About Ethiopia

Ethiopia in Brief

Official Name:

The Federal Democratic Republic of Ethiopia (FDRE):

The Federation is composed of Nine States (killil): Tigray, Afar, Amhara, Oromia, Somali, Benishangul-Gumuz, Southern Nations Nationalities and People Region (SNNPR), Gambella and Harari Regional States; and two Chartered Cities – Addis Ababa and Dire Dawa. The national regional states and the two city administrative councils are further divided into eight hundred woredas (districts) and around 15,000 kebeles (neighborhoods, the lowest level of elected administration).


Ethiopia is a multi-party federal democracy with legislative authority resting with the government headed by an executive prime minister and the elected House of Representatives (547 members) and the House of Federation (110 members). The Prime Minister is chosen by the party in power following multi-party democratic national and federal state elections which are held every five years. Parties can be registered at either the national or the federal state level. The President is elected by the members of the House of People’s Representatives.

President: H.E. Ambassador Dr. Mulatu Teshome

Prime Minister: H.E. Mr. Hailemariam Desalegn

Speaker of the House of People’s Representatives: The Honorable Mr. Abadula Gemeda

Capital City

Addis Ababa, one of the two chartered cities in the Federation, is the seat of the Federal Government and is also the capital of the Oromia Regional State. It is the largest city in the country with a population of 2.7 million at the 2007 census (estimated at 3.2 million in 2011). It lies on the central plateau at an altitude of 2300-2400 meters, and with an average temperature of around 160C.

Addis Ababa, founded in 1887, is host to the African Union (AU) and to the United Nations Economic Commission for Africa (ECA). Several other international organizations have their head quarters and offices there. It the seat of the Federal Government, the House of Representatives and the House of Federation, as well as country’s center of commerce and industry.

Regional State Governments and Capitals:

Afar Regional State: Semera

Amhara Regional State: Bahr Dar

Benishangul Gumuz: Asossa

Gambella Regional State: Gambella

Harar State: Harar

Oromia Regional State: Finfine (Addis Ababa)

Somali Regional State: Jijiga

SNNP Regional State: Hawassa

Tigray Regional State: Makelle

 Location and Boundaries

Ethiopia is located in the centre of the Horn of Africa. It shares borders with the Sudan and South Sudan to the west; Eritrea to the north and north-east; Djibouti and Somaliland to the east; Somalia and Kenya to the south.

It covers an area of 1.14 million square Kilometers (944,000 square miles)

The population according to the 2007 Census was 73,918,505. The growth rate is estimated at 3.2% and the current population estimate is now 86 million, of which 46% fall within the 1-14 age range; 51% between 15 and 64; and 3% are over 65. Approximately 17% of the population is estimated to live in urban areas.

Nation and Nationalities

Ethiopia is home to over 80 different peoples and nationalities. According to the 2007 census the larger ones are: Oromo 25.5 million (35%); Amhara 20 million (27%); Somali 4.6 million 6.2%); Tigrean 4.5 million (6.1%) Sidama 3 million (4%); Gurage 1.9 million (2.5%); Welayta 1.7 million (2.3%); Hadiya 1.3 million (1.7%); Afar 1.3 million (1.7%); Gamo 1.1 million (1.5%).



Christians make up 62.8% of the population (43.5% follow the Ethiopian Orthodox Church and 19.3 other denominations); Muslims 33.9%; traditional faiths 2.6%; and others 0.6%.


Although Ethiopia lies within 15 degrees North of the Equator, overall the country enjoys moderate temperatures and a pleasant climate, with average temperature rarely exceeding 200C (680F), owing to the moderating influence of high altitude. The more sparsely populated lowlands tend to have sub–tropical and tropical climates; and parts of the Afar regional State in the east of the country which lie below sea level are considered to be the hottest place on earth with temperatures regularly reaching 500C (1200F) or more.

At approximately 850mm (34inches), the average annual rainfall for the whole country is considered to be moderate by global standards. In most of the highland areas, rainfall occurs in two distinct seasons: the “small rains” (belg) during February and March and the “big rains” (kremt) from June to September. In the south east lowlands the rainy seasons are from March to May, the longer season (gu), and the short rainy season from October to December (deyr).


There are international airports at Addis Ababa (Bole International Airport), and at Dire Dawa, Bahr Dar, Gondar, Lalibela, Axum, Arba Minch, and Mekelle. The national carrier, Ethiopian Airlines, has an excellent international reputation and currently flies to 63 international destinations in America, Europe, Africa and Asia as well as 17 local flight destinations. It is now taking delivery of the latest Boeing 787 “Dreamliner” aircraft for its long haul flights.

The main entry points by road are at Moyale (from Kenya), Humera and Metema (from Sudan), Dewele (from Djibouti). All have full customs and immigration checks. Until Eritrea invaded Ethiopia in 1998, Humera, Rama, Zalembessa and Bure were entry points from Eritrea; in the absence of any effort by Eritrea to normalize relations, they remain closed.

 Currency  and Currency Regulations

The local currency is the Ethiopian birr, made up of 100 cents. Notes are issued in denominations of 1, 5, 10, 50, and 100 birr. There are six different coins: 1, 5, 10, 25, and 50 cents, and 1 birr.

 Top ETB Exchange Rates 01-02/2014
Mid-market rates: 2014-02-01 01:09 UTC
There is no limit to the amount of foreign currency that can be imported into Ethiopia, but it must be declared on arrival, using a currency declaration form. Foreign currency may be changed only at authorized banks and hotels .The currency declaration form will be required by Customs on departure. Visitors may change back any excess birr into foreign currency at the air port before departure, but they are expected to produce receipts for all exchange transactions. 

Credit cards

These can be used in some of the larger hotels in Addis Ababa, and major credit cards can be used for flights by Ethiopian Airlines.  A number of banks and hotels have  ATM machines available and Visa cards can be used at some banks. The US dollar is the best foreign currency to bring into Ethiopia and it can be exchanged at banks and foreign exchange bureaus.


Drivers require a valid International Driving License, which can be obtained by exchanging your own local license at the Transport and Communications office on Haile Gebreselassie Road in Addis Ababa. Visitors can recover their original driving licenses a day or so prior to departure. Those with their own vehicles require a permit from the Ministry of Transport and Communication. Driving is on the right hand side of the road.

Energy (Power)

Ethiopia uses a 220 Volt and 50 Hz. System. It is sensible to bring a round, two-prong adapter and transformer if necessary.

Health Requirements

All visitors (including infants) are required to possess a valid yellow fever vaccination certificate if you have recently travelled to a country where it is present. Vaccination against cholera is also required for any person who has visited or been in transit through a cholera-infected area within six days prior to arrival to Ethiopia. Malaria is endemic in areas of Ethiopia below 2000 meters, and both chloroquine–resistant and falciparum strains are present.

Medical Services

Medical facilities are available in all major towns but facilities are often over-taxed. Tourists and non-citizen residents should go to private hospitals and clinics. Contact your Embassy for referral to recommended doctors. Air rescue services are available.

Calendar and time

Ethiopia uses its own calendar which divides the year into 12 months of 30 days each, with the remaining five (or six days in a leap year) constituting a short 13th month of Pagme.  The Ethiopian New Year commences on the 11th or 12th of September in the Gregorian calendar.

There is a 7 or 8 year difference from the Gregorian calendar, seven years from September to January 1, and eight years from January 1 until September 10/11. The current Ethiopian year is 2004, running from September 12, 2011 to September 10, 2012. Meskerem 1, New Year’s Day 2005, will fall on September 11th 2012.


 Ethiopian month      Gregorian month    Gregorian dates 2011-2012
 Meskerem  September September 11 – October 10
 Tekemt  October October 11 – November 9
 Hedar   November November 10 – December 9
 Tahsas  December December 10 – January 8
 Tir   January January 9 – February 7
 Yekatit   February February 8 – March 9
 Megabit  March March 10 – April 9
 Miyazya    April April 10 –  May 8
 Ginbot  May May 9– June 7
 Sene   June June 8 – July 7
 Hamle   July July 8 – August 6
 Nehase    August August 7 – September 5


Ethiopia is in the GMT +3 time zone. Business hours vary according to the nature of the business. Normally government offices and most other office hours are from 8:00 a.m. to 12:30 p.m. and 1:30 p.m. to 5:30 p.m. from Monday through Thursday. Working hours on Friday are 8:30am to 11:30am and 1:30pm to 5:30pm.

Banks are open from 8:30 a.m. to 3 p.m. from Monday through Thursday. Working hours on Friday are 8:00 a.m. to 11:00 a.m. and 1:30 p.m. to 3: 00 p.m. and Saturday 8:30 to 11a.m.

Ethiopians also use a 12-hour clock, with one cycle of 1 to 12 running from dawn (6am) to dusk (6pm) and the other cycle from dusk to dawn. The start of the day is dawn, rather than midnight. Thus, 7:00 AM in East Africa Time (EAT) corresponds to 1:00 daylight in local Ethiopian time; 12:00 noon EAT is 6:00 daylight hours; and 6:00 pm EAT is 12:00 local time.



The home of mankind: human evolution in Ethiopia

It is appropriate to start with the fossil evidence as Ethiopia has remains that cover much of human evolution ranging from Chororapithecus Abyssinicus, (12 to 7 million years ago), a possible ape relative of humanity, to Homo Sapiens Idaltu (‘Elder’) the earliest modern human fossil at 160,000 year old found in the Afar Regional State at Horto. Recent discoveries include the 4.4 million year old Ardipithecus Kadaba and Selam, an almost complete skeleton of a three year old female child dating to 3.3 million years ago.  The most famous of the discoveries in the Afar region, of course, is that of Lucy (‘Dinkenesh’ – ‘wonderful’), the most complete skeleton of an early hominid yet found and dating back some 3.2 million years. A replica of her skeleton is on display in the National Museum of Ethiopia. Lucy (Australopithecus Afarensis) walked on two legs and stood about 3.5 feet tall. Australopithecus subsequently evolved towards the genus Homo, with the appearance of Homo Habilis (2.4 – 1.8 million years) and Homo Erectus (1.4 – 1 million years), and then Homo Sapiens, probably about 200,000 years ago. There are several notable fossil sites in Ethiopia including the lower Omo Valley and the Awash Valley, both registered as UNESCO World Heritage Sites, the latter including the Hadar area, Aramis and Melko Kunture, the scenes of numerous  paleontological discoveries.

 History 1000 BCE – 1991 CE

 Ethiopia’s history as an organized and independent polity dates back to the first millennium BCE. Earlier, Egyptian pharaohs traded with the Land of Punt, probably somewhere along what is now the coast of Eritrea or possibly Somaliland. Around the 8th century BCE a kingdom known as Da*ma*t probably had its capital at Yeha, but the first state about which there is much real information is the kingdom at Axum in the northern Regional State (Killil) of Tigray. Axum emerged at the beginning of the Christian Era and flourished until around 800CE, before suffering prolonged decline over the next few centuries. Axum’s period of greatest power lasted from the 4th through the 6th centuries CE. Its core area lay in the highlands of what’s today southern Eritrea, in Tigray and in Lasta and Angot, now part of the Amhara Regional State; its major centers were at Axum and the port of Adulis. Earlier centers, such as Yeha, also contributed to its growth. At the kingdom’s height, its rulers controlled the Red Sea coast from Sawak in present day Sudan in the North to Berbera in the present-day Somaliland to the south. They were also active as far as the Nile valley in modern Sudan, attacking and destroying the kingdom of Meroe in the 4th century CE. On the Arabian side of the Red sea, Axumite rulers also controlled much of the coast and extensive areas of modern Yemen. The rulers of Axum were converted to Christianity in the mid 4th century CE.

The rise of Islam in the Arabian Peninsula had a significant impact on Axum kingdom during the seventh and eighth centuries. By the time of the Prophet Mohammed’s death (A.D.632), the Arabian Peninsula, and the entire opposite shore of the Red sea, had come under the influence of the new religion. The steady advance of Islam over the next century resulted in Islamic conquest of all of the former Sassanian empire and much of the Byzantine empire. Relations with Axum were not hostile at first. According to Islamic tradition, members of the Prophet’s family and some of his early converts had taken refuge in Axum during the troubled years preceding the Prophet’s rise to power, and Axum was declared exempt from the Jihad, or Holy war.  The Arabs also considered the Axumite state to be one of the great powers of the time alongside the Islamic State, the Byzantine and Sassanian empires and China. Commerce between Axum and at least some ports on the Red sea continued, albeit on an increasingly reduced scale.

Once the Axumite state had lost control of South West Arabia and of the Red Sea trade on which much of its wealth and power had been based, it gradually shrank to its core area, with the political center of the state shifting farther and farther southward inside Ethiopia. Axum was abandoned as a political capital by the end of the seventh or eighth century (CE), becoming no more than a religious center and as a place of coronation for a succession of kings who traced their lineage to Axum. By then, Axumite cultural, political, and religious influence had been established south of Tigray in Agaw districts such as Lasta, Wag, and Angot and eventually, in Amhara areas. The move south continued over the following centuries with Axumite culture, Semitic languages and Christianity providing the driving force. By the tenth century, a post-Axumite Christian Agaw kingdom had emerged, controlling most of the highland areas from southern Eritrea to Shewa and holding much of the coast from Adulis as far south as Zeila in Somaliland, though the Caliphate controlled the trade of the Red Sea.

The origins of the Zagwe dynasty remain obscure so does its dating, but it appears most probable that it had set up its capital at Roha or Adefa by the end of the 10th century CE. This was later known as Lalibela after the most famous ruler of the dynasty who was traditionally responsible for the carving of twelve churches out of rock.  The churches, probably carved during the reigns of several rulers, are an incredible and impressive monument, a wonder of the world and are deservedly a UNESCO World Heritage site. The Emperor Lalibela, a priest and king, was probably the origin of the medieval European legend of Prester John, a great Christian ruler who was expected to come to the aid of the Crusaders in the Holy Land and help recover Jerusalem.

In about 1270 CE, an Amhara noble, Yekuno Amlak, drove out the last Zagwe ruler and proclaimed himself emperor, founding a dynasty of rulers claiming descent from former Axumite emperors and indeed from King Solomon of Israel. To strengthen Yekuno Amlak’s claims to the throne, a national epic was created (the Kebra Negast) which claimed the rulers of Axum had originated with the son of Solomon and the Queen of Sheba, the Emperor Minelik. Only descendants of Solomon could become emperors. The Zagwe rulers were thus designated as usurpers, and the accession of Yekuno Amlak could claim to be the legitimate “restoration” of the Solomonic line.

This first Shoan Amhara empire (13th to 16th centuries CE) represented the high point of the medieval civilization of Ethiopia. It is in this period that many, or most of the rock churches of Tigray region, were built and Christianity spread over much of the country, producing glorious illuminated manuscripts. With its major centers in the Amhara areas of northern Shewa and Wollo, the empire faced a series of powerful Muslim sultanates or Sheikhdoms to the south and east where a variety of peoples had embraced Islam. One of these was the Sultanate of Ifat in the foothills of north-east Shewa; another was the Sultanate of Adal, centered in the Islamic city of Harar, farther to the east and which controlled areas along the Red Sea inhabited by two other peoples who also converted to Islam, Afars and Somalis. To the south were the Sultanates and Kingdoms of Hadiya, Bali, Dawaro and Fatajar which usually paid tribute to the Christian empire, and further west, Damot.

For most of the 15th century, the Christian empire and the Sultanate of Adal existed in a precarious state of balance, but in the second decade of the sixteenth century, a successful military commander Ahmed Ibin Ibrahim Al Ghazi, (Ahmed Gran, the “left handed”), seized power in Harar which had become the seat of the Sultanate in 1520 CE. Acquiring the status of a religious leader, he called he launched a successful jihad to break the Christian power. After winning a major victory in 1529 CE, his forces ravaged far and wide across the empire for over a decade, destroying much of the literary, architectural, cultural and material wealth of medieval Ethiopia. In 1541, the arrival of a force of Portuguese to help the Emperor Galawdewos led Emir Ahmed to call on support from the Ottoman empire. After a preliminary defeat, the Portuguese helped Galawdewos win victory near Lake Tana in February 1543 where Emir Ahmed was killed. With his death the jihad collapsed as did the power of Adal.

Originally, the Portuguese were mainly concerned to strengthen their hegemony over the Indian Ocean trade routes. They subsequently made every effort to try to persuade Ethiopia to reject its Monophysite version of Christianity and convert to Roman Catholicism. The resulting conflicts, reaching the level of civil war, continued until the Jesuits and all Roman Catholics were expelled in 1632, also contributed to the weakness of an already exhausted empire and its inability to stem the advances by Oromo peoples from the south. The conflicts of the 1520s and the successes of the jihad in the 1530s, together with the collapse of the Sultanates and the Sidama kingdoms opened the way for pastoral Oromo confederacies in the area of the Ganale River to expand north into Bali and Fatajar. Originally the attacks seemed to be largely raids for plunder but once the weakness of opposition became apparent, during the Michelle gada (1554-1562 CE), the Oromo began to settle in the areas they had overrun. From Fatajar, the Metcha-Tulama clans spread out across the south and west, and to the north over the next century. Their original unity fragmented and the confederacies began to disintegrate as they settled. In the east, they destroyed the power of Adal in the latter sixteenth century though the walls of Harar kept the city inviolate. Oromo advances continued north, over-running much of Shoa and advancing into Wollo. To the west and south west they eventually overran Ennarya and advanced as far as the Gojeb River, where they were halted by the powerful kingdom of Kaffa. In the early 1800s, several Oromo kingdoms were set up in the Gibe area: Limmu-Ennarya (about 1800), Gumma, Gomma, Jimma, the most powerful, and Gera.

In the face of the advancing Oromo threat, the weakened empire re-established its center further north, at Gonder north of Lake Tana. This became a permanent capital and the centre of another vigorous flowering of Christian art and culture. As Oromo principalities were established in parts of Shewa and Wollo, their leaders began to play a role in the politics of the Gondar empire. By the end of the 17th century, the Oromo were as much part of the empire as the Amhara or the Tigreans. Their rise was symbolized by the marriage of the Emperor Bakaffa to an Oromo, and during the latter part of the 18th century and the first half of the nineteenth century, the family of Ras Ali Gwangul, ruling in Yejju, played a major role. This was the period of the Zemene Mesafint, the era of the princes, when the imperial power collapsed, and Amhara, Tigrean and Oromo princes fought for control of Gonder and of the emperors. At one point in 1800 there were six crowned emperors alive in the country, each supported by one of the leading regional princes. One emperor was placed on the throne on four different occasions.

This time of confusion was temporarily brought to an end by Tewodros II, a member of the local nobility from Qwara, who briefly restored some imperial authority with a series of victories over regional nobles, before committing suicide at Magdala when faced by defeat from a British invasion to release British prisoners in 1868. After another brief hiatus, Yohannis 1V from Tigray region, crowned emperor in 1872, re-established imperial control more successfully, fending off attacks from several external sources. In 1875 and 1876 two Egyptian expeditions were defeated at Gundet and Gura, and in 1887 Ras Alula wiped out an Italian battalion at Dogali briefly putting a stop to Italian incursions inland from Massawa whioch they had taken over in 1995. There were a number of successful battles against the forces of Mohammed Ahmad who proclaimed himself the Mahdi in 1881 but Yohannis himself was killed while winning the battle of Metemma in 1889 against the Mahdi’s Dervish army. He, he was succeeded by Minelik, King of Shewa, who expanded the empire to the east, south and west of Shewa, bringing back into imperial control lands that hadn’t been part of the Ethiopian polity for several centuries. This expansion coincided with the arrival of European colonial powers in the region, and after the defeat of Italy at the battle of Adowa in 1896, Minelik was able to establish the boundaries of Ethiopia, though despite his victory at Adowa he was unable to expel the Italians from their colony of Eritrea.

Minelik (1889-1913), who founded Addis Ababa as the capital, presided over the first stages of Ethiopian’s modernization. He was succeeded by his 13 year old grandson Lij Yasu who was never crowned. Lij Yasu’s father was Negus Michael, a Muslim Oromo leader from Wollo who had been converted to Christianity by Yohannis IV. In an Oromo and a converted Muslim, and in his three year reign Lij Yasu showed strong indications of turning away from the largely Amhara and Tigrean Christian highlands, raising the profile of the Muslim and non-Christian peoples of  peripheral regions including Oromos, Somalis and Afars. He also favoured links with Germany and the Ottoman Empire. As this was during the First World War, it caused concernes to the British, nervous about control of the route to India, and the French worried about the safety of Djibouti. Thery therefore backed the coup organized by Shoan Amhara nobles in 1916.  The result was a coup in 1916, backed by the UK and France, at war with Germany and the Ottoman Empire at the time, and Lij Yasu was replaced by Minelik’s daughter, the Empress Zewditu with Ras Taferi as Crown Prince and Regent. In 1930 after the death of the Empress, Ras Taferi was crowned Emperor, taking the throne name of Haile Selassie.

Haile Selassie (Regent 1916-1930, Emperor 1930-74) turned Ethiopia into a centralized autocracy. The process was briefly interrupted by the Italian invasion and occupation conquest of 1935-41. After Ethiopia’s liberation with British help in 1941, Haile Selassie found his control of the country circumscribed by his British ‘advisers’; Britian itself came close to trying to occupy Ethiopia was able to play off the United Kingdom, which came close to occupying Ethiopia after 1941  (it only withdrew from the Ogaden in 1948 and the Reserved Area (the Haud) in 1954), and controlled Eritrea under a UN mandate until 1952. Haile Selassie therefore  looked more  and more to the USA as an alterantive and more powerful ally. against the USA.  In 1952, Eritrea, a UN-mandated territory after the war, was federated with Ethiopia. Haile Selassie immediately dismantled its press, trade unions, political parties and its elected parliament, none of which could be found in Ethiopia and which were anathema to his own highly centralized structure of control. In 1962 Eritrea became a province of Ethiopia, igniting the Eritrean struggle for independence, originally led by the Eritrean Liberation Front (ELF), supported by Egypt and other Arab states, and later by the Eritrean People’s Liberation Front (EPLF) which eventually achieved de facto Eritrean independence in 1991 and formal recognition in 1993.

Emperor Haile Selassie created the framework of a modern state, including, in 1955, a constitution with an elected, though powerless, parliament. However he made no real effort to change land policy, or adjust the hierarchies of power. Ethiopia remained essentially feudal, with small Amhara-dominated modern sectors in bureaucracy and industry. This provided the impetus for outbreaks of opposition among other nationalities, notably in Tigrai in 1943, among Oromos and Somalis in the 1960s and after 1961 in Eritrea. Haile Selassie himself preferred to concentrate on international affairs. Addis Ababa became the head quarters of the Organization of African Unity (OAU), and the UN Economic Commission for Africa, and Ethiopia participated in UN operations in Korea and the Congo. Its main ally was the USA, and Ethiopia provided the USA with a major communications facility at Kagnew, in Eritrea.

The long-term weaknesses of the regime, including a growing agrarian crisis, inequitable distribution of land, and lack of development, were exacerbated by the costs of the revolt in Eritrea, drought and famine in Wollo and Tigray in 1972-74 (in which at least 200,000 people died), and after 1973 by Haile Selassie’s near senility and his failure to designate an heir, fuelled grievances of the military, students and workers. A series of army mutinies started in January 1974, accompanied by parallel civilian strikes, leading to the creation of an armed forces committee which began to arrest senior officials, sixty of whom were arbitrarily executed shortly after Haile Selassie was deposed in September. He died in mysterious circumstances a year later, most probably murdered. The monarchy was formally abolished in March 1975. The Imperial regime was replaced by a Provisional Military Administrative Council (PMAC), the Derg, which under the influence of left-wing politicians saw itself as the vanguard of an Ethiopian revolution. In December 1974, Ethiopia was declared a Socialist state, and a program of revolutionary reform, under the title of Ethiopia Tikdem (‘Ethiopia First’) was initiated. The aims of Ye-Itiopia Hibrtesebeawinet (‘Ethiopian Socialism’) were defined in the program for a National Democratic Revolution. In January and February 1975, the Derg nationalized all Banks and Insurance firms and seized control of practically every important company in the country. It followed this up by nationalizing all land.

In February 1977, Colonel Mengistu Haile Mariam, the vice-chairman of the Derg seized power in a putsch, killing a number of his rivals and declaring himself Chairman. He launched the ‘Red Terror’ under which the government security forces systematically hunted down and killed suspected and alleged members and supporters of opposition groups. Tens of thousands died in Addis Ababa alone and many more all over the country. This fueled the insurgencies that had appeared in several areas, most extensively in Eritrea and Tigrai regions. In mid 1977, Somalia, against the wishes of its ally, the Soviet Union, invaded to try and take advantage of the confusion of the revolution to seize the Somali speaking areas of the country as well as a much wider area of the south. Somali forces reached the gates of Harar before being defeated in February 1978 by a greatly expanded Ethiopian army supported by Cuban troops and massive supplies of USSR weaponry. After this victory, Derg forces moved back into Eritrea which had been largely overrun by the ELF and EPLF. It recovered most of the towns but failed to win military victory, despite a series of major offensives and the defeat of the ELF by the EPLF in an Eritrean civil war.  Elsewhere, despite the creation of its Workers Party of Ethiopia, the Derg also faced growing opposition, much of it ethnically based, most prominently from the Tigrai Peoples Liberation Front (TPLF) and the Oromo Liberation Front (OLF). Despite large-scale political and military support from the USSR and Soviet satellites, it failed to crush these movements which played a major role, together with the EPLF, in weakening the Derg. The Derg’s political failures were compounded by droughts and famine, notably in the mid 1980s, affecting millions of people and by steadily expanding opposition to its brutal campaign of resettlement and villagization. As the Soviet Union began to collapse in the later 1980s, its support for the Derg came to an end. Mengistu survived an attempted coup in 1989, but after a series of defeats at the hands of the TPLF and the Ethiopian Peoples Revolutionary Democratic Front (EPRDF), an organization it had set up in 1989, he fled in May 1991 to Zimbabwe where he still resides. In 2006, after a long trial, Mengistu was found guilty of genocide in absentia, and he and a number of other leading members of the Derg were given death sentences. None have been carried out. The surviving members of the Derg were released in 2011, having been held in jail for 20 years.

A week after Mengistu’s flight, the EPRDF took over Addis Ababa and brought an end to 17 years of communist authoritarianism and military dictatorship. It set up a Transitional Government composed of an 87 member Council of Representatives which drew up a National Charter to act as a transitional constitution. In June 1992, the OLF, dissatisfied with its role in government, withdrew its four ministers and tried to return to armed struggle. It was unsuccessful, but it has kept up some low-level anti-government activity, most recently from bases in Eritrea. In March 1993, members of another non-EPRDF party, the Southern Ethiopia Peoples’ Democratic Coalition also left the government. Despite this, the process for establishment of a federal constitutional government continued successfully. Based on ethnic structuralism, the aim was to decentralize authority and provide the major ethic groups and peoples of Ethiopia with the opportunity to develop politically, economically and culturally. A new constitution was drawn up in 1993 after extensive consultations and approval from an elected constituent assembly in December 1994 and by an elected Parliament in May 1995. The Federal Democratic Republic of Ethiopia, consisting of nine states and two chartered cities, was proclaimed in August 1995. Meles Zenawi, chairman of the majority party in Parliament, the EPRDF, was elected Prime Minister, and Negasso Gidada became non-executive President. There were national and federal elections in 2000, 2005 and 2010. In October 2001, Girma Wolde-Giorgis was elected president and again in 2007.

Within a year of the establishment of the EPRDF government, more than a hundred political parties and organizations had emerged. There was a similar explosion of private media publications though numbers of both have decreased subsequently. The election for members of the 547-member constituent assembly was held in June 1994. This assembly adopted the constitution of the Federal Democratic Republic of Ethiopia in December 1994, setting up a federal parliamentary democracy with an executive prime minister chosen by the party in power after legislative elections. Legislative power rests in the government and the two houses of parliament, the House of Peoples’ Representatives (547 members) and the Council of Federation (110 members) whose members are designated by the elected Regional State Councils. [Picture links?? Parliament in session] There is an independent judiciary whose appointments are made by the House of Representatives on the advice of the Prime Minister and the Judicial Administrative Council. There is an Ethiopian Human Rights Council and an active Ombudsman’s Office.  The constitution assigns extensive power to regional states to establish their own government and democracy according to the federal government’s constitution. The regional states (killil) elect regional councils which have legislative and executive power operating through an executive committee and regional sectoral bureaus. Under Article 39 of the Ethiopian Constitution the regional states also have the right to secede from Ethiopia. This structure of elected executive councils is replicated at the woreda level and at the lowest level of administration, the kebele.

Under the new constitution, the elections for Ethiopia’s first popularly-chosen national parliament and regional legislatures were held in May 1995. Most opposition parties chose to boycott these elections as they did in 2000, in both cases giving the EPRDF a landslide victory. Opposition parties as a whole did finally participate in the 2005 election and the election produced a record number of voters, with 90% of the electorate turning out to cast their vote. The African Union report on the process commended the election for a “display of genuine commitment to democratic ideals ; the US Carter Center concluded that the majority of the constituency results were credible and reflected competitive conditions; the US Department of State said the elections stood out as a milestone in creating a new, more competitive multi-party political system. The EU Observer Mission, however, uncritically accepting some opposition claims, suggested the election had fallen short of international standards, though it actually classified nearly ninety percent of the polling processes as good or very good. The final results showed opposition parties had increased their seats in Parliament from 12 to an impressive 176, and that they had won all but one of the seats for the Addis Ababa City Council. Despite this, the main opposition coalition refused to accept the results, claiming against all the evidence that it had won. It called for a boycott of parliament, and organized a series of street protests in Addis Ababa at the beginning of November. These rapidly turned violent, and nearly 200 people including 7 policemen died in three days of rioting. A subsequent judicial commission of enquiry deplored the deaths but cleared the police of using unnecessary force. Thousands of people were temporarily detained. A number of opposition political leaders were convicted of various offences and jailed, but pardoned two years later.

Before the next election, in 2010, most of the parties, determined to avoid another outbreak of violence, signed an Election Code of Conduct. The exception was the largest opposition coalition, the Forum for Democratic Dialogue (MEDREK), a coalition of eight parties which included most of the groups that boycotted Parliament in 2005. When it came to the vote, the electorate proved unimpressed by the opposition refusal to take up its seats in 2005, and equally disenchanted by MEDREK’s failure to sign the Code of Conduct, by the opposition’s lack of alternative policies, its failure to do more than criticize the EPRDF and the public bickering and quarrelling among its leaders prior to 2010. In sharp contrast, after 2005 the EPRDF had revitalized its structures, building up extensive Women’s and Youth organizations and reorganizing itself through the country. It won an overwhelming majority in local elections in 2008 and used this as a springboard for the national and federal elections in 2010. By then it also had the added advantage of presiding over significant growth and development, in infrastructure, primary education and health, and of achieving double-digit growth for the whole period between 2005 and 2010. It was hardly surprising that the results were a landslide victory for the EPRDF, including a total reversal of the Addis Ababa results of 2005 – in 2010 it was the opposition which only won a single seat, although over 40% of the city did vote for opposition parties. Elsewhere the EPRDF also achieved an almost clean sweep, with only one seat going to an independent. Overall, it won 499 of the 547 available parliamentary seats, and allied parties took another 46 seats. The opposition did just as badly in the regional state elections, with the EPRDF and parties allied to it winning all but one of the seats.

After 1991, the EPRDF redefined foreign as well as internal policies. The Foreign Policy and National Security Strategy [link here] identifies the major threats to the country and to its survival: economic backwardness, widespread poverty, the need for democracy and good governance together with the establishment of a democratic structure and democratic government at all levels. This in turn requires a commitment to peace and security, internally and regionally. In this Ethiopia has been largely successful in achieving good relations with its neighbors, with the exception of Eritrea.

In 1991, by agreement with the EPRDF, whose ally it had been in the fight against the military dictatorship, the EPLF took power in Eritrea and the region became de facto independent. In April 1993 a referendum was held in Eritrea and among Eritreans elsewhere, including Ethiopia, on taking independence or remaining part of Ethiopia. The issue of continued association through a federation or confederation was dropped from the referendum paper despite an earlier agreement to include this as an option. An overwhelming majority voted for independence which was formalized in May 1993, though an estimated 400,000 Eritreans living elsewhere in Ethiopia chose not to participate in the vote.

Relations between the new state and Ethiopia appeared close for the first few years though Ethiopia was concerned by the aggression Eritrea showed towards Sudan, Yemen and Djibouti in the mid 1990s in an apparent attempt to formalize its borders and establish a role as the major player in the region. This process culminated in May 1998 when Eritrea precipitated a shooting incident inside Tigrai regional state in northern Ethiopia and immediately invaded with two brigades to seize control of a small town, Badme, inside Ethiopia, claiming it as part of Eritrea.

The subsequent war lasted for two years although the actual fighting was confined to three relatively short campaigns, in May’June 1998, February to June 1999 and May-June 2000. These, however,  left  and led to  at least 60,000 casualties, as well as the expulsion of tens of thousands of Eritreans from Ethiopia (the majority of whom had voted for an independent Eritrea in the referendum of 1993) and at least as many Ethiopians from Eritrea. Hundreds of thousands on both sides were forced to flee from the war zones all along the common border. Ethiopia recovered Badme in February 1999 and won a series of victories in May and June 2000 threatening attacks on Asmara and Assab. These defeats finally forced Eritrea to accept the Algiers Agreement, signed in December 2000. This allowed for a 25 km wide demilitarized zone inside Eritrea to be monitored by a UN force. It also set up a Boundary Commission to look into the border issue and a Claims Commission which evaluated the claims made by both sides and, inter alia, detailed Eritrea’s responsibility for the conflict. The Boundary Commission reported in April 2002. Eritrea and Ethiopia, although it had some concerns about the details, have both accepted the report, but Eritrea has consistently refused to make any moves towards the dialogue necessary to allow for the demarcation of the border and the normalization of relations. It has also in effect torn up the Algiers Agreement by forcing out the UN Mission to Eritrea and Ethiopia (UNMEE) which had been monitoring the demilitarized zone and seizing control of it. In addition, by making destabilization of neighboring countries the central element of its foreign policy, it has caused serious security problems ay various times for Ethiopia, Somalia and Djibouti as well as both the Sudan and South Sudan.

In December 2006, at the request of the Transitional Federal Government of Somalia, and in reluctant response to the calls by the Islamic Courts Union (ICU) for a jihad against Ethiopia and a renewal of Somali irredentist claims against Ethiopia (and Kenya), Ethiopia deployed some 16,000 troops to assist the TFG in its conflict with the ICU, successfully driving the ICU out of Mogadishu in a matter of days , and assisting the TFG in its efforts to deal with various extremist groups, notably Al-Shabaab in Mogadishu and other areas. The ICU, Al-Shabaab and other extremist groups received arms and funds from Eritrea. The Ethiopian forces, which after early 2007 were operating on behalf of IGAD and the AU, left in January 2009, handing over to the African Union Mission in Somalia (AMSIOM), made up of Ugandan and later Burundian troops.

Ethiopia’s support for peace and security in the region has been the driving force behind its role in the regeneration and revitalization of regional organizations such as the Inter-Governmental Authority for Development (IGAD), covering the Horn of Africa and in the setting up of the Sana’a Forum for Cooperation (composed of Ethiopia, Sudan, Djibouti and Yemen). IGAD, of course, is one of the African Union’s Regional Economic Communities for African integration. The organization has played an important role in the Comprehensive Peace Agreement in Sudan, has been active in trying to resolve the problems of Somalia, and in setting up mechanisms for cross-border cooperation generally throughout the region.

Ethiopia was a founder member of the Organization of African Union, and is the seat of the African Union. It therefore carries a special responsibility for the AU and fully subscribes to the AU’s vision of an integrated, prosperous and peaceful continent providing a dynamic force in the global arena. From its leading role in support of  African liberation movements,as virtually the only independent African state, Ethiopia consistently gave aid and assistance  to the anti-colonial and anti-apartheid struggles particularly in Southern Africa [Picture links?? – New AU HQ] It has played a major role in championing Africa in global forums, with notable reference to climate change, in G8 and G20 meetings and other international bodies.

It has also shown similar interest in and cooperation with the United Nations of which it was a founding member. It has consistently discharged its obligations to the UN, cooperating in collective security and peacekeeping operations in Korea and Congo, as well as elsewhere, most recently in providing a UN peacekeeping force for Abyei in Sudan (in 2011).



The government’s long-term economic development strategy – Agricultural-Development-Led-Industrialization (ADLI) – is geared to the transformation of the economic structure. The strategy involves an export-led external sector, and internal emphasis on agriculture to supply commodities for exports, domestic food supply and industrial output, and expand markets for domestic manufacturing. The development strategy is supported by an economic reform program developed in cooperation with the World Bank and the International Monetary Fund (IMF) and by a series of structural adjustment programmes. There have been major gains from the reform programme, and from liberalization of the economy, including low inflation, fiscal discipline and low government borrowing, infrastructure improvement and the growth of the private sector after a privatization program was initiated in 1995 under which a majority of former government-owned firms have been denationalized.


The current Growth and Transformation Plan (GTP), finalized in November 2010, was built on the implementation of previous poverty reduction strategies, the Sustainable Development and Poverty Reduction Program for 2002/03−2004/5 and the Plan for Accelerated and Sustained Development to End Poverty for 2005/06−2009/10 (PASDEP) which laid out the directions to achieve the Millennium Development Goals by 2015 and the basis for Ethiopia to reach ‘middle-income’ status by 2020−25.  In March 2012, the IMF said Ethiopia would achieve this earlier if its rapid growth continued.


PASDEP provided for substantial progress in the provision of social services such as education, health and infrastructure through investing in physical and human capital formation and allocating over 60% of the budget to pro-poor expenditure. The spending on poverty-targeted sectors (both recurrent and capital) steadily increased during this period rising from 42.0% of total expenditure in 2002/03 to over 64% and this has continued.  The effects were visible in significantly improved education and healthcare services. Primary school net enrolment rose from 77 percent in 2004/05 to 82 percent in 2009/10, and is now over 96%; completion rates also increased steadily. Secondary enrolment also rose steadily. Tertiary level education increased sharply. The proportion of fully immunized children rose from 20 percent in 2006 to 66 percent in 2010; the percentage of births attended by healthcare workers increased from 16 percent to 29 percent during the same period. In 2005 the maternal mortality was 871 per 100,000 births; this declined to 590/100,000 by 2010. Under-five child deaths fell from 200/2000 to 75/2000 in 2009. Health service coverage increased from 30% to 89% during PASDEP.


In 2004, Ethiopian GDP (Gross Domestic Product) was about 63% of Kenyan GDP and 4.6% of South African GDP; by 2009, the comparison was 97% and 10.1% respectively. Per capita income had increased from $138 to $344 in 2009. In 2009/2010 the economy grew by 10.4%, compared to the estimated growth rate of 6.0% for all Sub-Saharan Africa. Agriculture and allied activities contributed 30% to the increase while the service and industry sectors provided 56% and 13% respectively. Inflationary pressure continued to ease due to prudent monetary and fiscal policies and other government measures, and annual average inflation dropped to 2.8% in June 2010 against 36.4% a year earlier. It has since fluctuated sharply, rising sharply in 2011 and remaining a serious problem in 2012.

The financial sector registered robust growth in 2009/10 despite global economic shock and financial crisis. The total number of banks operating in Ethiopia reached 15 as two new private banks joined the industry during the fiscal year. The number of bank branches also increased by 45 from 636 to 681. Banks were able to register high profit, enhance resource mobilization, expand their capital level and reduce their non-performing loans to a minimum level in 2009/2010. The fiscal year 2009/2010 saw strong performances in imports and exports, a surge in services and transfers and some narrowing of the current account deficit. Export proceeds amounted to US$ 2.0 billion, 37% higher than the previous year with increases of all major export items except leather products and pulses. Service inflows rose by over 18%. The total import bill grew by 7%, reaching US$8.3 billion, due to increases in the cost of semi-finished goods, fuel, capital goods and consumer goods.

Overall, during the period of PASDEP the non-agricultural sector of the economy showed a 23.6% expansion as a result of the combined effects of the growth in the industry and service sectors. The main factor for industrial growth came from the substantial investments in hydroelectric power generation.  Manufacturing showed an annual growth rate of 22.5 percent; mining surged by 95%, though construction was affected by a 1.2% slow down because of a subsequently rectified shortage of cement.  In the service sector financial intermediation showed over 30% annual average growth between 2004/5 and 2009/10 as the financial sector continued to expand along with the country’s economic growth.


The growth in agricultural output was largely attributed to improved productivity aided by favourable weather conditions and appropriate economic policies. The amount of land under cultivation increased steadily between 1996 and 2008, reaching 11.2 million hectares in 2009/10. The production of major crops, including cereals, pulses and oilseeds, increased by some 5.6% that year. Total agricultural production rose from 119.1 million quintals in 2004 to 191 million in 2009 with productivity averaging 15.7 quintal/hectare (up from 12.1 quintal/hectare in 2004/05). Between 1996 and 2008, cereal yields, aided by significantly greater use of fertilizer, increased by about 40%. Agriculture averaged 8.4% growth during PASDEP (2005/6-2009/10) and provided the basis for the average double-digit economic growth after 2004/2005.


The government has developed a pro-active policy for the horticulture industry, providing tax and excise duty rebates, allowing full profit repatriation, making land and finance available at low cost, and actively promoting trade standards and the creation of institutions to train skilled staff. The government has encouraged investment in agro-business projects and in land, particularly in areas where land is under-utilized or uncultivated. Some larger projects have been leased to foreign investors but most of those agreed between 2005 and 2010 involved Ethiopian investors. Largely in the southern and western parts of the country in the regional states of the SNNP, Benishangul Gumuz and Gambella, these are intended for the production of wheat, maize and rice as well as bio-fuel products sourced from sugar, jatropha, castor and palm. Generous leases with performance-linked options for renewal are tied to local employment and development as well as provision for sales to local or regional markets. Projects have to fulfil specific requirements in terms of economic benefit and sustainability with respect for the rights and interests of local populations. Any movement of people for agro-industrial development or for hydro-power projects, for example, must be voluntary. click here for more.


During the period of PASDEP Ethiopia became one of the fastest-growing non-oil economies in Africa averaging 10-11% growth rates, and the economy has continued to increase at this rate. On the basis of the achievements of the Plan for Accelerated and Sustained Development to End Poverty the aims of the Growth and Transformation Plan (GTP), 2010/11-2014/15 are to remove finally the chronic food insecurity from which Ethiopia has suffered for so long, achieve high growth of at least 11% within a stable macroeconomic framework; achieve the MDG targets particularly in the social sectors, and establish a stable democratic and developmental state. The GTP identifies sustained rapid growth, emphasis on agriculture, the promotion of industrialization, investment in infrastructure, enhancement of social development, strengthening of  governance, and the empowerment of youth and women as strategic pillars, and defines three strategic directions for strengthening governance: increasing implementation capacity; ensuring transparency and combating corruption; and securing participation in governance – all within a stable macroeconomic framework. It also underlines the importance of prioritizing public sector investment based on rigorous cost-benefit analysis, improving data quality and implementation capacity, maintaining fiscal prudence and continuing tax reform, containing inflation and promoting monetization and competition.

By the end of the plan, the government expects to achieve inter alia a number of ambitious targets. The Growth and Transformation Plan’s base case scenario allows for an 11.2% annual growth rate; the high case scenario anticipates 14.9% growth. Either allow for significant increases in agricultural production, possibly doubling it and substantial expansion in industrialization and infrastructural development. Other targets include reaching a per capita GDP of about USD 700 (the current level is about US$ 400); over 2 000 km of new railway line, 8 000 megawatts (MW) of additional power generation, mobile phone density of 8.5 per 100 (up from the current level of 1.5); and a road network of 136 000 km (up from the current level of 45 000 km). Farmers throughout the country are to be provided with access to roads, electricity and telecommunication services.



Business people around the world can explore a lot of business opportunities in Ethiopia. There are opportunities of investing in Agriculture and agro-processing, manufacturing, tourism, construction, mining and energy.

In order to thoroughly understand why one should do business in Ethiopia, you are invited to read the detailed information from the Trade & Investment section of this website.

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