Ethiopia’s ‘Economic Diplomacy’ and Regional Integration

Sixteen years ago the government of Ethiopia adopted the 2002 Foreign Affairs and National Security Policy, which emphasized ‘economic diplomacy’ as the cornerstone of its foreign policy. A central component of the strategy has been regional integration with Ethiopia’s neighbours in the Horn and Eastern Africa. Since then the political contexts have changed dramatically. Ethiopia is now seen as an attractive destination for labour-intensive manufacturing and the government continues to invest in mega infrastructure and power generation projects to drive its industrial ambition. However, the Ethiopian state faces a storm of internal and external threats that could undermine its ambitious programme of economic transformation and regional integration. This chapter assesses the extent to which the emphasis on ‘economic diplomacy’ has helped the government achieve its goals of economic development, regional integration, and peace and stability in a region where state weakness, poor governance, and vulnerability to external pressures are endemic.