Ethiopia: What the World Bank Thinks About Ethiopia

21 OCTOBER 2012

INTERVIEW

Thinking beyond dogmas is typical of Guang Z. Chen, the resident country director of the World Bank Group (WBG) in Ethiopia. An educational background that took him between the two poles of the existing world, his country of origin, China, and the global superpower, United States, might have contributed to his ability to easily and smoothly sail through the overlapping waters.

A development economist trained at Sun Yat-sen University of China and Harvard University of United States, Chen has ample development experience to capitalise on, while leading one of the largest portfolios of the Group in Africa. His hands-on experience in managing tailored projects in sustainable development, transport sector development and infrastructure development in Latin America would obviously boost his stature within the policy sphere. In this exclusive interview with GETACHEW T. ALEMU, OP-ED EDITOR, the country director discusses issues varying from structural imbalances to political transition. Excerpts:

Q: Before two weeks, the International Monetary Fund (IMF) has released its Article IV Consultation Staff Report, in which it has provided its view of the Ethiopian macroeconomic environment. The report recommends for the government to facilitate deep structural changes in the economy with a focus on the private sector. Do you share their view?

Guang Z. Chen: Yes. First of all, as you know, during the preparation of our country partnership strategy (CPS) endorsed in September, 2012, we had had a discussion with the government. Of course, the macroeconomic balance was key part of the discussion. There is a concern of macroeconomic imbalances witnessed with the rapid growth of the last seven years. One of the concerns is similar to what is being raised by the IMF; macroeconomic structures. We recognise the fact that the gross domestic product (GDP) targets are very ambitious and rely very much on public sector financing. There is a funding gap in between and the concern is how to fill the gap. The macroeconomic structure would affect how the gap is to be filled, while the growth is sustained. I think, this is where the concern is. http://allafrica.com/stories/201210230030.html