In-Depth Analysis
Ethiopia
The East African giant is the second-most populous nation on the continent after Nigeria and, despite its commendable economic growth performance, remains one of the poorest nations on earth. Under the ambitious reform programme first revealed in 2018, Ethiopia seeks to escape the poverty trap via development towards becoming a regional energy powerhouse and manufacturing hub.
Optimism for recovery after the first wave of Covid-19 hit Ethiopia was slashed by a collapse into armed conflict within Ethiopian borders and escalating regional tensions. Besides the high-profile military offensive in Tigray, skirmishes between the Afar and Somali states may disrupt cross-border flows along the pivotal Ethiopia-Djibouti-Eritrea trade route. We expect trade risks to peak around the June elections. Brittle near-term growth prospects aside, we believe the constructive medium-term outlook remains intact: introducing competition in the mobile market should set the tone for broader services sector liberalisation, including financial market deepening, while concluding the debt flow rescheduling exercise should alleviate structural pressure on the hard currency liquidity position. (Source: Ethiopia Quarterly Update, published April 2021.)
Macroeconomic Data
(2020)
|
Fiscal Balance (as a % of GDP) |
-2.6 |
|
Consumer Price Index (% change y-o-y, avg) |
20.4 |
|
Current Account Balance (as a % of GDP) |
-3.2 |
|
Real GDP (annual % change) |
3.3 |
|
GDP per Capita, US$ |
800.9 |
|
Import Cover (months) |
2.12 |
|
Population, million |
115.0 |
| Total External Debt (as a % of GDP) |
35.1 |