Ethiopia was one of Africa’s fastest-growing economies, with average annual growth of around 11 percent, until 2020, when a two-year civil war broke out in its northern Tigray region. The decision to let the market—rather than the state—determine the birr’s exchange rate severely devalued Ethiopia’s currency, leading to higher inflation rates and cost of living. Ethiopia secured this export growth despite its longtime suspension from the African Growth and Opportunity Act (AGOA), the trade agreement that gives many African countries duty-free access to the U.S. market. Ethiopia’s economic performance is also being driven by surging gold exports, though this may be a temporary boon. Analysts suggest that by backing RSF fighters, Ethiopia is seeking to counter Egypt, a close ally of the Sudanese military.

Source: Ethiopian News February 19, 2026 03:00 UTC