„Malheureusement, ce numéro de la revue de presse n’est actuellement disponible qu’en
allemand et en anglais.“
France changes course on the Western Sahara issue
France will support Morocco’s autonomy plan in the Western Sahara issue in future. This was revealed in a letter from French President Emmanuel Macron to Morocco’s King Mohammed VI, who celebrated his 25th anniversary on the throne on Tuesday. According to Macron, the autonomy plan proposed by Morocco in 2007, which provides for a certain degree of autonomous self-government for the region, albeit under the sovereignty of Morocco, is the « only way » to resolve the long-standing conflict over the territory of Western Sahara. The present and future of Western Sahara are a matter for Moroccan sovereignty, the letter continues. France is thus clearly breaking with its decades-long policy towards Morocco’s territorial claims, which had previously described the autonomy plan as a serious and credible basis for discussion to resolve the conflict, but had never spoken of Moroccan sovereignty over the territory in connection with Western Sahara.
While the change of course by Paris was welcomed in Morocco as a significant development, there was harsh criticism from neighbouring Algeria, among others, whose relations with France are already considered to be very tense. Algeria, which supports the Sahrawi liberation movement Frente Polisario, which is calling for the recognition of an independent Sahrawi Arab Democratic Republic, announced on Tuesday that it was withdrawing its ambassador from Paris. In a statement issued by the Algerian Foreign Ministry, which had already been informed of the planned move by Paris a few days earlier, the former colonial power’s change of course was criticised as a political calculation and a morally questionable decision. There was also criticism from the Frente Polisario. Mohamed Sidati, the foreign minister of the self-proclaimed Sahrawi Arab Democratic Republic, accuses France of supporting Morocco’s expansion plans on the African continent, acting against international law and denying the Sahrawis their right to self-determination.
The territory of Western Sahara, which was previously under Spanish colonial rule, was annexed by Morocco in 1975, which led to violent clashes between the Frente Polisario, which sees itself as representing the Sahrawis, and Morocco. The United Nations, which defines Western Sahara as a non-self-governing territory, finally managed to negotiate a ceasefire in 1991 and set up a peacekeeping mission. However, a planned referendum on the future and affiliation of Western Sahara was never realised due to disputes over its exact implementation. Since the ceasefire was broken and the Frente Polisario resumed its armed struggle in 2020, violence has continued to occur.
With its change of course, France is following numerous Western partners who already recognise Morocco’s autonomy plan. These include Spain, the US and Israel. In the meantime, 28 predominantly African and Arab states have also opened consulates in Rabat, which Morocco sees as concrete support. At the same time, Paris is also responding to ongoing diplomatic tensions with its former colonies Algeria and Morocco and the risk of losing both countries as partners. Some experts see the reorientation of the French position on the Western Sahara issue as a sign or reaction to the failed reconciliation policy with Algiers, which in turn also led to tensions between France and Morocco. Meanwhile, French diplomatic circles say that Paris is still endeavouring to strengthen Franco-Algerian relations. The extent to which France’s change of course will affect further developments in the Western Sahara issue and the conflict dynamics remains to be seen.
New financing package for Ethiopia
On Tuesday, the World Bank Board of Directors approved the first budget support for Ethiopia totalling 1.5 billion US dollars. This comprises a loan of one billion US dollars and a concessional loan of 500 million US dollars. A total of 6 billion US dollars is to be made available over the next three financial years to support economic reforms in the country with rapid budget support. The decision came just hours after the International Monetary Fund (IMF) approved a 3.4 billion US dollars package on Monday to support Ethiopia’s debt restructuring over the next four years. An immediate disbursement of around one billion US dollars is to be made. According to Ethiopia, the funds from the World Bank and the IMF are part of a package of around 10.7 billion US dollars that the East African economy is expecting from its creditors in the form of loans, grants and debt rescheduling.
The approval was preceded by the Ethiopian central bank’s announcement on Monday that it would open up the national currency, the birr, to free trade and thus liberalise the strict control of the exchange rate system – a decisive step towards securing financing from the IMF. In future, banks will be able to buy and sell foreign currencies at freely negotiated conditions. Unlike previously, the central bank will only intervene to a limited extent in order to support the market in the initial phase. In response to the currency reform, the birr fell by 30% on Monday. The reform package also removes the previous obligation for exporters and commercial banks to pay a levy to the Central Bank of Ethiopia. In addition, the rules for foreign currency accounts, particularly those of foreign institutions and direct investors as well as the diaspora, are to be simplified. The existing import restrictions for 38 categories of goods have also been lifted, while capital account outflows remain restricted as before.Other measures include the lifting of interest rate caps that previously applied to private companies or banks when borrowing abroad. The reform package, which is based on the Ethiopian government’s Homegrown Economic Reform Plan (HGER 2.0), aims to restore macroeconomic stability, revitalise the private sector and ensure sustainable, broad-based and inclusive growth. The introduction of an interest-based monetary policy was also announced at the beginning of the month – also under pressure from the IMF and World Bank, as many analysts agree.
Ethiopia’s move towards a market-oriented exchange rate was particularly welcomed by development partners and foreign investors. Previously, the strict exchange rate had artificially strengthened the value of the birr against foreign currencies and contributed to more goods being imported into the country than could be afforded. The competitive, market-based exchange rate reform is now intended to curb imports and boost exports. However, there are also critics who fear a negative impact on the purchasing power of Ethiopians and a further increase in inflation and the cost of living. The IMF package is also accompanied by further reform demands on Ethiopia, including the gradual abolition of subsidies for fuel and fertilisers.
In December last year, Ethiopia defaulted on its foreign debt – the third African country to do so in three years, along with Ghana and Zambia. Ethiopia’s foreign debt stands at around 28.24 billion US dollars. Talks with the IMF about a new loan programme have been ongoing since last year, after a three-year programme agreed in 2019 was abandoned due to the conflict in the northern region of Tigray. In 2021, Ethiopia also applied for debt rescheduling under the G20 Common Framework Initiative, under which also the debt rescheduling of Zambia and Ghana is underway. However, here too, progress was hampered by the civil war in Tigray, which ended with the peace agreement of 2022.
In Other News
On Sunday, the Bibliotheca Alexandrina International Book Fair in the Egyptian harbour city of Alexandria came to an end. The book fair, which took place in the modern library of Alexandria, once again attracted a large number of participants this year. A total of 77 publishers, including international ones, presented their works. This year, for the first time, an entire section was dedicated to children’s literature, thus also drawing young visitors into the fascination of the world of books. In addition, the official programme included 160 cultural events with around 600 artists. The Bibliotheca Alexandrina International Book Fair took place for the 19th time.