Ethiopia is the second most populous country in Africa (120,283,026 in 2020 according to the World Bank)1, is a one-party state with a planned economy.
Ethiopia is a growing Horn of Africa construction- and services-based economy, with annual GDP growth rate of 5.6% in 2021. In 2022, the real GDO growth fell to 5.3% but remained above East Africa’s average.2 The fall in GDP growth and the rise in inflation to 34% in 2022 result from internal conflict and humanitarian crises, but also macro-economic conjunctures. According to the African Development Bank, the GDP of Ethiopia is projected to grow 5.8% in 2023 and 6.2% in 2024. The industries projected to support this growth include tourism, industry, private consumption and investment, as well as the prospect of liberalizing additional sectors.3
The agricultural sector remains the largest contributor to Ethiopia’s GDP (37.57%), followed by Services (36.25%) and Industry (21.85%).4 According to the African Development Bank, recent supply-side drivers of growth include industry and services, while demand-side drivers include private consumption and investment.