An Analysis of Ethiopian’s Balance of Payments (2004-2015)

Abstract

The Analysis of Ethiopian Balance of Payments based on Descriptive statistics, National Income Accounting Framework and Econometrics technique aimed at identifying the major determinants of Ethiopian Balance of Payments which have been a matter of interest to the Ethiopia macro economics policy maker for a long period of time. The study used time series data for the period between 2003/04 – 2014/15 collected from CSA, NBE, World Bank Group and IMF. Estimation result of the model shows that gross saving and gross investment are the main determinant of Ethiopian balance of payments. Therefore to rise Ethiopian gross saving and to reduce the resource gap, the National Bank of Ethiopia and the Ethiopian government should develop a strategy to enhance the gross saving.