GSE REVIVES ITS GRAIN REGULATION POLICIES

UNCLAS ASMARA 000041 SENSITIVE SIPDIS DEPT FOR AF/E AND NAIROBI FOR GEORGIANNA PLATT FOR USAID LONDON AND PARIS FOR AFRICA WATCHERS E.O. 12958: N/A TAGS: EAGR PGOV SOCI ER SUBJECT: GSE REVIVES ITS GRAIN REGULATION POLICIES ¶1. (SBU) SUMMARY: In a recent interview, President Isaias mentioned a defunct grain regulation policy that has taken effect once more in Eritrea. The result is a visible tightening on the selling of grain in the marketplace as well as greater government control over the movement of grain between cities. All this takes place amid one of the worst harvests the country has seen in over twenty years. End Summary. BAN ON SELLING GRAIN -------------- ¶2. (SBU) President Isaias conducted a much-publicized interview with the government-owned website, shabait.com, January 10th where he referred to a prohibition of "selling and exchanging of crops," supposedly in place since the mid-90s. The reference to this statute led to a stir on opposition websites, condemning the President's "cereal proclamation." Market vendors responded by scaling back the amount of grain on display to just a few kilos. But the concern appears justified: reportedly some shops were closed after government investigators deemed them to be selling "contraband grainstuffs." ¶3. (SBU) According to one candid GSE official, the government control of grain stems from an unwritten policy created during the country's early years when President Isaias first developed his aversion to foreign aid and belief it was a threat to state power. To counter this perceived threat, Isaias ordered the government to take charge of the selling and distribution of grain. Although this policy seems to have been enforced only sporadically through the years, Isaias' recent mention of it and the market confiscations has put grain vendors back on alert. STATE CONTROL OF ALL FOOD -------------- ¶4. (SBU) Simultaneously, the GSE is now restricting movement of food between cities. Checkpoints now involve agricultural inspections to ensure that food is not being transported between cities without GSE approval. Farmers also report having entire crops taken by GSE authorities with little or no compensation in return. In most instances the farmers are given an "IOU" from the GSE. FOOD PRODUCTION LOW -------------- ¶5. (SBU) According to a recent UNFAO report, Eritrea is currently producing 30% of its food needs. In previous years the country has produced 60% of its food needs, and has supplemented the rest via imports. With restrictions in place on food imports and humanitarian aid in the name of GSE-styled "self-reliance" it will be impossible for the government to meet this 70% food shortfall. The director of one international NGO fears the situation is even worse than the FAO report indicates: "From what I've seen in the field the 30% is a large over-estimate." The NGO's local staff has compared the current food shortage to the well-known droughts of the mid-80s. MCMULLEN