During the last seven years, Ethiopia has made substantive economic progress.
Since 2003/04 growth has been sustained, recording more than 11% average growth. This growth is complemented by a strong performance in the Agriculture, Industry (construction and manufacturing) and service sectors with an average growth rate of 10%, 10% and 13.2%, respectively. The
construction sector has been stimulated by public sector investment in infrastructure.

During this period, across the country, health service coverage and school enrollment at all levels improved remarkably as human capital development also received significant consideration from the government.

With reference to infrastructural expansion, high quality asphalt roads and rural community roads have been constructed all over the country and access to potable water has improved. The hydroelectric power generation capacity of the country has increased the coverage to 41% in 2009/10 from 16% in 2004/05, telecommunication service coverage has reached 50% within a 5 km radius. The expansion of road network has increased the road density from 29km/1000 km2 in 2000/01 to 44.5km/1000km2 in 2009/10.

The average time taken to reach all weather roads has also been reduced to 3.7 hours in 2009/10 from about 7 hours in early 2000. The population living below the poverty line has declined to 29% as of 2009/10.

By spending more than 60 percent of its total expenditure on poverty oriented sectors, such as agriculture, education, health, water and road development during the last seven years, the government has maximized its efforts and shown the highest level of dedication to bring about pro-poor economic growth.

Despite the impressive growth record in recent years, low levels of income and savings and productivity in the agricultural sector, limited implementation capacity, unemployment and a narrow modern industrial sector base are the major challenges faced during this period.