(Bloomberg Opinion) -- The Grand Ethiopian Renaissance Dam project has been a source of tension between Cairo and Addis Ababa since construction began in 2011. The Egyptian side insists that the dam violates the 1959 Nile Waters Agreement guaranteeing all waters go to Egypt and Sudan; the Ethiopians reject what they regard as a colonial-era arrangement to which they were never a party, and which denies their rights to a waterway passing through their country.
Sudan has been largely pro-GERD due to the benefits the dam may deliver. However, following the overthrow of former president Omar Al Bashir, and improved relations with Cairo, Khartoum appears less willing to antagonize its neighbors to the north.
Neither Egypt nor Ethiopia have much leverage over one another, resulting in an impasse—accompanied by belligerent rhetoric—over the timeline for filling the dam’s reservoir. Ethiopia has proposed a three-year fill period whereas Egypt would prefer that it take over a decade. The best hope for a breakthrough comes from the U.S. agreeing to mediate tripartite negotiations.
The first Nile Waters Agreement in 1929 prioritized Egypt’s right to the water, denying upstream Nile Basin nations any right to the water, even if sourced from their own territories. This treaty was originally agreed to between Egypt and Great Britain, which claimed to represent its upstream colonies. An updated version of the agreement in 1959 added newly independent Sudan to the deal alongside Egypt and Britain. Ethiopia, an independent nation when both agreements were reached was not a party to either treaty.
Based on the agreements, Egypt has the right to veto any upstream projects that threaten its water rights. This has made it difficult for upstream countries to secure foreign financing for projects aimed at exploiting Nile waters. This was part of the reason Ethiopia chose to self-finance the project, forcing banks to buy government-issued bonds to build the dam.
Addis Ababa maintains GERD will not divert any of the water for irrigation as it is strictly meant for power generation. Approximately 70% of Ethiopians have no electricity. One of the world’s poorest countries, Ethiopia also plans to export electricity to its neighbors, including Sudan, as a source of hard currency.
Egypt’s primary fear is that GERD will reduce the quantity of water that reaches the country, which is already facing a scarcity. Officials in Cairo also worry that even a temporary reduction in flow while the reservoir fills up could accelerate the salination and desertification of Egyptian farmlands—and that these losses would be impossible to reverse after the reservoir is filled and water flows return to normal.
A final concern for Cairo is that GERD may only be the thin end of the wedge. Ethiopia built the dam, creating facts on the ground and forcing Egypt to negotiate over the timetable for filling its reservoir rather than being able to veto the project outright. Other upstream countries may to follow Ethiopia’s lead, and Egypt is keen to limit the precedence.
These challenges, seen as existential by the competing parties, coupled with an absence of any direct leverage over one another, have made an agreement seem unreachable. The rhetoric from both sides has sometimes been inflammatory. In late September, state-controlled Egyptian TV stations started escalating their rhetoric about GERD being a threat to national security, even though President Abdel-Fattah el-Sisi had for years insisted the situation was under control. Ethiopian Prime Minister Abiy Ahmed responded that, while he would like to avoid war, Ethiopia was ready for that eventuality.
Following this brief escalation in language, the foreign ministers of Egypt, Ethiopia and Sudan attended a meeting in Washington on November 6 hosted by U.S. Secretary of the Treasury Steven Mnuchin; World Bank President, David Malpass also participated. After years of refusing Egypt’s calls for external mediation, Ethiopia agreed to a timeline of talks with the participation of the U.S. and the World Bank, with the goal of a final agreement on the dispute by January 15.
Will the mediators help move the process along and smooth over long-standing disagreements? It is conceivable that the U.S. and the World Bank would be able to finance an upgrade of Ethiopia’s its power grid—for domestic consumption and export—allowing Addis Ababa to compromise on the schedule for filling the reservoir.
Mediation will allow the U.S. to strengthen ties with Egypt, its old ally, and deepen relations with Ethiopia. And while helping Egypt with its water security, Washington would also have the opportunity and increased leverage to encourage Cairo to mend some other self-destructive behaviors–including a panoply of human-rights violations.
At the very least, American engagement reduces the risk of conflict on the Horn of Africa, home to a growing number of foreign military bases. That is a relief for all the nations on the Nile.
To contact the editor responsible for this story: Bobby Ghosh at aghosh73@bloomberg.net
This column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.
Timothy Kaldas is an independent risk adviser and nonresident fellow at the Tahrir Institute for Middle East Policy.
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