The International Monetary Fund forecasts Ethiopia’s real GDP to grow 9.2 per cent in 2026, matching its estimated growth rate for 2025,before slowing to 7.8 per cent in 2027, according to the Fund’s October 2026 World Economic Outlook seen by APA on Tuesday.
The IMF projects Sub-Saharan Africa as a whole to grow 4.5 per cent in each of 2025, 2026 and 2027, which puts Ethiopia’s 2026 projection at about double the regional rate. The IMF’s group of low-income countries is projected to grow 6.4 per cent in both 2026 and 2027, below Ethiopia’s figures for both years.
Among regional peers, the IMF projects 2026 growth of 7.4 per cent for Rwanda, 6.2 per cent for Uganda, 6.0 per cent for Tanzania and 4.5 per cent for Kenya, all below Ethiopia. For 2027, Uganda is projected to grow faster than Ethiopia at 9.9 per cent, while Rwanda is projected at 7.2 per cent, Tanzania at 5.9 per cent and Kenya at 4.7 per cent.
On prices, the IMF projects Ethiopia’s average inflation to ease from 16.0 per cent in 2025 to 11.7 per cent in 2026, then edge up to 12.3 per cent in 2027. That is higher than the 8.6 per cent projected for Sub-Saharan Africa in both 2026 and 2027, and the 6.7 per cent and 7.4 per cent projected for low-income countries in those two years.
The IMF projects Ethiopia’s current account deficit, the broadest measure of the country’s trade and income flows with the rest of the world, at 0.8 per cent of GDP in 2025, widening to 2.5 per cent in 2026 and narrowing to 1.3 per cent in 2027. The low-income countries group is projected to run a deficit of 4.8 per cent of GDP in 2026 and 3.5 per cent in 2027.
The comparison places Ethiopia ahead of several major regional economies, including Kenya, which is projected to grow by 4.5 percent in 2026 and 4.7 percent in 2027. Tanzania’s economy is expected to expand by 6 percent in 2026 and 5.9 percent in 2027, while Uganda is projected to grow by 6.2 percent and 9.9 percent, respectively.
Rwanda is forecast to record growth of 7.4 percent in 2026 and 7.2 percent in 2027. However, Ethiopia’s projected growth moderation in 2027 contrasts with the broadly stable outlook for Sub-Saharan Africa. The IMF’s latest assessment also points to changes in Ethiopia’s external economic position.
The country’s current-account deficit is projected to widen from 0.8 percent of GDP in 2025 to 2.5 percent in 2026, before narrowing to 1.3 percent in 2027.T he widening deficit in 2026 indicates a deterioration in the balance of Ethiopia’s transactions with the rest of the world, including trade in goods and services, investment income and transfers.
MG/abj/APA