Following annual meetings between the IMF and Ethiopian officials, the statement said Ethiopia must also improve its domestic tax collections and strengthen the stability of the its financial system. In the meetings, IMF directors encouraged the country to improve the soundness of its financial system and increase competition, most notably by opening up its banking system to foreign banks. This move would bring in more competition and upgrade the quality and range of financial services in Ethiopia, according to the group. According to IMF statistics, Ethiopia's gross domestic product should grow by 6.7 percent in 1999 and inflation should remain low at about 3.6 percent. The external current account deficit, which was to have narrowed slightly to 8.2 percent of GDP in 1998 and 1999, is expected to widen to around 9.5 percent due to a sharp drop in world prices of coffee and higher-than expected military and food imports, the IMF said.
Coffee is one of the country's main crops.
The projected account deficit for 1999 is expected to reach 613 million dollars, up from a 513 million-dollar deficit in 1998. All rights reserved.