Ethiopia raising minimum civil servant salary from $35 to $44 per month

[Neptune]

The entry level salary for degree holders will also be going up from $49 to $82. The maximum salary has been raised from $158 to $286.

 

[Neptune]

Government employees in nearby countries earn more than this.

 

[Midas]

We've all known for a long time their gdp was fake but it obviously must be a lot worse than we thought since how is it possible that the maxium salary of a govt employee is $280 a month ?

Especially since the private sector is massively regulated by the country and you cant just do whatever you want.

 

[El Nino]

95% of the budjet gotta go to paying somali horgals. No way the whole country is doing niiko for them for free, Im shocked at the amount a degree holder is getting. Abysmal.

 

[Neptune]

We've all known for a long time their gdp was fake but it obviously must be a lot worse than we thought since how is it possible that the maxium salary of a govt employee is $280 a month ?

Especially since the private sector is massively regulated by the country and you cant just do whatever you want.

Abiy would rather spend billions on a new palace and vanity projects.

 

[Barkhadle1520]

The entry level salary for degree holders will also be going up from $49 to $82. The maximum salary has been raised from $158 to $286.

You can actually afford a pretty cheap vacation if you go to Ethiopia with USD, before all the insecurity at least

A 5 star hotel is probably the same price as your groceries

This means even with high paying jobs rich Ethiopians couldnt afford to go to vacation at Berbera or Xamar, Ive always wondered why you never hear about Ethiopian tourists with lacag visiting, its probably because the ones who make tons of lacag stealing from the gov flee to america lol

Their monthly gdp per capita is 90$

 

[Midas]

Abiy would rather spend billions on a new palace and vanity projects.

The more you think about it The more insane it sounds honestly. I remember watching a tiktok video of this guy who was apparently an oromo who spoke somali comparing life in somalia to life in ethiopia and saying it wasn't comparable. Even gave an example of how a lady in hargeisa will make a call and fly in an Ethiopian nurse maid when shes given birth to help her out. Use to think it was fake but over the last couple years realized how true it actually was.

 

[Midas]

Very few of us appreciate how nowhere in somalia is more than 200-300 miles from a port and its all a bunch of flat land you can cross with a terrible road. Versus ethiopia where you have to import stuff from djbouti and cross hundred of miles before you get into ethiopia and even then trucks have to cross all these mountains to reach any of the cities.

This proably makes importing anything into ethiopia several times more expensive and means their govt can clamp down on anything. Imagine the impact this has when you consider thd fact that african counties cant produce anything besides food and have to import everything. How big of a disadvantage is that ? Makes you realize why abiy is crazy about getting coastal acess. With a port he could probably reduce the cost of importing stuff several times over.

 

[Midas]

Somalia's transformation has honestly only begun. You have the oil money and the diaspora providing the knowledge and technical skills required. The big thing thats been on my mind recently however is the spaceport thing. If that really happens the future benefits we will get from the compounding effect of the first mover advantage is beyond comprehension.

Somalia might become one of the international centers of trade in transportation of goods and resources between earth and space. It might even develop into us having a mini monopoly. You can imagine how influential this would make somalia ?

 

[Karim]

I swear we can easily surpass Ethiopia's GDP if we obtain 10 years of sustained peace and proper governance.

 

[Barkhadle1520]

Somalia's transformation has honestly only begun. You have the oil money and the diaspora providing the knowledge and technical skills required. The big thing thats been on my mind recently however is the spaceport thing. If that really happens the future benefits we will get from the compounding effect of the first mover advantage is beyond comprehension.

Only turkey is crazy enough to build billion dollars infrastructure in Somalia, with all the risks and insecurity, dont imagine anyone else is gonna bet their money like this

 

[Midas]

Only turkey is crazy enough to build billion dollars infrastructure in Somalia, with all the risks and insecurity, dont imagine anyone else is gonna bet their money like this

Yeah there's probably several different intetnal reasons that came together that probably made this option seem worthwhile.

Keep in mind though these are the kind of crazy bets where the potential upside is unlimited.

 

[Garaad Awal]

So SL govt workers have a higher salary than one of the so called giants of Africa 44/month is crazy. Corruption must be rampant and out in the open

 

[SpaceyCadet]

Very few of us appreciate how nowhere in somalia is more than 200-300 miles from a port and its all a bunch of flat land you can cross with a terrible road. Versus ethiopia where you have to import stuff from djbouti and cross hundred of miles before you get into ethiopia and even then trucks have to cross all these mountains to reach any of the cities.

This proably makes importing anything into ethiopia several times more expensive and means their govt can clamp down on anything. Imagine the impact this has when you consider thd fact that african counties cant produce anything besides food and have to import everything. How big of a disadvantage is that ? Makes you realize why abiy is crazy about getting coastal acess. With a port he could probably reduce the cost of importing stuff several times over.

I mainly agree, but Abiy’s sea access push is more a distraction from Ethiopia’s real issues being tax structure. Yes, a port would boost government revenue, but Ethiopia already relies LESS on customs duties (25.6%) than Uganda (36%) or Chad (41%) which shows the problem isn’t just geographic.

Even with sea access, goods still face that brutal ~900km journey through mountains to reach Addis. The logistics premium would remain massive. Meanwhile, coastal Brazil charges 63% of a PS4’s price in import taxes while landlocked Switzerland charges almost nothing.

Abyi and his gov claim they need ports for economical reasons, they’re spending $10-15 billion on a new palace complex which is about 60-90% of Ethiopia’s entire annual budget (reminder they “claim” it costs them 1million a day to pay djibouti for fees). Ethiopia could basically slash import costs tomorrow through tax reform, regardless of geography.

 

[Flightboi]

Abiy would rather spend billions on a new palace and vanity projects.

The palace money actually didn't come from Ethiopia at all. It all came from the UAE

 

[Idilinaa]

The average Ethiopian earns in a month what someone in Somalia would make in just a single day. That’s how bad it is. In fact, they can earn more money begging or doing petty work in Somaliland or Puntland than working as a doctor or engineer back home.


I’ve spoken at length before about this “low-wage curse,” which really reflects the weakness of their domestic economy. It’s comparable to the low-wage trap China faces today, though for slightly different reasons, China’s being more policy-driven. There are valuable lessons to draw from both cases, especially around poverty reduction, boosting earning power, and creating a sustainable living wage. The key takeaway, in my view, is that building a functional domestic market economy should take priority over chasing export growth or launching massive infrastructure projects.

It also seems like Ethiopians don't understand how their economy functions in reality. Because i somehow suspect why they are exporting water and electricity is also because most people domestically don't have the purchasing power to pay for it.


Because lets say they start supplying water /electricity. People in Somalia pay up to 20-30 dollars a month for electricity.

The average Ethiopian household earned in an entire month was 15$ dollars in a 2018, now imagine how much less this must be since inflation has skyrocketed post Tigray War. https://addisstandard.com/economic-commentary-ethiopias-low-wage-is-a-curse-not-a-blessing/

According to this BBC article while a doctor in Somaliland earns 2000k a month , plus 800 in accommodations. The Ethiopian doctor earn 35 dollars a month. This is equivalent to what a Bajaaj driver would earn on a good day in Somalia. https://www.bbc.com/afaanoromoo/articles/c753n4ng3nno

I am unsure if we could fully put the blame on Abyi Ahmed, he did makes things worse but wages were abysmal before he came into office. It's something endemic to the Ethiopian economy.

He says:


''Ethiopian farmers are sandwiched between adverse global market conditions and weak domestic market" "They are compelled to produce at subsistence level, refraining from producing surpluses for domestic markets''

Basically that Ethiopian farmers don't bother producing surpluses and are stuck at subsistence because there are no consumers to purchase from them.

It makes sense to me how a farmer, pastoral or a fisherman in Somalia can earn up to 1200-3200 per month through just higher market integration. Because there are many consumers willing to buy it from them.

He also says:

''Third , the livelihood of those who do not depend on wages firmly hinges on the purchasing power of wage earners''

This is also implies producers in Somalia is carried by the purchasing power of wage earners in the towns. So they need earn of enough through wage earning to purchase and that's why it shows not only does Ethiopia have a weak domestic economy but also a weak service sector, financial sector and private sector/business economy unlike Somalia.


low wages → low demand → weak domestic economy → reliance on exports → persistent poverty is a cycle Ethiopia is stuck in.

The other thing that limits Ethiopia is that it doesn't have a functional domestic market economy, efficient logistic system that transport goods and very limited local entrepreneurship unlike Somalia. Industrialization has been heavily export driven and state led, often prioritizing large projects and foreign investment over small and medium enterprises

This is the reason why wages remain low and broad economic benefits are limited in Ethiopia.

For a couple of reasons . Firstly it overlooks small and medium enterprises (SMEs) that usually create most local jobs and help spread wealth more evenly. It limits domestic market development because the focus is on producing for foreign buyers, not local consumers. Keeps wages low to stay competitive internationally, which can trap workers in poverty.

In contrast a more balanced industrial growth includes a strong support for SMEs(small-medium businesses), domestic demand, and this promotes fair wages which tends to promote better overall development and poverty reduction. This is what you start to see more in Somalia.

I also discussed this with @Barkhadle1520 before that if Ethiopia built a strong domestic market economy and supply chains within the country it would lift many people out of poverty give them a decent earning power to support themselves, it would even boost agricultural production and make sure food , goods, money and resources are widely dispersed. Especially if they connect rural areas to urban centers, which are poorly connected in Ethiopia. So the solution seems very obvious to me.

There is a reason why Somalis have higher purchasing power because it's a market driven, urbanized, service heavy economy with huge diaspora capital inflows, whereas Ethiopia’s economy is still state heavy, rural, and subsistence based, with wages kept deliberately low for export competitiveness. It's as if they operated more like a feudal society in a way.

They also need to open more technical schools. Galbeed has led with this, and Somalia is shifting its educational system to be more market demand specific, boosting youth employment. Here even Somalia has the added advantage that there’s already a strong domestic market ready to absorb these skills. Because a lot of the skills from technical and vocational training can be immediately applied in the local economy because there’s an existing demand for them.


In Ethiopia, a big part of the challenge is that even if they train people, the domestic economy is weaker in absorbing them into good paying jobs , much of the manufacturing is export oriented, agriculture is still subsistence based not strongly linked to market systems that would create steady supply chains and income, local consumption is also limited.

 

[Midas]

The average Ethiopian earns in a month what someone in Somalia would make in just a single day. That’s how bad it is. In fact, they can earn more money begging or doing petty work in Somaliland or Puntland than working as a doctor or engineer back home.


I’ve spoken at length before about this “low-wage curse,” which really reflects the weakness of their domestic economy. It’s comparable to the low-wage trap China faces today, though for slightly different reasons, China’s being more policy-driven. There are valuable lessons to draw from both cases, especially around poverty reduction, boosting earning power, and creating a sustainable living wage. The key takeaway, in my view, is that building a functional domestic market economy should take priority over chasing export growth or launching massive infrastructure projects.

You know it'll be intresting to see how much this pattern holds when more reach is done historically. Its not for nothing most of the medieval towns seem to be located within somalia or somali galbeed.

 

[Midas]

Honestly no offense but im pretty sure the living standard for the avg person living in somalia right now is proably higher than that of our neighbors( sudan,yemen, Ethiopia ) and considering the current trajectories of our neighbors i only expect this gap to widen.

 

[Idilinaa]

You know it'll be intresting to see how much this pattern holds when more reach is done historically. Its not for nothing most of the medieval towns seem to be located within somalia or somali galbeed.

Some Ethiopian researchers have begun to revisit history, and we’ve shared a few of their publications. Increasingly, people in mainstream now are asking. ‘'Why is Ethiopia still so poor if it was never colonized?'' and the answers point less to colonization and more to their rural feudal societal structures and their low trust cultural dynamics.

A similar process will eventually unfold for Somalis, but in the opposite direction. As Somalia’s urbanization, industry/business/trade, and market development become more visible, people will be forced to rethink our history. Much of the negative rhetoric that has long been directed at Somalis will collapse under the weight of these transformations. It’s an accumulative effect where economic progress reshapes not only material realities but also how history itself is understood.

Honestly no offense but im pretty sure the living standard for the avg person living in somalia right now is proably higher than that of our neighbors( sudan,yemen, Ethiopia ) and considering the current trajectories of our neighbors i only expect this gap to widen.

I’d say people in Somalia have better living standards than most African countries. That’s because services here are more decentralized, inequality is lower, and there’s a stronger communal support system.

 

[Keep it a boqol]

The average Ethiopian earns in a month what someone in Somalia would make in just a single day. That’s how bad it is. In fact, they can earn more money begging or doing petty work in Somaliland or Puntland than working as a doctor or engineer back home.


I’ve spoken at length before about this “low-wage curse,” which really reflects the weakness of their domestic economy. It’s comparable to the low-wage trap China faces today, though for slightly different reasons, China’s being more policy-driven. There are valuable lessons to draw from both cases, especially around poverty reduction, boosting earning power, and creating a sustainable living wage. The key takeaway, in my view, is that building a functional domestic market economy should take priority over chasing export growth or launching massive infrastructure projects.

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