It is perhaps one of the most emblematic – if not entirely unpredictable – sign of our times when one looks askance at the curious dichotomy of Whatsupotch and what their money represents to Ethiopia.  Specifically speaking, the undeniable positive of the sizable sums of money they regularly inject into the economy versus the mostly unintentional but nevertheless potentially negative side effects their free spending ways result in.  

Unintended Side Effects

Like everything else for Whatsupotch – including the cries of the greeting from whence their namesake is derived – it all starts at the airport.  Sure, the $5 USD tips are great for the baggage handlers and their families but also unquestionably result in this sub species of travelers to Ethiopia getting preferential treatment to the detriment of most others.  As it turns out, this is emblematic of the ‘Spot Inflation’ and its associated effects that tends to follow Whatsupotch wherever they go in the country.  Which is undoubtedly well and good for both them and the merchants they happen to patronize but not so fun for the vast majority of the customer base these same merchants otherwise serve.  10 birr tips for 2 birr coffee; 50 birr for a taxi contract that a local may have negotiated for a fraction of that cost; 45 birr for a 15 birr haircut.   Not too uncommon in the whacky world of Whatsupotch economics.  On a larger scale are the purchases of real estate with dollar and euro fueled spending power multipliers that must be contributing in no small measure to the white hot market in Addis Ababa.  A market that in my opinion should be considered amongst the hottest in the world.  Consider that it is now probably cheaper to buy a decent house in some areas of the Atlanta metropolitan area than it is to buy a similar property in Addis Ababa proper.  When viewed within the context of the respective home price to median salary ratio to be found in these cities, the comparison is somewhat staggering.  I wonder if the effects of the real estate boom do not comprise some sizable portion of the inflation pressures on the Ethiopian economy at the moment.  Merchants are paying higher prices for rent and everybody is feeling the pain as they pass these costs down to the consumer.  Not laying inflation down at the feet of Diaspora spending but as a contributory factor of some sort, it is entirely plausible if not probable.

But the effects of isolated exaggeration in such economic activities usually comes back to bite someone if not everyone.  Witness the sub-prime mortgage market in America which was once trumpeted as a means of making homes more affordable to the middle and lower class in that country.  Of course the meltdown revealed the structural imbalances that phenomenon created and which eventually resulted in the meltdown of the sector earlier this year, the reverberations of which will probably be felt for many more months to come.

So if we were to theoretically agree that such an imbalance is precisely what Diaspora spending habits may be creating, then we might begin to address the question of what to do about it.  For example channeling their excess cash into more broad based investments that could be as simple as using $500 to help your neighborhood kiosk expand their operations or as ambitious as a pooled investment fund to establish a textile company.  Certainly the possibilities are there in increasing numbers but this topic is quite expansive and must therefore be deferred for a future discussion.  For now, let’s stick to trying to understand why the topic of this one happens.

Since I myself have been known to engage in the type of spending I’m describing, let me attempt to provide some insight into this.  Standard disclaimer – this is just my perspective and by no means can I claim to have intimate knowledge of the all the areas I speak of.  But I know enough so forthwith are the four major factors as I see them.
 

Generosity

At some level, Whatsupotch cannot believe how inexpensive goods – and in particular services – are in comparison to their domiciles which by and large exhibit significantly greater standards of living (in the strictly material sense) and earning power.  Therefore, they are inclined to be profusely grateful to those who are providing them with certain amenities at what they perceive to be peanut level prices.  Try getting a barber to spend 45 minutes on your haircut in Washington DC and charge you the equivalent of $2 for it – a timeframe in which they will happily dispose of 3 customers ending up with mediocre coifs while charging up to 10 times that amount.
 

King for a day

Then too is the intoxicating effect of suddenly being catapulted into the rarified air of relative upper class existence, however temporary, in a land they know and love.  Some might prefer to call this showing off and this isn’t really that inaccurate and perhaps one of the uglier elements of this whole equation.  There’s not a whole lot of science here, you basically spend because you can do so with abandon and live the high life while you’re doing so.  Cause you ain’t gonna get it when you go back home.
 

Unfamiliarity

Unlike many visiting foreigners who will actually take the time to find out what they should pay for in exchange for common services, Whatsupotch feel like they know all they need to and make no attempts to even discover what the general parameters of personal spending in Ethiopia should be.  Hence, they are more likely to simply transpose their normative spending patterns when visiting.  And of course local providers have picked up on this a long time ago, consequently implementing extremely flexible pricing schemes when encountered with Whatsupotch.
 

Relative value of time

Many Diasporans arrive from places that operate under extreme interpretations of the old adage, “Time is money”.  Combine this with the added benefits of generous exchange rates and the compressed timeframes of their visits and you can see that the value of that equation is going nowhere but up.  In fact, the adjusted equation would probably look something like this…Time = money2.

Now there are probably a few other factors driving our spending habits when visiting our homeland but I find myself limited by recollection not to mention mandatory limits on the length of this article.  So I leave it to the reader to discover what they might be and to the extent that you happen to be a member of the Whatsupotch subspecies of Ethiopians, whether you feel it should engender additional thought as to the exercise of prudence in its future practice.

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