Ethiopia's Internal Conflict, Displacement, and Security Challenges: A Socio-Economic and Political Perspective

Introduction

Ethiopian politics have experienced significant fluctuations since the mid-1960s up to the present day. The methods and the approach, as well as the social contract of Ethiopia, were assumed to become a new era when Prime Minister Abiy Ahmed took office in April 2018, which is unlike those of the previous regimes as well. His rise to power provided a promise and high potential for a democratic state, which later led to a major transformation in Ethiopia's political landscape-openness, and changes in promoting greater socio-economic and financial sectors. This change has been accompanied by various reform efforts and policies that have been met with opposition and challenges. On the other hand, unfortunately, internal conflict and displacement in Ethiopia occurred during Abiy Ahmed's leadership, much like under previous regimes. Additionally, the Prime Minister launched a new political party called the "Prosperity Party" as part of his vision of "Medemer," meaning synergy. The previous coalition of three parties within the EPRDF merged into a single party to implement the Medemer vision under his leadership. As a result of the Prime Minister's establishment of the new party, some factions reacted by pushing boundaries, which led to an outbreak of insurgency and rising tensions across the country.

Consequently, these insurgencies have grown stronger, which is resulting in more internal conflicts that have led to numerous catastrophes, mass displacements, and worsening socio-economic crises in the Tigray, Oromia, and Amhara regions. The insurgency group asserts that the government has transitioned from a decentralized, federal system to a centralized, authoritarian model. This shift has limited their regional autonomy and the rights they previously held under the federal structure, which they are now striving to protect despite growing pressures. Thus, the ongoing struggle between the factions and the federal government has revealed Ethiopia's fragility, resulting in an environment prone to violent conflict and economic decline.

This article's insight aims to discuss the current internal conflicts and security challenges from the perspective of socio-economic and political impacts in the country.

Socio-Economic Reforms and Structural Tensions

Abiy Ahmed (PhD), the Prime Minister, began with a reformist zeal: releasing political prisoners (i.e., journalists and opposition parties, among others), opening media spaces, and launching privatization plans for various public-owned enterprises. As a result, his government attempted to liberalize key sectors such as telecommunications and finance, to attract foreign investment and domestic investors, driving a shift from a state-led growth model to a market-oriented system.

Accordingly, some opposition parties and individuals claim that the Prime Minister's administration methods are inclined towards centralized reforms. According to this group, this approach contributes to the failure to address the social and economic inequalities established during the previous regime by bypassing the federal system that guarantees self-administration and regional autonomy. Similar clashes between the government and insurgency groups ended with large population displacements, loss of life, and mass catastrophes due to an increase in the internal conflict, political insecurity, and economic instability, the internal conflict and insurgency increased in regions such as Tigray and Oromia. Subsequently, the conflict expanded to the Amhara region. These various insurgencies in different regions strongly increase tensions, quickly morph into political violence, stalling investments and damaging infrastructure critical for growth. Finally, the conflict and internal displacement of the society create a huge gap in food security, health care services, the failure of the education system, and poor governance at large. Similarly, due to the high inflation, the failure birr vs dollar associated with the exchange rate, as well as the skyrocketing of the market price of the commodity, also make life difficult and unbearable for millions of Ethiopian people.

Displacement and Humanitarian Crisis

The report indicated that by 2024, Ethiopia had one of the highest numbers of internally displaced persons (IDPs) globally, estimated at over 4.5 million. These include urban and rural locations, those fleeing the Tigray conflict, and the Oromia and Somali regions. If the Amhara-Fano insurgency and communal violence in Gambella and Benishangul-Gumuz added to the number of displacements, maybe it increased. The displacement has enormous socio-economic consequences, like loss of livelihoods, starvation, immense population searching for food and clean water, schools damaged, and the education of almost 9 million children is interrupted, urban areas are overloaded, and among other economic, social, and psychological impacts.

The eyewitness argues that the government’s capacity to respond to humanitarian needs remains limited. In this situation, many camps lack basic sanitation, healthcare, and food supplies. The humanitarian response has been fragmented and underfunded, with bureaucratic barriers further complicating the distribution of aid. It has now become normalized to witness individuals and groups being brutally killed by militia and insurgent groups in front of their families, relatives, friends, or bystanders, by claiming that the murderers support the other side. This situation exemplifies the pervasive breakdown of the rule of law and the overall lawlessness that occurs daily in these countries.

On the other hand, high displacement has weakened economic activities in Ethiopia's vital Amhara region, which is crucial for agriculture and transportation. In 2023, agricultural output in Wollo and Gondar fell by an estimated 35% due to insecurity. For instance, due to road closures have made sesame exports and other key foreign exchange earners inaccessible.

Youth Unemployment and Radicalization

Ethiopia has a young population, with over 70% of its people under age 30. Youth unemployment remains dangerously high, estimated at 25% nationwide and even higher in conflict-affected areas. A lack of opportunities, combined with political frustration, has led many young people, particularly university graduates and unemployed youth, to join armed groups like TDF, Fano, and OLA. These groups appeal to young individuals by offering a sense of protection for their ancestral identity, a means of gaining acceptance, and a platform for expressing their political beliefs in one way or the others. As a result, the cycle of radicalization, violence, and repression continues, hindering economic recovery and social unity across the country. This significantly impacts the nation's economic and social progress, making it hard to build a new social contract for a peaceful future for the next generations.

Public Discontent and Fragile Institutions

The government's frequent issuance of emergency decrees has granted the military unchecked power and suppressed dissent, leading to a significant erosion of public trust. Over time, we have witnessed media censorship, the arrest of journalists, and internet shutdowns, all of which have stifled civic engagement. Consequently, various institutions and sectors are fragile and cannot function as intended, such as the questionable exercise of court power and police institutions.

The national dialogue initiative launched in 2022 had the potential to build consensus; however, various opposition groups, civil society organizations, and some diaspora communities criticized the process for its lack of inclusiveness and transparency. As a result, many opposition groups, among other actors, chose to boycott the initiative, arguing that it was a top-down, government-controlled effort that lacked legitimacy. From a socio-economic standpoint, the absence of inclusive governance reduces confidence in state institutions, deterring local and diaspora investment alike.

Macro-Economic Instability and Debt Burden

Ethiopia's debt-to-GDP ratio for 2023–2024 ranges from 50% to 56%, depending on whether domestic or external debt is considered. The current landscape, supported by compelling statistical evidence, indicates that Ethiopia’s debt-to-GDP ratio will surpass 60% by 2025. Investments in road infrastructure, construction of industries such as real estate, and the development of tourism destinations are vital for the growth of emerging economies. These investments should balance urban and rural sectors and focus on high-impact industries and solutions-oriented approaches. In Ethiopia, skyscrapers, large-scale corridor development projects in Addis Ababa, and the construction of various tourist destinations are underway, with corridor development expanding to some highways connecting cities across the country. Such an emerging project is crucial for developing the economy; however, these developments are not improving the lives of underprivileged groups in the short term, as they continue to face significant hardships that worsen daily. Various groups argue that the project should currently be prioritized, particularly for industrial and manufacturing sectors, as well as those that create jobs and address significant unemployment issues in the agro-industrial and services sectors.

Nowadays, the economic growth has become challenged, associated with the conflict’s impact, the imbalance of imports and exports, and the depreciating birr values following the central bank’s policy shift from the foreign exchange rate full control to a market-based, floating exchange rate since July 2024. As a solution to address the challenges related to hard currency, the government has negotiated with the IMF and the World Bank to secure additional hard currency flows and borrowing facilities that align with its homegrown economic growth policy. However, political instability and high inflation have negatively affected the economy, making it increasingly hard for ordinary citizens who are struggling with rising prices for food, fuel, and other essentials. As a result, the budget deficit has widened, with the government resorting to central bank financing, which has fueled inflation. Public sector wages have lost value in real terms, leading to strikes and protests from teachers and healthcare workers demanding better pay or salary increases to cover basic needs like housing, food, transportation, and children's education.

Unfortunately, in Africa, some high officials and a group of investors believe that being poor or an unprivileged society due to a result of their personal choice or destiny. The reasons an underprivileged group may experience poverty often stem from the mindset shaped by their historical experiences under colonial power and cultural influences. Additionally, a lack of awareness may limit their ability to seek better opportunities, causing them to pursue these paths less actively than businesspeople, largely due to information asymmetry. Moreover, past to presents a disadvantaged people have often been marginalized and experience poverty due to systemic oppression, coupled with high levels of structural corruption and poor governance from the past to the present. In other words, if the existing policy, regulation, and institutions structural fail to create an enabling environment; if the developmental industry sectors will not be expanded and supported them as individuals or groups to benefited as society from such the developmental projects as well, and do not improve sound innovation and creativity facilities for them, and lack of support entrepreneurship activities it will harm overall progress.

Conclusion

Therefore, as a way forward to address the current and forever socio-economic and political roots of conflict, Ethiopia and Ethiopian's must pursue a comprehensive and inclusive recovery strategy associated with genuine dialogue in accordance with inclusive and including all major factions in peace-building efforts, i.e., representatives of armed groups, civil society, and other stakeholders. Primarily, the focus should be on removing bureaucratic challenges between the regime and insurgency, both controlled by military barriers that hinder humanitarian access for aid distribution in areas under attack and conflict. Such bold moves aim to empower the country as a whole and regional governments to manage local development by decentralized economic planning, while maintaining national oversight. Additionally, expanding vocational training, facilitating social financing tools like microfinance in rural and urban areas in line with public works and private job creation to absorb unemployed youth through employment programs, is pivotal. Last but foremost, prioritize the use of diaspora remittances and skills for reconstruction. Ensure equal participation of both genders in peacebuilding for gender equality, fair aid planning, and economic recovery.

Currently, Ethiopia has significant potential, despite navigating a complex crisis during the regime transition. Under the Prime Minister of Abiy Ahmed's leadership, the country has begun with democratization, opening the political space to opponents as well, and economic development with huge hope and promise. Later, it fell into internal conflicts, which were not only merely political, but also ended with the deep socio-economic turmoil that caused displacement and a humanitarian crisis. As a result of this huge displacement in various regions, high unemployment rate, widening of economic and social inequality, and institutional weakness feed into cycles of violence and repression. Thus, to achieve peace and progress, it is essential to establish good governance and build strong institutions that operate independently, free from government or other entity interference, to enhance new developments in the country and support effective multilateralism. To do so, there must be genuine change that emphasizes inclusivity, rather than top-down mandates. This change should involve responsive processes that address the needs and aspirations of Ethiopia's diverse population, and only then can the vision of a united and prosperous Ethiopia be achieved.

Reference

Conflict in Ethiopia: https://www.cfr.org/global-conflict-tracker/conflict/conflict-ethiopia

Rising Tensions in Tigray Risk Regional Conflict: https://africacenter.org/spotlight/rising-tensions-tigray/

Underlying Causes of Conflict in Ethiopia: Historical, Political, and Institutional?, https://www.researchgate.net/publication/358181925_Underlying_Causes_of_Conflict_in_Ethiopia_Historical_Political_and_Institutional

The Silent Conflict: What Is Really Happening in Oromia?: https://www.thereporterethiopia.com/45060/

After drought, famine and war, ethnic conflict now plagues Ethiopia: https://www.economist.com/graphic-detail/2019/05/14/after-drought-famine-and-war-ethnic-conflict-now-plagues-ethiopia

Ethiopia: Internal Displacement Overview (as of June 2024): https://www.unocha.org/publications/report/ethiopia/ethiopia-internal-displacement-overview-june-2024

IMF Executive Board Completes Third Review under the Extended Credit Facility (ECF) Arrangement for Ethiopia and Concludes the 2025 Article IV Consultation:

https://www.imf.org/en/News/Articles/2025/07/02/pr-25234-ethiopia-imf-completes-3rd-rev-under-ecf-arrang-and-2025-art-iv-consult