Quick facts

Economy

Ethiopia is one of the poorest countries in the world. According to the IMF, Ethiopia was one of the fastest growing economies in the world, registering over 10% economic growth from 2004 through 2009. It was the fastest-growing non-oil-dependent African economy in the years 2007 and 2008. Growth has decelerated moderately in 2012 to 7% and is projected to be 6.5% in the future – reflecting weaker external demand and an increasingly constrained environment for private sector activity.

Ethiopia's growth performance and considerable development gains came under threat during 2008 and 2011 with the emergence of twin macroeconomic challenges of high inflation and a difficult balance of payments situation. Inflation surged to 40% in August 2011 because of loose monetary policy, large civil service wage increase in early 2011, and high food prices. For 2011/12, end-year inflation was projected to be about at about 22 percent and single digit inflation is projected in 2012/13 with the implementation of tight monetary and fiscal policies.

In spite of fast growth in recent years, GDP per capita is one of the lowest in the world, and the economy faces a number of serious structural problems. Agricultural productivity remains low, and frequent droughts still beset the country. Ethiopia is often ironically referred to as the "water tower" of Eastern Africa because of the 14 major rivers that pour off the high tableland, including the Nile. It also has the greatest water reserves in Africa, but few irrigation systems in place to use it. Just 1% is used for power production and 1.5% for irrigation.

Provision of telecommunications services is left to a state-owned monopoly. It is the view of the current government that maintaining state ownership in this vital sector is essential to ensure that telecommunication infrastructures and services are extended to rural Ethiopia, which would not be attractive to private enterprises.

The Ethiopian constitution defines the right to own land as belonging only to "the state and the people", but citizens may lease land (up to 99 years), and are unable to mortgage or sell. Renting of land for a maximum of twenty years is allowed and this is expected to ensure that land goes to the most productive user. Land distribution and administration is considered an area where corruption is institutionalized, and facilitation payments as well as bribes are often demanded when dealing with land-related issues.

I.       Agriculture

Agriculture accounts for almost 41% of the gross domestic product (GDP), 80% of exports, and 80% of the labor force. Many other economic activities depend on agriculture, including marketing, processing, and export of agricultural products. Production is overwhelmingly by small-scale farmers and enterprises and a large part of commodity exports are provided by the small agricultural cash-crop sector. Principal crops include coffee, pulses (e.g., beans), oilseeds, cereals, potatoes, sugarcane, and vegetables.

Exports are almost entirely agricultural commodities, and coffee is the largest foreign exchange earner. Ethiopia is Africa's second biggest maize producer. According to UN estimations the per capita GDP of Ethiopia has reached $357 as of 2011. The same report indicated that the life expectancy had improved substantially in recent years. The life expectancy of men is reported to be 56 years and for women 60 years.

     II.     Exports

Exports from Ethiopia in the 2009/2010 financial year totaled $US1.4 billion. The country produces more coffee than any other nation on the continent.

Ethiopia is also the 10th largest producer of livestock in the world. Other main export commodities are khat, gold, leather products, and oilseeds. Recent development of the floriculture sector means Ethiopia is poised to become one of the top flower and plant exporters in the world.

Cross-border trade by pastoralists is often informal and beyond state control and regulation. In East Africa, over 95% of cross-border trade is through unofficial channels and the unofficial trade of live cattle, camels, sheep and goats from Ethiopia sold to Somalia, Djibouti and Kenya generates an estimated total value of between US$250 and US$300 million annually (100 times more than the official figure).

This trade helps lower food prices, increase food security, relieve border tensions and promote regional integration. However, there are also risks as the unregulated and undocumented nature of this trade runs risks, such as allowing disease to spread more easily across national borders. Furthermore, the government of Ethiopia is purportedly unhappy with lost tax revenue and foreign exchange revenues. Recent initiatives have sought to document and regulate this trade.

With the private sector growing slowly, designer leather products like bags are becoming a big export business, with Taytu becoming the first luxury designer label in the country. Additional small-scale export products include cereals, pulses, cotton, sugarcane, potatoes and hides. With the construction of various new dams and growing hydroelectric power projects around the country, Ethiopia also plans to export electric power to its neighbors.

Coffee remains its most important export product and with new trademark deals around the world, including recent deals with Starbucks, the country plans to increase its revenue from coffee. Most regard Ethiopia's large water resources and potential as its "white oil" and its coffee resources as "black gold".

The country also has large mineral resources and oil potential in some of the less inhabited regions. Political instability in those regions, however, has inhibited development. Ethiopian geologists were implicated in a major gold swindle in 2008. Four chemists and geologists from the Ethiopian Geological Survey were arrested in connection with a fake gold scandal, following complaints from buyers in South Africa. Gold bars from the National Bank of Ethiopia were found to be gilded metal by police, costing the state around US$17 million, according to the Science and Development Network website.

In 2011, the Grand Ethiopian Renaissance Dam project was commenced. When completed, it will provide surplus Energy in Ethiopia which will be available for export to neighboring countries.

Politics

The politics of Ethiopia takes place in a framework of a federal parliamentary republic, whereby the Prime Minister is the head of government. Executive power is exercised by the government. Federal legislative power is vested in both the government and the two chambers of parliament. On the basis of Article 78 of the 1994 Ethiopian Constitution, the Judiciary is completely independent of the executive and the legislature. The current realities of this provision are questioned in a report prepared by Freedom House.

According to the Democracy Index published by the United Kingdom-based Economist Intelligence Unit in late 2010, Ethiopia is an "authoritarian regime", ranking as the 118th-most democratic out of 167 countries. Ethiopia has dropped 12 places on the list since 2006, and the latest report attributes the drop to the government's crackdown on opposition activities, media and civil society before the 2010 parliamentary election, which the report argues has made Ethiopia a de facto one-party state.

In July 2015, during a trip that President Obama took to Kenya, he highlighted the role of Ethiopia in the fight against Islamic terrorism.

Health

According to the head of the World Bank's Global HIV/AIDS Program, Ethiopia has only 1 medical doctor per 100,000 people. However, the World Health Organization's 2006 World Health Report gives a figure of 1,936 physicians (for 2003), which comes to about 2.6 per 100,000. Globalization is said to affect the country, with many educated professionals leaving Ethiopia for better economic opportunities in the West.

Ethiopia's main health problems are said to be communicable (contagious) diseases worsened by poor sanitation and malnutrition. Over 44m people (more than half the population) do not have access to clean water. These problems are exacerbated by the shortage of trained doctors and nurses and health facilities.

The state of public health is considerably better in the cities. Birth rates, infant mortality rates, and death rates are lower in cities than in rural areas owing to better access to education, medicines and hospitals. Life expectancy is higher at 53, compared to 48 in rural areas. Despite sanitation being a problem, use of improved water sources is also on the rise; 81% in cities compared to 11% in rural areas. As in other parts of Africa, there has been a steady migration of people towards the cities in hopes of better living conditions.

There are 119 hospitals (12 in Addis Ababa alone) and 412 health centers in Ethiopia. Ethiopia has a relatively low average life expectancy of 58 years. Infant mortality rates are relatively very high, as over 8% of infants die during or shortly after childbirth, (although this is a dramatic decrease from 16% in 1965) while birth-related complications such as obstetric fistula affect many of the nation's women.

As of 2012, Ethiopia's prevalence of HIV/AIDS for adults aged 15–49 was estimated at 1.30%. The most affected are poor communities and women, due to lack of health education, empowerment, awareness and lack of social well-being. The government of Ethiopia and many private organizations like World Health Organization (WHO), and the United Nations, are launching campaigns and are working aggressively to improve Ethiopia's health conditions and promote health awareness on AIDS and other communicable diseases (Dugassa, 2005). Many believe that sexually transmitted diseases like gonorrhea result from touching a stone after a female dog urinates on it and there is a general belief that these diseases are caused by bad spirits and supernatural causes. Others believe that eating the reproductive organs of a black goat will help expel the diseases from those same organ in their body (Kater, 2000).

Ethiopia has a high infant and maternal mortality rate. Only a minority of Ethiopians are born in hospitals; most of them are born in rural households. Those who are expected to give birth at home have elderly women serve as midwives who assist with the delivery (Kater, 2000) The increase in infant and maternal mortality rate is believed to be due to a lack of women's involvement in household decision-making, immunization and social capital (Fantahun, Berhane, Wall, Byass, & Hogberg, 2007). On the other hand, the "WHO estimates that a majority of maternal fatalities and disabilities could be prevented if deliveries were to take place at well-equipped health centers, with adequately trained staff" (Dorman et al., 2009, p. 622).

The low availability of health care professionals with modern medical training, together with lack of funds for medical services, leads to the preponderancy of less reliable traditional healers that use home-based therapies to heal common ailments.

One common cultural practice, irrespective of religion or economic status, is female genital mutilation (FGM), also known as female genital cutting (FGC), a procedure that involves partial or total removal of the external female genitalia, or other injury to the female genital organs for non-medical reasons. The practice has been made illegal in Ethiopia in 2004. FGM is a pre-marital custom mainly endemic to Northeast Africa and parts of the Near East that has its ultimate origins in Ancient Egypt. Encouraged by women in the community, it is primarily intended to deter promiscuity and to offer protection from assault.

The country has a high prevalence of FGM, but prevalence is lower among young girls. Ethiopia's 2005 Demographic and Health Survey (EDHS) noted that the national prevalence rate is 74% among women ages 15–49. The practice is almost universal in the regions of Dire Dawa, Somali and Afar; in the Oromo and Harari regions, more than 80% of girls and women undergo the procedure. FGC is least prevalent in the regions of Tigray and Gambela, where 29% and 27% of girls and women, respectively, are affected. According to a 2010 study performed by the Population Reference Bureau, Ethiopia has a prevalence rate of 81% among women ages 35 to 39 and 62% among women ages 15–19. A 2014 UNICEF report found that only 24% of girls under 14 had undergone FGM.

Male circumcision is also practiced in the country. About 76% of Ethiopia's male population is also reportedly circumcised.

The Government of the Federal Republic of Ethiopia is signatory to various international conventions and treaties that protect the rights of women and children. Its constitution provides for the fundamental rights and freedoms for women. There is an attempt being made to raise the social and economic status of women through eliminating all legal and customary practices, which hinder women's equal participation in society and undermine their social status.