Ethiopia has experienced significant economic setbacks following the suspension of the African Growth and Opportunity Act (AGOA) in January 2022, with approximately 18 foreign companies exiting the country and industrial parks losing an estimated $45 million in revenue, according to the African Development Bank Group’s (AfDB) Country Focus Report 2025 Ethiopia released on June 23.

AGOA had previously allowed Ethiopia duty-free access to the U.S. market for a wide range of products, fostering export growth and job creation. However, the suspension disrupted established market linkages and supply chains, leading to a 24% decline in exports from Ethiopia’s industrial parks in 2023. The Hawassa Industrial Park, one of the country’s largest, alone saw over 1,000 jobs lost due to these disruptions.

The report highlights that the suspension has compounded broader geopolitical and economic challenges, adversely affecting Ethiopia’s annual budget and threatening critical public services. Key donor countries are also scaling back aid: Germany plans to reduce its aid budget by 1 billion euros in 2025, while the UK intends to cut aid spending through 2027. Furthermore, following a U.S. government “work stoppage” on foreign aid programs, Ethiopia’s Health Ministry was forced to lay off 5,000 health workers previously supported by USAID and the CDC.

Food aid delivery has also been hampered. The AfDB report notes that 34,880 metric tons of essential food supplies—enough for 2.1 million people for one month—remain stranded at the port of Djibouti due to insufficient funds for transportation to Ethiopia.

The suspension has particularly hit Ethiopia’s textile, leather, and apparel sectors, which relied heavily on AGOA’s preferential access. The National Bank of Ethiopia reported that the suspension put approximately 11,500 jobs at risk across industrial parks, with Hawassa, Mekelle, and Bole Lemi among the hardest hit. Major investors, including PVH (parent company of Calvin Klein and Tommy Hilfiger), withdrew operations, causing supply chain disruptions and leaving many industrial park facilities idle.

The report stresses the urgent need for Ethiopia to diversify its export markets to reduce vulnerability to such shocks. While some companies have shifted focus to domestic markets, the loss of AGOA privileges has exposed the fragility of Ethiopia’s export-oriented manufacturing base.

The AfDB report also draws attention to illicit financial flows (IFF) as a significant challenge to Ethiopia’s economy. Mis-invoicing in trade documents—such as import over-invoicing and export under-invoicing—is estimated to account for between 55% and 80% of illicit money leaving the country, representing 6% to 23% of Ethiopia’s total business value. The International Monetary Fund (IMF) estimates that these illicit flows could reduce Ethiopia’s average annual GDP growth by 2.2% and cause a loss of 10% to 30% of government revenues.

While the Ethiopian government has enacted legislation to combat money laundering and terrorism financing, including the Prevention and Control of Money Laundering and Terrorism Financing Proclamation No. 780/2013, the report notes difficulties in effective enforcement.

The suspension of AGOA has had far-reaching consequences for Ethiopia’s economy, from job losses and declining exports to strained public services and aid delivery. Coupled with challenges such as illicit financial flows and reduced foreign aid, the country faces a complex landscape requiring strategic reforms. The AfDB report underscores the need for market diversification, enhanced governance, and stronger international cooperation to restore economic stability and growth.

By Eyasu Zekarias

Young innovators across Africa are driving transformative change in the agricultural sector by developing new technologies aimed at closing critical gaps and enhancing food security. Recent competitions organized by Heifer International have spotlighted and funded promising agritech solutions proposed by Africa’s youth, highlighting their vital role in shaping the continent’s agricultural future.

At the AYuTe NextGen 2025 competition held in Kampala, Uganda, four young agritech innovators from different African countries were recognized for their innovative approaches to addressing pressing challenges in the continent’s food system. The event, themed “Agricultural Technology Generation is on the Rise,” gathered leaders, investors, policymakers, and development partners to discuss major issues such as climate change, limited market access, and financing shortages for smallholder farmers.

Out of more than 100 applicants from 10 African countries, 11 finalists presented their innovations to an expert jury. Among the winners, Kenya’s Carolyn Mwangi was honored for developing climate change-resistant seedlings, while Ghana’s Nana Opoku received recognition for creating a digital platform that connects farmers with investors to secure funding.

The agricultural market in Africa, currently valued at $280 billion, is projected to grow to $1 trillion by 2030, with youth involvement playing a critical role in job creation and sector growth. Adesuwa Ifedi, Senior Vice President of Africa Programs at Heifer International, emphasized the impact of young entrepreneurs: “There are over 2,000 agricultural technology start-up companies operating on the continent, most of which are led by African youth. These young agricultural entrepreneurs are creating opportunities at all levels in the farming value chain. They are changing the way we produce food, exchange information, and solve climate problems.”

Parallel to the NextGen event, the AYuTe Ethiopia 2025 awards program recently took place, focusing specifically on young Ethiopian agritech innovators. The competition awarded cash prizes ranging from $7,500 to $15,000 to the top five innovators, who will also receive support to implement their ideas. The challenge aims to tackle obstacles faced by smallholder farmers in Ethiopia, encouraging technologies that boost productivity, income, financing access, and resilience.

Despite Africa’s vast agricultural potential—boasting 60% of the world’s uncultivated fertile land—the sector remains technologically underdeveloped. Experts attribute this lag to inadequate policy support, poor infrastructure, and limited funding for agritech startups, which have hindered progress.

By empowering youth-led innovation, initiatives like Heifer International’s AYuTe competitions are fostering sustainable solutions that promise to transform agriculture across Africa, improving livelihoods and strengthening food security for millions.

Moving to another country – the main fear in life or an opportunity to broaden horizons? This is the question our protagonist Eyerusalem Worku from Ethiopia askes herself today. She has been living and working in Russia with the Alabuga Start programme for over 1.5 years. How the girl’s parents reacted to the decision to move to another continent, what she was looking for and whether her expectations were met – read in our article.

“THE MAIN REASON THAT MADE ME COME HERE WAS BECAUSE OF THE CAREER GROWTH”

In the context of globalization and a rapidly changing world, higher education is fading into the background. New opportunities for professional development and career growth are opening up for young people in large companies that independently train personnel right on the job. The special economic zone “Alabuga” has become such a place, having launched an employment programme for girls from Africa, Latin America, South and Southeast Asia in 2022.

“I wanted to go abroad, discover more opportunities, learn a new culture, language and everything. By the time I was looking for opportunities, Alabuga Start was on my hand, so I decided to discover it more,” Eyerusalem shared her experience.

The girl moved to Russia in 2023 to try her hand in the Catering field.

“I started as a kitchen worker with a salary of $500: I helped in the kitchen, studied the technology of preparing various dishes, learned how to work with products correctly. In 1.5 years in the program, I grew to a barista and earn more than $1,200, and in a couple of months I will be promoted to an administrator,” explained Ms. Worku.

Becoming an administrator in a restaurant will be a big challenge, our interlocutor admitted. Leaving the comfort zone, communicating with a large number of people, managing processes in the restaurant – all this will require greater responsibility and “another level of leadership skill”.

FROM A DIFFICULT CHOICE TO FULL SUPPORT: HOW PARENTS REACTED TO THE DECISION TO MOVE TO RUSSIA

The issue of safety, trust and cultural environment is key for parents. And this is where Alabuga Start turned out to be unexpectedly convincing. From the moment of applying for the programme, the girls are accompanied throughout the selection and employment process by an HR specialist from Alabuga, who answers all questions from future participants and their parents in detail.

“It was somehow difficult for my parents to accept it. And the only thing I did was to research, to get information on the internet and talk to the HR specialist of the programme to get as many details as possible. As I was doing that, I was sharing with them every single piece of information I could find. So, yes, it was hard for them in the beginning, then they started accepting it, then they became supportive,” Eyerusalem said.

In addition, upon arrival, the girls begin to study Russian with professional teachers and immerse themselves in the local culture through an integration programme: excursions around Russia, sports events, communication with local residents.

The programme participants live in corporate hostels alongside with other Alabuga employees. Entrance to the hostels and buildings is carried out through the Face ID system, which makes their stay even safer.

“I live in an apartment with girls from Nigeria, Uganda, Kenya and Kyrgyzstan. We communicate in Russian – it has become a common language that unites us,” Eyerusalem shared with a smile.

Today, Eyerusalem’s younger sister Mahlet also joined the Alabuga Start programme and began her journey in the Catering field.

“After seeing my sister’s achievements, my parents no longer doubted my choice,” stated Makhlet Worku.

HOW TO BECOME A PART OF ALABUGA START?

Today, Alabuga Start offers employment in any of 7 fields to choose from: Catering, Service and Hospitality, Road Transport Shop (Driver), Production Operator, Installation Works, Finishing Works, Logistics.

Only girls aged 18 to 22 can join the international programme. The company explained that the age restrictions are determined by the results of an HR research, according to which Alabuga Start implies the opportunity to build a career from scratch.

The programme lasts only 2 years. During this time, the girls grow to highly qualified specialists and quickly advance in the career ladder.

Upon completion of the programme, participants can choose any of the options for themselves:

– Stay to work in Alabuga in their chosen field;

– Get a job at one of the resident plants of the special economic zone;

– Enroll in Alabuga Polytech or any other educational institution in Russia;

– Return home and start their own business, using the accumulated experience and professional skills.

At the age of 25 (which is how old the oldest participants will be at the end of the 2-year programme), the girls are already experienced enough to make their own destiny, yet still young enough to discover other opportunities for themselves in both their studies and career.

“I want to stay to work in Alabuga after I complete the programme”, – Eyerusalem envisioned her plans for the future. – “This place has already given me a lot. I would say that I’ve overcome one of my difficulties, which is working with other people. It was hard for me to be able to work in one team with people. And I have overcome that fear thanks to participating in Alabuga Start programme”.

You can apply for participation via the programme website.