Diplomats and observers of Ethiopia’s economy say that Beijing has grown frustrated after major investments such as the Djibouti railway line failed to generate sufficient revenues.
China’s partial retreat has thrown into relief Ethiopia’s indebtedness to Beijing. Observers say upending that equation is perhaps the greatest motivation for Ethiopia’s opening up to the West.
Speaking at a conference in Addis Ababa in December, Abiy went as far as to say the terms of Chinese loans had damaged the Ethiopian economy.
“There are some that say we are adding more debt to the country's already high debt. But borrowing from the IMF and the World Bank is like borrowing from one's mother,” Abiy said.
“What hurt Ethiopia is borrowing from other companies or some countries. For instance, Ethiopia borrowed to build a railway but was asked to repay the debt before the completion of the construction,” he added, referring to the Chinese-backed railway line to Djibouti.
European and American companies are hoping to make the most of the moment.
In December, Abiy received European Commission President Ursula von der Leyen, who laid out plans to forge a new relationship with Africa beyond just development aid and strategies to prevent the flow of migrants into Europe.
The previous month, Adam Boehler, the CEO of America’s International Development Finance Corporation, the investment branch of the U.S. government, said Washington is “prepared to make multibillion-dollar investments in Ethiopia.”
Such high-profile visits, analysts say, shows that Western economies have finally arrived at the table alongside China, the Gulf States and Russia, which have all been maneuvering for influence in Ethiopia since its economy started to boom about a decade ago. One of the most visible pledges came in 2018 through a $3 billion package of aid and investment from the United Arab Emirates.