Ethiopia’s economy will expand by between 7 per cent and 10 per cent this fiscal year, missing the government’s target, as a severe drought hurts agriculture.
“The economy will continue to register growth, if not a double-digit fast economic growth,” Prime Minister Hailemariam Desalegn said in a newsletter emailed by the Foreign Ministry. The government had a target of 11 per cent growth for the fiscal year ending on July 7.
Ethiopia, Africa’s second-most populous country after Nigeria, with almost 100 million people, said average growth has been more than 10 per cent a year for the past decade, including 10.2 per cent last year. Before the effects of the drought were known, the International Monetary Fund expected the economy to expand 8.1 per cent this year and said the increase for the previous 12 months was 8.7 per cent.
Agricultural growth will be less than the projected 11 per cent after the El Nino weather phenomenon reduced rains last year across eastern areas of the country, Hailemariam said. Agriculture accounted for 39 per cent of gross domestic product last year, according to Finance Ministry data. The drought, which is the worst in 50 years, has left almost one-fifth of Ethiopians needing food aid and 400,000 people facing severe malnutrition.
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