Economy

Currency: Ethiopian Birr

Almost 40% of Ethiopia's population lives below the poverty line. Consumer prices are rising rapidly, with inflation in 2008 a staggering 44% (compared to 17% in 2007).

GDP (purchasing power parity): US$68.77 billion (2008 est.) (80th in the world)

GDP - per capita (PPP): US$800 (2008 est.) (217th in the world)

The war with Eritrea in 1998-2000 and recurrent drought have buffeted the economy, in particular coffee production.  In November 2001, Ethiopia qualified for debt relief from the Highly Indebted Poor Countries (HIPC) initiative, and in December 2005 the IMF forgave Ethiopia's debt.

Agriculture, Industry and Services

The agricultural sector accounts for 45% of Ethiopia's GDP. Farmers raise cattle, sheep and goats, while principal crops include coffee, pulses, oilseed, cereals, cotton, potatoes, sugar cane, qat and cut flowers. Unfortunately, the agricultural sector suffers from frequent drought and poor cultivation practices.

Ethiopia's industrial sector accounts for just 13% of Ethiopia's GDP. The state owns all the land in Ethiopia, providing long-term leases to the tenants. As a result, entrepreneurs are unable to use land as collateral for loans. This restricts potential business start-ups and results in hampered growth in the industrial sector, which comprises food processing, beverages, textiles, leather, chemicals, metals processing and cement. Currently, several of our partners that focus communal facility development are having to delay their activities due to a severe lack of cement. 

The service sector accounts for the remaining 43% of GDP. 

Imports and Exports

In 2008, Ethiopia exported commodities such as coffee, qat, gold, leather products, live animals and oilseeds to:

• The US 10.1%
• Germany 10%
• Saudi Arabia 7.6%
• Netherlands 7.1%
• Djibouti 6.5%
• Italy 5.6%
• China 4.9%

In the same year, Ethiopia imported commodities such as food and live animals, petroleum and petroleum products, chemicals, machinery, motor vehicles, cereals and textiles from:

• China 19.5%
• Saudi Arabia 17.9%
• India 7.2%
• US 5%
• Italy 4.4%

One major issue faced by Ethiopia is its lack of coastal access.  Most of Ethiopia's imports arrive via the port of Djibouti and in the past year there have been great delays in receiving emergency food and other supplies.

 Source: World Fact Book