ETHIOPIA
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POVERTY

Ethiopia's per capita GNP of US$110 is one-fourth the average for sub-Saharan Africa and just about the lowest in the world. Pervasive poverty is manifested, inter alia, in the highest incidence of malnutrition and the lowest primary school enrollment ratio in the world. Severe infrastructural shortcomings, notably the lowest road density in sub-Saharan Africa, contribute to the isolation and vulnerability of the poor, particularly in drought years.

The low level of average income severely limits the scope for transfers, subsides, and social safety nets (although such limited safety nets as exist exhibit a low level of leakages, according to a United States Agency for International Development review). As noted above, the pervasiveness and severity of poverty makes redressing it an integral and central part of the overall development strategy.

There is evidence of significant decline in poverty during the recent years of rapid economic growth and good harvests. The widespread sharing of the benefits of growth, particularly through the emphasis on agricultural and rural development in the context of an egalitarian distribution of land, has been stressed above.

Measures to reduce the high variability of incomes, as indicated in earlier sections, are likely to have a particularly beneficial effect on the poor, who lack a consumption-smoothing mechanism.
In addition to broad-based growth, the government has acted promptly and decisively to make food available from stocks, exceptional imports, and surpluses areas to food-deficit areas in bad agricultural years. It has thereby succeeded in avoiding the famines that have unfortunately occurred in recent decades. The government will continue to exhibit this vigilance to avert future threats of famines. At the same time, a systematic program to alleviate food insecurity is to be finalized during 1998/99. This strategy needs to take account not only of drought-related insecurity but also of the more regular seasonal insecurity.

In this regard, the authorities' road sector program is of special significance, not only because it will bring markets and imports within reach of families, particularly in isolated areas, but also because it will facilitate getting food into food-deficit areas the lean season.

The other two sector investment programs, for education and health, also have a significant bearing on the alleviation of poverty.

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© World INvestment NEws, 1999.
This is the electronic edition of the special country report on Ethiopia published in Forbes Global Magazine.
July 26th 1999 Issue.
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