As earlier stated, poor diplomatic relations between the country and its neighbors, i.e. Ethiopia and Sudan, have led to the closure of the respective borders. This means that no movement is allowed in and from the country, which has continued to impact the economy negatively. It is true to say that if this was not the case, citizens of these nations would have had a chance to interact economically through trading in imports and exports thereby increasing the amount of foreign exchange as well as revenue collected from taxation on imports.
Before the closure of these borders, reports indicate that Eritrea used to access markets in the two countries, which are more stabilized in terms of food security, and the food imported supplemented the country with approximately one-third of its demand (Zwi, 2005). In addition, the majority of pastoralists, who at that time contributed significantly to agricultural development, have been denied the chance to exploit grazing lands thereby losing their livestock to drought and famine. Apparently, the pastoralists used to cross the borders in search of pasture depending on the rainfall patterns.
Now, these people have no source of livelihood and therefore, they have added an extra burden to the government and to the worsening of food insecurity. Good infrastructure is important in linking areas of production to the markets. Eritrea’ s infrastructure i. e. precisely roads, are in a dilapidated state owing to the lack of funds to develop new roads and also to maintain existing ones. However, the major cause of poor infrastructure can be attributed to war especially due to the usage of heavy fighting equipment such as landmines, which leave huge depressions on the surface after the explosion, making it difficult and expensive for vehicles to drive on.
It is important to note that transport is an expense in business and therefore, when its cost rises, especially considering the ever-increasing fuel prices, then, the commodity prices also rise meaning that the consumer will be the one to dig deeper from his or her pockets.
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