From Developmentalism to Homegrown Economy of Ethiopia: The Narratives and the Reality

Abstract

The political and economic narrative has shifted from developmentalism to the homegrown economy in post-2018 Ethiopia, but maintains the hegemony of developmental of state project of nation-building. This article investigates the shift to homegrown economic narratives, assesses the alignment with macroeconomic data and various sources and their implications. The narrative seeks an endogenous growth model and emphasizes macroeconomic stability, industrialization, private-sector growth, and contributions of key sectors for economic transformation. In some respect of industrialization and macro-financial stability, the macroeconomic data align with the reform narratives. However, agricultural productivity, export diversification, and dependency on imports remain critical challenges of the economy and implicate structural issues of the reform. Several factors, mainly civil war, Covid-19 and climate change, complicate this economic landscape. The article underlines a sustainable and inclusive growth in Ethiopia requires greater transparency and revisiting the assumptions and implications of the homegrown economic narratives.