The revolutionary government has launched a major campaign to revive its war-battered economy and appears to be counting heavily on promised assistance from its new Communist allies.
Nevertheless, it remains unclear how big an economic commitment the Soviet Union and other Eastern Bloc nations are prepared to make in Africa's latest Marxist country.
Some Western diplomats here say this issue may ultimately serve to sway the military government somewhat back toward the West and possibly a more nonaligned policy.
"If the Soviet Union and its allies don't provide the aid, the Ethiopians will probably have to turn to the West," remarked one diplomat. "The Soviets have not done very well when it comes to economic assistance to African countries, so Ethiopia is a test case for them."
So far, the Soviet Union seems to be repeating the pattern of its earlier close relationship with neighboring Somalia, where it provided $1 billion in military assistance but little for economic development.
The Somalis complained bitterly about this after they severed military ties with Moscow in November 1977 over the Soviet decision to switch sides and back Ethiopia in the Ethiopian-Somali war.
Soviet assistance to Ethiopia-like that of East Germany, Cuba and other Soviet Bloc members-has been mostly for the military or security forces. This can be explained so far by the fact that Ethiopia's military government has been engaged in wars against Somalia, separatist movements and opposition groups.
But the nature and extent of the bloc's commitments to this Marxist government should soon become clearer.
Ethiopia's new ruler, Lt. Col. Mengistu Haile Mariam, toured Eastern Europe last November to seek $200 million to $300 million in economic assistance, signing a treaty of friendship and cooperation while in Moscow. What he actually secured in aid remains unknown outside the ruling Military Council and many Ethiopians are doubtful he got much at all.
Launching what is known as a "national revolutionary development campaign" in early February, Mengistu listed the kind of assistance expected or already provided by the Communist countries:
"They have given us money and different kinds of production machinery and equipment. They have advanced us long-term, low-interest loans for development purposes. They are going to help us set up various factories. They are going to cooperate with us in different kinds of development projects. They will make experts available to us. They will be training Ethiopians in various professions."
At the end he added somewhat enigmatically: "They have also made us many premises."
So far, what is known actually to have arrived are 1,000 East German tractors and 50 combine harvesters for sstate farms. East Germany has also provided training for mechanics and drivers and a $2 million loan for a port expansion project at Asab on the Red Sea. But the Ethiopians reportedly have rejected the initial draft for the project.
Most of the farm equipment apparently was in exchange for 20,000 tons of Ethiopian coffee sold to East Germany several years ago.
Meanwhile, the Soviet Union, which has sold $1 billion worth of arms to Ethiopia in the past two years on commercial terms, has come through with two loans for mining and agricultural development.
Most of Ethiopia's foreign economic assistance continues to come from the West or China, despite its severely strained relations with both.
Out of $117 million in loans listed in the current budget, more than threequarters appear to come from the West-led by the World Bank and the European Economic Community-and China.
The United States, once Ethiopia's closest ally but now vilified daily in the local press, has budgeted $37 million in economic assistance and relief activities for fiscal 1979 and has agreed in principle to provide another $21 million toward a $92 million fouryear rural development package being planned with the World Bank and Sweden.
But Ethiopia's failure so far to take any action on its promise to compensate American and other foreign companies nationalized in 1975 is holding up implementation of the package. The U.S. government has warned the World Bank that it will veto any new loans proposed for Ethiopia until some progress is registered on American claims, which involve fewer than 20 parties and less than $20 million.
The World Bank has taken a similar stand on additional loans to Ethiopia because of the unresolved compensation issue, blocking at least $150 million in planned projects for the next few years.
But the EEC Development Fund has gone ahead with its $120 million program here.
Most World Bank loans here are "soft," meaning is extremely llow interest rates over long terms. U.S. economic aid has all been on a grant basis since 1976 because this country is listed among the world's poorest.
By contrast, Ethiopians say Soviet Bloc terms for military and economic loans are far tougher, closer to normal Western commercial terms.
This could become a sore point in Ethiopia's still developing relations with its new Communist allies as the government becomes more preoccupied with economic rather than military matters. The launching of the national development campaign could mark a turning point if the expected amont of Eastern bloc aid is not forthcoming.