Corruption Campaign May Backfire

THE INDIAN OCEAN NEWSLETTER N° 955
23/06/01 ETHIOPIA



By launching an anti-corruption campaign aimed essentially at the dissidents of the TPLF, Ethiopian Prime Minister Meles Zenawi has taken the risk to see his own supporters implicated in the scandals. By launching an anti-corruption campaign aimed essentially at the dissidents of the ruling Tigray People's Liberation Front (TPLF), at their closest family members, and at their potential allies in the army, Prime Minister Meles Zenawi has taken the risk to see, conversely, his own supporters implicated in the scandals.

Indeed, the fraudulent practices (nonpayment of taxes, resale on the local market of products earmarked for export, recourse to friendly relations for preferential treatment) are neither novel nor limited to the TPLF dissidents. A few months ago, an official of the Société Générale de Surveillance (SGS) unearthed a huge traffic of nonpayment of taxes and informed the Ethiopian authorities thereof, but the local official of the Geneva-based company got the impression that nothing came thereof, unless it was the feeling of having mixed into affairs that was none of its business.

Other members of the prime minister's inner circle who have the reputation of having enjoyed unwarranted privileges include his brother Nikodimos Zenawi (a former employee who has struck it rich), his wife Azeb (known as Lemlem and former head of Mega Net, a firm which has benefited from untaxed imports), and Benyam Mesfin (son of the foreign minister and owner of a fleet of Scania trucks). Ethiopian journalists have uncovered another type of unsavory practice: the hiring of friends or members of one's extended family. A good example of this would be the National Election Board (NEB): its head, Assefa Biru, is the uncle of both education minister Ghenet Zewde and the speaker of the federal assembly, Dawit Yohannes. A significant number of NEB employees are linked to people close to Biru: Zewdnesh Teklu is the sister-in-law of Yohannes; Aklilu Mekuria, who has worked there, is the son of Mekuria Endeshaw, a friend of Biru's; and Desta Meghrete is related to Zewde's children: she is their baby-sitter.

As it stands, however, the governmental accusations of corruption have been somewhat selective for the moment. So far they concern especially the family of former defense minister Seye Abraha and they are now darkening the prospects of the former Ethiopian army's chief of staff. Now under house arrest, General Tsadkan Gebre Tensaye seems to have been caught with his hand in the sugar bowl. Besides his involvement (through his brother and a friend) in illicit coffee exports, he is accused of illegal sugar sales. He is said to have abused his position as chairman of the board of directors of the Ethiopian Sugar Corporation (ESC) to sell sugar illegally to the Star Business Group (SBG) and businesswoman Yeshareg Zewde, owner of the Geta Trading firm. The offices of SBG and Geta have been closed by the police and their leaders have been imprisoned. Yeshareg Zewde is said to have struck it rich during Ethiopia's war with Eritrea by transporting oil products for the Ethiopian army. She is also suspected of having bought a government flour mill for 41 million birrs, a price deemed far too low. But her business relations are not limited to the people only on the stand.

As for SBG, it rapidly grabbed the upper hand in the sugar trade after its 1995 creation, but it has interests in several areas, from import-export and transportation to retail trading and repair workshops. The group had 22 branches throughout the country and important interests in the Abyssinia Bank and in Nyala Insurance, as well as in a number of affiliates (the Mina Trading Company, Tis Abbai PLC, the Ajma-Ethiopia General Trade and Industry Company). SBG's managers and shareholders include Tedla Yizengaw, Minwiyelet Atnafu, Abebew Desta, Worku Megra, and Asnake Jenbere. Most of these are behind bars today, but Tsadkan's wife has still not been bothered, although she is an SBG shareholder. Might it be because she happens to be closely connected to the family of Sebhat Nega, one of the strongest partisans of Meles Zenawi?


THE INDIAN OCEAN NEWSLETTER N° 955