Country Information - Ethiopia

ECONOMIC BACKGROUND Ethiopia's poverty-stricken economy is based on agriculture, which accounts for half of GDP, 85% of exports, and 80% of total employment. The agricultural sector suffers from frequent drought and poor cultivation practices, and as many as 4.6 million people need food assistance annually. Coffee is critical to the Ethiopian economy with exports of some $260 million in 2000. Other important exports include qat, live animals, hides, and gold. The war with Eritrea in 1999-2000 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. 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. Despite this limitation, strong growth is expected to continue in the near term as good rainfall, the cessation of hostilities, and renewed foreign aid and debt relief push the economy forward. Click here for Country Map [23kB]

BI-LATERAL TRADE OVERVIEW Bi-lateral trade between Ethiopia and the United States peaked in 1999 and 2001, but has since dropped sharply. Ethiopia is a net importer of U.S. goods, and in 2002 recorded a trade deficit of $ 34 million. Total exports to the US in 2002 amounted to $ 25 million (2001: $ 28 million) (see link to Country Trade Profile below). Exports eligible under the newly-added AGOA product categories amounted to only $ 0.2 million in 2001, the first full year of operation of AGOA, and increased to $ 1,3 million in 2002. They consisted exclusively of 'textiles and apparel' and 'agricultural products'. Ethiopia met the 'Rules of Origin' requirements for wearing apparel on August 2, 2001, in addition to being classified as a 'Lesser Developed Country' (providing a window of opportunity for sourcing third country textile inputs for the production of AGOA-eligible garments). There are tentative indications that there will continue to be year-on-year increases in AGOA exports from 2002 onwards, especially in apparel exports. The make-up of Ethiopia's exports to the U.S. currently consists mostly of 'agricultural products', although this is likely to diversify over time as AGOA-eligible products begin to feature more prominently in exports. Detailed bilateral trade data for this country, disaggregated by industry sector, can be accessed by following the link below. Aggregate data featuring all AGOA-eligible countries is updated on this website as soon as new data is published, including ranked AGOA / non-AGOA trade, aggregate trade by industry sector as well as the latest apparel trade data. Click here for Detailed Trade Profile