A couple of things - try getting a land lease in Ethiopia, or better yet, entering a government tender.

And I'm sure you know the famous joke about corruption in Africa and Asia!

No - what is the famous joke?

Here's one version:

In the 1970s a young Asian and a young African go to a Western university together. They study and become firm friends before returning to their home countries to take up careers in their respective governments. Twenty years later the African decides to visit his old friend and catches a plane. The Asian is delighted to see him and proudly shows off his fine house, swimming pool and two flashy cars in the drive. The African is impressed and congratulates him. The Asian smiles and points out of the window to a huge highway in the distance. 'Can you see that road project?' he asks. He rubs his hands and winks before saying: 'Ten percent'.

The next year the Asian returns the visit. The African's house is twice as big as his. He has two pools and a fleet of cars and an army of servants. The Asian is amazed. 'But you have done better than me?' he cries. The African nods and points out of the window. The Asian looks and there is nothing but thick, unbroken African bush. The African winks and rubs his hands. '100 percent,' he says.

Has someone/some entity investigated where all the millions of foreign aid dollars go? The staggering, unabating poverty suggests those dollars aren't going where they should.

The thing is this country has been, for quite until recently, a nirvana as far as corruption is concerned. But by the day we are seeing young riches who are some how affiliated to the political elites. You see them driving state of the art cars, owning a huge and expensive mansions and you name it. Corruption is becoming a rule in this country. So, no doubt the level will reach that of other African countries, the likes of Nigeria, in no more than a decade if the current regime stays in power.

These are the type of reports that scare away investors. The respondents that the report authors must be the opponents of the regime who seem to think tarnishing the country will help their cause. Trying to equate Ethiopia with Kenya, Nigeria and Cameroon is quite laughable.

To the poster with the alias donkoro (you did pick the right name for yourself!)

Where you think the money to finance the expansion of the roads, schools, health centers, power plants, irrigation projects, etc that are being built all over the country is coming from?

I donot think ethiopia is as bad as kenya or nigeria in terms of corruption. Do you know that some people call nairobi as nairobbery. My friend once went to nairobi and the police asked him to give them some money or he would have his night in prison. I donot think this will ever happen in addis. But corruption is very very common in the construction industry,bids,almost every government institutes. Infact, some people justify corruption to traffic police as they get very small salary...they can't live with such a small salary...so...! i donot think it is reducing and given the 'illegitimacy' of the government in regard to the recent election, it might even increase!

You see, people tend to forget the first line, and hence, the begining of the thought process of the person writing the article.
Ethiopia is included in this "barometer of transparency" for the first time! One should ask the question why now??
Okay, she didn't rate too good. Hey. that's expected! The saying goes, it takes one, to know one.
You, being a ferenji (and hence not a local) are allowed/presented with a face that's for ferenjis (not locals). That's the Ethiopian way of doing things. We Ethiopians respect and treat well those from other places.
I don't have to tell you here that you are getting the "respect" (and hence , a preferential treatment and not being harassed for a bribe) is because of the fact that that you are an outsider! If you have lived in Ethiopia long ebough, you wou;d know this by now.
I know the level of corruption that exists in Ethiopia because I had to pass through the beaurocratic hurdles and because I am an Ethiopian, not a "ferenji" or "outsider"!!
Trust me, it's rampant.
and the Ethiopian way of dealing with an "outsider" should in no way distract you from the face of that's

I was that dog in Cameroon, and let me tell you how happy I was that my brave owners faced down the nasty traffic cops, who smelt like very bad men.

Now, for a nap.

Alfie - sorry to remind you about this, but those were the same owners who let you bounce out of the back of their pick-up truck while there were speeding along on their way to the beach. Brave cetainly, but a little careless. You weren't very happy with them then were you?

Whether it is from respecting "ferengi" as the previous comment stated or lack of self respect (I will think the later), Ethiopians don't treat their fellow people the same way they treat you. Corruption exists at every level of our society. I will give you an example. I live in the U.S. and visit my family about every other year. About 3 years ago my mother bought a new house and I happen to visit right after she moved in. During my stay an inspector from the city administration showed up one day and he was taking measurements of the house and compound. I was told that he will use that for tax estimates in order to issue my mom the "carta" as they call it or proof of ownership. I asked the guy at the end of his visit what the next step is. He pointed me to a guy who lives next door and said he will know. I was very puzzled. I found out later on that the "guy who knows" is a neighbor of my mom and also a middle man who collects few hundred birr, depending on size of the house, and delivers it to this official as a bribe before he can release the necessary paperwork for my mother's ownership paper. That is how real Ethiopia lives beyond what you see on the surface.

It is known corruption in Ethiopia is dragging the country backward. what surprises me is how a human being steal AID money while the poors daying from starvation.

Corruption is why Africa is in crisis. Billions of aid money and little progress to show for it. It doesn't make any sense to keep throwing money into the hands of corrupt goverments run by tribalistic despots with no regard for human rights. Africa is in dire need not of humanitarian aid money, but of selfless, humanitarian leadership.

yes well, I suppose they were a bit careless then. But really, I blame myself for not being cute enough. I've really put the effort in since then, grown my chops, widened my eyes and cut out as much farting as I can. They haven't thrown me out of any moving vehicles for months now, so it must be working.

Woof.

Hmm, well yes, there is no bare-faced corruption and demanding bribes at gun-point in Ethiopia(anymore). But the reasons for the private sector doing so badly is that government tenders and bids favour government-owned businesses, tax breaks also favour the same etc. etc. Andrew, as a foreigner you won't enter those sticky realms of hospital staff not deigning to look at you if you look to poor to pay for some "chai na bunna", the municipality people witholding ownership papers, telecom connecting and disconnecting your telephone line to see how far they can take this farce while you offer them higher and higher sums- why do you think it took so long for you to get your internet line reconnected? Immigration and customs staff, hospital security guards- the list is long and sad, because the trend it shows is that the poorer you are the more likely you'll be treated like shit and have obstacles hurled in your way whatever you do- no breaking out of the poverty cycle a la "dishwasher to millionaire" here. And ever sadder if you consider it has also a grounding in ethnicity (sorry, I don't have a hidden agenda here- it's facts)- if you look and speak the same as those who move and shake in Ethiopia then you're likely to be asked for less or even nothing, or even let in on some dodgy business undermining your competition. Another point is that the recent anti-corruption campaign on TV and media is making people more cautious, so if they once used to pay ETB10 for a quick deal they now resort to more elaborate tricks that cannot be traced so easily. The Ethiopian Anti-Corruption Commission report about 6 months ago clearly stated that corruption has become more insidious and widespread. Another thing with this campaign is that it enables the ruling government to get rid of opponents on basis of corruption- false charges etc. Look at Tamirat Layne- did the government really only notice his misdemeanor?
Sometimes Andrew you are surprisingly and frighteningly naive.

I also was disappointed when I saw how this report rated Ethiopia. In my two years there I was amazed by how little corruption I saw.

I agree with the posters above that a certain amount is hidden from foreigners. Still, does anyone really believe that regular Ethiopians face as much corruption as Kenyans or Nigerians? Or, for that matter, Russians? If you have experiences comparing them (I don't), please post.

I don't believe Meles, Mengistu, or Haile Selassie have been corrupt in the sense that Mobutu or the Duvaliers were corrupt. A violent ideologue is not the same as a fat man who skims off the top. And yet there are more corrupt countries where people are better off because the economy functions.

I met an Italian aid worker in Addis who complained that Ethiopia could stand a little more corruption if it would help cut through the endless red tape. At the time I was a little shocked, but later I thought he had a point. I worked with Ethiopian companies bidding for government tenders and the general backwardness and inflexibility of the bureaucracy was much more of a problem for us than corruption.

But of course we all look forward to the day when Ethiopia puts both red tape and corruption behind it.

i share your ideas .now i am writing my senior essay. On The role of philosophy, social values and proper usage of technology to avoid corruption in ethiopia ,so could you give me your opinion

Hi you all,

I also would like to comment on this topic.

I am originally Dutch but traveling all my live all over the world.
9 years ago I married an ethiopian lady (for which I can not thank Ethiopia enough)and since than we have lived on and off in this beautifull country.

We also bought a house in Addis Ababa and after my retierment we will live there.

I know all the African countries by experience and it is not right to compare Ethiopia with countries like Nigeria or Kenia.

Ethiopia has some corruption (like with goverment tenders)but it is not too much.
Any developing country has corruption that has to do with the income of the people and the control of the goverment and private sector on this.

I know that corruption in Ethiopia is one of the lowest in the world if you compare it with other developing countries like India or China.

We are living in China now and I can tell you that corruption is here in China much more integrated in the business and government organisations than in Ethiopia.

The money donated for aid is probably better spend in Ethiopia than in any other country in Africa, but the way aid is being given could improve all over the world.

It is like the old saying "it is better to teach people to fish than to feed them"

Ethiopia and more important the Ethiopian people are for me still unique in culture and behaviour

Greetings

Eef

Ethiopians rate corruption 1. from their narrow view point 2. Always in perspective or the current political situation.
It it true the going is easier both in the private and public sector if you are member of the EPRDF political group who is currently in power. This is real and is affecting a lot of lives. e.g. you will be giving preference or priority for business licenses and other import related issues.
The problem in the way business is done in the private sector at the grass roots level is more to do with backward and clumsy traditional methods rather than corruption. Ethiopians, rather than fixing their methods they complain about corruption. It is true there are embezzlements, lying, thefts, and corruption. However these have to do mostly due to lack of accountability and modernized implementation of it. e.g. Ethiopians to the most part do not use written and signed contractual commitments. Business deals are set usually by hand shakes left for trust. A lot of families live a worried life making deals with untrustworthy groups or individuals, always worrying if the other party will come through in their part of the deal. Usually someone will breach the trust deal, mostly by extending the implementation timing and other issues. In some high number of cases some actually deny if any such deal is made, causing frustration and generally lowering of the standard of life. Also even with sgined contracts the court system is so backward and slow most people opt not to deal with it at all.
I think corruption in Ethiopia can be easily curbed if the system is modernized. The most challenging part is fixing politically motivated preferential treatments of people belonging to a certain political party of even to a certain tribe.

EFFORT The TPLF Business Empire

July 13, 2009
Report

The Ethiopian economy is controlled by two large interlocking conglomerates: The Endowment Fund For The Rehabilitation of Tigrai (EFFORT) and Mohamed International Development Research Organization Companies (MIDROC), the Saudi billionaire, Sheikh Mohamed Al-Amoudi’s vast business enterprise.

However, the focus of this report is on EFFORT, the Tigrai People’s Liberation Front’s (TPLF) economic empire, that has monopolized the private sector of the Ethiopian economy to the extent never seen anywhere in the African continent.

The seeds for the thriving TPLF business empire were planted back in 1978 when the Relief Society of Tigrai (REST), the financial umbrella of the rebel movement in Northern Ethiopia was created as an NGO. Though REST was a relief organization, a TPLF Central Committee member headed it; and it collected donations from the international community and channeled it to the TPLF, playing a key role in the survival and ultimate victory of the TPLF over the Marxist military Derg.

After the TPLF came to power in 1991, REST was formally registered with the Ethiopian government’s Relief & Rehabilitation Commission as an “NGO”. As the financial backbone of the TPLF, REST continued enjoying state protection; and the restructured REST emerged as the richest "NGO" in the African continent. In the summer of 1995, about four years after the rebel group took control of power in Ethiopia, the TPLF established a stronger peer for REST - the Endowment Fund for the Rehabilitation of Tigrai (EFFORT). Business documents suggest that EFFORT started its business venture with a lofty investment volume of about 2.7 billion birr — then just under U.S. $1 billion.

The predominance of party-owned companies, referred to as parastatals, that control the strategic income generating sectors such as agriculture, industry, banking, mining, import-export, transport, construction, insurance, and communications is bitterly resented by private entrepreneurs as well as the general population which views it as a deliberate ethnic based and systemic economic exploitation. Since 1995, the TPLF has been using the parastatals under EFFORT as a “cash cow” to accumulate immense amounts of wealth to pursue its ethnically motivated political and economic domination of Ethiopia.

Although privatization was initiated early on and a competitive policy and trade practice commissions were developed, they did not have a significant impact, since the process was discriminatory and highly politicized -- plagued with nepotism, insider information, and other political considerations. In its most egregious form, for example, the entire process of modernizing and increasing the role of the private sector is delayed to this day until the weak parastatals are able to compete and become major players especially in the lucrative IT and Telecommunications sector.

The World Bank, many internal and external observers, as well as, business people have noted that party-owned enterprises enjoy preferential access to contracts, capital, physical infrastructure and administrative services, tax breaks and other politically motivated and privileged supports.

The business community complains that the system of taxation is aggressive and targets those who do not have political connection, or those who are not linked to party parastatals. Some business people have complained that heavy taxes have been used as a tactic of pressurizing and settling scores on those suspected of supporting the opposition.

For example, the Commercial Bank of Ethiopia (CBE) the dominant market player, faced financial meltdown a few years ago as its level of non-performing loans (NPLs) passed the 50% mark, due to unregulated lending to state-owned companies, parastatals, and to private individuals with political or personal connections with bank officials.

The parastatals also have an adverse impact on the investment climate and the economic well being of a large segment of the society. First of all, they deliberately give privileged and monopolistic economic power to a minority segment of the society to control huge amounts of assets by TPLF- the ruling party. Secondly, they create barriers to new market entrants, especially for those who refuse to enter into some kind of joint venture or cooperative activity with the parastatals. Thirdly, they create an endemic culture of obscene corruption by leveraging state resources and unfair trade practices through granting privileged access to land and information regarding procurement. Moreover, since these parastatals operate across various sectors, some have real strategic influence on other sectors [transport sector] and high demand commodities [fertilizer].

The TPLF has clearly been engaged in massive corruption and unethical business practices by national or international business rules and practices since its rise to power in Ethiopia. As a ruling party, it not only owns strategic sectors of the economy and engages in commercial and trading activities, it also puts competing private sectors in a hopeless no-win situation. This preponderant economic dominance is also used as a political weapon to harass, incarcerate, dominate, weaken and control opposition forces in order to stay in power indefinitely.

Under these untenable circumstances, it is a moral imperative for the Ethiopian people to continue the struggle against the total economic and political domination of the Tigrai ethnic minority regime, that hails from one of the poorest regions of Ethiopia and produces no exportable commodity, yet, parasitically exploits the natural resources of the country for its sole benefit.

The economic hegemony of the TPLF coupled with its gross mismanagement of the nation’s resources and the massive systemic corruption that has infected the body politic of the nation is the ticking time bomb that may very well destroy the fabric of the Ethiopian society.

Full List of TPLF Companies Under EFFORT

Companies with investment capital of 50.000.000 Million Ethiopian Birr

Company Name Year Est.(EC) Capital HQ Board Chairman
Almedan Garment Factory 1995 660,000,000 Birr Mekele Abadi Zemu
Mesfin Industrial Company 1995 500,000,000 Birr Mekele Arkebe Ekubay
Mesob Cement Factory 1995 240,000,000 Birr Mekele Abadi Zemu
Almeda Textile Factory 1995 180,000,000 Birr Mekele Abadi Zemu
Sur Construction 1995 150,000,000 Birr A.Ababa Arkebe Ekubay
Trans Ethiopia 1995 100,000,000 Birr Mekele Shimelis Kinde
Dedebit Saving & Loan 1995 60,000,000 Birr Mekele Atkilit Kiros
Ezana Mining Development 1995 55,000,000 Birr A.Ababa Tewodros H. Berhe
Addis Pharmaceuticals Production 1995 53,000,000 Birr A.Ababa Abadi Zemu
Tana Trading House Axion Association 1995 50,000,000 Birr A.Ababa Sibhat Nega
Total Capital 1,868,000,000 Birr

Companies that did not make their paid-up capital public

Ambassel Commerce Dinsho Share Company Tigrai Tagai Association Brook Chemical Share Company
Dashen Beer Factory Express Ethio Travel Service Tigrai Development PLC Computer Networking Technology
Amhara Meleso MaquaQuam Berhan Building Construction Star Pharmaceutical Importers National Electromechanical
Saba Emnebered Guna Trade Services Biftu Dinsho Oromia Credit Bank
Adwa Flour Factory Wendo Trading Shala Advertisement National Geo-Textile
Trans Ethiopia Tikal Agri Tigrai Wegagen Bank Alage Forest Products
Sebhat Nega PLC Addis Transport Walta Industry Martha poultry
Dima Honey Processinf plant Zeleke Agricultural Mechanization PLC Tikur Abbay Transport Beruk Tesfa Plastic Factory
Aberdele Animal Export Company Maichew Particle Board

These 66 companies are owned and managed by ethnic Tigreans
*Some Board Chairmen might have moved within the parastatals
*The amount shown on the tables above are initial start up capitals. The total networth of the parastatals has quadrupled.

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