Ethiopia has emerged as one of the world’s fastest-growing economies in terms of labor productivity growth over the past decade. According to the 2025 Global Innovation Index (GII) released by the World Intellectual Property Organization (WIPO), Ethiopia recorded an annualized productivity growth rate of 5 percent between 2014 and 2024, placing it among the top three economies globally alongside China (5.9%) and Vietnam (5.4%).
While Ethiopia’s overall rank in the GII stands at 134th out of 1399 economies in 2025, the country has improved its innovation efficiency—a key metric reflecting how well an economy converts innovation investments into tangible outputs. Ethiopia’s rise in this indicator highlights progress in optimizing its innovation ecosystem despite volatility in its overall ranking.
The 2025 GII report further identifies Ethiopia among several economies, including Sweden, the United States, Malta, India, Mexico, Tunisia, and Nigeria, that have advanced in aligning their innovation investments with output. These countries are maximizing the productivity and impact of their innovation ecosystems to generate greater returns from resources committed to science, technology, and development.
Ethiopia’s position in the GII and its enhanced efficiency rating reflect growing efforts to promote innovation-driven economic growth, leveraging education, research, and technology adoption. However, the report also underscores challenges remaining for Ethiopia in human capital development, infrastructure, and market sophistication, which are crucial pillars for sustained innovation advancement.
Despite such challenges, Ethiopia’s remarkable decade-long productivity surge is particularly important given its sizable population and the imperative for inclusive growth and poverty reduction. As one of the fastest-growing productivity performers, Ethiopia demonstrates significant potential to contribute meaningfully to global development agendas through strengthened support for innovation ecosystems.
The GII 2025 report highlights Ethiopia’s capacity for knowledge creation, technology adoption, and business sophistication as areas to nurture further in order to ascend both innovation and economic development rankings in coming years. Policymakers and stakeholders are encouraged to sustain investments in research and development (R&D), support startups and scale-ups, and foster stronger linkages between universities, industry, and government to translate scientific discoveries into economic benefit.
In the broader African context, the GII places Ethiopia among countries showing growing innovation momentum amid mixed regional performance. With sustained focus on education, infrastructure, and policy reforms, Ethiopia can build on its rising innovation efficiency to accelerate diversified and sustainable growth pivotal to achieving long-term development goals.
Ethiopia’s progress in innovation efficiency signals an optimistic trajectory that, if harnessed well, could enhance its competitiveness and integration into global knowledge economies, benefitting both its population and regional economic dynamism.
