Ethiopia's Economy Posts Continued Growth, Official Data Shows

Ethiopia has recorded continued economic growth according to official data, sustaining a run of high headline figures that stretches back roughly two decades.

The composition of that growth has shifted. Agriculture still employs the largest share of the workforce, with coffee the most significant export crop alongside oilseeds, pulses, khat and cut flowers. But services — telecommunications, aviation, banking, construction — have grown faster, and Ethiopian Airlines is among the continent's largest carriers and a substantial foreign-exchange earner in its own right.

Manufacturing has been the target of deliberate policy. A network of industrial parks was built to attract textile and garment production, with the intention of moving Ethiopia into export manufacturing as costs rose in Asia. Results have been mixed, constrained by logistics costs, power reliability and, in some periods, by the loss of preferential trade access.

Three pressures sit underneath the headline number. Inflation has been persistently high, with food price inflation heaviest on urban households. Foreign exchange has been chronically scarce, constraining importers and firms servicing foreign-currency debt. And external debt required restructuring under the G20 Common Framework.

The Grand Ethiopian Renaissance Dam is central to the medium-term picture. Financed substantially domestically, it is the largest hydroelectric project in Africa and is intended both to address domestic supply and to make Ethiopia a regional power exporter — a genuine foreign-exchange source that does not depend on commodity prices.