Towards the next decade of interconnectivity
24 November 2023
On the 3rd Belt and Road Forum (BRI) for International Cooperation held in October 2023 in Beijing, China, Prime Minister of Ethiopia Abiy Ahmed (Ph.D.) brought witness to the practicality of the BRI initiative when he highlighted the benefits of the initiative translated into interconnecting people and markets in the Horn region.
He had this to say: “Africa’s longest transnational electric-powered railway runs through Ethiopia all the way to Djibouti. The line has revitalized local and regional economies. It is playing a critical role in connecting people and enhancing the efficiency of the logistics value chain along the strategic Ethio-Djibouti corridor”.
The initiative, conceived by Chinese President Xi Jinping and introduced on September 7, 2013, at the Central Asian hub, Kazakhstan, marked its 10th anniversary this year. Inclusive development and creating a fairer world is said to have been central to the initiative. President Xi in his book, XI Jinping: Governance of China argued that “The BRI has vitalized global connectivity and common development, improving global economic governance and promoting healthy development of economic globalization.”
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Since its inception, the subject has become an integral part of countries’ development plans. Most, if not all, regarded the BRI as one that came at the right time. Particularly, emerging countries along the BRI corridor are able to accelerate their development by getting connected to global and regional economies.
Studies carried out by reputable organizations have proven the above argument true.
To cite, the World Bank has attempted to analyze the pros and cons of the initiative. If we see the findings of the WB, for instance, its 2018 research project, which focused on 71 economies along the BRI corridor that of course included China itself, shows BRI transport projects would be responsible for “reducing travel times along economic corridors by 12%, increasing trade between 2.7% and 9.7%, raising income by up to 3.4%, and lifting 7.6 million people from extreme poverty, provided its successful completion.”
For Ethiopia, the initiative is a tremendous opportunity. It has enabled the country to access capital for critical infrastructural projects and to adopt new technology and skills.
As the premier told participants at the same event, which also marked the 10th anniversary of BRI, Ethiopia is a gateway to Africa, Asia, and Europe. For one of the fastest-growing economies, which are home to 120 million people, diversifying and modernizing infrastructural interconnection would definitely do the trick to lure more FDI to the expanding industrial parks, just to say nothing of its significance in improving the livelihood standards of citizens.
If we see the dividends of the Chinese-built Ethio-Djibouti railway that connects Ethiopia, a land-locked country at the current stature, to the Red Sea Djibouti Port, the previous 72-hour travel to and from Djibouti to Addis has been trimmed to less than 12-hour travel.
The next BRI decade is expected to further integrate Ethiopia’s economy with the rest of the world. Ethiopia has a huge ambition that includes owning a sea port.
The BRI seeks to connect economies and peoples in Asia, Europe, and Africa by rail, road, and maritime means. In a recent press conference, Chinese Assistant Minister of Commerce Chen Chunjiang said that from 2013 to 2022, the volume of goods trade between his country and countries along the “Belt and Road” expanded from 1.04 trillion USD to 2.07 trillion USD, spurring an average annual growth rate of 8%. He indicated that, investment among China and countries participating in BRI steadily increased. Infrastructural connectivity expanded, and industrial and supply chains strengthened in those countries.
Ethiopia, through its 10-year perspective plan, envisions improving the transport sector. The national plan and that of the BRI in this regard can feed off each other. There is a huge demand for capital, technology, and skills here. And investing in Ethiopia is so lucrative because it is a huge market and is rich in all kinds of resources, including the availability of easily trainable human capital.
The relations between Ethiopia and China have recently taken a new height, and an all-weather strategic cooperative partnership would guarantee further cooperation in the transport interconnectivity area. Over the coming years, Ethiopia’s economy would not only benefit itself, but its neighbors could also use Ethiopia’s potential to augment their economies.
There is a huge need in Ethiopia for infrastructural expansion.
Most places in Ethiopia that have profound national and regional significance need to be accessible by all means, such as by rail and road. These demand that the country pump a great deal of finance into such projects. If we see the 10-year Ethiopian perspective plan, for instance, there is a goal to build 102,000 km of new roads, thereby raising the overall national road network from 144,000 km to 246,000 km.
Similarly, the length of the railway is expected to grow from 902 km to 4,199 km. What is more, the country’s global ranking for logistics performance is planned to drop from 126th to 40th. All these and many other goals laid out in the perspective plan cannot be achieved singlehandedly. Partnership is indeed the fuel to set the wheel of the plan into accelerated motion.
The next ten years will shape the BRI into a good-looking, 20-year-old young guy. There are hopes that the age brings with it more concrete infrastructural projects both in Ethiopia and in the wider Horn, and even beyond. There are, of course, those that have already matured. It is fair to mention the Mombasa-Nairobi Standard Gauge Railway in Kenya, which connects the major Indian Ocean port city of Mombasa with Nairobi, for instance. Its economic significance would not be confined to Kenyans. There are visible dividends for the region as well.
Still, interconnection in the Horn and East African region lags behind other regions, even in Africa. Hence, those schemes on the drawing board should come to fruition.
The East African Railway Master Plan, which is part and parcel of the BRI, can be a case in point in this regard. The possibility of the realization of projects under this plan would bring seamless positive change to the region. The plan, if realized, connects Tanzania, Kenya, Uganda, Rwanda, Burundi, South Sudan, Ethiopia, and the Democratic Republic of the Congo. Of course, the implementation of the projects comes through varying stages, and it also depends on the execution capacity of the individual countries.
In addition to improving the efficiency of logistics and transportation services among the countries and fostering people-to-people relations, land-locked countries would get alternative access to sea outlets.
Data shows that intra-African trade is still kept below 15%, which is far behind other continents. Through the BRI, it would be possible to exchange goods and services among African countries. The continent has already launched the African Continental Free Trade Area.
This article was first published in THE ETHIOPIAN HERALD