The Role and Risk of Coffee-based Development in Ethiopia
A new report issued by the United Nations Children’s Fund (Unicef) claimed that the child mortality rate in Ethiopia has been cut from more than 200 deaths per 1,000 live births in 1990 to 68 per 1,000 today. With a per capita gross domestic product of less than $1,200, Ethiopia is one of the poorest countries in the world, ranking 169th (out of 180) according to World Bank estimates. The Ethiopian economy is heavily dependent on coffee exports, which account for more than a quarter of the country’s export earnings. Coffee production—like agricultural production in Ethiopia more generally—is highly dependent on rainfall. But the Unicef report suggests that Ethiopia—a country with a long history of famine and malnutrition—is one of the few African countries making progress towards achieving the Millennium Development Goal of reducing child mortality rates. The country’s success, according to Health Minister Kesetebirhan Admasu, has been based on a strategy of “aggressively expanding its primary healthcare network.” Increased household incomes have, according to Admasu, “also resulted in better nutrition for children [and] women; this has translated into better sanitation – all these have direct or indirect impact on the survival of children.”
Ethiopia’s success has been driven, at least in part, by a price increase for coffee between 2003 and 2010 (see graph above). This price increase generated additional employment and income at the household level and higher tax and excise revenues at the national level. But since 2010, global coffee production has grown sharply and prices are starting to decline. And with lower coffee prices, Ethiopia’s development strategy might falter as well. For now, though, Ethiopia is rightly basking in the limelight, having shed its image as a land of famine and hunger.