Ethiopia: The Dam Dammed by Cash Flow?

In my March 2013 commentary, “Rumors of Water War on the Nile?”, I argued: 

… Whether there will be an actual “Grand Ethiopian Renaissance Dam” [GERD] is the $5bn dollar question of the century. Because Egypt has been successful in pressuring multilateral development and investment banks not to fund the project, the regime in Ethiopia has defiantly forged ahead to fund the project itself. But is self-funding of the mother of all African dams a realistic possibility?…                                                                                                                                                                      

In that commentary, I asked a number of commonsensical questions about the economic feasibility of the touted “8th largest dam in the world”: 

Is it possible to raise USD$5bn by 2015 from the people of the second poorest country in the world, the vast majority of whom live on less than USD$1? Is the largest recipient of international aid in Africa capable of raising multiple billions of dollars from its citizens for the Dam? Can a country which “lost US$11.7 billion to illicit financial outflows between 2000 and 2009” be able to undertake construction of a USD$5bn dam (unadjusted for cost overruns) on its own? Can a country which the IMF describes as having “foreign reserves [that] have declined to under two months of import coverage” as of June 2012 really be able to build the largest dam in African history? Can a country whose external debt in 2012 exceeded USD$12bn be able to build a $5bn dollar project?     

At the time, a self-described  researcher on the Nile, intent on demonstrating the “nudity of some extremist Diaspora” and “challenging” me on my “flawed arguments”, suggested that the “single reflective concern of Al Mariam`s piece would be his concern on how to finance the dam but because he is absorbed by personalizing the dam he missed his target.” (Emphasis added.)  In my April 2014 commentary,Dam! White Elephants in Ethiopia?,  I argued  that the “Grand Ethiopian Renaissance Dam” is the white elephant in the room that no one wants to talk about openly and earnestly. Meles, like all of his predecessor African dictators suffered from delusions of grandeur. Like his brethren African dictators, Meles wanted to have a big project that could immortalize him as the little “Big Man” of Africa… The so-called GERD is a vanity make-believe project principally intended to glorify Meles posthumously…” At the time, another commentator,  apparently outraged by my “flawed arguments” was not content to merely disagree with me; he charged me both with the “unthinkable” political crime of high “treason” as well as the low moral crime of “vulgarity”. That commentator groused over my “temerity” in undertaking a “demonization of the Ethiopian Government”: 

…Writing as members of a group is not something unusual, and in no way should excuse any writer to , as can unleash an avalanche of vulgarity as can be observed in Alemayehu’s article quoted above. And ultimately  Alemayehu did the unthinkable: he committed treason against Ethiopia by siding with Egypt. He had the temerity to call the construction of the Grand Ethiopian Renaissance Dam a “White Elephant” and a “wasteful vanity” project… Alemayehu should have been a lot more careful before writing an article that applauds IRN and demonize the Ethiopian Government and devalue Ethiopia’s sovereignty on its own rivers. (Emphasis added.)  

Last week, FRANCE 24 TV released a video report announcing, Ethiopia’s Nile dam project delayed due to shortage of funds. The report stated: 

Ethiopia is building a huge dam in the Nile Valley… Why aren’t international donors funding it? … The construction project is several years behind schedule. The biggest obstacle is that Ethiopia has to finance the dam on its own. No international institution wanted to help the country since the project is controversial…. Egyptian concern about the dam was put on dramatic and unintended display in 2013 at a ministerial meeting chaired by [President] Mohammed Morsi. [Video insert shows one Egyptian minister at the meeting stating] ‘I say loud and clear that all options are available to us. If diplomacy fails to change the situation, we shall resort to international law; and if this is unsuccessful, we shall resort to anyone can imagine in order to protect our water security, because for us water security is a matter of life and death…. [Video insert of another Egyptian minister at the meeting stating] ‘If all these attempts fail, we may resort to our intelligence agencies in order to destroy any dam that undermines Egypt’s security… That building this dam is tantamount to a declaration of war against Egypt…” (Emphasis added.)  

Last week, the Thugtatorship of the Tigrean Peoples Liberation Front (T-TPLF), through its public relations jockeys, planted a story in the international media announcing  yet another big white elephant: Ethiopian oil marketer sees $5 billion refinery within 10 years.  According to that report (I did not say fairy tale): 

Ethiopia’s leading private oil marketer plans to build a $5 billion refinery within ten years to meet the growing demand for refined products in a region experiencing fast economic growth… Tadesse Tilahun, the chief executive of National Oil Ethiopia, said the final decision to build a refinery producing between 200,000 to 300,000 barrels per day was yet to be taken. ‘It is a firm plan because oil demand is growing in Ethiopia… about 10 percent each year from the annual consumption of 3 million cubic metres and in the next 10 years we expect that to double… I would assume in the next 10 years we should have the refinery on the ground… National Oil’s shareholders include Saudi billionaire Mohammed Hussein Al Amoudi, whose investment portfolio in construction, gold, hotels and energy has helped amass an estimated fortune of over $10 billion…  

In March 2011, the T-TPLF announced its $5 billion Nile Dam.  In March 2015, the T-TPLF announces a $10 billion oil refinery.  What a coincidence! Or is it just that the T-TPLF likes to bring out and parade its big white elephants in the month of March? To read the rest of the commentary, CLICK HERE Or copy and paste this url into your browser: