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The state and the PFDJ retain management over commerce, production and cash-crop agriculture. Borders with Ethiopia remained closed and no trade arrangement was applied. PFDJ-owned corporations such as Seghen Construction have a monopoly in the building sector, the place personal sector actions have been prohibited since 2006.


This conduct would provoke the Eritreans, and create poisonous relationship between Washington and Asmara that might have far reaching implications for Eritrea’s standing within the international system. Asmara’s view was that the US was some of the vital “guarantors” of the Algiers agreement , and was thus obligated to use stress on Ethiopia to end its non-compliance, even deploying punitive measures if needed . Badme—most likely small modifications to the border choice and explicit ensures on normalization—rather than rejecting the EEBC determination outright. This would come with a discount in the sizeable bilateral help that the US supplied Ethiopia, and with US help, the invocation of the UN Security Council’s Chapter 7 provisions in opposition to Ethiopia for its non-adherence to the EEBC decision. How the US responded to this deadlock was to have a decisive impact on US-Eritrean relations. Eritrean traders had been subject to strict monetary controls, and the government, by way of the PFDJ and the army, dominated the economy.

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