretary Pompeo and his team should consider, going into the new year.

Working with allies on global infrastructure at the G-20 Summit in Japan

There are enormous infrastructure deficits around the world that are going to be financed and built one way or the other. We should work to ensure that the United States and its allies fill these gaps. Meeting this challenge is both an opportunity for American companies and going to be an increasing American foreign policy challenge.

If the Belt and Road Initiative, the Asian Infrastructure Investment Bank, and the Hambantota port were not sound-enough as wake-up calls, the most recent news coming out of Kenya should push the United States to have a national strategy to enable global infrastructure. The good news is that we have allies who also care about this challenge. Japan has suggested “quality infrastructure,” which has been growing as a useful concept.

The idea of “quality infrastructure” first emerged in May 2015, when Japanese Prime Minister Shinzo Abe announced a multibillion-dollar infrastructure aid package intended to create durable, environmentally sustainable, and disaster-resistant infrastructure in countries around the world. At the Ise Shima summit of 2016, the G-7 further developed this idea by adopting a set of principles to guide their conceptualization of the term “quality infrastructure.”

The June 2019 G-20 Summit in Osaka is a moment to pull together new agreements, focus resources, and create a new approach to global infrastructure given China’s increasing influence around global infrastructure.

Ensure strong U.S. leadership in the EBRD at the G-7 Summit in France

The G-7 Summit will be held in France this year. For the past few months, the French government has been working on the idea of merging the European Bank for Reconstruction and Development (EBRD) and the European Investment Bank (EIB), for want of a more unified and coordinated framework from institutions that benefit from the European Union (EU) budget. Such a merger might have bad implications for the United States and should be stopped. A full merger of these two institutions could lead to a diminished U.S. influence over the organizational decision-making process in one of the largest regional development banks and diminished influence of the United States in a region continually threatened by Russia.

The U.S. should work with the British, the Canadians, and perhaps a Continental European G-7 member (such as Italy) to stop this merger. At the same time, the U.S. should use this discussion to signal continued support for the EBRD.

If you do not follow these things, the EBRD might sound like an obscure agency; to the contrary, it invests about € 48 billion (or about US$ 55 billion) a year in Eastern Europe, the former Soviet Union (minus Russia) and parts of the Middle East. It is a major force multiplier of an American form of globalization and one of the most significant ways we help countries such as Ukraine. Founded in 1991, the EBRD helped post-Cold War countries transition to market economies and fostered entrepreneurship. The United States is the single largest shareholder of the EBRD.

The United States should use the summit to work with Canada, the United Kingdom, and potentially Italy, to stop a full merger from happening.

Stay the course in Afghanistan and hold free and fair elections

2019 is the year when Afghanistan will hold its fourth presidential election. The country has achieved significant progress over the past decade, and it is crucial that the United States continues to stay the course. Progress continues in the country, and a proper election would help things further.

As the nation stands up, we can stand down. A strong government needs to take many steps that are central to attract investment and improve governance.

There are many issues that a civilian government needs to address. One critical step any Afghan government needs to take — and that is worth the U.S. government’s attention — is to ensure Ministry of Transportation and Civil Aviation (Afghanistan) remains independent, given aviation’s strategic importance in making the country function.

Ignore the press: Time for a new partnership with Brazil

Regardless of the universally negative press towards Jair Bolsonaro, this is the most pro-American administration that Brazil has elected in over 50 years.

Brazil, which inaugurated Bolsonaro as its new president on January 1, has a unique opportunity to partner with the United States on a number of issues, including finding a solution for the ongoing crisis in Venezuela.

A top priority for the countries under the new administration should be to initiate negotiations on a bilateral free trade agreement between Brazil and the United States.

Deepen our ties with Ethiopia and change the larger Horn of Africa

The United States must support the reform-focused Abiy Ahmed government in Ethiopia. Ethiopia has 80 million people and will double its population. It has one of the fastest growing economies in the world.

Prime Minister Ahmed and his cabinet have been credited for Ethiopia’s shift away from autocracy and for bringing the country back from the brink, all of which has boosted the East African country’s overall economic outlook. Ahmed has also strived to establish deeper economic and cultural ties with the United States and has been instrumental in advancing the U.S.-Ethiopia relationship.

Prime Minister Ahmed has also undertaken credible efforts to establish peace with its neighbor, Eritrea, and end the ongoing conflict in the Horn of Africa. Peace between Ethiopia and Eritrea could create new opportunities for the U.S. in the region and transform the Horn of Africa. When lasting peace comes between the two countries, the United States will then be able to engage with Eritrea to discuss a possible U.S. military port or base on Eritrean territory, given the geostrategic significance of this country and the region.

Daniel Runde is a Senior Vice President and William A. Schreyer Chair in Global Analysis at the Center for Strategic and International Studies. He previously worked for the U.S. Agency for International Development, the World Bank Group, and in investment banking, with experience in Africa, Asia, Europe, Latin America, and the Middle East.

ECADF

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