Business Day

Peace in sight as Eritrea withdraws border troops

- Agency Staff Addis Ababa /Reuters

Eritrea has pulled back troops from its heavily militarise­d border with Ethiopia as a “gesture of reconcilia­tion”, the progovernm­ent Eritrean Press agency said on its Facebook page.

There was no immediate confirmati­on from the government in Asmara, but the move would be consistent with rapidly improving ties between the Horn of Africa neighbours, whose 1998 war killed tens of thousands and led to two decades of military stalemate.

Ethiopia’s Prime Minister Abiy Ahmed and Eritrea’s President Isaias Afwerki signed an agreement in Asmara on July 9 to restore ties and have since taken steps to put it into practice, including reopening embassies in each other’s countries.

“It is imperative for all those who care about the long-term stability and economic viability of the region to do everything they can to help the two countries move beyond the senseless war that wrought so much suffering on both peoples,” the agency said.

Earlier on Thursday, Ethiopia appointed its first ambassador to Eritrea in two decades, the stateaffil­iated Fana news agency said. An online report from Fana said Redwan Hussien, formerly Ethiopian ambassador to Ireland, had become Addis Ababa’s representa­tive in Asmara.

Abiy became prime minister in April and said he wanted to implement a peace deal to end the war. The surprise decision was part of a broader effort to reform economics and politics in Ethiopia, the second most populous country in Africa and East Africa’s largest economy.

The government released thousands of political prisoners, a big step in a tightly controlled country ruled by a coalition of parties that drove the previous regime from power in 1991.

Better relations between the two countries could eventually give landlocked Ethiopia access to Eritrea’s ports and lay the groundwork for an easing of Eritrea’s political isolation. Both leaders have visited each other, and Isaias reopened his country’s embassy in Addis Ababa this week.

National carrier Ethiopia Airlines made its first flight to Asmara in two decades on Wednesday. Dancers waved flags and flowers as families separated for decades had emotional reunions.

Ethiopian Airlines is in talks to take a stake in Eritrean Airlines, Tewolde GebreMaria­m, CEO of Ethiopian Airlines, said in an interview on Thursday, adding that a study would be conducted to determine the size of the stake.

In another sign of change, the new Ethiopian central bank governor met the business community and heads of major banks and listened to their complaints for two hours while private TV cameras rolled and journalist­s took notes.

“We are open to listen to the challenges of the business community, unlike in previous days,” said Yinager Dessie, who was appointed in June.

Business leaders said his predecesso­r was too conservati­ve and sources in Addis Ababa said he was a man who rarely met bank executives and businesspe­ople and did not engage with institutio­ns such as the World Bank and IMF.

Yinager pledged to meet the business community regularly and said two main concerns they had raised — scant access to credit and crippling foreign exchange shortages — were government priorities.

“We are working on amending regulation­s and directives that have caused challenges for the business community,” said Yinager, who previously served as head of the government’s National Planning Commission.

He also said that sweeping changes should be expected.

“It is inevitable to have a secondary market. We cannot be square and keep our economy closed to foreign markets,” Yinager said.

Ethiopian law currently does not allow any secondary markets. The state controls the banking sector and foreign banks are not allowed to invest in Ethiopian banks.

 ?? /AFP ?? Key changes: Ethiopian Prime Minister Abiy Ahmed, left, and President Isaias Afwerki of Eritrea celebrate the reopening of the embassy of Eritrea in the Ethiopian capital Addis Ababa.
/AFP Key changes: Ethiopian Prime Minister Abiy Ahmed, left, and President Isaias Afwerki of Eritrea celebrate the reopening of the embassy of Eritrea in the Ethiopian capital Addis Ababa.

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