Discussion: the role of the main stakeholders and the role of interest vs ideas in

The Ethiopian government has retained control over the policy process since its very beginning. Key policy decisions like the selection of participants in the Steering Committee, the extension of the pilot to three more regions and the rapid closure of the design phase due to the pressure of social unrest have been taken by the government and accepted by the other stakeholders.

The socio-economic instability and the ensuing political changes have provided the developmental partners with the opportunity to encourage the Steering Committee to depart from the conventional top-down, dirigiste approach informing early policy design and expand the profile of actors involved in the process and the approach to its implementation.

The visit in Emilia Romagna played a key role in preparing the field for a new approach to IAIP development. Ethiopian authorities could appreciate a different model of agro-industrial development. They also realised that most of the ingredients (especially strong cooperatives, dedicated public institutions and specialised universities) were present also in Ethiopia; what mattered was finding a way to capitalise on what existed and improve what didn’t. This included enhancing the quantity and quality of supply of agricultural raw materials, attracting quality FDIs and promoting technology transfer and linkages with the local economy, devising institutions that connect agro-processors with smallholders’ cooperatives (like contract farming), improving access to finance for farmers, cooperatives and agro-processors, setting up a decentralised food quality and safety system, building the capacities of the RIPDCs, ensuring that technical schools and universities provide the kind of workers that the private sector needs. These are indeed the priorities identified by the 3 Italian funded projects, PROSEAD and the BMZ Special Initiative.

It is important to acknowledge here though, that this window of opportunity has been exploited by both development partners and government officials, which were still under pressure for results, but benefitted from a more open

“strategy space” (Rodrik, 2014) allowing them to embrace new, more inclusive models of agro-industrial development with more chances to deliver results. At the same time, with the start of the implementation phase, regional authorities were facing some key problems, such as the duplication of functions between already well-established cooperatives and the pilot RTCs, these latter’s unclear managerial structure and the difficulty to induce cooperatives and the private sector in investing in them, since they had been designed and built without their consultation. The regional authorities thus

started looking as well at alternative options, more inclusive and more private sector oriented.

Finally, even after a consensus had emerged towards a more inclusive and bottom-up approach, the Ethiopian government has continued to invest significant amounts of funds (540 million USD have been so far allocated to the Regions in three instalments: 53% of them in 2017/2018, 32,5% in 2018/2019 and 32,5% in 2019/2020), making of the IAIPs one of the main Ethiopian programmes for agro-industrial development in the country.

It is therefore probably fair to conclude that the principle of government ownership has been the guiding one all along the policy process.

Drawing from our conceptual framework introducing the role of interests and ideas in influencing the policy process, it is worth to note that interests have played an important role in the whole policy process.

To begin with, the IAIPs were promoted, in the inception phase of the policy, as a tool to create jobs and increase rural income in a critical moment for the country. Policies that promote pro-poor growth are perfectly consistent with the developmental state model and serve also the political interest of those in power to continue to stay in power (Poulton, 2014; Clapham, 2018).

The need to ensure equity among the most powerful Regions of the country led to the decision to widen the scope of the programme from one to four IAIPs.

The increasingly assertive stance of Oromia, Amhara and part of SNNPR (Sidama) in demanding the decentralisation of the country’s political system eventually led to the regionalisation of the parks.

The perception of the federal government about the increasing social unrest influenced the policy process, reinforcing the need for expediency at the cost of critically reviewing the IAIP model.

While there was no obvious political interest at stake in the approach of the Ministry of Industry towards the design and implementation of the IAIPs, we could see an institutional interest in retaining control of the process, against other constituencies, like the Federal IPDC and EIC and the Regions (until the Proclamation n. 886/2015). This would be consistent with the Niskanen model of budget maximising bureaucracies (Niskanen, 1973).

The issue of land expropriation has played a pivotal role in the choice of the location of the IAIP of Bulbula, in a period where the political cost of appropriating farmers’ land was high, so as to spark social unrest.

Development partners have consistently pursued their main interests, such maximising the returns on their investments and retaining their strategic role in the policy process, all along the design and implementation of the IAIP programme, but with more effectiveness only from the period of regime change and thanks to their capacity to exploit the broadened “strategy space”

(Rodrik, 2014) to mobilise effective coalitions of like-minded actors (Keeley and Scoones, 1999) and epistemic communities (Stone, 2008) and change the

narrative around policy models for agro-industrial development (Keeley and Scoones, 1999; Sumner et al., 2011).

Ideas, in the form of ideological paradigms, policy models and evidence, have been very relevant during the whole policy process.

To begin with, the hierarchical political tradition of the country (Lefort, 2007;

Markakis, 2011) and the ideological orientation of the Ethiopian developmental state were determinant in shaping the top-down, state-led approach followed during the design phase. Almost all the people we have interviewed agreed upon the fact that the process should have been more inclusive since its inception, especially with regards to the private sector and the cooperative movement.

Again, ideas in the form of international policy models (Lavers and Hickey, 2016), have been very relevant in shaping the policy process. The policy model of the IPs has been key in shaping all the discourse around the IAIPs, probably distracting policymakers from the fact that the issue at hand was much more complex, because it involved primarily the integration of agriculture and industry, which can happen only if policies oriented towards the development of agricultural value chains and the improvement of the business climate for agro-processors are devised. But this challenge needs holistic thinking, is very context specific and is much more time consuming than building traditional IPs for textile, garment and apparel. As we have seen, insights from the policy model of Emilia Romagna based on agro-clusters put the concepts of “flexibility”, “local actors” and “networking” at centre of the narrative since 2018.

Finally, ideas in the form of “evidence” have also influenced the process. The identification of the Agro-Industry Growth Corridors was done according to objective criteria, even if the selection of the four AICGs where the IAIPs would be located was done according to political considerations. Again, the identification of the sites for the IAIPs followed objective criteria, but the political cost of expropriating land was the determining factor, at least in Oromia. We see here a pattern: evidence received primary consideration only when political interests were not at stake.

The decision to put cooperatives and private investors at the centre of the project followed a different path. Resisted at the beginning, on the ground of expediency motivated by the mounting social unrest, it has been eventually endorsed. Several factors contributed to this policy change. As anticipated, we believe the most important were the opening of the “strategy space”

(Rodrik, 2014) brought by broader political change (Lavers and Hickey, 2016) and the role of international actor-networks and epistemic communities in modifying the narrative (Sumner et al, 2011) and showing that the best interest of Ethiopian policy makers was to follow a more bottom-up and inclusive approach that had better chances to result in successful agro-industrial parks. Looking at the framework of Rodrik (2014) we could

interpret this new approach as an “innovative policy” (that improve social welfare, without threatening the interest of those in power): the advantages in terms of economic growth and sustainability of involving cooperatives and private investors in the design, ownership and operational choices have been eventually recognised (and are likely to increase social welfare); the threat that these actors represent for those in power must have been judged as low - cooperatives have close links with local government agencies (Berhanu and Poulton, 2014), the government can still exert a certain degree of control over private sector in IPs (this is in line with Farole and Akinchi, 2011, p.16, considerations about China SEZs experience) - in any case lower than the failure of the parks (which would have meant further social unrest because of unemployment).

In line with the considerations above, Figure 8 summarises the evolution of the whole policy process as well as to what extent the respective interests and ideas of both the Ethiopian government and development partners have shaped the phases of design and implementation of the IAIPs so far.

Figure 8: The influence of stakeholders’ interests and ideas over the policy process

* Multi-stakeholder approach means involving in the process (at different levels: federal, regional and grassroot) essential actors previously not included, such the Ministry of Agriculture, the Ethiopian Investment Commission, the Federal Cooperative Agency, the Federal TVET Agency, the Regional governments, the private sector, farmers cooperatives and the local communities.

Source: Author