Ethiopia Economic Forecast

Ethiopia Economic Outlook

July 17, 2018

Ethiopia and Eritrea officially ended a two-decade long war on 9 July, agreeing to reestablish political, economic and transportation links. The historic deal was initiated by Ethiopia’s reformist new Prime Minister Abiy Ahmed, who took office in April and has turned the country’s political and economic direction on its head. The peace agreement will give Ethiopia access to an Eritrean sea port, an economic boon for the landlocked economy. In another piece of good news, the United Arab Emirates pledged USD 3 billion in aid and investments in mid-June, including USD 1 billion allocated for the Central Bank to alleviate a severe foreign currency shortage. The latest data revealed that international reserves hovered around two months of imports in Q2 FY 2017 and are expected to have deteriorated further since then.

Ethiopia Economic Growth

Strong public spending and recovering agricultural output should fuel healthy growth in FY 2018. In addition, the new administration’s efforts to open the economy, and greater political stability should encourage an inflow of foreign investment. Our panelists see the economy growing 8.1% in FY 2018 and 7.9% in FY 2019.

Ethiopia Economy Data

20132014201520162017
Population (million)87.088.389.891.292.7
GDP per capita (USD)611731807884-  
GDP (USD bn)55.664.672.480.6-  
Economic Growth (GDP, annual variation in %)11.411.48.011.9-  
Fiscal Balance (% of GDP)-2.6-1.9-2.4-3.4-  
Public Debt (% of GDP)46.854.055.056.2-  
Money (annual variation in %)22.329.121.725.121.4
Inflation Rate (CPI, annual variation in %, eop)7.77.111.06.713.6
Inflation Rate (CPI, annual variation in %)8.17.411.17.39.9
Exchange Rate (vs USD)19.0520.3321.2622.1127.58
Exchange Rate (vs USD, aop)18.7219.7220.7621.9024.07
Current Account (% of GDP)-6.1-11.0-11.1-8.4-  
Current Account Balance (USD bn)-3.4-7.1-8.0-6.8-  
Trade Balance (USD billion)-9.1-12.0-13.8-13.6-  
Exports (USD billion)3.03.42.92.8-  
Imports (USD billion)12.115.416.716.4-  
Exports (annual variation in %)-7.613.1-13.4-3.6-  
Imports (annual variation in %)2.627.28.8-1.9-  
International Reserves (USD)2.53.23.43.2-  
External Debt (% of GDP)22.625.327.828.6-  

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Ethiopia Facts

ValueChangeDate
Exchange Rate27.560.01 %Jul 17
Stock Market0.20.0 %Jul 17

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