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Can a peace deal help jumpstart Ethiopia's economy? [Business Africa]

Zemedeneh Negatu, chairman of the Fairfax Africa Fund during an interview with Ronald Kato   -  
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Business Africa

Ethiopia and Tigray rebels have signed a peace deal but not before two years of ferocious fighting and economic devastation.

Amidst the war and a pandemic, Addis Ababa's GDP slowed from 9% in 2019 to 6.1% in 2020, 6.2% in 2021. The IMF predicts growth of just 3.8% in 2022.

The country also faces mounting debt and has run to its creditors seeking relief. But that too is dependent on whether the government can agree a financing deal with the IMF.

Dwindling foreign exchange reserves have piled pressure on the birr, leading to inflation.

Overall, the conflict has been a loss for Ethiopia's image as a top FDI destination and its years of double-digit growth.

With a peace deal, there is optimism that counting on its big population and vast electricity generation capacity, Addis Ababa can quickly forge an economic comeback.

Zemedeneh Negatu, chairman of the Fairfax Africa Fund joins the show to talk about the opportunities the end of the conflict opens for Ethiopia’s economy.

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But the climate summit touted as Africa’s COP only delivered a mix of disappointment and hope for developing countries.

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