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Since mid, the economy has evolved toward a decentralized, market-oriented economy, emphasizing individual initiative, designed to reverse a decade of economic decline. Gradual privatization of business, industry, banking, agriculture, trade, and commerce is underway. While the process of economic reform is ongoing, so far the reforms have attracted only meager foreign investment, and the government remains heavily involved in the economy.

Many government-owned properties during the previous regime have just been transferred to EPRDF-owned enterprises in the name of privatization. Furthermore, the Ethiopian constitution defines the right to own land as belonging only to "the state and the people," but citizens may only lease land up to 99 years and are unable to mortgage, sell, or own it. With only ten percent of its land arable, the Ethiopian economy is based on agriculture , which contributes 47 percent to GNP and more than 80 percent of exports, and employs 85 percent of the population.

The major agricultural export crop is coffee , providing 35 percent of Ethiopia's foreign exchange earnings, down from 65 percent a decade ago because of the slump in coffee prices since the mids. Other traditional major agricultural exports are hides and skins, pulses, oilseeds, and the traditional "qat," a leafy shrub that has psychotropic qualities when chewed.

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Sugar and gold production have also become important in recent years. Ethiopia's agriculture is plagued by periodic drought , soil degradation caused by inappropriate agricultural practices and overgrazing, deforestation, high population density, undeveloped water resources, and poor transport infrastructure, making it difficult and expensive to get goods to market. Yet agriculture is the country's most promising resource.

Potential exists for self-sufficiency in grains and for export development in livestock, flowers, grains, oilseeds, sugar, vegetables , and fruits. Gold , marble , limestone , and small amounts of tantalum are mined in Ethiopia. Other resources with potential for commercial development include large potash deposits, natural gas , iron ore, and possibly petroleum and geothermal energy. Although Ethiopia has good hydroelectric resources, which power most of its manufacturing sector, it is totally dependent on imports for its oil.

A landlocked country, Ethiopia has relied on the port of Djibouti since the border war with Eritrea. Ethiopia is connected with the port of Djibouti by road and rail for international trade. Of the 23, kilometers of all-weather roads in Ethiopia, 15 percent are asphalt. Mountainous terrain and the lack of good roads and sufficient vehicles make land transportation difficult and expensive.

Dependent on a few vulnerable crops for its foreign exchange earnings and reliant on imported oil, Ethiopia lacks sufficient foreign exchange earnings. The financially conservative government has taken measures to solve this problem, including stringent import controls and sharply reduced subsidies on retail gasoline prices. Nevertheless, the largely subsistence economy is incapable of meeting the budget requirements for drought relief, an ambitious development plan, and indispensable imports such as oil. The gap has largely been covered through foreign assistance inflows.

Ethiopia's population is highly diverse. Most of its people speak a Semitic or Cushitic language. The Oromo, Amhara, and Tigrayans make up more than three-fourths of the population, but there are more than 80 different ethnic groups within Ethiopia. Some of these have as few as ten thousand members. Semitic-speaking Ethiopians and Eritreans collectively refer to themselves as Habesha or Abesha, though others reject these names on the basis that they refer only to certain ethnicities.

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The Arabic form of this term is the etymological basis of "Abyssinia," the former name of Ethiopia in English and other European languages. Traditionally, the Amhara have been the dominant ethnic group, with the Tigreans as secondary partners. The other ethnic groups have responded differently to that situation. Resistance to Amhara dominance resulted in various separatist movements, particularly in Eritrea and among the Oromo. Eritrea was culturally and politically part of highland Ethiopia since before Axum's achievement of political dominance; Eritreans claim Axumite descendency as much as Ethiopians do.

The "Oromo problem" continues to trouble Ethiopia. Although the Oromo are the largest ethnic group in Ethiopia, never in their history have they held political power. Ethiopian highlanders subjected many ethnic groups in the present state of Ethiopia, such as the Oromo, to colonial status. Conquered ethnic groups were expected to adopt the identity of the dominant Amhara-Tigrean ethnic groups the national culture.

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It was illegal to publish, teach, or broadcast in any Oromo dialect until the early s, which marked the end of Haile Selassie's reign. Even today, after an ethnic federalist government has been established, the Oromo lack appropriate political representation. Only Population below poverty line is Life expectancy at birth is Children in urban areas begin attending school at age five if their families can afford the fees. In rural areas, schools are few and children do farm work.

This means a very low percentage of rural youth attend school. The government is trying to alleviate this problem by building accessible schools in rural areas. Children who do well in elementary school go on to secondary school. University education is free, but admission is extremely competitive. Every secondary student takes a standardized examination. The acceptance rate is approximately 20 percent of all those who take the tests. Traditionally, labor has been divided by gender, with authority given to the senior male in a household.

Men are responsible for plowing, harvesting, the trading of goods, the slaughtering of animals , herding, the building of houses, and the cutting of wood. Women are responsible for the domestic sphere and help the men with some activities on the farm. Women are in charge of cooking, brewing beer, cutting hops, buying and selling spices , making butter, collecting and carrying wood, and carrying water.

The gender division in urban areas is less pronounced than it is in the countryside. Many women work outside the home, and there tends to be a greater awareness of gender inequality. Women in urban areas are still responsible, with or without a career, for the domestic space. Employment at a baseline level is fairly equivalent, but men tend to be promoted much faster and more often. Arranged marriages are the norm, although this practice is becoming much less common, especially in urban areas.

The presentation of a dowry from the male's family to the female's family is common. The amount is not fixed and varies with the wealth of the families. The dowry may include livestock, money, or other socially valued items. Ethiopia has 84 indigenous languages. English is the most widely spoken foreign language and is taught in all secondary schools.

Amharic was the language of primary school instruction but has been replaced in many areas by local languages. According to the census, Christians made up In , the breakdown was percent Muslim, percent Ethiopian Orthodox, 12 percent animist , and percent other, including Jews. Muslims and Christians generally get along peacefully.

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The Axumite Kingdom was one of the first nations to officially adopt Christianity, when King Ezana of Axum converted during the fourth century C. Today, the Ethiopian Orthodox Tewahedo Church is by far the largest denomination, though a number of Protestant churches have recently gained ground. Because of the spread of Islam, Ethiopian Orthodox Christianity was severed from the Christian world. This led to many unique characteristics. The Ethiopian Orthodox Church lays claim to the original Ark of the Covenant , and replicas called tabotat are housed in a central sanctuary in all churches; it is the tabot that consecrates a church.

The Ethiopian Orthodox Church is the only established church that rejects the doctrine of Pauline Christianity , which states that the Old Testament lost its binding force after the coming of Jesus. The Old Testament focus of the Ethiopian Orthodox Church includes dietary laws similar to the kosher tradition, circumcision after the eighth day of birth, and a Saturday sabbath. Islam in Ethiopia dates back almost to the founding of the religion ; in , a band of Muslims was counseled by the Prophet Prophet Muhammad to escape persecution in Mecca and travel to Abyssinia, which was ruled by, in the Prophet's estimation, a pious Christian king.

Moreover, Islamic tradition states that Bilal, one of the foremost companions of the Prophet Muhammad, was from the region of present-day Ethiopia. There are numerous indigenous African religions in Ethiopia. In general, most of the Christians live in the highlands, while Muslims and adherents of traditional African religions tend to inhabit lowland regions.

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A small group of Jews , the Beta Israel, lived in Ethiopia for centuries, though most emigrated to Israel in the last decades of the twentieth century as part of the rescue missions undertaken by the Israeli government. Ethiopia is also the spiritual homeland of the Rastafari movement, whose adherents believe Ethiopia is Zion.

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The classical language of Ge'ez, which has evolved into Amharic and Tigrean, is one of the four extinct languages but is the only indigenous writing system in Africa still in use. Ge'ez is spoken in Orthodox Church services.

Ge'ez was also the first Semitic language to employ a vowel system. Many apocryphal texts—such as the Book of Enoch , the Book of Jubilees , and the Ascension of Isaiah—have been preserved in their entirety only in Ge'ez. Even though these texts were not included in the Bible, among biblical scholars and Ethiopian Christians they are regarded as significant to an understanding of the origin and development of Christianity.

Religious art, especially Orthodox Christian, has been a significant part of the national culture for hundreds of years. Illuminated Bibles and manuscripts have been dated to the twelfth century, and the eight-hundred-year-old churches in Lalibela contain Christian paintings, manuscripts, and stone relief. Christian music is believed to have been established by Saint Yared in the sixth century and is sung in Ge'ez, the liturgical language. The traditional dance, eskesta, consists of rhythmic shoulder movements and usually is accompanied by the kabaro, a drum made from wood and animal skin, and the masinqo, a single-stringed violin with an A-shaped bridge that is played with a small bow.

Foreign influences exist in the form of Afro-pop, reggae , and hip-hop. Wood carving and sculpture are very common in the southern lowlands, especially among the Konso. A fine arts school has been established in Addis Ababa that teaches painting, sculpture, etching, and lettering. Traditional Ethiopian cuisine employs no pork of any kind, as both Muslims and Ethiopian Orthodox Christians are prohibited from eating pork.

The coffee kafa ceremony is a common ritual.

The server starts a fire and roasts green coffee beans while burning frankincense. Once roasted, the coffee beans are ground with a mortar and pestle, and the powder is placed in a traditional black pot called a jebena. Water is then added. The jebena is removed from the fire, and coffee is served after brewing for the proper length of time. Often, kolo cooked whole-grain barley is served with the coffee.

Traditional houses are round dwellings with cylindrical walls made of wattle and daub. The roofs are conical and made of thatch, and the center pole has sacred significance in most ethnic groups. Variations on this design occur.