Economy of Eastern Africa


In connection with independence in 1962, the Belgian colony was divided into two countries; Burundi and Rwanda. During the 1990’s, the country was marked by severe conflicts and civil wars that resulted in about 250,000 deaths and 800,000 refugees. The situation for the union is very difficult. Two central trade unions are affiliated to the International Trade Union Confederation, ITUC


Country Facts

State condition: Republic

Surface: 27,834 km

Capital: Bujumbura

Language: Kirundi and French are official languages. Swahili is used in trade

Labor market and economy:

According to COUNTRYAAH, Burundi is a very densely populated country – about 12 million on an area slightly smaller than Dalarna. The country’s economy is completely dependent on agriculture, where 90 percent of the population works. However, many have to combine that work with other jobs in the informal sector in order to make a living. Coffee and tea are the main exports. It also makes the economy very weather dependent. Burundi is one of the absolute poorest countries in the world.

Customs freedom in the East African Economic Community benefits the country and economic development was good for a few years until the political crisis in connection with the 2015 elections when President Pierre Nkurunziza ran against the country’s constitution. A coup attempt was thwarted but the country has been in constant crisis ever since. A large number of politically active people have fled, unemployment is high and the cost of living has risen sharply. Aid, which has long accounted for almost 50 per cent of GDP, has fallen sharply.


The small archipelago northwest of Madagascar is an extremely poor and politically troubled Islamic republic. Although there are only 7,000 salaried employees, there are two central organizations and 14 unions.


Country Facts

State condition: Republic

Surface: 1 862 km²

Capital: Moroni

Language: Official Arabic, French and Swahili are widely used

Labor market and economy:

The Comoros are very poor and completely dependent on aid from the former colonial power France, as well as on the money sent home from 300,000 citizens living abroad. That money makes up almost 25 percent of GDP.

Agriculture employs the majority of the citizens, but despite this, today it is not even enough for its own population, but in recent years the country has been forced to import food. The lack of electricity and poor infrastructure are obstacles to development.

The industry consists mostly of fishing, tourism and perfume production and employs no more than 20 percent of those of working age.

In recent years, many have been concerned about what is perceived as increased Islamization. Several religious aid organizations from Iran have been accused of Shiite propaganda. The unrest that occurs from time to time has made it difficult to invest in tourism.


The small country on the Red Sea has an authoritarian regime but is formally a democracy. The strategic location on the shores of the Red Sea is the country’s largest source of income. The largest trade union central organization, Union Djiboutienne du Travail (UDF), is affiliated to the World Trade Union Confederation, ITUC.


Country Facts

State condition: Republic

Surface: 23 200 km²

Capital: Djibouti

Language: French and Arabic official languages, Somali and Afar the largest languages ​​in the country

Labor market and economy:

The small desert land (slightly larger than Värmland) lacks natural resources and has almost no arable land. Djibouti is heavily dependent on aid. The economy is based on the country’s strategic location; France, the USA, Japan and Italy and since 2017 also China have military bases in the country. Much of Ethiopia’s trade is via a Chinese – funded railway between Addis Ababa and Djibouti. Unemployment is between 40 and 50 percent, for young people upwards 80 percent. Today, a large portion of the population lives on less than two dollars a day. The free trade zone that is being established, the government hopes will provide many jobs.


After a 30-year war of liberation against Ethiopia, Eritrea won its sovereignty in 1993. This was followed by a few years of positive development, but since then, wars and border conflicts with Ethiopia have replaced each other until 2018 when the countries made peace. The regime commits constant violations of trade union freedoms and rights.


Country Facts

State condition: Republic

Surface: 121 144 km²

Capital: Asmara

Language: Tigrinya’s largest indigenous language. Arabic and English are also used in official contexts

Labor market and economy:

After a few hopeful years immediately after independence, the war against Ethiopia led to the annihilation of the economic progress made. Eritrea’s infrastructure is in shambles and the economy is in shambles. The policy is focused on developing agriculture in order to avoid dependence on food aid. Unemployment is very high, but exact figures are lacking. Nearly 80 percent of the population lives in self-sufficiency in rural areas. Eritrea often suffers from severe drought. The country has rich mineral resources and several foreign mining companies have begun prospecting for mining gold, copper and zinc.

The peace that was concluded with Ethiopia in 2018 can improve the conditions for a more positive development in the future.


Ethiopia has never been colonized. When the 700-year-old empire was abolished in 1974, a Marxist dictatorship followed until 1991. Ethiopia is one of the poorest countries in the world, but has a rapid economic development. Trade union rights do not exist, but in 2018 a comprehensive reform policy was initiated in the country, which in the long run is expected to give the trade union movement greater freedom.


Country Facts

State condition: Republic, federal state

Surface: 1 133 380 km²

Capital: Addis Ababa

Language: Amharinja and English official languages

Labor market and economy:

When Abiy Ahmed was elected Prime Minister in 2018, a comprehensive transformation of Ethiopian society began with a broad program of political and economic reforms. 2019 was awarded Abiy Ahmed Nobel peace prize for his work with to finish the 20 – year-old post-war territorial death situation between Ethiopia and Eritrea.

Ethiopia has had strong economic growth for many years and has the most even income distribution among the African countries. The country is still one of the poorest countries in the world. The economy is based on agriculture, which accounts for 90% of exports of goods, of which coffee accounts for 60%. Despite plans for privatization and liberalization, 90% of the industry is still owned by the state. The service sector – led by the state-owned airline Ethiopian Airlines, which is Africa’s largest – accounts for a large share of foreign exchange earnings. Intensive work is also underway to improve the infrastructure. A large dam was completed in 2017 and three more dams are under construction. When completed, they will provide electricity to develop the industry.

Unemployment is high. A large proportion of the population works in the informal sector with e.g. sales on a smaller scale, mainly in the larger cities.


Kenya became independent from Great Britain in 1963. A well-developed large-scale agriculture gave good economic development in the beginning. Kenya has long had a strong trade union movement. The difference between legislation and the application of trade union rights is very great. Corruption and terrorism pose a threat to democratic development and human rights.


Country Facts

State condition: Republic, unitary state

Surface: 582 646 km2

Capital: Nairobi

Language: English and Kiswahili official languages

Labor market and economy:

Kenya’s economy is based on agriculture but is still relatively varied with a fairly significant industrial sector. The main export item is coffee. The tourism industry has provided large incomes, but the unrest in recent years has led to a crisis. The government’s inability, corruption and very high population growth and climate change with recurring dry periods are other factors that have a negative effect on development. There are some signs of a positive turnaround and some reforms have been implemented.

In 2019, Kenya became the first African country to introduce a third gender in its population register.

Economic cooperation with Tanzania, Uganda, Rwanda and Burundi has been strengthened and a common stock exchange and, in the long term, a common currency are also planned. Kenya is the economic center of East Africa and attracts many foreign investments, including China has financed a high-speed rail link between Nairobi and Mombasa, the largest port city on the Indian Ocean coast.

Unemployment is high and a majority of Kenyans support themselves in the informal sector with small-scale agriculture and various service jobs.