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Ethiopia's infrastructure: a continental perspective

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  • Foster, Vivien
  • Morella, Elvira

Abstract

Infrastructure contributed 0.6 percentage points to Ethiopia's annual per capita GDP growth over the last decade. Raising the country's infrastructure endowment to that of the region's middle-income countries could add an additional 3 percentage points to infrastructure's contribution to growth. Ethiopia's infrastructure successes include developing Ethiopia Airlines, a leading regional carrier; upgrading its network of trunk roads; and rapidly expanding access to water and sanitation.The country's greatest infrastructure challenge lies in the power sector, where a further 8,700 megawatts of generating plant are needed over the next decade, implying a doubling of current capacity. The transport sector faces the challenges of low levels of rural accessibility and inadequate road maintenance. Ethiopia’s ICT sector currently suffers from a poor institutional and regulatory framework. Addressing Ethiopia's infrastructure deficit will require a sustained annual expenditure of $5.1 billion over the next decade. The power sector alone requires $3.3 billion annually, with $1 billion needed to facilitate regional power trading. That level of spending represents 40 percent of the country's GDP and a tripling of the $1.3 billion spent annually in the mid-2000s. As of 2006, there was an annual funding gap of $3.5 billion. Improving road maintenance, removing inefficiencies in power (notably underpricing), and privatizing ICT services could shrink the gap. But Ethiopia needs a significant increase in its already proportionally high infrastructure funding and careful handling of public and private investments if it is to reach its infrastructure targets within a reasonable time.

Suggested Citation

  • Foster, Vivien & Morella, Elvira, 2011. "Ethiopia's infrastructure: a continental perspective," Policy Research Working Paper Series 5595, The World Bank.
  • Handle: RePEc:wbk:wbrwps:5595
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    References listed on IDEAS

    as
    1. Foster, Vivien & Steinbuks, Jevgenijs, 2009. "Paying the price for unreliable power supplies : in-house generation of electricity by firms in Africa," Policy Research Working Paper Series 4913, The World Bank.
    2. Yepes, Tito & Pierce, Justin & Foster, Vivien, 2009. "Making sense of Africa's infrastructure endowment : a benchmarking approach," Policy Research Working Paper Series 4912, The World Bank.
    3. You, Liangzhi & Wood, Stanley & Wood-Sichra, Ulrike, 2007. "Generating plausible crop distribution and performance maps for Sub-Saharan Africa using a spatially disaggregated data fusion and optimization approach:," IFPRI discussion papers 725, International Food Policy Research Institute (IFPRI).
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    Cited by:

    1. Kebebe, E. & Duncan, AJ & Klerkx, L. & de Boer, I.J.M. & Oosting, S.J., 2015. "Understanding socio-economic and policy constraints to dairy development in Ethiopia: A coupled functional-structural innovation systems analysis," Agricultural Systems, Elsevier, vol. 141(C), pages 69-78.

    More about this item

    Keywords

    Transport Economics Policy&Planning; Infrastructure Economics; Public Sector Economics; Banks&Banking Reform; Town Water Supply and Sanitation;

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