Health in Ethiopia - Socio-economic Situation

Socio-economic Situation

The Government of Ethiopia follows a market–based and agricultural led industrialization economic policy for the development and management of the economy. There have been a number of policy initiatives and measures taken in these directions which included privatization of state enterprises and rationalization of government regulation which the process is still ongoing. Ethiopia's economy depends heavily on the agricultural sector. Agriculture accounts for 83.4% of the labour force, about 43.2% of the Gross Domestic Product (GDP) and 80% of exports . The regular droughts combined with poor cultivation practices, make Ethiopia's economy very vulnerable to climatic changes. Despite these obvious challenges, Ethiopia has shown an impressive economic growth over the last seven years, although the per capita of 235 USD remain below the Sub Saharan average. But, Poverty Head Count Index has declined from the 1996 level of 45.5% to 32.7% in 2007/08. The reduction in poverty has been more pronounced in rural areas than in urban areas. The overall economic dependency ratio for the country is estimated at 93 dependents per 100 persons in the working age group of 15-64 years. During the SDPRP I period (2002/03 - 2004/05), real GDP grew on average by about 5 percent per annum. However, during the first three years of PASDEP period the country registered an average of double digit economic growth of 11.8% per annum with steady and strong positive performance in real GDP . This steady growth marks a significant progress, not only compared to the 7% annual growth target that would be required to meet the MDGs, but also to realize Ethiopia’s objective to become a middle-income country in the next two decades. Another important feature of the economic reform in Ethiopia is equal opportunity for women in the participation of the economic development of the country which is enshrined in the constitution. The Ethiopian Constitution recognizes the principle of equality of access to economic opportunities, employment and property ownership for women. Following this, the government has formulated a national gender policy, which recognizes equality between the sexes and sets up mechanisms for the improvement of women’s conditions, such as the establishment of the Ministry of Women’s Affairs. The main strategies employed to implement the national policy include gender mainstreaming in sector and development programs, advocacy and capacity-building initiatives.