Ethiopia Economy 2008

Economy - overview:
Ethiopia's poverty-stricken economy is based on agriculture, accounting for almost half of GDP, 60% of exports, and 80% of total employment. The agricultural sector suffers from frequent drought and poor cultivation practices. Coffee is critical to the Ethiopian economy with exports of some $350 million in 2006, but historically low prices have seen many farmers switching to qat to supplement income. The war with Eritrea in 1998-2000 and recurrent drought have buffeted the economy, in particular coffee production. In November 2001, Ethiopia qualified for debt relief from the Highly Indebted Poor Countries (HIPC) initiative, and in December 2005 the IMF voted to forgive Ethiopia's debt to the body. Under Ethiopia's land tenure system, the government owns all land and provides long-term leases to the tenants; the system continues to hamper growth in the industrial sector as entrepreneurs are unable to use land as collateral for loans. Drought struck again late in 2002, leading to a 3.3% decline in GDP in 2003. Normal weather patterns helped agricultural and GDP growth recover in 2004-07.

GDP (purchasing power parity):
$55.07 billion (2007 est.)

GDP (official exchange rate):
$16.9 billion (2007 est.)

GDP - real growth rate:
9.8% (2007 est.)

GDP - per capita (PPP):
$700 (2007 est.)

GDP - composition by sector:
agriculture: 48.8%
industry: 12.9%
services: 38.3% (2007 est.)

Labor force:
27.27 million (1999)

Labor force - by occupation:
agriculture: 80%
industry: 8%
services: 12% (1985)

Unemployment rate:
NA%

Population below poverty line:
38.7% (FY05/06 est.)

Household income or consumption by percentage share:
lowest 10%: 3.9%
highest 10%: 25.5% (2000)

Distribution of family income - Gini index:
30 (2000)

Inflation rate (consumer prices):
15.9% (2007 est.)

Investment (gross fixed):
27.2% of GDP (2007 est.)

Budget:
revenues: $2.944 billion
expenditures: $3.683 billion (2007 est.)

Public debt:
54.5% of GDP (2007 est.)

Agriculture - products:
cereals, pulses, coffee, oilseed, cotton, sugarcane, potatoes, qat, cut flowers; hides, cattle, sheep, goats; fish

Industries:
food processing, beverages, textiles, leather, chemicals, metals processing, cement

Industrial production growth rate:
9% (2007 est.)

Electricity - production:
2.864 billion kWh (2005)

Electricity - consumption:
2.577 billion kWh (2005)

Electricity - exports:
0 kWh (2005)

Electricity - imports:
0 kWh (2005)

Oil - production:
7 bbl/day (2005 est.)

Oil - consumption:
29,000 bbl/day (2005 est.)

Oil - exports:
0 bbl/day (2004)

Oil - imports:
28,460 bbl/day (2004)

Oil - proved reserves:
428,000 bbl (1 January 2006 est.)

natural gas - production:
0 cu m (2005 est.)

natural gas - consumption:
0 cu m (2005 est.)

natural gas - exports:
0 cu m (2005 est.)

natural gas - imports:
0 cu m (2005)

natural gas - proved reserves:
23.9 billion cu m (1 January 2006 est.)

Current account balance:
-$1.851 billion (2007 est.)

Exports:
$1.2 billion f.o.b. (2007 est.)

Exports - commodities:
coffee, qat, gold, leather products, live animals, oilseeds

Exports - partners:
China 11%, Germany 9.1%, Japan 7.8%, US 7.1%, Saudi Arabia 6.1%, Djibouti 6%, Italy 5.2% (2006)

Imports:
$4.54 billion f.o.b. (2007 est.)

Imports - partners:
Saudi Arabia 18.1%, China 11.4%, India 8.1%, Italy 5.1% (2006)

Economic aid - recipient:
$1.6 billion (FY05/06)

Reserves of foreign exchange and gold:
$840 million (31 December 2007 est.)

Debt - external:
$3.793 billion (31 December 2007 est.)

Market value of publicly traded shares:
$NA

Currency (code):
birr (ETB)

Exchange rates:
birr per US dollar - 8.96 (2007), 8.69 (2006), 8.68 (2005), 8.6356 (2004), 8.5997 (2003)
note: since 24 October 2001 exchange rates are determined on a daily basis via interbank transactions regulated by the Central Bank