DATE=6/2/2000
TYPE=BACKGROUND REPORT
TITLE=ERITREA ECONOMY
NUMBER=5-46433
BYLINE=NICK SIMEONE
DATELINE=ASMARA
CONTENT=
VOICED AT:
INTRO: The war between Ethiopia and Eritrea has
crippled two of Africa's poorest nations. But
economists say if the war ends soon, Eritrea may
emerge from the two-ear conflict in remarkably strong
economic shape. Correspondent Nick Simeone reports
from a country that is defying the image of Africa.
TEXT: Eritrea's 30-year struggle to break away from
Ethiopia has given its people a definite mark of
independence. So much so that the country's main form
of investment now comes from its own people.
Economists say Eritreans abroad are sending their
money home -- about 400 million dollars a year --
making this the country's main source of foreign
investment. It's an infusion of cash that experts say
has made Eritrea self-reliant and kept Africa's
youngest country going when much of its business has
ground to a halt because of people being sent off to
the warfront.
John Weakliam is a banker who has represented western
interests in Asmara the past four years.
/// WEAKLIAM ACT ///
I think it's fair to say the country has a
greater chance to be a tiger economy than any
other African country, with the exemption of
Mauritius or Botswana. The business community
and the wealthy population of the country,
rather than converting its money into dollars
and taking it outside, has chosen to leave it's
deposits in the banks. In fact, bank deposits
are up by 20 percent since the war started.
/// END ACT ///
Despite a war that has brought foreign investment to a
standstill, the International Monetary Fund predicts
Eritrea's economy will grow at three to four percent
this year -- a far better pace than most other African
countries. Economists say Eritrea has virtually no
government corruption or crime. And, unlike other
countries in Africa where diamonds or oil play a role
in conflicts, no one in this government, they say, is
using the war for personal profit. Emmanuel Ablo is
the World Bank's representative in Asmara.
/// ABLO ACT ///
This is almost a unique phenomenon. You are
seeing a situation in Eritrea where if, I could
put it this way, the government does not steal
from its own people. In many countries in this
kind of war situation, bureaucrats, people in
authority, people in power, would be profiting
from this situation. They would divert
resources, goods meant for the populace, for
their own private gains. You don't see this.
/// END ACT ///
Instead, what you do see is a government that
continues to finance public works projects. The war
has caused a refugee crisis, but shops and stores in
Asmara are stocked. Eritrea seems to be a country
defying the odds.
/// ABLO ACT ///
They don't wait around for the development
partners, for the donors to do things for them.
With their limited resources, they have embarked
upon road projects, they have embarked upon
health projects and they don't wait around for
the donors to come and help them, bail them out.
I think this is a country that is trying to help
itself.
/// END ACT ///
Eritrea had one of the fasting growing economies in
Africa before the latest war with Ethiopia. If the
conflict ends soon, analysts say it may emerge
stronger and in better shape economically than its
much larger neighbor. (SIGNED)
NEB/NJS/JP
02-Jun-2000 14:45 PM EDT (02-Jun-2000 1845 UTC)
NNNN
Source: Voice of America
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