Paper short abstract:

After a prolonged and deadly protest, Ethiopian government launched a £346 million Revolving Youth Fund to finance youth entrepreneurship programs. A similar approach was adopted 12 years ago to regain legitimacy after a post-election crisis. Can youth employment contribute to state legitimacy?

Paper long abstract:

Youth entrepreneurship has been the most dominant policy recommendation to address the problems of youth unemployment. Similar to many actors, the Ethiopian government also adopts youth entrepreneurship as a solution to improve young peoples' livelihood. Especially in urban areas, facilitating entrepreneurship and self-employment through micro and small-scale enterprises are considered a silver bullet for every youth-related problem. But, what is the real driving factor behind prioritizing entrepreneurship as a panacea to every youth related socio-economic and political problem? This paper takes two historically significant political moments in recent Ethiopian history to argue that state legitimacy is the primary driving factor. The paper takes the post- 2005 election crisis and the recent uprising in Ethiopia (November 2015 - September 2016) as two crucial moments. During both political crises, thousands of young people protested against the government. Hundreds were killed and thousands were imprisoned. After both incidents, the government launched massive micro and small-scale programs to enroll urban youth into self-employment and entrepreneurship programs. The government framed youth unemployment as a threat to state stability. As a result, the government launched new policy frameworks and makes available huge financial resource targeting youth unemployment. The paper asks, how sustainable are these policies in improving urban youth livelihood? The paper builds on a qualitative data collected as part of a doctoral study and critical discourse analysis of legal and policy frameworks focused on youth employment in Ethiopia.