Working Paper 198

Ethiopia has been pursuing a manufacturing-led development strategy since the early 2000s, achieving substantial growth and poverty reduction for over a decade. However, little attention has been paid to whether these results were achieved at the expense of environmental sustainability. Relying on the review of promulgated environmental policies and on 22 in depth interviews with public and private stakeholders, this study aims to assess whether the existing command and-control approach to environmental management is delivering on its promises, and whether there is scope for a wider deployment of environmental taxes. Our analysis demonstrates that, despite the implementation of a variety of policies since the late 1990s, environmental management in Ethiopia is substantially ineffective. This is due to a combination of institutional instability and a lack of technical and human resources in the main agency tasked to protect the environment, and to the low political priority of environmental protection, seen as an unaffordable luxury when pursuing rapid economic growth. In this context, whether a switch to a market-based approach to environmental management would improve the situation seems doubtful, as any new instrument would be ineffective as long as there is a lack of political will to enforce environmental protection by capacitating the agencies mandated to this task.


Seid Yimam Mohamed

Seid Yimam is based at the Institute of Development Studies, working as a Research Associate focusing on tax administration, gender and tax compliance, informal tax, and environmental taxes. He is also a PhD student in Economics at the University of Sussex on a scholarship funded by ICTD. Outside of the field of taxation, his main research areas are in contemporary development focusing on Agriculture and Food Systems Transformation. He holds an MSc in Economics (Policy Analysis) from Addis Ababa University and an MSc in Economics from the University of Copenhagen. He worked as a Research Officer at the International Food Policy Institute (IFPRI) and the Policy Study Institute (PSI), and he was also a lecturer of Economics at Debre Berehan University in Ethiopia prior to joining ICTD.

Tiruwork Arega

Tiruwork Arega is a Doctoral Fellow at UNU-MERIT. Her research is focused on the nexus of energy, development, and gender. Prior to joining UNU-MERIT, Tiruwork worked as a research officer at the International Food Policy Research Institute, the Environment and Climate Research Center of the Policy Studies Institute, and as an instructor at Mekelle University, Ethiopia.

Giovanni Occhiali

Dr Giovanni Occhiali is a Development Economist based at the Institute of Development Studies, where he works on a number of projects related to Tax Administration and Compliance, Tax and Governance and co-leads ICTD’s capacity building programme together with Dr Max Gallien. His research focuses on Sub-Saharan Africa, and outside of the field of taxation his main interests are energy economics and industrial policies. He holds a PhD from the University of Birmingham and prior to joining ICTD, he was a Researcher at the Fondazione Eni Enrico Mattei and an Overseas Development Institute Fellow at the National Revenue Authority of Sierra Leone.
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