Rapid Economic Growth 68. Ethiopia has one of the fastest growing economies in the world, with a fast growing annual GDP. In 2007 and 2008, with a GDP growth rate of 11.5 percent, it was one of the fastest growing non-oil dependent African nations. Economic growth, averaging double digits over the past five years, is likely to remain buoyant in the short- and medium-term, despite the perennial threat of drought, rising inflation, and a trade deficit which the authorities are addressing. 1.1.2 Key Challenges Ethiopia and the Challenge of Transition towards a Democratic Developmental State 69. 70. 71. In this contemporary era, Ethiopia is a country in transition that aspires to become a ‘developmental state’, going by the current political discourse in the country.10 The ruling party/government is reviving the discourse on the suitability of the East Asian developmental model for Ethiopia in order to identify a possible alternative developmental paradigm that can help the country promote fast economic and social development within a short period of time. As a country in transition, Ethiopia has a historical opportunity to lay a firm foundation for a democratic developmental state. But the process of societal transition is rarely a simple matter that proceeds in a linear fashion.11 In most cases, it involves radical shifts in political arrangements, transformations in the structure of the economy, perceptible changes in attitudes, and significant changes in the relationships between different groups (i.e. social classes, ethnic groups, or other collective interests). Accordingly, contemporary Ethiopia faces many political, economic and social challenges. While notable progress has been achieved in pursuit of political and economic reforms, the country still faces a number of challenges that, if not properly and diligently addressed, could complicate its quest to improve the welfare of the majority of its people. It should, however, be stressed that, regardless of the wishes of the leadership and citizenry, a transition period is often a fairly protracted one, and attempts to shorten it through quick-fix solutions can be counter-productive in the long run. 10 The quest for the East Asian Model of Development, which over the years was dubbed ‘developmental state model’, is not a new phenomenon in Ethiopia. It goes back to the imperial era of Haile Sellasie and his political elites of the 1920s and 1930s. Many Ethiopian intellectuals of the day were passionately obsessed with the Japanese developmental model. However, the Ethiopian ruling elites’ desire to adopt and implement the Japanese developmental model was not realised, as it was overtaken by events of alarming proportions: Ethiopia was invaded by Italy in 1935, and the Second World War soon followed. 11 Eshetu Chole (2004), Underdevelopment in Ethiopia (OSSREA, Addis Abeba). - 58 -