The Economics of the Hawassa City, Sidama: The Hawassa

The Economics of the Hawassa City, Sidama: The Hawassa Economics 101 for dummies!!
By: Dr. Wolassa Lawissomics


The relentless cyber misinformation on the Sidama nation and its land Hawassa is a cyber civil war on the nation that can not be taken lightly.

This short essay is a reply to outrageous campaigns of misinformation on the Sidama society and its land Hawassa by some self proclaimed die-hard unitarists and supermacists, and their lackeys in the south.

Hawassa is built solely by the wealth of the Sidama nation: Hate speeches, lies and innuendos can never change the truth. Here is the economics 101 of the Hawassa city:

Hawassa (Adaare) is an ancient settlment of the Sidama nation. Its urban settlement dates back to just five decades. Hawassa is not a developed city by any international standard. Like its surroundings in Sidama and neighboring Oromia, it is a poverty striken developing town with a great future potential to develop as a modern city in Sidama National Regional State the nation is aspiring to build.

No doubt, few factories, hotels, little asphalt roads and few other amenities were built in Hawassa in the past five decades since its founding. How were these amenities built and what is the truth about who built them?

These amenities were built exclusively by the wealth of the Sidama nation. How? The key drivers of economic development in any society are natural resource endowments, capital accumulation (both physical and human) and technological progress. What does Sidama have? Sidama is endowed with vast natural resources and is the richest sub region in the southern part of the country. It is a major producer of key agricultural cash crops that are the backbone of the Ethiopian economy. Sidama is the largest producer of coffee, chat and sugar cane in southern Ethiopia, the first two of which are the major foreign exchange earners for the country.

Sidama produced over 50,433.47 tonnes of coffee in 2016/17 G.C. The second largest producer of coffee in the southern part of the country, Gedeo produced 24,120.9 tonnes of coffee in the same year followed by Kaffa 18, 377.8 tonnes and Sheka 18,190.5 tonnes in the same period. These 4 sub regions alone accounted for over 75% of the coffee supplied from the souther part of the country in the same period, Sidama being the largest supplier of coffee by far. In addition, Sidama alone produced over 40,000 tonnes of chat accounting for 64% of the chat output in the entire southern region in 2016/17 GC. Furthermore, Sidama alone produced 356,558 tonnes of sugar cane accounting for 41% of sugar cane produced in the entire southern region in the same period. These figures are obtained from the Central Statistical Agency of Ethiopia.

What do the above economic statistics speak about the natural resource endowment, and capital accumulation, the key drivers of economic progress in Sidama? These economic statistics
indicate that the vast economic surpluses generated in Sidama could have industrialised the entire Sidama sub region, could have created jobs to all of the 2.5 million youth currently unemployed in Sidama and could have built more than ten cities like Hawassa in Sidama if the revenues from these natural resources were equitably utilised. It could have helped adequately address poverty.

The Sidama coffee alone generates over birr 8 billion per year in export earnings for the country. Sadly, however, Sidama receives only birr 3.9 billion in federal subsidy per year. Compare the federal subsidy allocated to Sidama with the federal subsidy allocated to the Tigray region of Birr 21.7 billion (6.03% of the total budget of Birr 346.9 billion for 2018/19). Judge for yourself how grossly inequitable and unacceptable the ethiopian federal administrative system is in terms of just budget allocations.

In spite its massive contribution to the foreign exchange earnings of the country, Sidama receives shockingly inequitable and insignificant subsidy from the federal government. No wonder why the Sidama people now constitute the largest numbers of beggars on the streets of Hawassa and sizable number of beggars in Finfinnee. This is surely a government sponsored poverty by looting the revenues from the natural resources of the region dry.

The looting is facilitated by inequitable administrative structure that denied the Sidama nation the right to regional self administration by the successive imperial regimes including the current one.

The preceding economic statistics points to the fact that the natura resources from Sidama built not only the Hawassa town but also towns in resource poor regions in the north through inequitable allocations of federal budget not to mention resourses looted through corruption and money laundering.

Obviously Oromia and Sidama subsidize most of the resource poor laud mouth, teff and sweet potato economies of the north as well as the south with billions of birr every year. This is an economic reality!!

Hawassa was built neither from the revenues of teff nor those of sweet potato. Period!! Patience and civility are neither ignorance nor cowardice!! The so called journalist- activists and little sweet potato economies, be advised that let alone Hawassa you are dependent on Oromia and Sidama for your very economic survival if you have any idea about the basic principles of resource endowments.

Outside of Sidama, Gedeo, Kaffa and Sheka, the economies of the other sub regions in the south are tiny. Those sub regions in the south with little economic potential are the net beneficiaries of the natural wealth of the richest sub regions particularly Sidama and that is why they leave no stone unturned to preserve the unconstitutional, illegal and inequitable forgery of a region called snnprs. That is why they are hell bent not to come off the shoulder of the Sidama nation and our land, Hawassa. That will stop right now and right here!! Learn to stand for your little selves! Come off the shoulder of the Sidama nation.

Hawassa, which was founded just a little over 5 decades ago was built by bulldozing farms and cattle enclosures of the Sidama peasants. When Hawassa was founded, it was supposed to be confined to 120 hectares of the Sidamaland. That 120 hectares of land was confiscated from the Sidama farmers without any compensation to build Hawassa urban settlement.

In the past five decades, more than 6400 more hectares of the Sidama land was confisicated by the three successive regimes displacing thousands of the poor Sidama farmers leaving them destitutes and beggars on the streets. In the past three decades, the Sidama land in Hawassa became a great source of income for speculative government connected land traders. The land confiscated from the poor Sidama farmers or purchased with few pennies was sold to investors and residential property builders for billions of birr. Today 9500 more hectares of the surrounding Sidama land is enclosed into Hawassa city administration expanding the city administration to over 15000 hectares from 120 hectares just five decades ago. Whose wealth is the stolen 15000 hectares of land and the billions of birr generated from the land trade? It is the stolen wealth of the Sidama nation.

The land grab aside, who funded the investments in the city. The investments in the city were funded almost entirely by four sources of income: (1) Own revenues from the Hawassa city administration; (2) corporate savings by private businesses, (3) Household savings and (4) Few federal investments in factories from foreign exchange earnings generated by the Sidama natural resources.

Like any other cities in the world, the Hawassa city administration does not receive any subsidies from federal or regional governments. It raises its revenues from various taxes it levies on businesses and households and charges on the services it provides to the residents. The private businesses use their profits to pay taxes to the Hawassa city administration as well as other government organs as appropriate and save and invest their remaining profits.

How do businesses in Hawassa generate profits? They generate profits from sales of goods and services they produce in Hawassa? Who are the majority of the consumers of the goods and services produced by businesses in Hawassa? This is no rocket science. I am sure you will not tell me that the tiny 325000 people living in Hawassa consume the bulk of the goods and services produced by the businesses in the city. As Hawassa is in the heart of Sidama, over 90% of the consumers of the goods and services produced in Hawassa are the Sidama people. The remaining 10% or less is consumed by the city residents, tourists and domestic and foreign markets. The residential buildings are built either from incomes from the Sidama land trade or savings of the working class. The few manufacturing enterprises were built by the central government particularly by the military regime again from revenues generated by Sidama natural resources.

So, where is the contributions of the revenues from teff and sweet potatoes in building the Hawassa city? None.

This is how the wealth of the Sidama nation built its city Hawassa. The Sidama nation deserve compensation in hundreds of billions of birr for its massive wealth looted especially in the past 28 years.

Hate speeches, lies and innuendos will never change the truth and the facts on the ground. Federal structure of governance is there to stay in Ethiopia. Unitarism is dead and burried. It will never revive again ever!!

Desperate campaigns of misinformation will never deter the Sidama nation from excercising its constitutional right to self determination. In 70 days we will declare the Sidama National Regional State.

ሀዋሳን ከሆነ ሰማይ እንዳመጣችሁ ለምታለቃቅሱ ቡድኖች፤ ለማስታገሻ ያህል ነው።