Ethiopia’s GDP reaches USD 41.1bln


Access Capital’s Research Unit Mid-Year Macroeconomic review for July 2012 has put the  the aggregate size of Ethiopia’s economy, or nominal Growth Domestic Product (GDP) to about USD 41.1 billion based on the year-average exchange rate of 17.28 birr per dollar.
This nominal GDP calculation reflects a starting (actual) GDP base of Birr 511 billion in the Fiscal Year 2010/11, boosted by real GDP growth of 11.1 percent and an estimated GDP deflator of 25 percent in the just completed fiscal year. Final GDP statistics for Fiscal Year  2011/12 are not out yet (and will not be available until the end of 2012), but the Ministry of Finance and Economic Development  has put out a growth estimate of 11.1 percent in its recent Budget Document presented to Parliament.
The report’ assertion has been boosted by  figures in actual outturn data for various sectors among which is the agriculture sector which has already been released by the Central Statistical Agency (CSA).
The CSA report states that the main harvest takes place early in the fiscal year. It points to 21.9 million tons of food output in the just concluded Ethiopian fiscal year, 2011/12.
This according to the report is a 7.4 percent increase from the previous year and stems from more land coming under cultivation, that being 12.1 million hectares farmed this year, up 2.2 percent from the previous Fiscal year and from slightly better yields.
Data from Food and Agricultural Organization (FAO) appear to support national agricultural growth figures, with their estimates pointing to 9.4 percent growth, a figure which is actually higher than government’s growth figures unlike the case in each of the past two years.
Non-agricultural sectors have shown even stronger growth than the farm sector, according to the Ministry of Finance, which estimates growth of 17.9 percent for Industry and 11.5 percent for services for the just concluded fiscal year.
Other positive indicators in this respect are found in some strongly suggestive indicators of continued economic expansion in Fiscal year 2011/12: figures for electricity consumption up 15 percent, airline cargo volumes up 15 percent, and tourism arrivals up 11 percent.
Investment trends remain relatively robust and are expected to remain that way, despite some severe operational challenges in selected sub-segments of the business environment related to credit availability and trade logistics.
Large foreign direct investment deals in the mining, consumer goods, and manufacturing sectors continue to be launched and/or expanded, typically facilitated by their own funding sources as well as generous financing support from the development bank.
The report however highlights that for domestic businesses, however, shortages of working capital and short-term credits as well as extended delays in sourcing imports for key raw materials remain challenges faced by many.
The report states that the outlook for growth in the period ahead remains positive, with an excellent start to the main rainy season currently normal to above-normal rainfall is being recorded by the Ethiopian Meteorological Agency for most food-growing regions.
Growth is expected to be boosted by continued heavy infrastructure investments, a strong pipeline of FDI inflows, and generally buoyant service sector activities. 
Activities in Public Investments, Agricultural Transformation, Consumer Goods Revolution, and Emerging Export Industries are expected to continue to propel activity levels in their respective domains. Based on this projection the report’s projections of 10 percent real GDP growth and a 16 percent GDP deflator for this new fiscal year, nominal GDP will reach nearly USD 50 billion for the current fiscal year 2012/13.