Trade and Regional Integration in Ethiopia: FY2019/20

Ethiopian exports have been volatile and declined during the period from 2015 to 2018. This decline in exports has not led to a significant deterioration of gross official foreign exchange reserves due to slower demand for imports caused by the persistent depreciation of the ETB. The declining exports has not led to a deterioration of Ethiopia’s current account balance due to slower import demand. Ethiopia is still dependent on agriculture-based exports which are also its top exported goods to its neighbours in the Common Market for Eastern and Southern Africa (COMESA). However, Ethiopia is well integrated in COMESA buts its trade is unbalanced due to the significant trade surplus the country enjoys in the region. This suggests that there is significant room to increase Ethiopia’s imports from COMESA.