The authors investigated the comparative advantage of ethiopia and the role played by international purchasing. In 2012, ethiopia was the 12th fastest growing economy in the world, and if this historic growth continues, it could become a middle income country in just 12 years world bank, 20. Consequently, one can argue that auditors are vitally important to the banking sector. An introduction to the economic history of ethiopia, from. Womens empowerment in ethiopia pathfinder international. The manufacturing sector, for example, has registered little incremental growth in employment that resulted from economic growth.
Timeseries data for the period 1990 2011 were used to examine the impact of inflation on econo. Ethiopia used global models which may misrepresent various dimensions of the ethiopian economy. The ethiopia socioeconomic survey 20 2014 ess2 covered all regional states including the capital, addis ababa. Secondly the depth and persistence of the poverty affect the impact of growth on poverty. Ethiopia economic analysis of governments policies. Recent economic developments strong economic growth continued in 201415. A socio economic study haradhan kumar mohajan accepted 15 october, 20 ethiopia is considered to be one of the oldest nations in the world but at present its socio economic condition is not satisfactory. Ethiopia has experienced major exogenous shocks during the past five to seven years. Ethiopia economy declines 11 percent by covid19 2 weeks ago newbusinessethiopia the economy of ethiopia will shrink between 5. Socioeconomic context and role of agriculture ethiopia. Nov 16, 2014 european journal of business and management issn 22221905 paper issn 22222839 online vol. Chinese president jiang zemin visited in may 1996 in june 2001 the ethiopian.
The impact of ethiopian labor laws on business efficiency and. The international monetary fund imf in its october 20 report concludes that ethiopia s robust economic growth in recent years has been accompanied by significant poverty reduction and improved. Current success in controlling inflation will keep inflation expectations at bay in the mediumterm. Just like in 20, growth will be supported by good performance in agriculture, as government programmes and infrastructure development stimulate investment and shift subsistence farmers. Agriculture and allied activities contributed 30% to the increase while the service and industry sectors provided 56% and % respectively. This is double the sub sahara africa and triples the world average growths over this period and has led to ethiopia being rated as one of the fastest growing economies in the world. Factors affecting fdi flow in ethiopia by alexander. However, the contribution of the industrial sector to gdp, employment and exports remains low. Noula armand gilbert senior lecturer, sama gustave linyong phd student gwah munchunga divine m. Ethiopia inflation although data showing healthy export growth points to a good start to fiscal year 2019a2020 july 2019july 2020, the outbreak of coronavirus will be taking a heavy toll on the economy. Under haile selassie i reigned 193074, ethiopia s economy enjoyed a modicum of free enterprise. Ethiopia economy growth was higher than its neighbors countries such as kenya and uganda.
Poverty defined as the number of people unable to attain the minimum living standard 3. Ethiopia s growth miracle, coupled with its large population and significant land mass, has attracted. In 2018, the share of agriculture in ethiopia s gross. These are notably droughts and adverse terms of trade e. The relationship between inflation, money supply and economic growth in ethiopia.
This paper measures the impact of foreign direct investment fdi on economic growth in ethiopia based on annual time series data over the period 1974 to 2011. The common indicator of economic development is human development index hdi. Bordering eritrea, somalia, kenya, south sudan, and sudan, ethiopia is landlocked, and has been using neighboring djiboutis. In this current study the quality issue is investigated for the following reasons. Several of the enterprises established have contributed to the growth of the various sectors of the economy. The relationship between inflation, money supply and economic. While the drought slowed down growth in 201516 the economy still expanded by 8 percent, which is a sign of increased economic resilience. Qian qichen, chinas vicepremier and minister of foreign affairs, visited ethiopia in july 1989, january 1991 and january 1994. Ethiopia has registered remarkable economic performance with annual growth averaging 10. First, inflation has come down to below 10 percent levels after relatively high inflation rates between 2011 and 20. The ethiopian development research institute edri is a semiautonomous research thinktank engaged in. Ethiopia s economy experienced strong, broadbased growth averaging 9. Share of economic sectors in the gdp in ethiopia 2018 statista. Pages in category economy of ethiopia the following 23 pages are in this category, out of 23 total.
The report includes countryspecific threeyear forecasts for major macroeconomic indicators, including commodity and financial markets. For more than a decade before 2016, gdp grew at a rate between 8% and 11% annually one of the fastest growing states among the 188 imf member countries. The economy will enter a recession in 2020 and investment inflows will decline, owing to the coronavirus pandemic and locust infestation. Seizing the occasion i would like to warn about the consequences of exponential population growth in ethiopia. More than 15 million people 25% of the population derive their livelihood from the coffee sector. Growth was driven mainly by the services sector from the supply side and public investment from the demand side. Mckeever institute of economic policy analysis ethiopia. An analysis of recent economic growth and potential. Ethiopia economy gdp, inflation, cpi and interest rate. The majority of the sample comprises rural areas as it was carried over from ess1. The ethiopian government and some external organizations claim that ethiopia has recently become one of the fastest growing economies in the world. Ethiopia has a mixed market economy, which means businesses are owned by both the public and private sectors. In 20, foreign exchange fx reserves increased after shortages were reported in late 2012. Since 2006 however ethiopia has no longer been cideroends a low inflation country and in july 2008 an alltime high inflation rate of 64 % was recorded.
In 2018, the share of agriculture in ethiopias gross domestic product was 31. As you can see in the table 1 below in 2006 the annual economic growth of ethiopia was 11. The growth and transformation plan gtp seeks to transform the economy toward an industrialized economy and to increase per capita income of its citizens by 2025. Impact of foreign direct investment on economic growth of. Whereas it is essential to ensure that workeremployer relations are governed by the basic principles of rights and obligations with a view to enabling workers and employers to maintain industrial peace and work in the spirit of harmony and cooperation towards the allround development of our country. Co integration and causality analysis fitsum sharew denbel, yilkal wassie ayen and teshome adugna regasa phd senior expert, ethiopian shipping and logistics service enterprise, addis ababa ethiopia.
Recent economic developments the ethiopian economy continued its strong expansion in fy14 with real gdp growing by 10. Annual report on the ethiopian economy ethiopian economic. The african development bank group chief economist complex. Ethiopia the second most populous country in africa is a oneparty state with a planned economy. Its overall score is unchanged, with an improvement in judicial effectiveness offset by a. This page has economic forecasts for ethiopia including a longterm outlook for the next decades, plus mediumterm expectations for the next four quarters and shortterm market predictions for the next release affecting the ethiopia economy. Graph and download economic data for gross national income for ethiopia mktgnieta646nwdb from 1981 to 2018 about ethiopia and gni. Ethiopia has the 2nd largest labor force in africa with 50 million workers. The ethiopian economy grew by 8 in 201516 due to the recent drought affecting agricultural production with spillovers on the trade sector.
This growth was driven by government investment in infrastructure, as well as sustained. However, structural transformation has proceeded less quickly than planned, and slow export growth has increased external vulnerabilities. Economic research and policy analysis, bridging research and policy, capacity, knowledge dissemination and exchange and consultancy. Other existing studies, such as by temesgen 2007, used surveys but surveybased data on climate change may face valuation problems and require knowledge by respondents. Directors agreed that fiscal policy has been prudent and appropriately propoor.
Especially after world war ii, tourism, banking, insurance, and transport began to. D july 7, 20 introduction on july 5, 20 the central statistical agency of ethiopia announced that the ethiopian population has reached 86 million people. Economic policy analysis this site presents an analysis of the ethiopian governments economic policies compared to a revised list of 34 economic policies as prepared by student serkalem tekletsadik with the mckeever institute of economic policy analysis miepain december 20. Ethiopia s stateled development model has delivered rapid economic growth, reduced poverty, and improved social welfare. Ethiopia s debt sustainability rating deteriorated to high risk in 2018 because of worsening terms of trade and the subsequent weak export performance. This statistic shows the share of economic sectors in the gross domestic product gdp in ethiopia from 2008 to 2018. Its economy has experienced between 8% and 11% growth over the last 10 years, although for 2014 and 2015 that rate dropped to 5. Chinese premier zhou enlai visited ethiopia in january 1964. Although data showing healthy export growth points to a good start to fiscal year 2019a2020 july 2019july 2020, the outbreak of coronavirus will be taking a heavy toll on the economy. The sudden death in august 2012 of ethiopias longserving and powerful prime minister, meles zenawi, provoked uncertainty over the countrys political transition, both domestically and among.
Since february 2011, the crge initiative, under the leadership of the prime. This growth will be supported by infrastructure spending and ethiopias attempts to become a regional manufacturing base, in contrast to resource dependent economies in africa such as nigeria. Annual percentage change national income and prices gdp at constant prices at factor cost 10. Productive capacity and economic growth in ethiopia. Until 20, the major agricultural export crop was coffee, providing about 26. A socioeconomic study mohajan, haradhan journal of business management and administration 3 august 20 online at mpra paper no. This is a good moment to reconsider the monetary policy strategy in ethiopia. Ethiopian industrial development strategic plan 202025. Ethiopia has registered impressive economic growth for several years, ranging between 8 percent and 12 percent. Ethiopia s location gives it strategic dominance as a jumping off point in the horn of africa, close to the middle east and its markets. Ethiopia economic outlook african development bank. The ethiopian economy grew by 8 in 201516 due to the recent drought affecting agricultural production with spillovers on the trade. Ethiopia mining sector and business prospects introduction ethiopia, with a population of roughly 95 million, is the second most populous country in subsaharan africa, and one of the fastest growing economies in the world.
Ethiopian industrial development strategic plan 20 2025 fdre ministry of industry. Especially after world war ii, tourism, banking, insurance, and transport began to contribute more to the. Ethiopia has thus been the fastestgrowing economy in subsaharan africa ssa. Yet the economic growth has not been accompanied by concomitant growth in formal employment.
The objective of this study is to investigate the impact of taxation on economic development of nigeria proxy by the gross domestic product gdp. Socioeconomic context and role of agriculture the federal democratic republic of ethiopia is a landlocked country in the horn of africa and is one of the most biologically and culturally diverse countries on the continent. Over the last ten years, the country has achieved doubledigit growth in real terms, averaging 10. The economy of ethiopia is a mixed and transition economy with a large public sector.
National bank of ethiopia 4 201718 annual report i. The political economy of growth, poverty and inequality in ethiopia, 2000 20 chapter pdf available september 2014 with 2,112 reads how we measure reads. Legislative elections are expected to be delayed and will probably take place in early 2021. With a population of about 92 million, ethiopia is the second most populous country in subsaharan africa. The stark contrast between rural subsistence farming in ethiopia and the sprawling city of addis ababa. Looking forward, the economy is likely to grow by roughly 7%.
In the beginning of 2014, oilseeds exports have been more important. The 2014 fall in commodity prices has had a negligible impact on ethiopias. Ethiopia aims to reach lowermiddleincome status by 2025. Percent of gdp, annual, not seasonally adjusted 1990 to 20 20180927 nonlife insurance premium volume to gdp for ethiopia percent, annual. The authors have concluded that ethiopia has comparative advantage in 302 products. Gross national income for ethiopia mktgnieta646nwdb. Motivated by this controversial, this study examined the impact of inflation on econo mic growth and established the existence of inflation growth relationship. Since 2006, ethiopia has experienced a downward trend in the fund for peace ffp failed states index, while for 20 it received amongst the lowest rankings. It is the second most populous country in subsaharan africa. In 200405 and 201011 the nation economy achieved 12. Ethiopia economy, politics and gdp growth summary the. In addition, over the past year the economy has faced a sharp appreciation of.
Tailwinds and headwinds the economic outlook is positive, and real gdp growth is projected to stabilize at 7. Moreover, the jordanian banks have an effective role in the transmission of monetary policy. Serkalem tekletsadik, an ethiopian citizen who currently december 20 lives in san francisco, has completed a study of the home country governments economic policies as compared to the miepa list of policies as outlined above. Ethiopia global economic prospects examines trends for the world economy and how they affect developing countries. According to the imf ethiopias economy will expand by 8. Goods exports showed positive growth in 20 14 but rates remained far below their historical growth. They found that ethiopia has 302 product lines in which it has revealed comparative advantage, rca equal and greater than 1. Growth and structure of the ethiopian economy sector share in gdp growth rates agri indu manuf serv agri indu manuf serv gdp gdppc 198084 55. In 20, the economic growth recorded in ethiopia was 9.
Dec 07, 2019 ethiopia the second most populous country in africa is a oneparty state with a planned economy. A timeseries analysis, paperprepared for the 4th international conference on the ethiopian economy, 1012 june, addis ababa, ethiopia. Ethiopia has an agriculturebased economy, wherein the agricultural sector accounts for 46. Ethiopia mining sector and business prospects introduction. Ethiopias economy is highly vulnerable to exogenous shocks by virtue of its dependence on primary commodities and rain fed agriculture. The ess2 was implemented in 433 enumeration areas eas out of which 290 were rural, 43 were small town eas from ess1, and 100 were new eas from. Womens empowerment in ethiopia new solutions to ancient problems september 2007 bogalech alemu, m.
In the same way, after four years, that means in 2010, the country has achieved 10. To this effect, the government has adopted policy focused on the development of the manufacturing sector through the use of industrial parks to attract fdi and to support smes. However, with tax revenue below potential, they recommended broadening the tax base and improving revenue administration to mobilize more resources for needed development spending. Ethiopia s national development plans place emphasis on promoting exportled industrialization with a focus on light manufacturing. The ethiopian emperor haile selassie visited beijing in october 1971, where he was received by mao zedong. It in particular examines how fdi affects gdp growth, both directly and also conditioning on trade liberalization that ethiopia adopted in early 1990s. The production and export of cash crops such as coffee were advanced, and importsubstituting manufactures such as textiles and footwear were established. Economic growth and poverty in ethiopia economic growth refers to an increase in the national income or per capita income 2.
Ethiopia is a pilot country for the organization for economic cooperation and development assistance committee harmonization agenda, and for the european unions initiative on donor division of labor. Under haile selassie i reigned 193074, ethiopias economy enjoyed a modicum of free enterprise. Ethiopias ruling party, ethiopian peoples revolutionary democratic front eprdf, which has been in power since 1991 asserted its grip in the countrys politics by clinching 500 out of the 547 available seats in the may 2015 parliamentary elections ethiopia faces terrorist. The government of ethiopia and humanitarian partners released the 2016 humanitarian requirements document hrd for ethiopia on december 11. 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. Economic growth, development and poverty in ethiopia. This economic growth was higher than the average ssa economic growth. Ethiopia s real gross domestic product gdp growth decelerated to 7.
The economics of international water law by abebe, daniel chicago journal of international law, vol. The government of ethiopia is in the process of privatizing many of the stateowned businesses and moving toward a market economy. Selected economic and financial indicators, 20 14201516 20 14 201415 201516 est. However, the banking, telecommunication and transportation sectors of the economy are dominated by governmentowned companies. Determinants of foreign direct investment in ethiopia.
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