Mekelle፡ 24 June 2024 (Tigray Herald)
Intent of New “Asset Recovery” Bill Vague, Fears It May Be Used Against Political Opponents
The Ethiopian government has recently tabled draft legislation on “Asset Recovery” to the Federal Parliament that could potentially be misused against political opponents and individuals. Security experts note that such legislation is common in other countries. These ‘draconian’ laws are often used by authoritarian governments to maintain social control, order, and silence opponents. For instance, Turkey’s government of President Tayyip Erdogan used similar measures against Gulenist political opponents. Governments in Hungary, Iran, and Afghanistan also employ “autocratic legalism” to isolate and punish their opponents. The implementation of such a bill has resulted in ethnic, ideological, and geographical implications in the authoritarian world.
The Draft Bill
The draft bill, presented to the Ethiopian parliament in mid-June, aims to give the government the authority to seize the assets of individuals who cannot account for their source. It requires that individual suspects who own assets with funds sent from abroad produce legal receipts to a court, transferring the burden of proof from state prosecutors to the asset owners. Additionally, the bill allows the government to confiscate assets if prosecutors have reasonable grounds to believe they are beyond the legitimate and known income of the individual, and if the individual cannot prove the source. State prosecutors can investigate cases up to 10 years back to determine the financial sources of assets worth more than 5 million Ethiopian birr.
The draft bill has triggered strong suspicion among Ethiopian business people and Ethiopians and Ethiopian-born individuals in the diaspora who own businesses in the country. The government claims the bill is part of its crackdown against illicit financial activities and money laundering. However, many argue that Ethiopia already has laws in place to prevent the illicit flow of money and hence question the need for a new one and the rush to approve it.
Security experts argue that the government’s intention may be to cut off the flow of money to armed groups in the country from the diaspora community. Prime Minister Abiy Ahmed has repeatedly warned the Ethiopian business community to stop financing armed groups fighting against the government and opposition media outlets.
Experts note that the Fano militia in the Amhara region is heavily funded by ethnic Amharas in the diaspora, enabling them to continue fighting government forces. The rebel Oromo Liberation Army (OLA) in Oromia region is also believed to have sympathizers within the Oromia regional government, apart from receiving financial support from the diaspora to some extent.
In 2019, after Ethiopia and Eritrea reset their diplomatic relationship following two decades of hostility, thousands of Eritrean diaspora members flocked to Ethiopia and became involved in various business activities. Eritrean government-affiliated underground business operations, including black market currency exchange networks, boomed during this period. However, since early 2023, the relationship between Asmara and Addis Ababa has been strained once again, prompting Ethiopian authorities to scrutinize Eritrean operations closely.
If the bill is approved by the parliament, the government will have unlimited authority over suspected businesses and individuals, which in turn may result in a significant decrease in the flow of remittances through informal channels from abroad.
International financial institutions promote legal protection for property rights and unfettered transnational financial transactions as a prerequisite for increased foreign investment. The latest bill, however, would add another hurdle to attracting already dwindling foreign direct investment following the 2020-2022 war in the northern part of the country.
In an ethnically polarized Ethiopia, the fear that the draft bill, if passed by the parliament, could serve as a weapon to weaken political opponents and individual businesses under
the of fighting illicit financial activities and money laundering is legitimate.
