Ethiopia's
poverty-stricken economy is based on agriculture, accounting for
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 $156 million in 2002, 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
International Monetary Fund 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 2% decline in GDP in 2003. Normal weather
patterns late in 2003 helped agricultural and GDP growth recover in
2004-05.
coffee, qat, gold, leather products,
live animals, oilseeds
Exports - partners:
China 10.5%, Germany 8.7%, Japan
7.4%, US 6.8%, Saudi Arabia 5.8%, Djibouti 5.8%, Switzerland 5.1%,
Italy 5% (2006)
Imports:
$4.105 billion f.o.b. (2006 est.)
Imports - commodities
food and
live animals, petroleum and petroleum products, chemicals,
machinery, motor vehicles, cereals, textiles
Imports - partners:
Saudi Arabia 18.1%, China 11.4%,
India 8.1%, Italy 5.1% (2006)
Reserves of foreign exchange & gold:
$1.108 billion (2006 est.)
Debt - external:
$6.038 billion (2006 est.)
Economic aid - recipient:
$1.6 billion (FY05/06)
Currency:
birr (ETB)
Currency code:
ETB
Exchange rates:
birr per US dollar - 8.69
(2006), 8.68 (2005), 8.6356 (2004), 8.5997 (2003), 8.5678 (2002) note: since
24 October 2001 exchange rates are determined on a daily basis via
interbank transactions regulated by the Central Bank