The International Monetary Fund (IMF) has projected Ethiopia’s economy to expand by 7.2% in the current fiscal year, marking one of the strongest growth outlooks in sub-Saharan Africa. The forecast is part of the IMF’s latest annual regional economic report, released on Thursday.
While slightly more conservative than the Ethiopian government’s target of 9%, the IMF’s projection reflects confidence in Ethiopia’s ongoing economic reform agenda. Looking ahead, the Fund expects Ethiopia’s growth to ease slightly to 7.1% in FY2026, just 0.1 percentage points lower than this year’s forecast.
Sub-Saharan Africa Shows Resilience
The IMF report — which reviews the economic performance of 45 sub-Saharan African countries — highlights that despite global headwinds such as volatile commodity prices, high debt levels, and weakened trade flows, the region remains resilient. Overall regional growth is expected to remain steady at 4.1% through 2025, supported by reform-driven economies like Ethiopia, Nigeria, Benin, Côte d’Ivoire, Rwanda, and Uganda, identified among the fastest-growing economies globally.
Commodity Prices Offer Relief
While global economic growth is set to slow slightly, the IMF notes that higher prices for key exports such as coffee and gold — compared to pre-pandemic levels — will benefit resource-rich countries like Ethiopia. However, the Fund also cautioned that double-digit inflation remains a major concern, placing Ethiopia alongside Angola among countries struggling with persistent price pressures.
Government Figures More Optimistic
The IMF’s projections contrast with figures shared by President Taye Atske-Selassie, who, during the opening of the Houses of People’s Representatives and Federation last week, stated that Ethiopia aims for 9% growth this fiscal year and had achieved 8.8% growth in 2017.
Despite differing estimates, both the IMF and government outlooks point toward continued economic momentum — with reform efforts expected to play a key role in sustaining recovery.
Source: Ethiopia Insider
