Author: Alemayehu Geda.

Following their accession to the World Trade Organization (WTO) and spectacular growth, China and India are gaining attention in the African economy, including Ethiopia, as important trade partners. As Alden(2003) puts it, “at a time when the world seems preoccupied by events in the middle east and the ‘global war on terror’, China’s growing engagement in Africa has gone litt le noticed in the west” (Alden ,2003:147.) Yet in a span of less than a decade trade between the regions has increased from US$10 billion in 2000 to US$28 billion in 2005. Over the last 20 years, China has grown at the rate of nearly 10 per cent per annum, driven primarily by an expansion of the modern, industrial export oriented sector. With some 20 million Chinese workers moving from rural underemployment to the modern sector annually, the impact is akin to ad ding another middle sized-industrial economy to the world economy each year as noted by Eichengreen et al (Eichengreen et al , 2004).. China’s and Indian emergence over the last decade as key net importers of commodities from Africa means that global commodity markets are likely to be the main channels thro ugh which the impact of China and India’s ascendancy has been (and will be ) felt on the African continent (Eichengreen et al , 2004). Ethiopia is not exception to this impact. Chinese investment and Ethiopia’s trade with China and India is growing at a very accelerated rate, making the Ethiopia’s export to China about 15 per cent of its total exports today which was none five years ago. Today one can even find a private school that teaches the Chinese language in Addis Ababa.