IMF: Ethiopia’s economy will this year decline to 4.5%

Young unempolyed persons look for jobs in newspapers on October 12, 2015 in Addis Ababa. It will be even more difficult to get work in 2016. (Photo/Thomas Imo/Photothek via Getty Images).

By MGAfrica

In its latest economic outlook released Tuesday, the IMF projects the economy of Angola—the continent’s second biggest oil producer— will grow just 2.5% this year,IMF: Ethiopia’s economy will this year decline to 4.5% falling from 3% posted in 2015.

The continent’s biggest oil producer, Nigeria, will see its economy grow 2.3% this year, the IMF projects, continuing a reversal that saw it expand 2.7% last year. In 2014, its economy grew 6.3%.

Oil prices have fallen more than 70% since June 2014, with few willing to bet their house on a substantive recovery any time soon. Another oil producer, Equatorial Guinea, last year saw its economy shrink 12.2%, while Sierra Leone contracted a staggering 21.5%, following its battle with the Ebola fever. Such reversals inform the gist of the IMF’s cloudy outlook, in which positive messages are scant.

7| Ethiopia’s staggering reversal

Last year Ethiopia was the world’s fastest growing economy, banking growth of 10.2% (it’s reporting year runs between July and June). But the Horn of Africa country is currently battling its worst drought in 30 years, with a fifth of its approximately 100 million people in need of food aid, with the rescue bill estimated at $1.4 billion. The adverse weather is linked to the ocean-warming effects of El Nino. As a result the IMF says, Ethiopia’s economy will this year decline substantially to 4.5%—it had projected 8.1% this year—with recovery to 7% seen in 2017.