According to the IMF, Ethiopia was one of the fastest growing economies in the world, registering over 10% economic growth from 2004 through 2009. It was the fastest-growing non-oil-dependent African economy in the years 2007 and 2008. In 2015, the World Bank highlighted that Ethiopia had witnessed rapid economic growth with real domestic product (GDP) growth averaging 10.9% between 2004 and 2014.
Ethiopia’s growth performance and considerable development gains came under threat during 2008 and 2011 with the emergence of twin macroeconomic challenges of high inflation and a difficult balance of payments situation. Inflation surged to 40% in August 2011 because of loose monetary policy, large civil service wage increase in early 2011, and high food prices. For 2011/12, end-year inflation was projected to be about 22%, and single digit inflation is projected in 2012/13 with the implementation of tight monetary and fiscal policies.
The Ethiopian constitution defines the right to own land as belonging only to “the state and the people”, but citizens may lease land (up to 99 years), and are unable to mortgage or sell. Renting of land for a maximum of twenty years is allowed and this is expected to ensure that land goes to the most productive user. Land distribution and administration is considered an area where corruption is institutionalized, and facilitation payments as well as bribes are often demanded when dealing with land-related issues.