Ethiopia, like many of Africa’s new growing economies, began achieving high growth rates from a low base, writes William Gumede.
For aboutt 10 years, the country has notched up double-digit economic growth rates. The average annual rate in the past 10 years has been 10.9 percent, according to figures from the African Development Bank.
By contrast, other sub-Saharan African economies grew 5.4 percent on average in the same period.
By the end of the 2012-13 fiscal year, Ethiopia’s economy had grown by 9.7 percent, according to the 2014 Economic Report on Africa from the UN Economic Commission for Africa. This year it will probably show bumper growth.
Ethiopia, like many of Africa’s new growing economies, began achieving high growth rates from a low base. Of course, in spite of its stellar growth, Ethiopia remains one of the poorest countries in the world.
It wants to become a middle-income country by 2025. This is defined by the World Bank as a country with a gross national income for each person of about $1 430 (about R16 500) a year. Ethiopia’s figure is low: $470 compared with $3 187 in Egypt and $7 508 in South Africa.
What is fuelling Ethiopia’s high growth rates? The large services sector and agricultural production have been significant factors. The country’s main exports include coffee, horticultural products and livestock.
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