Productive capacity and economic growth in ethiopia. Maintaining a growth rate in agricultural gdp of six percent would provide enough employment growth to contribute to rapid economic transformation of the economy and rapid decline in poverty. Dec 20, 2019 graph and download economic data for gross national income for ethiopia mktgnieta646nwdb from 1981 to 2018 about ethiopia and gni. World bank and imf policy to most part is not pro working class or middle. Economic growth and development in ethiopia from tutor2u subscribe to email updates from tutor2u economics join s of fellow economics teachers and students all getting the tutor2u economics teams latest resources and support delivered fresh in their inbox every morning. Gni formerly gnp is the sum of value added by all resident producers plus any product taxes less subsidies not included in the valuation of output plus net receipts of primary income compensation of employees and property income from abroad. The second characteristic of ethiopia economic growth was fast economic growth. The african development bank group chief economist complex. The relationship between inflation, money supply and. Poverty defined as the number of people unable to attain the minimum living standard 3. Apr 12, 2017 ethiopias national development plan ethiopias economic policy is guided by the second phase of the growth and transformation plan 201516 202021. The pattern of growth in ethiopia, based on data for the last four decade, can be characterized as erratic. The pasdep macroeconomic framework and growth scenarios 57 6.
Ethiopia economy in the 1980s and framework for accelerated. There exists a large debate in the relationship between these two macroeconomic variables both theoretically and empirically. Gdp at purchasers prices is the sum of gross value added by all resident producers in the economy plus any product taxes and. Fiscal policy holds crucial implications for economic growth in both the short and long run. Gross national income for australia mktgniaua646nwdb.
There is a lot of effort to garner economic develo. This reading from the trend in table 1 can further be examined by a more rigorous exercise, such as determinants of growth and growth accounting exercise using standard economic models in section 2. During this period, ethiopia economic growth was 10. Economic growth greatly intensified since 2005 at slightly above 10% per annum in the ensuing 10 years, allowing per capita gdp to grow at nearly 8% annually. This statistic shows the share of economic sectors in the gross domestic product gdp in ethiopia from 2008 to 2018. Growth was driven mainly by the services sector from the supply side and public investment from the demand side. The role of fiscal policy in the longrun growth process has been central in macroeconomics especially since the appearance of endogenous growth models.
Ethiopia economic outlook african development bank. Current situation and challenges page 2 percent in average change of 0. Over the past decade, ethiopia has achieved high economic growth, averaging 10. However, basic challenges such as unskilled labor, high transport costs. The relationship between economic growth and fiscal policy is complex and critically important for policymakers. Click download or read online button to get the ethiopian economy book now. Ethiopias growth miracle, coupled with its large population and significant land mass, has attracted. This led to closer scrutiny of export growth on economic growth to achieve a sustained economic growth. It in particular examines how fdi affects gdp growth, both directly and also conditioning on trade liberalization that ethiopia adopted in early 1990s. Although data showing healthy export growth points to a good start to fiscal year 2019a2020 july 2019july 2020, the outbreak of coronavirus will be taking a heavy toll on the economy. The ethiopian government has developed comprehensive agricultural and economic development plans that have contributed to the countrys substantial growth in agriculture, industry and services. Download limit exceeded you have exceeded your daily download allowance. Ethiopia economy in the 1980s and framework for accelerated growth english abstract. Aim to be a global lightmanufacturing hub building a climate resilient green economy aim to become a net exporter of energy ultimate goal is to push ethiopia into.
Complete report in english official version of document may contain signatures, etc official pdf, 18 pages 0. In addition, the central statistical agency and the ethiopian roads authority were instrumental in providing the necessary data on population figures and road infrastructure throughout the country. In particular, a persistent high level of public debt can consequently trigger detrimental effects on capital. In particular, a persistent high level of public debt can consequently trigger detrimental effects on capital accumulation and productivity, which potentially has a negative impact on economic growth kumar and woo, 2010. The relationship between inflation, money supply and economic growth in ethiopia.
The role of higher education in economic development. Pdf determinant of economic growth in case of ethiopia. Sep 28, 2015 economic growth, refers to an increase in real national income or gross domestic product gdp, and may also be expressed as an increase in per capita income. This procedure is usually referred to as growth accounting. In 20, the economic growth recorded in ethiopia was 9. As you can see in the figure 2 below, the ethiopia economic growth8 was higher than the ssa countries economic growth. Over the last ten years, the country has achieved doubledigit growth in real terms, averaging 10. Wef ethiopia is the fastestgrowing economy in 2017, according to the world banks latest edition of global economic prospects. Agriculture and the economic transformation of ethiopia. Economic growth, refers to an increase in real national income or gross domestic product gdp, and may also be expressed as an increase in per capita income. In 2006, 2010 and 20, the average ssa countries annual economic growth was 6. In the same way, after four years, that means in 2010, the country has achieved 10.
Economic growth, development and poverty in ethiopia. The performances and challenges of growth and transformation. This paper examines the economic effects of the demographic transition in developing countries. Ethiopia gdp annual growth rate 19812018 data 20192020. Institutional and policy factors appear to have been the dominant influence, except in the years of drought. In 2012, ethiopia was the 12th fastest growing economy in the world.
The effect of exportled growth strategy on the ethiopian. Economic growth and poverty in ethiopia economic growth refers to an increase in the national income or per capita income 2. This is a revision video and presentation on aspects of growth and development in the fastgrowing country of ethiopia. Ethiopia is a fascinating country to use as a case study in economic growth and development according to a recent editorial in the financial times, ethiopia has transformed in 20 years from a famineravaged nation into a destination for savvy and wellknown private equity groups such as kkr. Ethiopian economic growth compared to sub saharan africa.
And, 3 what are the links among economic growth, income distribution and poverty in the short and long term. Using time series data for the same period, the empirical results indicated that past external debt accumulation has a negative impact on economic growth. Growth and development in ethiopia economics tutor2u. Growth should benefit from the homegrown economic reform program, which seeks to address macroeconomic imbalances and unlock structural.
What are the reasons for ethiopias recent economic growth. The role of financial instituions in economic growth of. Ethiopia failed economic growth and transformation plans. Complete report in english official version of document may contain signatures, etc.
The role of higher education in economic development page 3 of 12 introduction the role of higher education as a major driver of economic development is well established, and this role will increase as further changes in technology, globalization, and demographics impact the united states. Ethiopia economy gdp, inflation, cpi and interest rate. There are many ways in which the ethiopian economy can be applied to different areas of the a level economics course. The view of exportled growth conceives growth of exports as having a favorable impact on economicgrowth. Between 2006 and 2014, average africa economic growth was 4. The policy framework paper, which forms the basis for the economic reform programme, sought to revitalize the economy and create a more market oriented economic system, giving room for. This economic growth was higher than the average ssa economic growth. I think the main engine is the governements explicit effort to attract investors and attemp to encourage private investors within the country. The impact of external debt on economic growth in ethiopia. Ethiopia economic growth and development economics tutor2u. Statement of the problem the ethiopian economy has been characterized by erratic nature of output as the economy has been highly dependent on natural factors.
This site is like a library, use search box in the widget to get ebook that you want. Gross national income for ethiopia mktgnieta646nwdb. Co integration and causality analysis fitsum sharew denbel, yilkal wassie ayen and teshome adugna regasa phd senior expert, ethiopian shipping and logistics service enterprise, addis ababa ethiopia. The paper starts with an overview of ethiopia s economic growth and the change in the domes tic economic structure.
Ethiopia gdp annual growth rate 19812018 data 2019. The report examines the causes of low growth, identifying the respective roles of structural, institutional and policy factors. Given the low level of crop yields relative to those of other countries with comparable resources, and relative to best farmers and experiment stations, a. There has also been tremendous growth in the number, diversity and market share of private businesses in the ethiopian economy. The role of financial instituions in economic growth of ethiopia. The economic outlook is positive, and real gdp growth is projected to stabilize at 7. Ethiopia tops list of the worlds fastestgrowing economies. Many notable ethiopian economists, intellectuals, and journalists have discussed this issue in an attempt to determine the veracity of the governments claim of over 10 per cent. The effect of exportled growth strategy on the ethiopian economy. This paper measures the impact of foreign direct investment fdi on economic growth in ethiopia based on annual time series data over the period 1974 to 2011. Recent economic developments the ethiopian economy continued its strong expansion in fy14 with real gdp growing by 10. World bank lauds ethiopias economic growth in a report. It seeks to answer the question what proportion of recorded economic growth can be attributed to growth in the capital stock, growth of the labor force and changes in overall efficiency.
There exists a large debate in the relationship between these two macroeconomic variables. In 2018, the share of agriculture in ethiopias gross domestic product was 31. Population and economic growth in developing countries minh quang dao professor of economics, eastern illinois university, 600 e. The ethiopian economy download ebook pdf, epub, tuebl, mobi. Determinant of economic growth in case of ethiopia. The manufacturing sector is seen as the success of ethiopia s growth. The relationship between inflation and economic growth is one of the most popular macroeconomic issues among central bankers, policy makers and macroeconomists barro 1995.
The relationship between inflation, money supply and economic. If the country can continue its historically impressive growth performance, it could potentially reach middle income status by 2025. Since 1992, the economic growth policy of ethiopian government was guided by the idea of export led growth. Since agriculture accounted for over 50 percent of gdp for most of the recent past, whenever weather. Selection of key themes for ethiopia developmental state via 5 year plans rapid industrialisation strategy key role of logistics infrastructure in growth building tourism around ethiopian airlines fragile state political unrest emergency rule o. Graph and download economic data for gross national income for ethiopia mktgnieta646nwdb from 1981 to 2018 about ethiopia and gni. It is based on the information available at the time it was completed on september 5, 2014. Economic growth, as proposed by neoclassical growth models, can be measured as the average annual change in the natural logarithm of gdp per person. There is economic growth in ethiopia, but it is far behind addressing the abject poverty down in the economic ladder. Using the aggregate production approach cobbdouglas production functions of gdp measurement, solow 1957 showed how factor accumulation and technological progress determine the path of. The gross domestic product gdp in ethiopia expanded 9 percent in 2018 from the previous year.
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