From Land of Famine to Land of Hope

Will Ethiopia Become a Model for an African Upswing?

Ethiopia is one of the world’s least developed countries. Yet over the past two decades, the country has made extraordinary progress. Targeted investment in health, education and employment has improved living standards and triggered a rapid decline in the fertility rate. If it succeeds in consolidating these achievements, Ethiopia could become one of the first Sub-Saharan countries to benefit from a “demographic dividend” and demonstrate how development can work in Africa. Hopes are now pinned on the young prime minister, Abiy Ahmed, to introduce the necessary reforms and measures to break out of the vicious circle of poverty and rapid population growth. The study shows which factors have helped Ethiopia along its development path and which challenges it still needs to overcome in order to become a model country on the African continent.

The Berlin Institute would like to thank the Austrian Development Agency (ADA) for funding the project with funds from the Austrian Development Cooperation, as well as the DEG – Deutsche Investitions- und Entwicklungsgesellschaft mbH and the GfK Verein for financial support.

Focus Areas: International population policies, Demographic dividend
published: 21th September 2018

Press kit

Selected Figures

Since the mid-2000s, Ethiopia has attracted particular attention due to consistently high economic growth rates. For more than a decade, average annual GDP growth exceeded 10 percent. No other Sub-Saharan country has been so successful. But Ethiopia is also a heavyweight due to its large population. With more than 100 million inhabitants, it is the second most populous country on the African continent. © Berlin-Institut

Targeted investment in health, education and employment has improved living standards for many people in Ethiopia. Incomes have also increased considerably. Although average Ethiopian disposable incomes are still half the continental average, they have seen far faster growth than elsewhere. Since 1995, the average Ethiopian income has almost tripled, while the average income in Sub-Saharan Africa as a whole has risen by a factor of 1.5. © Berlin-Institut

Ethiopia’s development has contributed to a faster fall in fertility rates since the mid-1990s than in any other country in Sub-Saharan Africa. The declining number of births means that Ethiopia’s population pyramid is will likely transform into a teardrop shape in future. This age structure – the so-called demographic bonus – could lead to a demographically induced boost to development as experienced by the Asian tiger states. Whether this happens will depend on if employment can be provided for the growing number of young people of working age with an increasingly high level of education. © Berlin-Institut