Ethiopia

The socialist regime created in Ethiopia in 1974 came to an end in 1991, after violent uprisings and major refugee problems. In 1994, the constitution was approved and the country held multiparty elections for the first time in 1995. While Ethiopia and Eritrea established a peace treaty in 2000, the boundary has yet to be separated because of Ethiopia’s hesitation. The United Nations has turned its attention to Ethiopia because of human rights concerns. Also, after an oil installation belonging to the Chinese was attacked in Eastern Ethiopia, the country has the responsibility to take care of the safety of the Chinese oil workers.

Main Airports

Addis Ababa (ADD) (Bole International), Dire Dawa (DIR) (Aba Tenna D Yilma International Airport)

U.S. Embassy

P.O. Box 1014, Entoto Street, Addis Ababa, Ethiopia
tel: 251/11/517-40-00

Statistics

GDP: purchasing power parity:

$62.88 billion (2005 est.)

GDP - real growth rate:

8.9% (2005 est.)

GDP - per capita: purchasing power parity:

900 (2005 est.)

Inflation rate (consumer prices):

11.6% (2005 est.)

Labor force:

NA

Exports:

$612 million f.o.b. (2005 est.)

Exports - partners:

Germany 15.5%, China 10.5%, Japan 8.5%, Saudi Arabia 6.9%, Djibouti 6.8%, Switzerland 6.4%, Italy 5.9%, US 5.5%, Netherlands 4.2% (2005)

Imports:

$2.722 billion f.o.b. (2005 est.)

Imports - partners:

Saudi Arabia 14.7%, China 12.6%, US 12.4%, **COUNTRY** 9.6%, India 6.7%, Italy 4.6% (2005)

Population:

74,777,981 (July 2006 est.)

Population growth rate:

2.31% (2006 est.)

Population Below Poverty Line:

50% (2004 est.)

Major Industries:

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

Employing Workers: 79*

Registering Property: 146*

Enforcing Contracts: 82*

Closing a Business: 55*

*2006 World Bank rank out of 175 countries

Starting a Business

The table below shows the number of steps and the amount of time needed to start a business, on average

Indicator	Ethiopia	Region
Procedures (number)	7	11.1
Time (days)	16	61.8

Ethiopia Risk Assessment

Country Rating

Rating: C

A very uncertain political and economic outlook and a business environment with many troublesome weaknesses can have a significant impact on corporate payment behaviour. Corporate default probability is high.

Risk Assessment

For the fourth straight year Ethiopia achieved strong growth in 2007, up nearly 10 per cent. The agricultural sector, representing 47 per cent of GDP in 2006/07, continued to underpin the economic activity, a broader base of growth notwithstanding. And the economy should benefit from record harvests again in 2007/08, which will be good for the food industry and exports. In this context, the tighter monetary policy adopted in 2007 should help stem inflation that has been above 10 per cent since 2005, stoked by household consumption and the increasing cost of credit.

A narrow tax base continues to undermine public finances. With international aid only covering part of its financing needs, the government has turned increasingly to domestic borrowing. External accounts have also remained deep in deficit with growth in the value and volume of coffee and gold exports not sufficing to offset rising capital goods imports and the increasing cost of oil. International long-term loans and foreign direct investment have, however, been covering external financing needs. Ethiopia has thus been able to accumulate foreign exchange reserves albeit to an insufficient extent. Debt relief granted under the HIPC and MDRI programmes, respectively in 2004 and 2006, substantially reduced a debt burden that had become unsustainable in the medium-term.

Despite notable efforts to foster national reconciliation, the government's popularity has slackened since the sharp increase in basic foodstuff prices. It has moreover been contending with the insurrection of a jumble of armed groups, linked by ethnic and religious affinities, particularly in Ogaden, in the eastern part of the country. The still-unsettled border-demarcation issue with Eritrea could lead to renewed hostilities in a context of re-armament of the protagonists and of regional tensions. The Ethiopian army's involvement in Somalia exacerbates furthermore the risk of regionalising the conflicts

• Agriculture
• Apparel
• Arts & Crafts
• Automobile
• Bags, Cases & Boxes
• Chemicals
• Computer Hardware & Software
• Construction & Real Estate
• Consumer Electronics
• Electrical & Electronics
• Energy & Environment
• Food & Beverage
• Furniture & Furnishing
• Health & Medicine
• Home Supplies
• Industrial Supplies
• Lights & Lighting
• Machinery
• Mineral & Materials
• Office Supplies
• Security & Protection
• Service
• Sports & Entertainment
• Telecommunications
• Textile
• Toys
• Transportation