Industry is projected to overtake agriculture as Ethiopia's second-largest economic sector in the 2018 Ethiopian Fiscal Year, according to preliminary estimates released by the government. The National Bank of Ethiopia and Ethiopian Statistics Service, working with technical assistance from the International Monetary Fund, completed a rebasing exercise that places industry's contribution at 31.78 per cent of gross domestic product, narrowly ahead of agriculture's 31.35 per cent. Services would remain the largest sector, accounting for 33.85 per cent of GDP. The nominal GDP for 2018 EFY is estimated at approximately 31.9 trillion birr, up from 24.03 trillion birr in 2017 EFY. The industrial sector's projected lead of 0.43 percentage points over agriculture marks a shift in how the economy's composition is measured, though the figures remain preliminary.
The rebasing exercise, which began in January 2026 and concluded in September, substantially revised earlier estimates of economic activity. The revised accounts put nominal GDP for 2017 EFY at 24.031 trillion birr, equivalent to approximately US$201.42 billion, compared with the previous estimate of 15.094 trillion birr. This 59.21 per cent upward revision reflects changes in statistical coverage, classification and measurement rather than a sudden increase in production. The exercise incorporated information from economic censuses, household surveys, establishment data, administrative records and state-owned enterprises, seeking to capture activities previously underrepresented, including parts of the informal economy, emerging services, telecommunications, transport and mining.
Industry recorded the largest upward revision among the three broad sectors, with measured value added increasing by 73.2 per cent compared with the previous estimate. Manufacturing was revised upward by 160.56 per cent to 1.65 trillion birr, while mining and quarrying recorded a particularly large adjustment, with measured value added increasing by 245.08 per cent to 1.38 trillion birr. Electricity and water increased by 495.35 per cent to 613.58 billion birr. Construction, which remains a substantial component of industry, generated 3.61 trillion birr in value added. Agriculture was revised upward by 53.1 per cent and services by 56.3 per cent. The revised 2017 EFY accounts put crop production at 5.07 trillion birr in value added, while animal production contributed 1.79 trillion birr.
The revised framework uses the 2008 System of National Accounts and an updated industrial classification to provide a more comprehensive picture of economic activity. Real economic growth is projected at 7.7 per cent for 2018 EFY. The distinction between nominal and real growth is important: nominal GDP reflects both changes in production and prices, while real growth measures changes in the volume of goods and services produced. Several service activities also underwent substantial revisions, with transport and storage increasing by 286.74 per cent to 1.85 trillion birr and accommodation and food services rising by 218.76 per cent to 1.13 trillion birr. The updated accounts are intended to strengthen the statistical basis for economic planning, policy formulation and investment decisions.
Despite industry's projected advance, agriculture continues to account for nearly one-third of measured output, with a declining share of GDP not necessarily meaning agricultural production is falling. The sector's share can decrease even as its output grows if other activities expand faster. On the expenditure side, gross capital formation reached 8.49 trillion birr in 2017 EFY, equivalent to 35.3 per cent of GDP, representing a 179.3 per cent upward revision. Private final consumption stood at 15.47 trillion birr, or 64.4 per cent of GDP, while government final consumption amounted to 1.14 trillion birr, or 4.7 per cent. Gross domestic savings were estimated at 7.42 trillion birr, equivalent to 30.9 per cent of GDP.