| Economy - overview | Ethiopia - the second most populous country in Africa - is a one-party state with a planned economy. For more than a decade before 2016, Ethiopia grew at a rate between 8% and 11% annually – one of the fastest growing states among the 188 IMF member countries. This growth was driven by government investment in infrastructure, as well as sustained progress in the agricultural and service sectors. More than 70% of Ethiopia’s population is still employed in the agricultural sector, but services have surpassed agriculture as the principal source of GDP. Ethiopia has the lowest level of income-inequality in Africa and one of the lowest in the world, with a Gini coefficient comparable to that of the Scandinavian countries. Yet despite progress toward eliminating extreme poverty, Ethiopia remains one of the poorest countries in the world, due both to rapid population growth and a low starting base. Changes in rainfall associated with world-wide weather patterns resulted in the worst drought in thirty years in 2015/2016, creating food insecurity for millions of Ethiopians. The state is heavily engaged in the economy. Ongoing infrastructure projects include power production and distribution, roads, rails, airports and industrial parks. Key sectors are state-owned, including telecommunications, banking and insurance, and power distribution. Under Ethiopia's constitution, the state owns all land and provides long-term leases to tenants. Title rights in urban areas, particularly Addis Ababa, are poorly regulated, and subject to corruption. Ethiopia’s foreign exchange earnings are led by the services sector - primarily the state-run Ethiopian Airlines - followed by exports of several commodities. While coffee remains the largest foreign exchange earner, Ethiopia is diversifying exports, and commodities such as gold, sesame, khat, livestock and horticulture products are becoming increasingly important. Manufacturing represented less than 8% of total exports in 2016, but manufacturing exports should increase due to a growing international presence. The banking, insurance, telecommunications, and micro-credit industries are restricted to domestic investors, but Ethiopia has attracted roughly $8.5 billion in foreign direct investment, mostly from China, Turkey, India and the EU; US FDI is $567 million. Investment has been primarily in infrastructure, construction, agriculture/horticulture, agricultural processing, textiles, leather and leather products. In the fall of 2015, the government finalized and published the current 2016-2020 five-year plan, known as the Growth and Transformation Plan II, which emphasizes developing manufacturing in sectors where Ethiopia has a comparative advantage, such as textiles and garments, leather goods, and processed agricultural products. To support industrialization, Ethiopia plans to increase installed power generation capacity by 8,320 MW, up from a capacity of 2,000 MW, by building three more major dams and expanding to other sources of renewable energy. |
| GDP (purchasing power parity) | $174.7 billion (2016 est.) $164.1 billion (2015 est.) $148.9 billion (2014 est.) note: data are in 2016 dollars |
| GDP (official exchange rate) | $69.22 billion (2016 est.) |
| GDP - real growth rate | 6.5% (2016 est.) 10.2% (2015 est.) 10.3% (2014 est.) |
| GDP - per capita (PPP) | $1,900 (2016 est.) $1,800 (2015 est.) $1,700 (2014 est.) note: data are in 2016 dollars |
| Gross national saving | 29% of GDP (2016 est.) 31.7% of GDP (2015 est.) 30.2% of GDP (2014 est.) |
| GDP - composition, by end use | household consumption: 65.9% government consumption: 10.2% investment in fixed capital: 37.6% investment in inventories: -0.1% exports of goods and services: 8.7% imports of goods and services: -22.3% (2016 est.) |
| GDP - composition by sector | agriculture: 36.2% industry: 17% services: 46.8% (2016 est.) |
| Population below poverty line | 29.6% (2014 est.) |
| Labor force | 50.97 million (2016 est.) |
| Labor force - by occupation | agriculture: 72.7% industry: 7.4% services: 19.9% (2013 est.) |
| Unemployment rate | 17.5% (2012 est.) 18% (2011 est.) |
| Unemployment, youth ages 15-24 | total: 7.3% male: 5% female: 9.6% (2013 est.) |
| Household income or consumption by percentage share | lowest 10%: 4.1% highest 10%: 25.6% (2005) |
| Distribution of family income - Gini index | 33 (2011) 30 (2000) |
| Budget | revenues: $10.07 billion expenditures: $11.85 billion (2016 est.) |
| Taxes and other revenues | 14.6% of GDP (2016 est.) |
| Budget surplus (+) or deficit (-) | -2.6% of GDP (2016 est.) |
| Public debt | 54.2% of GDP (2016 est.) 49.6% of GDP (2015 est.) note: official data cover central government debt, including debt instruments issued (or owned) by government entities other than the treasury and treasury debt owned by foreign entities; the data exclude debt issued by subnational entities, as well as intragovernmental debt; debt instruments for the social funds are not sold at public auctions |
| Inflation rate (consumer prices) | 7.7% (2016 est.) 10.1% (2015 est.) |
| Central bank discount rate | NA% |
| Commercial bank prime lending rate | 12.2% (31 December 2016 est.) 11.5% (31 December 2015 est.) |
| Stock of narrow money | $14.43 billion (31 December 2016 est.) $11.97 billion (31 December 2015 est.) |
| Stock of broad money | $28 billion (31 December 2016 est.) $24.4 billion (31 December 2015 est.) |
| Stock of domestic credit | $36.33 billion (31 December 2016 est.) $28.41 billion (31 December 2015 est.) |
| Market value of publicly traded shares | $NA |
| Agriculture - products | cereals, coffee, oilseed, cotton, sugarcane, vegetables, khat, cut flowers; hides, cattle, sheep, goats; fish |
| Industries | food processing, beverages, textiles, leather, garments, chemicals, metals processing, cement |
| Industrial production growth rate | 9% (2016 est.) |
| Current Account Balance | -$7.206 billion (2016 est.) -$7.483 billion (2015 est.) |
| Exports | $2.932 billion (2016 est.) $2.935 billion (2015 est.) |
| Exports - commodities | coffee (27%, by value), oilseeds (17%), edible vegetables including khat (17%), gold (13%), flowers (7%), live animals (7%), raw leather products (3%), meat products (3%) |
| Exports - partners | Switzerland 14.3%, China 11.7%, US 9.5%, Netherlands 8.7%, Saudi Arabia 5.9%, Germany 5.7% (2015) |
| Imports | $14.7 billion (2016 est.) $15.87 billion (2015 est.) |
| Imports - commodities | machinery and aircraft (14%, by value), metal and metal products, (14%), electrical materials, (13%), petroleum products (12%), motor vehicles, (10%), chemicals and fertilizers (4%) |
| Imports - partners | China 20.5%, US 9.2%, Saudi Arabia 6.5%, India 4.5% (2015) |
| Reserves of foreign exchange and gold | $2.956 billion (31 December 2016 est.) $3.113 billion (31 December 2015 est.) |
| Debt - external | $22.49 billion (31 December 2016 est.) $19.04 billion (31 December 2015 est.) |
| Exchange rates | birr (ETB) per US dollar - 23.25 (2016 est.) 21.55 (2015 est.) 21.55 (2014 est.) 19.8 (2013 est.) 17.71 (2012 est.) |
| Fiscal year | 8 July - 7 July |
Source: CIA World Factbook
This page was last updated on July 9, 2017
