* Ethiopian economy

Ethiopian Economy

Figure 1.-- Ethiopia is among the poorest countries in Africa, largely because of an inefficent agricultural sector. This and a range of enviriomental issues have resulted in several terrible famines. The Deng added distatorial mistrule. The mother and chikdren here are being cared for in a refugee center. I think the registratiin card is what the boy is holding up. thinking it was important for the photograph. .

Ethiopia is located at a stregic point--the Horn of Africa a crossing point between Africa and the Middle East. It is no accident that the Queen of Sheba with Yemeni/Ethiopian origins is mentioned in the Bible. The trading consequences are obvious. This for example is coffee which oruiginated in the highlands of Ethioia made it to Arabia and the world. Many other African products were transported over this route. In ancient times, Ethiopia had a largerly agrucultural economy, but African oproducts like gold, ivory, and hides were important. Ethiopia entered the 20th century with a traditional, stil largely agricultural economy. Land was primarily owned by the royal court's long-established aristocracy. Exports were primarily coffee, grains, hides, and gold. Ethiopia during the 20th century was one of poorest African countries. The poverty was the result of poor yields from the country's agricultural economy--the major economic sector. More than 80 percent of the population was involved in agriculture--high by even African standards. And Ethiopian agriculture was, perhaps the most backward in Africa. Here the country's medieval feudal system impeded any modernization. And because so many Ethiopian farmers lived in abject poverty, they had no ability to buy better tools and improve farming methods. Enviromental issues (droughts, overgrazing, deforestation , and locusts) were also issues, affecting yields. Ethiopia was a rare African country not colonized by Europeans. Not that the Europeans did not try. An Italian Army was defeated (1898). As a result, there were few connections with the modern world. There were few health care and educational facilities. After the Italian occupation and World War II, economic changes began. Tourism, banking, insurance, and transport began to make an economic contribuion. Land reform created many small holders. The Communist Derg dictatorship (1974-91) nationalized all means of production, including land, housing, farms, and industry. A famine resulted. The small land holder subsistence farmers were the backbone of Ethiopian agriculture were unsure what to plant because of Government policy and concern over land rights. Although land remained nationalized, conditions in rural Ethiopia have improved slightly, as the government attempted to promote rural development. Ethiopia was faced with revovring from the ecomomic wreckage left by the Deng--one of many socialist economic disasters. There has been economic reforms and progress since the fall of the Deng. Today Ethiopia is a land-locked country, closed off from the world by Eriteran War (1998-2000). Ethiopia qualified for debt relief under the Highly Indebted Poor Countries initiative of the International Monetary Fund (IMF) and World Bank (2001). Ethiopia was one of several countries that benefited from 100 percent debt relief of loans from the IMF, the World Bank, and the African Development Bank (2005). The land ownership issue has remained contentious and has meant that high productivity commercial agricultue has not developed. This is a serious issue in a country with a rapidly growing population. Even so, the country has had in the 21st century one of the fastest growth rates in Afriam which ahas began to imprive the pooverty situation. Industry, mostly construction, and services have been growing. Manufacturing is still limited. The Eritrean War was followed by a long hostile period. Ethiopia had tomuse neighboring Djibouti's main port for 2 decades. A permanent peace wasfinally areed (2018). Ethiopia is now set to resume accessing the Eritrean ports of Assab and Massawa for international trade.


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Crerated: 3:49 AM 10/23/2020
Last updated: 3:49 AM 10/23/2020