Tuesday, April 23, 2024
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Global initiative, local impact: How BRI transformed Ethiopia’s transport troubles

Though there is some criticism of the Belt and Road Initiative (BRI), it undeniably played an important role in Ethiopia’s railway history. When the Initiative was launched by China in 2013, Ethiopia’s only railway line – stretching from Addis Ababa to Djibouti – was more than a century old and in urgent need of upgrades. BRI changed the situation dramatically.

A hundred years earlier, Ethiopia had completed construction of the Addis Ababa to Djibouti railway line, which then served as the backbone of Ethiopia’s import and export trade. The railway facilitated the movement of people and goods.

The history of modern urbanization in Ethiopia is closely associated with this railway infrastructure. Urban centers like Dire Dawa, Adama and Modjo emerged along the Addis Ababa-Djibouti line. Until the line fell into disrepair, the railway was crucial to the survival of these towns and other sites along the route.

It was functionally obsolete by the turn of the 21st century. While demand for infrastructure was rising due to population growth and economic expansion, the state lacked the capacity to meet Ethiopia’s needs. Beyond merely being unable to satisfy public and economic infrastructure demands, Ethiopia did not have the finances to properly maintain the existing railway line. This illustrated Ethiopia’s broader development finance challenges.

Economic growth inherently requires efficient transport infrastructure to move people and goods. When a nation enters a growth spurt, investing in infrastructure to facilitate trade, connect people and attract investment is crucial to sustain that growth. In the first decade of the 21st century, Ethiopia was experiencing high economic growth but was also in dire need of development financing to build the necessary infrastructure to further fuel that growth.

This story is common across all developing nations. Every developing economy can initially develop using existing infrastructure. But once growth accelerates, major investments are needed to modernize and expand infrastructure. Whether in Asia, Latin America or Africa, infrastructure demand far exceeds national economic capabilities. Developing nations face multiple challenges: rising populations, lack of financing, limited technical skills and unmet development needs. Filling infrastructure gaps remains one of the greatest obstacles for developing countries worldwide.

The BRI has played a significant role in helping fill the financing gaps of developing nations struggling to meet public infrastructure demands. While BRI generally helps connect China to Europe over land and sea, its significance for developing countries like Ethiopia is greater: it meets local demand for modern infrastructure, transfers technical knowledge and skills to local communities.

Ethiopia enthusiastically embraced BRI as it facilitated the country’s development and transformation efforts. A decade after its launch, the Ethiopia-Djibouti railway system boasts a carbon-free line, organized management, efficient freight transport of commodities and knowledge transfer. Old urban centers like Dire Dawa are reviving and becoming major investment hubs. Any visitor to Furi Lebu Train Station in Addis Ababa will see passengers waiting for their train. Commodities like cement and edible oil are transported in bulk from Dire Dawa and Djibouti respectively to central markets.

Infrastructure projects like the Ethiopia-Djibouti railway offer a glimpse of how the BRI can make a tangible difference in improving livelihoods and transforming developing nations. By providing financing, technical know-how and modern infrastructure, the BRI helps fill critical gaps that have long held back economic development and improvements in people’s lives. With smart investments in infrastructure, the BRI could be a true catalyst for development in Ethiopia and other nations around the world.

Dareskedar Taye is the director general for the Asia-Pacific Research Directorate at the Addis Ababa Institute of Foreign Affairs.

Contributed by Dareskedar Taye

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