The second Growth and Transformation Plan (GTP II) has fallen short of hitting its target of ensuring an 11 per cent yearly economic growth rate, the average annual growth rate standing at 8.6 per cent for the last three years.
The National Planning Commission commissioner, Fitsum Assefa, disclosed at a consultative forum held on 11 December, 2018, mentioned the recent bouts of political instability, social unrest, and tense security situation among the reasons for GTP II not performing as well as it was projected to. Regardless, the commissioner added, that the 8.6 per cent growth rate is still well-off the required growth rate of 7 per cent that Ethiopia needs to achieve the Sustainable Development Goals (SDGs) by 2030.
Mr. Fitsum mentioned the need for putting more emphasis on the effective utilization of the rapidly expanding industrial parks and agro-processing clusters to sustain economic growth, speed up economic transformation, and increase export earnings.
Regardless of GTP II not performing as well as it was planned, the per capita income has increased from 693 USD in 2015 to 801 in 2016 and 863 USD in 2017. This is despite the devaluing of the birr by 15 per cent against the dollar in October 2017. The industrial sector, grew by 20.6 percent in 2015/16 against a plan of 21.8 percent for the year. The service sector grew by 8.7 percent in 2015/16 against a plan of 10.3 percent annual growth, while its growth rate rose to 10.3 per cent against a planned goal of 10.2 per cent.
Sources: Ethiopian Herald, Fana BC