NATIONAL HUMAN DEVELOPMENT REPORT 2014 ETHIOPIA
NATIONAL HUMAN DEVELOPMENT REPORT 2014ETHIOPIAEmpowered Lives.Resilient Nations.Accelerating Inclusive Growth forSustainable Human Development in Ethiopia
BNational Human Development Report 2014 - Ethiopia United Nations Development Programme, 2015All rights reserved. No part of this publicationmay be reproduced, stored in a retrieval system,or transmitted, in any form or by any means,electronic, mechanical, photocoying, recording, orotherwise, without prior permission.The analysis and policy recommendations ofthis report do not necessarily reflect the viewsof the United Nations Development Programme,or those of the Federal Democratic Republic ofEthiopia. The report is an independent publicationcommissioned by UNDP. It is a consultativeeffort with the Ministry of Finance and EconomicDevelopment (MoFED) and authored by anindependent team of Consultants with technicaland financial support of UNDP Country office.
Empowered Lives.Resilient Accelerating Inclusive Growth forSustainable Human Development in EthiopiaAddis Ababa, Ethiopia
ForewordI am pleased to present the 2014 National Human Development Report, which has been written onthe theme of “Accelerating Inclusive Growth for Sustainable Human Development in Ethiopia.” It isover 15 years since the last National Human Development Report for Ethiopia was published andmuch has changed in the intervening period. The Government has been engaged in a major effortto transform Ethiopian society and place the country on a trajectory to become a middle-incomeeconomy by the year 2025. Over the last several years, the economy grew by nearly 10 per cent perannum, one of the fastest growth rates registered in the world. During this time, significant attentionhas been given to upgrading economic and social infrastructure and promoting pro-poor spendingon education, health, and other services that benefit the poor and marginalized. Ethiopia’s socialsafety net system was able to avert famine and mass suffering when drought struck the countryin 2011, in contrast to the tragic events when drought struck in preceding decades. By the sametoken, the poverty rate fell from 38.7 percent per cent in 2004/05 to 26.0 per cent in 2012/13. Likewise, Ethiopia is on track to meet most of the eight Millennium Development Goals (MDGs) by 2015.Despite the major economic and social improvements over the last decade, some 25 million Ethiopians currently remain trapped in poverty and vulnerability. With a Human Development Index (HDI)of 0.435 in 2013, the country is still classified as a “low human development” country, based onUNDP’s Human Development Index. One of the key challenges for Ethiopia in its quest to becomea middle-income country is therefore to ensure that all Ethiopians fully benefit from the phenomenalprogress that the country has registered and that all have the opportunities to realize their humandevelopment potential.This Report has been written to encourage debate and policy discussions on what further steps areneeded to ensure that the goal of inclusive growth and enhanced human development is achieved.I commend the authors for computing regional HDI values – the first time this has been done forEthiopia - to track progress and show disparities between the regions in Ethiopia. The report hasbeen prepared with several diverse audiences in mind. It is intended for policymakers, developmentorganizations, the private sector, civil society, students and the academic community. It is hopedthat it will stimulate debate and engage Ethiopians throughout the country, as well as internationalpartners, in creating opportunities that strengthen and advance human development so that Ethiopiacan successfully achieve its laudable development goals.Eugene OwusuResident RepresentativeUNDP
AcknowledgementsPreparation of the Ethiopia National Human Development Report 2014 (NHDR) has been donein consultation with the Ministry of Finance andEconomic Development (MoFED) and the National Planning Commission (NPC). A conceptnote was prepared to guide the preparation ofthis NHDR, and the entire preparatory processwas coordinated by a core team drawn fromthe Development Planning and Research Directorate of MoFED/NPC and the Policy AdvisoryUnit of UNDP. Consistent with the NHDR PolicyGuidelines, particularly to ensure independenceand national ownership, the preparation of thisNHDR followed a collaborative and consultativeprocess. A Technical Working Group (TWG)was formed composed of members from relevant departments of MoFED/NPC, UNDP, theMinistry of Health, the Ministry of Water and Energy, the Central Statistics Agency, the Ethiopian Roads Authority, the Ethiopia DevelopmentResearch Institute, Poverty Action Network(PANE) and the Ethiopian Chamber of Commerce and Sectoral Associations.The initial drafting of the Report was undertakenby a team of consultants and benefitted frominputs and revisions from UNDP Country Officestaff and counterparts from the NHDR TechnicalWorking Group, the UNDP Regional Bureau forAfrica (RBA) Economists Network, a Readers’Group, and other experts.The NHDR core team responsible for the overalldirection and management of the report preparation process comprised: James Wakiaga, Senior Economist, UNDP; Haile Kibret, NationalEconomist, UNDP; Roza Mamuye, EconomicsAssociate, UNDP, Temesgen Walelign, Director,Development Planning and Research Directorate, MoFED/NPC; Solomon Alayu, Senior Expert, Development Planning and Research Directorate, MoFED/NPC; and Getahun Tafesseand Thomas Stephens, consultants. GeorginaWilde provided invaluable editorial support inpreparing the document for publication.The Technical Working Group included, alongwith the core team: Heyeru Hussien; Gebreegzabihere Gebru; Wondwosen Damte; TeshomeAdno; Daniel Mengistie; Nurmeded Jemal;Eliyas Girma; Haregewoin Tekle; MohammedHussen; and Eyassu Gebru, The institutional affiliations of the Technical Working Group members are listed in Annex 2.In addition, several staff members from UNDPEthiopia provided valuable comments and suggestions during the drafting and review process.These included: Eugene Owusu; Samuel Bwalya; Bettina Woll; Samuel Choritz; Eyob Tesfaye;Selamawit Alebachew; Chrysantus Ayangafac;Emily Bosch; Fekadu Terefe; Soria Sewasew;Sinkinesh Beyene; Dillip Kumar; Dassa Bulcha;and Edda Zekarias. Thanks are also due to theReaders’ Group and especially Professor AbbiKedir of Leicester University and GetachewAdem, Deputy Commissioner, National Planning Commission, for providing valuable comments that enriched the report.Given the short time frame for completing theNHDR, the team relied mostly on existing datasources. The process was aided by the existence of a number of recently completed national surveys, such as the 2011 HouseholdConsumption and Expenditure Survey (HCES),the 2010/11 Welfare Monitoring Survey, and theDemographic and Health Survey (EDHS), thathelped to illuminate recent trends in the human development situation in the country. Theteam also used a number of reports and studiescompleted by the Government of Ethiopia andpartners, which provided an in-depth analysisof recent socio-economic trends.The comments and insights provided by thewide range of policymakers, senior managersand technical experts were invaluable for ensuring that the scope and direction of this reportcovered multiple perspectives.
Table of ContentsExecutive Summary Socio-Economic Policies and Performance Inclusiveness of Growth Ethiopia’s Policy and Institutional Framework Conclusions and Recommendations 112221. Introduction 42. Ethiopia’s Recent Socio-Economic Development 2.1.2.2.2.3.2.4.Trends in Economic Performance Factors Affecting Growth Trends in Social Development Chapter Summary 3. Ethiopia’s Progress in Human Development 3.1.3.2.3.3.3.4.3.5.3.6.101014212426Gains in Human Development Regional Variations in Human Development Performance Education Health Poverty Trends Chapter Summary 2628344144464. Risk, Vulnerability, Shocks and Climate Change 484.1. Addressing Risk and Vulnerability of the Poor 4.2. Addressing Climate Change and Vulnerability 4.3. External Shocks and Inclusive Growth 4852544.4. Chapter Summary 55
5. Analysis of Ethiopia’s Inclusive Growth 5.1.5.2.5.3.5.4.5.5.Inclusive Growth from a Policy Perspective Pace and Pattern of Growth Employment and Job Creation Role of the Private Sector in Inclusive Growth Chapter Summary 6. Policy and Institutional Framework for Inclusive Growth 6.1.6.2.6.3.6.4.6.5.6.6.6.7.6.8.The Developmental State Model and Inclusive Growth Macroeconomic Policy Environment Governance in the Ethiopian Context The Ethiopian Context for Planning Public Resource Allocation and Human Development Institutional Framework for Inclusive Growth Policy and Institutional Gaps for Inclusive Growth Chapter Summary 7. Strategic Challenges and Proposed Directions forAccelerating Inclusive Growth in Ethiopia 7.1.7.2.7.3.7.4.Macroeconomic Policy and Employment Creation Social Policies and Programmes Governance Issues Summary Reflections 56565963676970707172757984878889909195958. ANNEXES 97
viNational Human Development Report 2014 - EthiopiaList of TablesTable 2.1 Key Macro Indicators Table 2.2 Sectoral Percentage Shares of GDP Table 2.4 Contribution of Expenditure Components of GDP Table 3.1 Trends in Ethiopia’s National HDI Table 3.2 African Country Ranking Among HDI “Fast-Moving” Countries (2000-2011) Table 3.3 Ethiopia: Regional HDI calculations (2004/05 and 2012/13) Table 3.4 Regional Comparisons in Key Selected Basic Human Development Indicators 2011 Table 3.5 Average Annual Construction of Schools Table 3.6 Net Primary Enrolment, Gender Parity and Grade 8 Completion Trends Table 3.7 Expansion in Tertiary Education 11Table 3.8 Selected Education Quality Indicators Table 3.9 Number of Health Facilities10 Table 3.10 Selected Key Health Indicators Table 3.11 Healthcare Workforce Standards Table 3.12 Trends in Skilled Delivery Coverage (%) Table 3.13 Poverty Trends in Ethiopia Table 3.14 Trends in Income Inequality (Gini coefficients) Table 4.1 Trends in External Shock Transmission Channels (US mn) Table 5.1 Growth Rate of Real GDP by Sector (%) Table 6.1 The Government of Ethiopia’s Medium-Term Planning Frameworks (2002 -2015) Table 6.2 Selected GTP Targets Related to Inclusive Human Development Table 6.3 Key Public Revenue Indicators Table 6.4 Key Public Expenditure Indicators Table 6.5 Trends in Pro-Poor Spending in Total Public Expenditure (%) Table 6.6 Key Indicators in Road Expansion over the Past Decade Table 6.7 Selected Improvements in Business Procedures Table 6.8 Selected Improvements in Customs Procedures 40Table 1: Ethiopia: Expected Years of Schooling (2004/05-2012/13) Table 2: Ethiopia: Distribution of Regional Expected Years of Schooling (2012/13) Table 3: Ethiopia: Percentage of Population by Educational Attainment (2005 and 2011) Table 4: Ethiopia: Regional distribution of mean years of schooling (2005 and 2011) 85989999
Accelerating Inclusive Growth for Sustainable Human Development in EthiopiaList of FiguresFigure 2.2 Trends in the Value and Growth of Imports Figure 2.3 Share of GDP by Sector Over Time Figure 2.4 Imports and Exports as a Percentage of GDP Figure 2.5 Trends in Remittance Inflows Figure 3.1: The Trend in National HDI Figure 3.2: Comparison of Regional HDIs Figure 3.3: Comparison of Regional HDIs and National Average Figure 3.4 Regional Comparison in Percentage of Assisted Deliveries Figure 3.5 Gross Enrolment Rates, Primary/Secondary; Boys/Girls Figure 3.6 Completion Rates Male/Female – Urban/ Rural (2011/2012) 13Figure 5.1 Rural and Urban Employment Status by Gender Figure 6.1 Ethiopia’s Public Expenditures vs Gross Capital Formation over Time (% of GDP) 6415181927303133353881List of BoxesBox 1.2 Inclusive Growth and Human Development Box 2.1 Promoting Women’s Economic Participation Box 3.1 Student Perceptions of Educational Experience Box 3.2 Safe Birth Deliveries Box 4.1 Institutionalizing Disaster Risk Reduction Box 4.2 Social Protection in Law and Policy Box 4.3 Ethiopia: Productive Safety Net Programme (PSNP) Box 5.1 Reaping the Demographic Dividend Box 5.2 The National Population Policy Box 5.3 Agriculture and Inclusive Growth in Ethiopia Box: 5.4 Entrepreneurship Development for Inclusive Growth Box 5.5 Ease of Doing Business in the Top 20 African Countries Box 6.1 The Developmental State Model Box 6.2 The Federal Ethics and Anti-Corruption Commission Box 6.3 Revenue Assignment and Expenditure Allocation in Ethiopia Box 6.4 The Agricultural Transformation Agency 6234042495052585962666871738087vii
viiiNational Human Development Report 2014 - EthiopiaList of Abbreviations and AcronymsAfDBAfrican Development BankAPRAnnual Progress ReportATAAgricultural Transformation AgencyBrCSACSO(s)Ethiopian birrCentral Statistical AgencyCivil Society Organization(s)DAGDevelopment Assistance GroupDBEDevelopment Bank of EthiopiaDHSDemographic and Health SurveyEEAEthiopian Economics AssociationEFYEthiopian Fiscal Year (July 8-July 7)EPAEnvironmental Protection AuthorityEPRDFERAERCAETCEUFAOFDIFEACCFTAEthiopian People’s Revolutionary Democratic FrontEthiopian Roads AuthorityEthiopian Revenue and Customs AuthorityEthiopian Telecom CompanyEuropean UnionUN Food and Agriculture OrganizationForeign Direct InvestmentFederal Ethics and Anti-Corruption Commission of EthiopiaFinancial Transparency and AccountabilityGDPGross Domestic ProductGEFGlobal Environment FacilityGEQUIPGeneral Education Quality Improvement ProgrammeGERGross Enrolment RateGHGGreenhouse GasesGNIGross National IncomeGoEGovernment of EthiopiaGPIGender Parity IndexGTPGrowth and Transformation PlanHDIHuman Development IndexHDRHuman Development ReportHEW(s)Health Extension Worker(s)
Accelerating Inclusive Growth for Sustainable Human Development in EthiopiaHIPCHIV/AIDSHeavily Indebted Poor CountriesHuman Immunodeficiency Virus/Acquired Immune-deficiencyHCEHousehold Consumption-ExpenditureHICEHousehold Income, Consumption and ExpenditureHSDPHealth Sector Development PlanHSDPHealth Sector Development ProgrammeICTInformation and Communications TechnologyIDAInternational Development AssociationKebeleLSMSM&EMDG(s)Ethiopian (Amharic) term for a village or communityLiving Standards Measurement StudyMonitoring and EvaluationMillennium Development Goal(s)MDTFMulti-Donor Trust FundMFI(s)Micro-finance Institution(s)MoARDMoEMoFEDMoHMoLSAMinistry of Agriculture and Rural DevelopmentMinistry of EducationMinistry of Finance and Economic DevelopmentMinistry of HealthMinistry of Labour and Social AffairsMoWCYAMinistry of Women, Children and Youth AffairsMSME(s)Micro, Small and Medium Enterprise(s)NAPNational Action Plan for GenderNBENational Bank of EthiopiaNERNet Enrolment RateNGO(s)NHDRNon-Governmental Organization(s)National Human Development ReportNPCNational Planning CommissionODAOfficial Development AssistanceOECDPASDEPPPDFPPP(s)PSNPOrganization for Economic Co-operation and DevelopmentPlan for Accelerated and Sustainable Development to End PovertyPublic-Private Dialogue ForumPublic-Private Partnership(s)Productive Safety Net Programmeix
xNational Human Development Report 2014 - EthiopiaRSDPSDPRPRoad Sector Development ProgrammeSustainable Development and Poverty Reduction ProgrammeSEZSpecial Economic ZoneSMESmall and Medium EnterpriseSNNPRSouthern Nations, Nationalities and Peoples RegionSOEState-owned EnterpriseSSASub-Saharan AfricaUNDPUNICEFUnited Nations Development ProgrammeUnited Nations Children’s FundUS United States DollarVATValue-added TaxWEFWIDEWorld Economic ForumWell-Being and Ill-Being Dynamics in EthiopiaWFPWorld Food ProgrammeWMSWelfare Monitoring SurveyWMUWelfare Monitoring UnitWoredaEthiopian (Amharic) term for a district
Accelerating Inclusive Growth for Sustainable Human Development in EthiopiaExecutive SummaryOver the 15 years since the country’s last National Human Development Report (NHDR)was published Ethiopia has undergone significant economic and social changes and has recorded some of the highest growth rates in theworld-over 10 per cent in some years. However,Ethiopia’s Human Development Index (HDI) andits relative ranking have not moved appreciablyduring the past decade. Even though Ethiopiais one of the 10 countries globally that has attained the largest absolute gains in its HDI overthe last several years, it still ranks 173rd out of186 countries in the latest UNDP Human Development Report.It is this development challenge that underlinesthe fact that the preparation of the NHDR is soopportune now and why the focus of the report on “inclusive growth for sustainable humandevelopment” is so apposite. In 1998, whenthe last NHDR was written, the developmentchallenges facing the country were considerably different, even if poverty was then andstill is the most challenging development issuefacing Ethiopia. At that time, the threat of severe drought and famine still pressed upon thenational psyche, as did the multiple challengesof overcoming decades of war, civil strife andsocio-economic disruption.To address these development challenges,since 1998 the Government has introduced acompletely new development framework thatushered in fundamental changes in policies,as well as in the institutional and administrative structures of governance. In this context,the Government prepared a number of strategic policy documents and national plans thatsought to articulate the national policies andpriorities that would put Ethiopia on a solidhuman development trajectory, with the overall objective of charting a path towards fulfillingEthiopia’s stated national vision:. . . to become a country where democratic rule, good-governance and social justicereign, upon the involvement and free will ofits peoples, and once extricating itself frompoverty to reach the level of a middle-incomeeconomy as of [2025].11 MoFED,2010, p.1. N.B. The Government has amended the targetdate for achieving middle-income status from 2023 to 2025.Socio-Economic Policies and PerformanceAt the centre of the country’s strong economic and social performance has been the Government’s proactive and leading role in shapingsocio-economic policy. With its goal of makingEthiopia a middle-income country no later than2025, the Government, among other things,has been investing heavily in economic and social infrastructure, streamlining public services,revamping the tax collection system, and supporting small and medium enterprises (SMEs).It has also prioritized key sectors such as industry and agriculture, as drivers of sustainedeconomic growth and job creation. The mostrecent data, for 2012/13, reveal that GDP registered a growth rate of 9.7 per cent, which wasaccompanied by an increase in the savings rateand, backed by a prudent fiscal policy, the budget deficit was contained at 2 per cent of GDP.High economic growth and enhanced propoor investments have helped reduce povertyin both urban and rural areas. Since 2005, 2.5million people have been lifted out of poverty, and the share of the population below thepoverty line fell from 38.7 per cent in 2004/05to 26 per cent in 2012/13 (using a poverty lineof US 0.60/day). However, because of highpopulation growth, the absolute number of thepoor (about 25 million) has remained largely unchanged over the past fifteen years.In line with the Growth and Transformation Plan(GTP), pro-poor sector spending as a share ofthe federal government budget has increasedsteadily from 28 per cent in 1999/2000 to 70per cent currently. Nevertheless the tax taketo GDP ratio remains low at 12.5 per cent in2012/13 in contrast to the Sub-Saharan Africa(SSA) average of over 20 per cent, and externalassistance in providing basic services remainscritical.In looking at the social sectors, education hasbeen expanding rapidly in Ethiopia over the past15 years, and net e
I am pleased to present the 2014 National Human Development Report, which has been written on the theme of “Accelerating Inclusive Growth for Sustainable Human Development in Ethiopia.” It is over 15 years since the last National Human Development Report for Ethiopia was
Human migration has traditionally been studied without the application of a human development approach. By using this approach to the study of human migration, UNDP's Human Development Report 2009, sets itself apart from other postcolonial studies. The report, Overcoming Barriers: Human Mobility and Development, gives a
September: 2013 33,391.18 9/24/2013 October: 2013 33,391.18 10/24/2013 December: 2013 65,031.50 12/20/2013 January: 2014 33,099.37 1/23/2014 February: 2014 33,099.37 2/24/2014 March: 2014 33,099.37 3/24/2014 April: 2014 31,662.23 4/25/2014 May: 2014 31,662.23 5/22/2014 June: 2014 31,662.24 6/26/2014 392,881.03
accelerate human development and achieve the Millennium Development Goals. Indeed, they have come to serve as important tools for policy advocacy and dialogue, placing human development at the forefront of national political agendas. Thailand is no exception. The previous national human development report on Thailand,
A-1 Human Growth and Development Unit - 1 : Approaches to Human Development Structure 1.1 Introduction 1.2 Objectives 1.3 Human developments as a discipline from infancy to adulthood. 1.4 Concepts & Principles of development 1.5 Developing Human Stages (Prenatal to Adulthood) 1.6 Nature vs. Nurture 1.7 Demains of Human Development 1.8 References
The 2013 Human Development Report is the latest in the series of global Human Development Reports published by UNDP since 1990 as independent, empirically grounded analyses of major development issues, trends and policies. Additional resources related to the 2013 Human Development Report can be found online at
HUMAN DEVELOPMENT REPORT 2009 Overcoming barriers: Human mobility and development Acknowledgements Acknowledgements This report is the fruit of the efforts, contribu-tions and support of many people and organiza-tions. I would like to thank Kemal Derviş for the opportunity to take on the daunting task of Director of the Human Development Report,
Human De ve lopment for Ever yo ne Acknowledgements The 2016 Human Development Report is the product of the Human Development Report Office (HDRO) at the United Nations Development Programme (UNDP). The findings, analysis and policy rec-ommendations of the Report are those of HDRO alone and cannot be attributed to UNDP or to its Executive Board.
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