Ethiopia targets China trade gap with export drive

Ethiopia is launching new initiatives to reduce its significant trade deficit with China. During the ‘Big Market for All: Export to China’ forum in Addis Ababa, Ethiopian and Chinese companies signed 33 cooperation agreements valued at over USD 330 million. These agreements focus on sectors including coffee, oilseeds, pulses, leather, textiles, and mineral products.

Data from the 2025/26 fiscal year shows a substantial trade imbalance: Ethiopia imported approximately USD 21 billion worth of goods from China—primarily machinery, construction materials, and industrial inputs—while exports to China totaled only USD 369 million. Kassahun Gofe, Minister of Trade and Regional Integration, stated that Ethiopia aims to leverage the Chinese market to accelerate domestic production, diversify exports, and improve foreign-exchange earnings.

While Ethiopian exports to China have grown at an average annual rate of 92 percent over the last five years, the volume remains small relative to imports. The trade gap, driven in part by Chinese involvement in Ethiopian infrastructure and industrial parks, has increased pressure on Ethiopia’s foreign-exchange reserves, prompting calls for greater import substitution and export-oriented manufacturing.