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Land and Ethiopia’s Corruptocracy

no corrThe silence of Ethiopia’s “beautiful minds”

Professor A. P. J. Abdul Kalam, the renowned Indian scientist  (“Missile Man of India”)  and Eleventh President of India (2002-2007) said, “If a country is to be corruption free and become a nation of beautiful minds, I strongly feel there are three key societal members who can make a difference. They are the father, the mother and the teacher.”

Recently, the World Bank released its 448-page World Bank (WB) report, “Diagnosing Corruption in Ethiopia” with evidence galore showing that Ethiopia under the absolute dictatorship of the Meles Zenawi regime has become a full-fledged corruptocracy (a regime controlled and operated by a small clique of corrupt-to-the-core vampiric kleptocrats who cling to power to enrich themselves at public expense). Perhaps the report’s findings should not come as surprise to anyone since “power corrupts and absolute power corrupts absolutely”.

Over the past several weeks, I have made a number of cursory remarks on the shocking findings of the WB report. I have also discreetly appealed to a segment of  Ethiopia’s  “beautiful minds”  (its teachers, professors, economists, political and social scientists, lawyers, and other members of the learned professions)  to critically examine the report and inform their compatriots on the devastating impact of  corruption on the future of their poor country and make some recommendations on how to deal with it. I even challenged the political opposition to issue a “white paper” and make crystal clear their position on accountability and transparency and make some concrete proposals to remedy the endemic corruption that has metastasized in the Ethiopian body politic.

I have yet to see any substantive analysis or commentary on the WB’s “diagnosis of corruption” in Ethiopia in the popular media or in the scholarly journals;  nor have I seen any proposals on how to sever the vampiric tentacles of corruption sucking the lifeblood from the Ethiopian people. Could it be that Ethiopia’s “beautiful minds” can’t handle ugly truths? Or do Ethiopia’s “beautiful minds”  turn faint-hearted when it comes to speaking ugly truths to power?

Few can tell the ugly truth about corruption in Ethiopia more bluntly thanGlobal Financial Integrity  (GFI), the renowned organization that reports on “illicit financial flows” (illegal capital flight, mispricing, bulk cash movements, hawala transactions, smuggling, etc.) out of developing countries. In 2011, GFI told the world, “The people of Ethiopia are being bled dry. No matter how hard they try to fight their way out of absolute destitution and poverty, they will be swimming upstream against the current of illicit capital leakage.”

When the late dictator Meles Zenawi was asked in July 2011 about his feelings concerning the use of the word “famine” synonymously with Ethiopia by the Oxford Dictionary,  he said, “… Like any citizen, I am very sad. I am ashamed. It is degrading. A society that built the Lalibela churches… Axum obelisks… some thousand years ago is unable to cultivate the land and feed itself….  That is very sad. It is very shameful. Of all the things, to go out begging for one’s daily bread, to be a beggar nation is dehumanizing. Therefore, I feel great shame.”  I too feel great shame that Ethiopia has become not only a “beggar nation” over the past 21 years, but also that she has now become synonymous with the word “corruption”. It is unbearable that the land of “13 months of sunshine” has become the land of 13 months of the darkness of corruption.

Speaking the ugly truth to power

Given the icy silence of Ethiopia’s “beautiful minds”, it is my humble duty and unenviable job to continue to speak the ugly truth about corruption to the powers that be in Ethiopia. For years, I have written numerous commentaries on corruption in Ethiopia as a serious human rights violation. I agree with Peter Eigen, founder and chairman of Transparency International (Corruption Index) that “corruption leads to a violation of human rights in at least three respects: corruption perpetuates discrimination, corruption prevents the full realisation of economic, social, and cultural rights, and corruption leads to the infringement of numerous civil and political rights.” I also believe corruption undermines  good governance, cripples the rule of law and destroys citizens’ trust in political leaders, public officials and political institutions.

In 2007 when Ethiopia’s auditor general, Lema Aregaw, reported that Birr 600 million of state funds were missing from the regional government coffers, Meles fired Lema and publicly defended the regional administrations’ “right to burn money.” In my December 2008 commentary “The Bleeping Business of Corruption in Ethiopia,” I argued that “corruption in Ethiopia is an evil with a thousand faces. It is woven into the fabric of the political culture.” Corruption is the modus operandi of the regime in power in Ethiopia today. Former president Dr. Negasso Gidada clearly understood the gravity of the situation when he declared in 2001 that “corruption has riddled state enterprises to the core,” adding that the government would show “an iron fist against corruption and graft as the illicit practices had now become endemic”. In 2013, the business of corruption is the biggest business in Ethiopia.

In my November 2009 commentary, “Africorruption, Inc.”, I described the tip of the iceberg of the web of corruption in Ethiopia by synthesizing some of the eye popping anecdotal evidence. Dr. Negasso documented corruption in the misuse and abuse of political power for partisan electoral advantage. Coincidentally, in 2009, U.S. State Department spokesman Ian Kelley announced that the U.S. is investigating allegations that “$850 million in food and anti-poverty aid from the U.S. is being distributed on the basis of political favoritism by the current prime minister’s party.” (For reasons unknown, but not difficult to guess, the U.S. State Department has never released the findings of its investigation.)

The ruling regime’s “Federal Ethics and Anti-corruption Commission” (FEAC) in 2008 documented the fact that “USD$16 million dollars” worth of gold bars simply walked out of the country’s principal bank. FEAC described the heist as a “huge scandal that took place in the Country’s National Bank and took many Ethiopians by surprise… The  corruptors dared to steal lots of pure gold bars that belonged to the Ethiopian people replacing them with gilded irons… Some employees of the Bank, business people, managers and other government employees were allegedly involved in this disastrous and disgracing scandal.”

FEAC also reported that “there was another big corruption case at the Ethiopian Telecommunications Corporation that took many Ethiopians by surprise” which involved the “competitive tendering for the supply of telecommunication equipment.” FEAC  “found out that nearly 200 million USD has been lost to corruption through the entire fraudulent and corrupt process…. In another case involving a telecommunications deal with the Chinese, a high level regime official was secretly tape recorded trying to extort kickbacks for himself and other regime officials.” (Even though high level bank officials were fingered in the gold heist, there is no evidence that any one of them has ever been prosecuted.)

In my November 2011 commentary “To Catch Africa’s Biggest Thieves Hiding in America!”, I called attention to a Wikileaks cablegram which confirmed long held suspicions about massive corruption in the current ruling party in Ethiopia, the Tigrayan People’s Liberation Front (TPLF): “Upon taking power in 1991… [the TPLF] liquidated non-military assets to found a series of companies whose profits would be used as venture capital to rehabilitate the war-torn Tigray region’s economy…[with] roughly US $100 million… Throughout the 1990s…,  no new EFFORT  [Endowment Fund for the Rehabilitation of Tigray owned and operated by TPLF] ventures have been established despite significant profits, lending credibility to the popular perception that the ruling party and its members are drawing on endowment resources to fund their own interests or for personal gain.” According to the World Bank, “roughly half of the Ethiopian national economy is accounted for by companies held by an EPRDF-affiliated business group called the Endowment Fund for the Rehabilitation of Tigray (EFFORT)… EFFORT’s freight transport, construction, pharmaceutical, and cement firms receive lucrative foreign aid contracts and highly favorable terms on loans from government banks.”

When 10,000 tons of coffee earmarked for exports had simply vanished (not unlike the gold bars that walked out of the National Bank) from the warehouses in 2011, Meles Zenawi called a meeting of commodities traders and threatened to “cut off their hands” if they should steal coffee in the future. In a videotaped statement, Meles told the traders he will forgive them this time because “we all have our hands in the disappearance of the coffee”.

In my December 2011 commentary “The Art of Bleeding a Country Dry”, I argued, “No one knows corruption — the economics of kleptocracy — better than [Meles] Zenawi.  The facts of Zenawi’s  corruptonomics are plain for all to see: The [Ethiopian] economy is in the stranglehold of businesses owned or dominated by Zenawi family members, cronies, supporters or hangers-on.”

“Diagnosing Corruption in (in the land of) Ethiopia”

Transparency International (Corruption Index) broadly defines corruption as “the abuse of entrusted power for private gain”. Corruption manifests itself in grand and petty ways. “Grand corruption consists of acts committed at a high level of government that distort policies or the central functioning of the state, enabling leaders to benefit at the expense of the public good.” Grand corruption often involves political corruption in which political decision makers manipulate “policies, institutions and rules of procedure in the allocation of resources and financing by political decision makers, who abuse their position to sustain their power, status and wealth.” Petty corruption often occurs when the law enforcement officials or bureaucratic functionaries exact payments from “ordinary citizens, who often are trying to access basic goods or services in places like hospitals, schools, police departments and other agencies” .

Corruption in Ethiopia is no longer a question of disparate anecdotal evidence or an issue of intellectual debate.  Corruption has become the loathsome disease of the Ethiopian body politic. That is why the World Bank carefully titled its report, “Diagnosing Corruption in Ethiopia”. Diagnosis refers to the clinical process of identifying a disease. The 448-page World Bank report has diagnosed corruption as the metastasizing cancer of the Ethiopian body politic.

Corruption in land is the root of all corruption in Ethiopia! Grand corruption in land originates from the upper circles of power in the public and private sector. The powerful political and economic elites in Ethiopia exploit the anarchic, arbitrary, secretive, unaccountable and confused governance of the ruling regime to weave their tangled webs of corruption. The World Bank report states that “the land sector [in Ethiopia] is particularly susceptible to corruption and rent seeking [using social or political institutions to redistribute wealth among different groups without creating new wealth (profit seeking)].” Corruption  in  land in Ethiopia is inherent (as the old communist ideologues used to say, “part and parcel of”) in “the way policy and legislation are formulated and enforced.”

The World Bank report explains that corruption in the land sector in Ethiopia occurs in several ways. First and foremost, “elite and senior officials” snatch the most desirable lands in the country for themselves. These fat cats manipulate the “weak policy and legal framework and poor systems to implement existing policies and laws” to their advantage. They engage in “fraudulent actions to allocate land to themselves in both urban and rural areas and to housing associations and developers in urban areas.” These “influential and well-connected individuals are able to have land allocated to them often in violation of existing laws and regulations.”

In the capital Addis Ababa, it is “nearly impossible to a get a plot of land without bribing city administration officials.” These officials not only demand huge bribes but have also “conspired with land speculators” and facilitated bogus “housing cooperatives [to become] vehicles for a massive land grab. It is estimated that about 15,000 forged titles have been issued in Addis Ababa in the past five years.”

Management of rural land is similarly deeply infected with corruption. “In rural areas, officials have distorted the definition of ‘public land’ to mean ‘government land’”. Officials define “public purpose” in applying expropriation which is believed to be a leading cause of “landlessness”. Officials have also “engaged in land grabbing to grant land to functionaries” and this is “happening at the woreda (district) level and is being copied by the elected committee members at kebele (subdistrict) level.”  According to the World Bank report, “Almost all transactions involving land most often incorporate corruption because there is no clear policy or transparent regulation concerning land.”

It is stunning to learn from the report that the ruling regime does not even have the most elementary system of  land management in place. “Rural areas have no maps of registered holdings… In urban areas, there is little mapping of registered property. Encumbrances and restrictions are not recorded in the registers, and the encumbrances, if registered, are listed in a separate document. Land use restrictions are not recorded in the register. There is no inventory of public land, which affects the efficient management of public land and creates opportunities for the illegal allocation of public land to private parties.” Because existing institutions and laws are evaded, ignored and manipulated for private gain, the system of land management is a total failure making it impossible to hold officials in power legally accountable for their corrupt practices.

A variety of methods are used to perpetuate corruption in land in Ethiopia. One “key method” of land corruption involves the illegal allocation of municipal land “to housing cooperatives controlled by developers who then sell off the land informally.” Often “buyers were unaware of the legal status of the land they were buying” and end up in court before judges who are “aligned (in cahoots) with the corrupt officials”.  Another “method” is official falsification of documents. “With limited systems in place to record rights, particularly in urban areas, and limited oversight, officials have plenty of opportunities to falsify documents. It is not uncommon for parcels of land to be allocated to many different parties, sometimes to as many as  different parties, from whom officials and intermediaries collect multiple transaction and  service fees.”  Blatant conflict of interest of board members who oversee the lease award process, the absence of a compliance monitoring process for lease allocations and payments and the absence of land use regulations have served to accelerate the metastasizing corruption in land in Ethiopia.

State ownership of all land in Ethiopia is the fountainhead of land corruption. Wealthy elites and influential groups seize the land of the poor and marginalized through forced, but “legal” evictions and eminent domain actions. Nowhere is this type of land grab corruption more conspicuous than in the regime’s land giveaways to foreign “investors”.  The World Bank report states that “a substantial proportion of expropriated land is transferred to private interests”, but not to smallholders. “The expropriation and relocation of smallholders has been to the advantage of extensive commercial farming, including flower farms, biofuel, and other commodities.” It is also documented that the Ethiopian “government is forcing the Indigenous Peoples of the southwest off their ancestral lands and leasing these lands to foreign companies.” This expropriation has been achieved through a bogus program of “villagization” in which 1.5 million people have been “resettled” from the regions of Gambella, Benishangul-Gumuz, Somali, and Afar and their ancestral lands handed over to domestic and international “investors”.

As I documented in my March 2011 commentary, “Ethiopia: Country for Sale”, the Indian agribusiness giant Karuturi Global today owns a 1,000 sq. miles, “an area the size of Dorset, England”, of virgin Ethiopian land for “£150 a week (USD$245)” for “50 years”. As Karuturi Project Manager in Ethiopia Karmjeet Sekhon euphorically explained to Guardian reporter John Vidal, “We never saw the land. They gave it to us and we took it. Seriously, we did. We did not even see the land. They offered it. That’s all.” The Karuturi guys would like us to believe they got something for nothing. The regime wheeler-dealers  would like us to believe they gave a 1,000 square miles of virgin land to one of the richest agribusinesses in the world for nothing. Suffice it to say that they may also believe we were born yesterday; but surely, we were not born last night!

Prognosis on corruption in Ethiopia

Corruption in Ethiopia is the principal business of the State. Corruption has metastasized in the Ethiopian body politic  because the political and economic elites that have total control over the country’s land resources benefit enormously. They use tailor-made legislative opportunities to secure,  sell and speculate in land rights. Because the state is the sole owner of land, those who own the state alone have the power to privatize land, expropriate, lease, zone or approve construction plans or negotiate large-scale land giveaways.  Those who control the land in Ethiopia control not only the political and economic process but also the digestive process (stomachs)  of 90 million Ethiopians!

The culture of corruption must be changed before the tangled webs of corruption spun by the political and economic elites in Ethiopia are shattered. The major problem with changing the culture of political corruption is, as Peter Eigen observed, “in many parts of the world, the local people are resigned to the fact that there is corruption. They think there is nothing they can do about it. Therefore they more or less try to accommodate themselves, pay bribes themselves.”

Most Ethiopians are unaware of the regime’s “anti-corruption” efforts and those who are aware view the whole effort with a jaded eye. The simple fact of the matter is that having the “anti-corruption” agency (FEAC) to oversee, monitor, investigate and prosecute the architects and beneficiaries of corruption in Ethiopia is like having  Tweedle Dee monitor, investigate and prosecute Tweedle Dum. To invoke an old Ethiopian saying, “It is difficult to get a conviction when the son is the robber and the father is the judge.”

Effective anti-corruption efforts require an active democratic culture based on the rule of law and a vigilant citizenry empowered to confront and fight corruption in daily life.  Genuine anti-corruption efforts must necessarily begin by empowering ordinary people to fight back, not by creating a make-believe anti-corruption bureaucracy.

There have been some successful experiments in grassroots anti-corruption efforts where ordinary people have been given the tools to fight back corruption. In India, for instance, they have successfully organized local “vigilance commissions” in many towns and brought together the vulnerable and interested groups to probe into corruption. These commissions have put a significant dent in corruption. In Bangalore, “hub for India’s information technology sector”, residents have been involved in rating the quality of all major service providers in the city. The results were used to put pressure on government officials and service providers to become more accountable to citizens. The  Central Vigilance Commission of India also runs Project VIGEYE (Vigilance Eye)  which is “a citizen-centric initiative” in which “citizens join hands with the Central Vigilance Commission in fighting corruption in India.” VIGEYE provides citizens given multiple channels of engagement in the fight against corruption. In parts of Brazil, citizens are empowered to fight corruption through “participatory budgeting.” By including citizens from various backgrounds in the process of budget allocation, Brazil has been able to decrease levels of corruption and clientelism (exchange of goods and services for political support).

Ethiopia can learn much from Botswana, regarded to be the least corrupt country in Africa. The “Botswana Model” uses the strategy of “name and shame” to educate and accentuate public awareness of corruption. Using the free press as a tool, Botswanans name and shame corrupt officials by publishing their photographs on the front pages with the headline: “Is this man corrupt?” Botswana’s top political leaders are said to maintain high levels of public integrity and teach by example. Peter Eigen credits Botswana’s success to the “Directorate on Corruption and Economic Crime in Botswana [which] has processed thousands of [corruption] cases since 1994 and has made great strides against corruption.” In 2012, Botswana ranked an extraordinary 30/174 countries on the Corruption Index. These examples point to the fact that citizen involvement and monitoring are very effective in reducing corruption and increasing public integrity. Creating a bloated, toothless and  self-perpetuating anti-corruption bureaucracy  such as FEAC is mere window dressing for international donors and loaners.

The other remedy for corruption lies in vigorous and well-publicized criminal prosecutions of corrupt officials, asset forfeitures (divestment of corruptly obtained wealth) and imposition of tough prison sentences on convicted corrupt officials. FEAC’s own data show that corruption prosecutions and convictions in Ethiopia are negligible.

Absent some dramatic treatment for the cancer of corruption in Ethiopia’s land sector, there is no doubt that Ethiopia will be bankrupted in the foreseeable future. This   is  a country whose foreign reserve today could barely cover two months of its import bills, has accumulated over USD$12 billion in foreign debt;  and over the past decade Ethiopia  has lost USD$11.7 billion dollars in illicit financial flows.  Ethiopia’s “beautiful minds” and the opposition elements need to do a better job of addressing the issue of corruption. Passing references to “corruption” that “plagues the infrastructure sector”, “corruption that has never been seen before in the history of” Ethiopia and pleas to “arrest corruption that is rampant in the country” are simply not adequate.

I like to ask naïve questions. When it comes to governance, I ask not why Ethiopia’s rulers have chosen the “China Model” but rather why they have not chosen the “Ghanaian Model?” When it comes to corruption control, I simply ask why Ethiopia’s rulers have chosen not to follow the “Botswana Model”?

At the end of the day, “if Ethiopia is to be corruption free and become a nation of beautiful minds,” its  “beautifully minded” scholars, professors, researchers, policy analysts, lawyers  and other members of the learned professions  must renounce their vows of silence and loudly speak truth to black-hearted dictators! Silence may be golden but when we see the gold walking out of the National Bank in broad daylight, we had better  scream, shout and holler  like hell!!!

Professor Alemayehu G. Mariam teaches political science at California State University, San Bernardino and is a practicing defense lawyer.

Previous commentaries by the author are available at:

http://open.salon.com/blog/almariam/

www.huffingtonpost.com/alemayehu-g-mariam/

Amharic translations of recent commentaries by the author may be found at:

http://www.ecadforum.com/Amharic/archives/category/al-mariam-amharic

http://ethioforum.org/?cat=24

 

Ethiopia: The Art of Bleeding a Country Dry

Alemayehu G. Mariam

Ethio-Corruption, Inc. (Unlimited)

The people of Ethiopia are being bled dry. No matter how hard they try to fight their way out of absolute destitution and poverty, they will be swimming upstream against the current of illicit capital leakage”, wrote Economist Sarah Freitas who co-authored an upcoming report with  Lead Economist Dev Kar of Global Financial Integrity (GFI). The GFI report entitled, “Illicit Financial Flows from Developing Countries over the Decade Ending 2009,” previewed in the Wall Street Journal, found that

Ethiopia, which has a per-capita GDP of just US$365,  lost US$11.7 billion to illicit financial outflows between 2000 and 2009. In 2009, illicit money leaving the economy totaled US$3.26 billion, which is double the amount in each of the two previous years… In 2008, Ethiopia received  US$829 million  in official development assistance, but this was swamped by the massive illicit outflows.  The scope of Ethiopia’s capital flight is so severe that our conservative US$3.26 billion estimate greatly exceeds the  US$2 billion value of Ethiopia’s total exports in 2009.”

Two weeks ago in my commentary, “Why is Ethiopia Poor?”, I highlighted the fact that the Legatum Institute (LI), an independent non-partisan public policy group based in London, had recently ranked Ethiopia a pretty dismal 108th/110 countries on its 2011 Prosperity Index (LPI). Last year, the Oxford Poverty and Human Development Initiative (OPHDI) Multidimensional Poverty Index 2010 (formerly annual U.N.D.P. Human Poverty Index) ranked Ethiopia as the second poorest (ahead of famine-ravaged Mali) country on the planet. According to OPHDI, the percentage of the Ethiopian population in “severe poverty” (living on less than USD$1 a day) in 2005 was 72.3%.  Six million Ethiopians needed emergency food aid in 2010 and many more millions needed food aid in 2011 in what the U.N. described as the “worst drought in over half a century to hit parts of East Africa”.

The cancer of corruption is deeply embedded in the marrow of the Ethiopian body politic. The recently released  Transparency International (TI) 2011 Corruption Perception Index report on Ethiopia confirms the findings of GFI and other anti-corruption international organizations. For the past decade, TI has ranked Ethiopia at the bottom of the barrel of countries ruled by the most corrupt governments. In fact, for the past ten years Ethiopia’s score on the TI index has remained virtually unchanged (TI ranks countries on a 0 (“highly corrupt”) to 10 (“very clean”) scale.

TI Corruption Index Score for Ethiopia by Year

2011     2.7

2010     2.7

2009     2.7

2008     2.6

2007     2.4

2006     2.4

2005     2.2

2004     2.3

2003     2.5

2002     3.5

In light of the 2011 GFI and TI reports, is there any doubt today why Ethiopia is the second poorest nation in the world? Is it rocket science to figure out why Ethiopians are the second poorest people on the planet? Ethiopians are poor because they have been robbed, ripped off, flimflammed, bamboozled, conned, fleeced, scammed, hosed, swindled, suckered, hoodwinked, victimized, shafted and taken to the cleaners by those clinging to power like bloodsucking ticks on an African milk cow. Is it not mindboggling that the US$3.26 billion stolen out of Ethiopia in 2009 was double the amount stolen in 2008 and 2007!?!

The Art of Bleeding Ethiopia Dry

I have long argued that the business of African dictatorships is corruption. In a November 2009 commentary entitled “Africorruption Inc.”, I wrote the following about corruption in Ethiopia:

The devastating impact of corruption on the continent’s poor becomes self-evident as political leaders and public officials siphon off resources from critical school, hospital, road and other public works and community projects to line their pockets. For instance, reports of widespread corruption in Ethiopia in the form of outright theft and embezzlement of public funds, misuse and misappropriation of state property, nepotism, bribery, abuse of public authority and position to exact corrupt payments and gain are commonplace. The anecdotal stories of corruption in Ethiopia are shocking to the conscience. Doctors are unable to treat patients at the public hospitals because medicine and supplies are diverted for private gain. Tariffs are imposed on medicine and medical supplies brought into the country for public charity. Businessmen complain that they are unable to get permits and licenses without paying huge bribes or taking officials as silent partners.

Publicly-owned assets are acquired by regime-supporters or officials through illegal transactions and fraud. Banks loan millions of dollars to front enterprises owned by regime officials or their supporters without sufficient or proper collateral. Businessmen must pay huge bribes or kickbacks to participate in public contracting and procurement. Those involved in the import/export business complain of shakedowns by corrupt customs officials. The judiciary is thoroughly corrupted through political interference and manipulation as evidenced in the various high profile political prosecutions. Ethiopians on holiday visits driving about town complain of shakedowns by police thugs on the streets. Two months ago, Ethiopia’s former president Dr. Negasso Gidada offered substantial evidence of systemic political corruption by documenting the misuse and abuse of political power for partisan electoral advantage. Last week, U.S. State Department spokesman Ian Kelley stated that the U.S. is investigating allegations that “$850 million in food and anti-poverty aid from the U.S. is being distributed on the basis of political favoritism by the current prime minister’s party.” [As of December 2011, over two years after the investigation was launched, the State Department has not publicly released the results of its  investigation.]

Deceit, chicanery, paralogy and sophistry are the hallmarks of Meles Zenawi’s regime in Ethiopia. The cunning dictator has been able to shroud his corrupt empire by pursuing a propaganda policy of mass distraction and by staging one farcical political theatre after another. Zenawi has successfully distracted public attention from rampant corruption by

Making wild allegations of terrorism against his critics, persecuting and prosecuting his opponents and by jailing and exiling independent journalists (a couple of weeks ago, Zenawi shuttered Awramba Times);

Proclaiming a bogus Growth and Transformation Plan that will “double economic growth by an annual average of  14.9 percent” by 2015;

Selling Ethiopia’s most fertile land for pennies above the table and for millions under the table;

Panhandling the international community for famine and humanitarian aid and misusing that aid for political purposes;

Taking massive loans from international banks without     any significant accountability on how it is spent;

Trying to shame and intimidate Western bankers and donors by hectoring them of the evils of  “neoliberalism”;

Proclaiming the construction of an imaginary hydroelectric dam over the River Nile;

Sending troops to occupy Somalia and threatening war with other neighboring countries;

Vilifying international human rights groups, election observers and officials of multilateral organizations who disagree with him;

Dispatching swarms of officials to panhandle the Ethiopian Diaspora for nickels and dimes to buy dam bonds;

Systematically extracting foreign remittances sent by Diaspora Ethiopians;

Staging political theatre by a toothless anti-corruption agency to hoodwink complicit Western donors and loaners.

Etc., etc.

The Economics of Corruption

The Economist Magazine in its November 7, 2006 editorial described “the Ethiopian government as one of the most economically illiterate in the modern world.”  In 2009 at a high level meeting of Western donor policy makers in Berlin where, a German diplomat suggested that Ethiopia’s economic woes could be traced to “Meles’ poor understanding of economics”. They are all wrong!

No one knows corruption, the economics of kleptocracy, better than Zenawi.  The facts of Zenawi’s corruptonomics are plain for all to see: The economy is in the stranglehold of businesses owned or dominated by Zenawi family members, cronies, supporters or hangers-on. According to the World Bank, business enterprises affiliated with Zenawi’s regime control “freight transport, construction, pharmaceutical, and cement firms receive lucrative foreign aid contracts and highly favorable terms on loans from government banks.” Dataprovided by Zenawi’s regime  showed that by the end of the 2009 fiscal year, Ethiopia’s  outstanding debt stock was pegged at a crushing USD$5.2 billion. The USD$11.7 billion stolen over the past decade could easily retire that debt. Ethiopia is Africa’s largest recipient of foreign aid at nearly $USD4 billion in 2009, and the second largest foreign aid recipient in the world after Afghanistan.

Is There a Way to Stop Ethiopia from Bleeding?

The international community “naively” believes that corruption in Ethiopia and the rest of Africa could be controlled and significantly reduced by anti-corruption programs. The U.N. Convention Against Corruption (2003)requires signatories to “develop and implement or maintain effective, coordinated anti-corruption policies that promote the participation of society and reflect the principles of the rule of law, proper management of public affairs and public property, integrity, transparency and accountability.” Ethiopia signed the U.N. Convention in 2003. The Africa Union Convention on Preventing and Combatting Corruption (2003)  established a regime to empower African countries to “prevent, detect, punish and eradicate corruption and related offences in the public and private sectors.”  The Convention prescribes that “in order to combat corruption and related offences in the public service, State Parties” shall “require public officials to declare their assets at the time of assumption of office during and after their term of office  in the public service.” Ethiopia signed the AU Convention in 2004. Neither of these Conventions has even made a dent in controlling the metastasizing corruption in Ethiopia.

Zenawi knows the power of corruption. He has effectively used corruption allegations to neutralize and eliminate his political opponents. He used his “Federal Ethics and Anticorruption Commission” to railroad his comrade-in-arms and former defense minister, Seeye Abraha, to jail for six years on unsubstantiated allegations of  corruption. When then-Judge Birtukan Midekssa, and later Ethiopia’s first female political party leader and long suffering political prisoner, released Seeye for lack of evidence, Zenawi rammed legislation through his rubberstamp parliament  to deny Seeye bail and keep him in pretrial detention. He later fired Judge Birtukan.  In 2008, Zenawi’s anticorruption commission reported that “USD$16 million dollars” worth of gold bars simply walked out of the bank in broad daylight. A number of  culprits were fingered for the inside bank job, but no one was ever prosecuted. In February 2011, Zenawi publicly stated that 10,000 tons of coffee earmarked for exports had simply vanished from the warehouses. He called a meeting of commodities traders and in a videotaped statement told them he will forgive them because “we all have our hands in the disappearance of the coffee”. He warned them that if anyone should steal coffee in the future, he will “cut off their hands”.

For years, I have documented and railed against corruption in Ethiopia. In December 2008, three years to the month, in a weekly commentary entitled, “The Bleeping Business of Corruption in Ethiopia”, I wrote:

The fact of the matter is that the culture of corruption is the modus operandi in the Ethiopian body politics. Former president Dr. Negasso Gidada clearly understood that when he declared in 2001 that ‘corruption has riddled state enterprises to the core,’ adding that the government would show ‘an iron fist against corruption and graft as the illicit practices had now become endemic’. In 2007 when Ethiopia’s auditor general, Lema Aregaw, reported that Birr 600 million of state funds were missing from the regional coffers, Zenawi fired Lema and publicly defended the regional administrations’ ‘right to burn money.’…. Ironically, in 2003, Ethiopia signed the U.N. Convention Against Corruption; and a couple of months ago, a conference on institutions, culture, and corruption was hosted jointly in Addis Ababa by the United Nations Economic Commission for Africa and the Council for the Development of Social Science Research in Africa.

The fact of the matter is that absolute power corrupts absolutely. Zenawi has absolute power in Ethiopia.  Pleading for transparency and issuing moral exhortations against corruption will have no effect on the behavior of Zenawi or any of the other African dictators. Indeed, to plead the virtues of accountability, transparency and good governance with Zenawi and Co., is like preaching Scripture to a gathering of heathens. It means nothing to them. They are unfazed by moral hectoring or appeals to conscience. They sneer and jeer at those who rail and vociferate against corruption. Preaching to the corrupt, to put it simply, is an exercise in total futility!

In my November 7 commentary “To Catch Africa’s Biggest Thieves Hiding in America!”, I discussed the importance of initiating and cooperating with the U.S. Justice Department (DOJ) in civil forfeiture actions to seize corruptly obtained cash, personal or real property of any person or entity that can be traced to “specified unlawful activity”. These civil court actions extend to foreign offenses involving extortion, money laundering, or the misappropriation, theft or embezzlement of public funds by or for the benefit of a public official of a foreign government. (18 U.S. C. sections 981 (a) (1) (c); 1956; 1957.)  The U.S. has recently filed action to seize personal and real property of Teodoro Nguema Obiang Mangue, the 43-year old son of President Teodoro Obiang Nguema Mbasogo of Equatorial Guinea.

Carefully review and analysis of GFI and TI data sources reveals that public assets and funds stolen from many African countries, including Ethiopia, are often hidden in banks located in the U.S. and Europe, although the clever African dictators are now diversifying by taking advantage of  financial havens in countries experiencing rapid growth and industrialization. Much of the corruption activity centers around money laundering (that is,  illegal or dirty money is put through a complex cycle of financial transactions or washed and is transformed into legitimate or clean money).

The basic idea in money laundering is to minimize the chances of detection of stolen public assets and funds by breaking the direct link between the kleptocrats or “corruptocrats” and their collaborators by disguising the true ownership. Using financial consultants, shell companies (bogus companies that exist to simply create the appearance of legitimate transactions through fake invoices and balance sheets), fraudulent official documentation, wire transactions, and “smurfing” techniques (breaking up large amounts of money into smaller, less-suspicious amounts in the names of multiple persons) etc., those who have stolen public assets and funds try to sever or camouflage their loot from its illegal source by placing it in international financial institutions. The aim in money laundering is at least twofold: 1) gain anonymity and hide the audit trail in case of a criminal investigation, and 2)  plough the “clean money” into the legitimate economy by buying homes, investing in legitimate businesses, starting businesses and so on.

If the problem of corruption is to be addressed effectively in Ethiopia and the rest of Africa, it is not going to be at the fountainhead of the corruption itself but in the ocean where the river of corruption terminally flows. As one cannot expect the fox to safeguard the henhouse, one cannot similarly expect Africa’s dictators and corruptocrats and their collaborators to safeguard public assets and funds. A big part of the answer to the question of corruption lies in the Laundromats of financial institutions where the dirty money is washed. That’s why I believe it is the civic and moral duty of every Ethiopian and African to help the U.S. Justice Department catch Africa’s biggest thieves hiding in America. It is very easy to do, and do it anonymously.  Individuals with information about possible proceeds of foreign corruption in the United States, or funds laundered through institutions in the United States, should contact Immigration and Customs Enforcement, Homeland Security Investigations (ICE HIS) toll free at 866-347-2423 or send email to: [email protected]. If calling from outside of the U.S., the number is: 802-872-6199  

BLOW THE WHISTLE ON AFRICA’S BIGGEST THIEVES HIDING IN AMERICA!!!

Previous commentaries by the author are available at:

www.huffingtonpost.com/alemayehu-g-mariam/

and

http://open.salon.com/blog/almariam/