By Merga Yonas

Ethiopia has grown at or near double-digits from 2003- 2010, but faces high inflation and low international reserves, according to the African Economic Outlook of 2010.

The report, which was launched on Monday at the conference hall of the United Nation Economic Commission for Africa (UNECA), revealed the country had achieved impressive results in education, agriculture and the road sector. Despite tax reform and other measures, government revenue has declined in recent years.

Ethiopia is a fast growing non-oil economy that achieved double-digit growth in the period 2003/04-2007/08. However, the country had been struggling with the twin macroeconomic challenges of high inflation and very low international reserves since 2007/08. Economic growth remains robust, with real gross domestic product (GDP) growth of 9.9 percent in 2008/09, down from 11.6 percent in 2007/08 – the lowest since 2003/04, Emmanuel Nnadozie, director of Economic Development at UNECA, told journalists.

This high growth rate has been driven mainly by a boom in services and healthy growth in agriculture, supported by strong service exports and increasing official development assistance. Growth is expected to slow marginally to 9.7 percent in 2009/10, owing to the expected weak global recovery. The tight fiscal and monetary policies that seek to contain inflation are expected to slow down domestic demand as well, he added.

For the year 2010 some African countries are expected to show soaring growth, while others are slated to register a decline in growth. For instance, in 2009 Congo registered real gross domestic product (GDP) growth of 7.6 percent, which is expected to rise to 11.9 percent in 2010. This projection is the highest when compared to other countries in the list. On the contrary, Madagascar, which registered -4.5 percent in 2009 and is expected to show a -0.4 percent growth this year, was listed as a country that could register low level real GDP growth.

The third edition of the African Economic Outlook 2010 was jointly launched by the African Development Bank (AfDB), Organization for Economic Co-operation and Development (OECD) and UNECA. The theme for this year’s report is ‘public resource mobilization and aid’.

Source: EthiopianReporter