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International Monetary Fund

This paper reviews economic developments in Ethiopia during 1995–99. It provides an update on macroeconomic performance and structural reforms during FY96–FY99 (fiscal year ended July 7), when Ethiopia—as Africa’s second most populous country and one of the world’s poorest nations—continued to make strides in transitioning to a market-based economy and alleviating widespread poverty. The paper also highlights the major challenges in the areas of financial sector liberalization, civil service reform, and privatization.