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A quiet disappointment is brewing in the Addis Abeba
City Caretaker Administration, following an
instruction two weeks ago from Kassu Yilala (PhD),
minister of Works and Urban Development (MoWUD). He
wants the city officials to stop providing plots for
developers through negotiations.
In a letter he signed on September 26, 2007, the
Minister urged the City Administration to adhere
only to the auctioning system and suspend all plot
requests whose negotiations are pending, while he
also orders city officials not to take new requests
based on negotiations.
The letter from Minister Kassu argued that provision
of plots through negotiations is less transparent,
and thus hinders the federal government’s
overarching policy of promoting good governance. Nor
does he believe it is efficient for it takes a
longer time to conclude a deal with prospective
developers and does not generate as much revenue to
the city compared to auctioning the plots.
“There is a problem of finding open spaces [in the
city],” said Minister Kassu. “And resettling
residents from a plot granted through negotiations
is also found to be very complicated.”
Kassu advised city officials to prepare and
implement the reform on land administration, a
programme that is part of the urban good governance
reform package promulgated by the federal government
last year. It contains a component of reforming land
development and administration as well as the lease
system.
his reform programme requires all provisions of
urban plots for prospective developers to be
distributed exclusively through auctioning, as
opposed to the three different ways the City
Administration has been practicing so far: reward,
allocation, negotiations or auctioning. However,
plots required for businesses were usually leased
either through auctions or negotiations.
Kassu’s letter was not taken positively by city
officials; several of those in the nine-member
Cabinet felt a direct intrusion on their autonomy in
managing the city’s business, according to reliable
sources. Addis Abeba is one of the two cities in the
country with its own charter that grants it autonomy
from the federal government or any other regional
state.
However, its administrators are accountable to the
federal government, according to Ethiopia’s
Constitution, Article 49, Sub-Article 3. The City
Charter that followed the Constitution gives the
Ministry, in Article 11, the responsibility to
oversee the implementation of government policies
and strategies. It is not clear whether federal
authorities have the power to tell city officials
what they ought to be doing.
“It is a very delicate and sensitive issue,” said a
senior official at the City Administration.
Nonetheless, members of the Addis Abeba Land
Development and Administration Lease Board, chaired
by Mayor Brehane Deressa, met on October 5, 2007,
and showed their disgruntlement with the latest
instruction.
They have argued that auctioning should not be the
only way of transferring plots to developers, while
many in the Administration feel the instruction
arriving at a poorly chosen time.
“The letter requires us to dislocate residents
before leasing plots through auctions, which this
Administration is not capable of doing,” an official
told Fortune. “Negotiations, on the other
hand, help us screen out the right developer in
addition to giving an opportunity for residents to
develop their own plot collectively. If negotiations
stop, it will be cumbersome to develop the central
part of the city.”
City officials are worried that conducting
auctioning after a mass arrest of district officials
a few months ago follwing investigators of the
Federal Ethics and Anticorruption Commission has
robbed the public of confidence in the bureaucracy
of the City Administration; thus many are reluctant
to engage in any public tender management for plots.
“Telling us to stop negotiations in such
circumstances amounts rather to a disservice,”
another city official told Fortune.
What is at stake is the pending files of several
hundred prospective developers who have applied to
get plots through negotiations; these are applicants
who have also deposited huge amounts of money as a
security.
Reliable sources in the city government disclosed to
Fortune that there are over 100 housing
cooperatives and 500 investors whose requests for
plots have not been finalised. The cooperatives
alone have put 300,000 Br each in blocked accounts,
while the would-be investors have tied their money,
estimated to reach up to six million Birr each.
Minister Kassu wants all these negotiations to be
terminated.
“We have put one million Birr in a blocked account
in order to develop our own holdings,” the head of
one of these cooperatives in Piazza told Fortune,
dumbfounded. “It is inauspicious to hear that
another instruction has been passed which repels the
City Administration.”
The Mayor had centralised the mandate with which
plots are leased through negotiations, taking it
away from the districts. And city officials have
determined to close the pending files of prospective
developers before complying with the demand from the
federal government, disclosed sources.
“What do we do now?” quizzed a senior official from
the City Administration. “Do we arbitrarily tell all
these people to forget about it and go home?”
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