Ethipia is one of the world's poorest countries. Even in Africa a continent for its poverty, Ethiopia stand out. Its per capita income in the early 1990s was $130, second lowest in Africa next to Mozambique. .
The Ethiopian economy features a mixture of state control and private enterprise. The Mengistu regime greatly extended state control over the economy in the mid to late 1970s, but the transitional government that took power in 1991 began loosening many of these controls. Shortly after toppling Mengistu, the EPRDF announced plans to sell most state-run businesses and industries. In the early 1995 the government announced its intention to sell a variety f state-run enterprise such as hotels, restaurants, small shops, and food and beverage processing plants. Officials have also pledged to return residential property seized by the Mengistu government to its original owners.
Economic performance has generally improved since 1991. Export improved since 1991. Export earnings have risen, although the country continues to suffer from a serious shortage of skilled labor "a problem aggravated by the exodus of political refugees in recent years. And food shortages are still a threat due to irregular rains and inadequate harvests. Until Ethiopia's agricultural sector can be made more productive, reliance on food imports will probably continue.