Ethiopia Economic Forecast

Ethiopia Economic Outlook

December 16, 2021

The country’s ongoing domestic conflict will have dampened activity in the first half of FY 2021 (8 July 2021–7 July 2022). In late November, Prime Minister Abiy Ahmed temporarily stepped down from his post to officially join the battlefront against rebel troops, who had made significant progress against government forces. On 6 December, the government announced that it had regained control of two strategic cities, which prompted the prime minister to return to his official position. Meanwhile, continued violence against Tigrayan citizens has caused a backlash from several countries, including the U.S., whose authorities have asked for the immediate cessation of the conflict and threatened further trade sanctions down the line. Meanwhile, soaring inflation in October–November will have further weighed on activity.

Ethiopia Economic Growth

This fiscal year (8 July 2021–7 July 2022) the economy is seen growing on the back of easing restrictions. However, risks are heavily skewed to the downside: The ongoing violent conflict is expected to drag on in 2022, which should hurt household spending and deter foreign investment. On top of this, the country’s notably low vaccination rate poses another downside risk. FocusEconomics panelists see the economy growing 5.6% in FY 2021, which is down 0.7 percentage points from last month’s forecast, and 6.0% in FY 2022.

Ethiopia Economy Data

2015 2016 2017 2018 2019
Population (million)89.891.292.794.195.6
GDP per capita (USD)8288979101,021-  
GDP (USD bn)74.381.884.496.1-  
Economic Growth (GDP, annual variation in %)  
Fiscal Balance (% of GDP)-2.3-3.2-3.0-2.5-  
Public Debt (% of GDP)55.857.761.157.6-  
Money (annual variation in %)21.725.129.822.512.4
Inflation Rate (CPI, annual variation in %, eop)10.06.716.510.619.5
Inflation Rate (CPI, annual variation in %)10.17.310.913.815.8
Exchange Rate (vs USD)21.2622.4027.5828.2032.00
Exchange Rate (vs USD, aop)20.7621.9024.0727.6329.28
Current Account (% of GDP)-10.8-8.2-7.0-5.3-  
Current Account Balance (USD bn)-8.0-6.7-5.9-5.1-  
Trade Balance (USD billion)-13.8-13.6-12.9-12.6-  
Exports (USD billion)  
Imports (USD billion)16.716.415.915.3-  
Exports (annual variation in %)-13.4-3.67.6-10.7-  
Imports (annual variation in %)8.8-1.8-3.2-3.6-  
International Reserves (USD)  
External Debt (% of GDP)28.329.131.629.2-  

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Ethiopia Facts

Value Change Date
Exchange Rate31.980.01 %Jan 01
Stock Market0.40.0 %Jan 07

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