- International Monetary Fund (IMF) has withheld its GDP forecast for Ethiopia’s economic recovery in 2022 in its latest World Economic Outlook for the next four years.
- The exclusion by the international Money lender can be regarded as a mute comment on the economic outlook of Ethiopia. Usually only war-torn countries and failed states are treated like this by IMF.
- Ethiopia joins other countries including Afghanistan, Libya and Syria who are also excluded from the projections.
International Monetary Fund (IMF) has withheld its GDP forecast for Ethiopia’s economic recovery in 2022 in its latest World Economic Outlook for the next four years. The exclusion by the international Money lender can be regarded as a mute comment on the economic outlook of Ethiopia. Usually only war-torn countries and failed states are treated like this by IMF. Ethiopia joins other countries including Afghanistan, Libya and Syria who are also excluded from the projections.
Though the IMF has not made any explicit reference to the Tigray war, analysts are of the view that the on-going conflict is the most likely reason for exemption of the country.
Economic experts say that the missing projections and lack of macroeconomic data could affect Ethiopia’s outlook for investors. Investment decisions are made by making in-depth analysis of the target country and if data is missing about the country, investors may hold back. It was observed that even conflict-ridden countries like Somalia or South Sudan projections are available.
Ethiopia is also facing high risk of international sanctions. In early October, the Ethiopian government expelled seven UN officials from Addis Ababa for allegedly interfering in internal politics that further strained the already tense relations with the international community. Subsequently, the EU parliament demanded an “immediate cessation of hostilities by all parties” and urged for sanctions, including an arms embargo. The United States is also considering several options, including sanctions. UN has stated that government blockade has obstructed humanitarian aid leading to widespread famine in the Tigray.
