Ethiopia’s record export earnings in 2025/26 should be welcomed, but they also expose a familiar weakness: the country still depends too heavily on gold and coffee for foreign exchange. When two commodities account for nearly four-fifths of export earnings, the economy remains vulnerable to price swings, supply shocks, and policy changes beyond its control.
The headline numbers are impressive. Export revenue crossed 11 billion dollars, well above the government’s target of 9.8 billion dollars and sharply higher than last year’s 8.3 billion dollars. Gold alone brought in nearly 5.5 billion dollars, while coffee earned 3.1 billion dollars. Together, they generated 8.6 billion dollars, or 78.2 percent of total export earnings. That is not diversification; it is concentration.
This matters because a narrow export base can create a false sense of strength. A good year in gold or coffee can lift foreign exchange inflows, but it does not necessarily build a resilient economy. If global prices fall, production slows, or demand softens, the country’s earnings can deteriorate quickly. That is a risky position for any economy, especially one that needs steady foreign exchange to finance imports, stabilize prices, and support industrial growth.
The problem is not that gold and coffee are unimportant. They are, and they should remain central to the export mix. Gold has become a major source of hard currency, and coffee remains one of Ethiopia’s strongest global brands. The problem is that success in these sectors has not been matched by equally strong growth in manufacturing, agro-processing, horticulture, livestock, tourism, or high-value services. Ethiopia is earning more, but not yet broadly enough.
A more diversified export basket would do more than reduce risk. It would create jobs, expand tax revenue, improve regional balance, and build more durable growth. Raw commodity exports usually generate limited local value addition. By contrast, processed goods, branded agricultural products, and service exports can retain more income at home and support deeper industrial development. In practical terms, that means moving from simply shipping out raw materials to earning foreign exchange from transformed, higher-value products.
The government has repeatedly said export diversification is a strategic priority. That is encouraging, but strategy alone is not enough. The country needs a more forceful implementation agenda. First, there must be stronger support for agro-processing industries that can turn sesame, oilseeds, pulses, fruits, and vegetables into export-ready products. Second, exporters need better logistics, storage, and transport systems so that perishable and semi-processed goods can reach markets reliably. Third, financing must be more accessible for firms outside the traditional commodity sectors, especially small and medium-sized exporters.
Policy consistency is equally important. Businesses will not invest in new export sectors if rules change too often or if foreign exchange access remains unpredictable. A credible diversification plan requires clear incentives, transparent regulation, and better coordination across customs, transport, agriculture, trade, and finance authorities. Exporters also need technical support to meet international standards, packaging requirements, and certification rules. Without that, promising sectors will continue to underperform.
There is also a role for regional trade. Ethiopia should do more to tap into African markets under the African Continental Free Trade Area. Many non-traditional exports, especially manufactured goods and processed food products, can find buyers closer to home if trade barriers are reduced and logistics improve. Regional trade may not generate the same prestige as gold, but it can create more stable demand and help companies scale.
Tourism and services deserve more attention too. Ethiopia has a strong cultural and historical profile, major natural assets, and a national airline with continental reach. These are export earners in their own right, even if they do not show up in the same way as merchandise trade. A serious foreign exchange strategy should treat services as part of the export conversation, not as an afterthought.
The biggest lesson from this year’s export performance is simple: strong numbers are not the same as strong structure. Ethiopia has made striking gains in gold and coffee, but a two-commodity export model is still too fragile for the demands of a large and fast-changing economy. The next phase of progress should not be measured only by how much gold is sold or how much coffee is shipped. It should be measured by how many more sectors contribute meaningfully to foreign exchange, employment, and industrial upgrading.
If Ethiopia wants lasting economic stability, it must turn export growth into export diversity. That means using the momentum from gold and coffee as a launchpad, not a ceiling.
