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Trade in the Contemporary World

Ethiopia: trade on the periphery of the global system

  • 3 things to know
  • Component 02

Overview

Recall questions on Ethiopia as a low income developing country, coffee, gold, oilseeds and cut flowers, its trading partners, dependence on coffee and the value added abroad, being landlocked and reliant on Djibouti, its weak negotiating position and WTO status, AGOA and its loss, instability, Ethiopian Airlines, the Hawassa industrial park, and the Grand Ethiopian Renaissance Dam.

What you need to know

Answer each one before you reveal it.

Your recallNot started
Key term

Why is Ethiopia classed as a low income developing country?

Process

Explain why processing more of its coffee before export would benefit Ethiopia, and what makes it hard to do.

Key term

Which crop is Ethiopia's leading export earner?

Questions from this subtopic

Each one with the model answer underneath.

  1. 1

    Why is Ethiopia classed as a low income developing country?

    Model answer

    It has a very low income per head, an economy still dominated by farming, limited industry and a low Human Development Index, despite rapid growth in recent years.

  2. 2

    Which crop is Ethiopia's leading export earner?

    Model answer

    Coffee is Ethiopia's leading crop export, although gold overtook it as the country's largest single export earner in 2024/25.

  3. 3

    Name three Ethiopian exports other than coffee.

    Model answer

    Oilseeds, cut flowers and gold.

  4. 4

    Describe Ethiopia's main trading partners.

    Model answer

    China is by far its largest source of imports and a major creditor, while its leading export destinations include the United States, China, Saudi Arabia, Germany and the Netherlands.

  5. 5

    Why is Ethiopia's dependence on coffee exports a risk?

    Model answer

    World coffee prices swing sharply with harvests elsewhere and with speculation, so a good Ethiopian crop can still earn less than the year before and growers have no control over the price.

  6. 6

    Why does an Ethiopian coffee grower receive only a small share of the price paid in a European café?

    Model answer

    Most of the value is added after export, in shipping, roasting, blending, branding, distribution and retailing, all of which take place in the consuming country.

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