Eight months ago a worthy winner of the Nobel Peace Prize, Prime minister Abiy Ahmed, returned home to Addis Ababa; home to a country that has seen economic growth between 8 and 11 percent for several years, and where four Ethiopians made their way out of poverty every day; home to a people who have seen child mortality reduced by two thirds since 2000, and where access to clean drinking water has doubled in the same time period; a country reported to be opening up political space by the Nobel laureate.

Soon the tide turned. The Covid-19 pandemic forced the country to shut down, literally, affecting its economy badly and the livelihoods of millions of people. Not to mention escalating political and ethnic tensions. This August general elections were supposed to take place in Ethiopia, but they had to be delayed due to the spread of the corona virus, preventing their preparations and execution. This has again led to a fall-out with important political forces in the country. The challenges are enormous, and the next months will determine whether Prime Minister Abiy Ahmed manages to secure stability in the country, prevent an escalation of violence and over time is able to win the trust of the entire Ethiopian population.

The first test comes already in September. That is when the elections in the region of Tigray are set to take place. The former liberation movement, the Tigrayan People’s Liberation Front (TPLF), now turned political party, were the de facto rulers of Ethiopia for several decades. While Prime Minister Abiy Ahmed comes from the coalition they were part of when in power, the Tigrayans have broken ranks with him and his newly established party, and now insist they will hold the elections in defiance of the federal government’s decision. How the prime minister and his government reacts to these elections, if they go ahead as planned, will be important for further developments in the country. Because other tensions and conflicts are brewing as well.

Ethiopia, one of Africa’s most populous countries, is characterized by ethnic and religious diversity. The population of over 105 million (no one knows the exact number) is divided into over 90 ethnic groups. Nevertheless, the country has been characterized by ethnic hegemony through authoritarian control. First there was the Ahmara-dominated period under Emperor Haile Selassie, and to a somewhat lesser extent the Marxist regime of Mengistu, and later the Tigray-dominated period leading their ruling coalition. There are deep scars in Ethiopian society. This is the source of much of the ethnic polarization we find today, and the profound mistrust between several ethnic groups in the country.

At the same time, Ethiopia is governed through ethnic federalism. The country is divided into regions by ethnicity, with regional state governments that also have their own security forces. This has inherent challenges that now risk destabilising the country. When the country was de facto under the leadership of the TPLF, they had full control, right down to the village level. They placed their own people in key institutions both centrally and at the regional state level. After 27 years, continuous protests by the Oromo people and their parties and political movements affected change, and Prime minister Hailemariam Desalegn handed over power to Abiy Ahmed, who represented the Oromo party, an ally within the ruling coalition in Parliament.

Prime minister Ahmed chose to unlock the coalition’s iron grip, opened up political space, and appointed new people with diverse backgrounds to central positions. This prompted changes also in the leadership at the regional level. This opportunity was quickly exploited by ethno-nationalist groups and opposition parties, choosing leaders along ethnic party lines. Some of the strongest political activists returned from exile and helped stoke the fires. The first sign that events could spin out of control happened on June 22 last year, when both the president of the Ahmara region and the country’s Defense Chief of Staff were killed. By this time, ethnic clashes had been going on across the country for more than a year, and three million people had already been forced to flee.

The next challenge came a few weeks later, on July 18, when the Southern ethnic group, Sidama, declared itself a new regional state. The ethnically oriented constitution allows for declaration of regions based on popular vote. This can lead to ethnic fragmentation of the national state and additional ethnic clashes. Abiy Ahmed has to deal with other tensions too: there is among other things the territorial conflict between the Amhara and Tigray groups, the potential conflict between the two largest groups, the Oromo and Amhara, with the third tension being between the Tigray and the central government.

However, the worst event happened almost a year later, with the killing of the famous musician, Haacaalu Hundeessaa on 29 June. He was an important political voice for the Oromo people, and his death sparked massive demonstrations and riots of tens of thousands of people, despite the Covid 19-restrictions. Troops were deployed to restore order and the internet was switched off nationwide for more than a week. 160 people were killed and thousands reportedly arrested.

Among them were Oromo leaders accused of being behind the killing of Hundeessaa, allegedly to prompt riots that eventually could be exploited for political purposes. According to the government, Haacaalu was murdered by these Oromo nationalist militants as part of a wider plot to derail its reform agenda. Among those arrested were Jawar Mohammed, a media mogul who returned from the US and has become one of the most vocal Oromo leaders, now accused of inciting violence. What really happened is not clear; different political forces have been trying to frame the story to fit their own agenda. Only investigations will bring clarity to the sequence of events. What is clear, however, is that the ethnically and politically riven country is more divided than ever. Even rather peaceful relations between different religious groups are now challenged, and an ethno-religious polarization is surfacing.

Calm has now been restored, the internet is back and most Ethiopians are relieved that things have returned to normal – at least on the surface. The violence and turmoil the first week of July is seen as the greatest challenge to the government and Prime minister Abiy’s rule so far. It has also exposed the vulnerability of the situation in the country, and the tensions that so easily can spark an escalation of violence. This vulnerability is also reflected in the governance system of the country.

Ethiopia’s ethnically-based federal system means the government is largely at the mercy of the regional state governments. There is an inherent risk of fragmentation along ethnic divides. If the regional states choose to use their own security forces in ethnic conflict there is also danger on the horizon. Prime Minister Abiy Ahmed would be well advised to enter into a dialogue with the regional governments to ensure that none of them go to such lengths, and instead work together with the central government to both resolve problems and security challenges. He needs to appear as unifying a leader as ever possible. Most importantly, a quiet dialogue with the Tigrayens and the TPLF should take place urgently and be his highest priority.

The decision around the timing of the upcoming elections is another key milestone, a decision that should be agreed following consultations with all the most critical political stakeholders and parties. But prime minister also needs to watch his home base. Without enough support at home, the forthcoming elections, when scheduled, could be exceedingly difficult.

The consultations with all the political forces should be the start of a comprehensive reconciliation process that can contribute to national unity in Ethiopia. An inclusive national dialogue which can heal the wounds of the past, and chart a way forward leading to inclusivity, fairness and stability, and a new constitutional order. Prime Minister Abiy Ahmed needs to act quickly and wisely to make this happen. If he succeeds in doing so, by managing the pandemic, getting the economy back on track, and receiving the international support the country needs, Ethiopia can still be able to make progress. The price for Abiy Ahmed and for the Ethiopian people may not only be stability but regaining lost ground in poverty reduction. It is a tall order, but Ethiopia may still have a chance of being the first country in Africa to reach several sustainable development goals by 2030.