(1) Inequality of income= Benefits are delivered unevenly as growth occurs. In other words, the rich becomes richer while the poor becomes poorer. The income distribution is already one of the biggest problems that developing countries face. The growth would benefit the society, and increase the profit for multinational corporations.
According to the survey in 1998, 3.0% of the total income was earned by the lowest 10% of the population, wheras the highest 30% earned more than 80% of the country’s total income.
(2) Pollution: As an economy grows, it will push the firms to increase the outputs. This will increase the air and water pollution, because of increase in the number of factories and facilities. Also, since most developing countries have weak protection on its forests and environments, economic growth could accelerate the deforestation and environmental degradation.
Ethiopian wolves, lions, and Gelada Baboons are under the danger of extinction. Local hunting, agriculture, and housing developments cause deforestation too. Increase coffee production is one of the main causes.
(3) Loss of non-renewable resources= As the production increases drastically, the efficiency of the economy in using the resources would decline. Faster the production is, available resources would last for a shorter time period.
Ethiopia has deposits of coal, gemstones, kaolin, iron ore, soda ash, and tantalum, but only gold is mined in significant quantities. In 2001 gold production amounted to some 3.4 tons.
(4) Loss of Land= Increase in production of an economy decreases the amount of available land.
The agriculture of Ethiopia accounts for 46.3% of GDP, 60% of exports, and 80% of the total unemployment. Because of deforestation, originally 35% of the land was covered with trees, but it declined to 11.9%. In terms of loss of land, soil erosion and deforestation are two big problems that Ethiopia is facing,
(5) Lifestyle changes= The push for growth changes the income and consumption of families and communities.
The lifestyle of Ethiopia hasn’t been changing, since the education level stayed the same. Enrollment is one of the lowest among the African countries, and almost half of the population is illiterate.
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Ethiopia needs to increase its efficient use of natural resources. Although the country has deposits of different natural resources, the economy is mostly dependent on the mining of gold. By increasing the production/mining of coal and gemstones, it will benefit different industries that are related to the resources. In a long term, when there’s not much gold, they can depend on other natural resources and make sure the growth to carry on.
