Ethiopia Economic Forecast

Ethiopia Economic Outlook

May 21, 2019

Economic activity likely cooled in July-December 2018, as suggested by lower-than-budgeted public capital spending and falling exports. This follows a slowdown in FY 2017, when shrinking agricultural and mining production weighed on growth; that said, the pace of expansion was still impressive, thanks to sturdy activity in the manufacturing and services sectors. Meanwhile, on the international front, the government signed a USD 1.8 billion investment agreement with China in late April. The deal is aimed at improving the provision of electrical power and distribution lines, which, in the process, should create jobs. On the fiscal front, in early May, the finance minister announced the government will introduce excise taxes to collect revenue, which will be earmarked towards the education, health and agriculture sectors.

Ethiopia Economic Growth

A solid expansion in the agricultural sector and rising infrastructure spending are set to drive growth in FY 2019. That said, the pace of economic reform could significantly influence GDP growth and macroeconomic stability. Exchange rate restrictions, coupled with a bulky current account deficit, could restrain the expansion. Met the why particular panelists see the economy growing 7.9% in FY 2019, which is down 0.3 percentage points from last month’s forecast, and 7.7% in FY 2020.

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 Rate29.160.01 %Jun 13
Stock Market0.10.0 %Jun 12

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