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Ethiopian economy set to grow fastest in Africa
July 16, 2017, 1:37 pm

According to the latest World Bank Global Economic Prospect report, Ethiopia’s economy will be the most expansive on the continent for the year 2017, followed by that of Tanzania, Ivory Coast and Senegal.

‘‘Ethiopia is forecast to expand by 8.3 percent in 2017, Tanzania by 7.2 percent, Ivory Coast by 6.8 percent, and Senegal by 6.7 percent, all helped by public investment,” revealed the Bank’s report published in June.

In April, the International Monetary Fund (IMF) had also reiterated Ethiopia’s economic growth by disclosing that Ethiopia had dethroned Kenya to become the largest economy in East Africa. The IMF pegged Ethiopia’s economic growth since 2015 at 10.8 percent, putting a significant gap between the country and Kenya. In monetary terms, Ethiopia has opened a gap of over $29 million over Kenya, said the IMF.

Ethiopia’s economic growth is hinged on public-led spending on infrastructure and a strong demand by locals. It has also recently become a destination of choice for investors from Asia, especially the Chinese. Another factor believed to be driving the economy is Ethiopia’s large population, which is almost double that of Kenya.

Ethiopia’s annual economic output for 2017 was expected to hit $78 billion from $72 billion recorded last year.  And, buoyed by reports from global financial institutions, Ethiopian parliament last week passed a $13.9 billion budget for fiscal year 2017/18, which marked an increase of nearly 17 percent from the previous year.

It is especially noteworthy that Ethiopia’s economic gains come despite its security challenges caused by an influx of refugees and a biting drought that has blighted many areas in the Horn of Africa.

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