Diversification and performance of Ethiopian export: Based on Extensive and Intensive margin measures

Abstract

Export is the main determinant of economic growth as well as achieving sustainable development in developingcountries like Ethiopia. Countries with good export performance can achieve economic growth by importingcapital goods. To identify whether Ethiopia’s export was well diversified or not both in market destination andproduct diversification in this study Gini Hirschman Index was used. The result shows Ethiopia’s export hadincreasing when we compare export as a percentage of GDP before and after regime change of 1992. But still itis not good due to its volatility both international price and export volume over time and even decreasing for theyear 2011/12, 2012/13 and 2013/14. The Gini Hirschman Index result shows that there was export destinationcountries diversification and still it shows improvement. There was moderate concentration on commodityexport between 2005/06 and 2007/08 but no concentration between the interval 2008/09 and 2013/14. Butservice export was undiversified most of it was concentrated to transportation service export. Even if exportdestination countries diversified it was undiversified on the continent level due to our export is still concentratedto Europe and Asia even if there is development on export to Africa.Key Words: Ethiopian export performance, Diversification, Gini Hirschman Index