Can Abiy Ahmed Survive the Cost-of-Living Crisis?

The queue at the petrol station begins before dawn. In Addis Ababa, Dire Dawa, and Hawassa, these scenes have become routine, connected directly to Ethiopia's foreign exchange crisis and the government's inability to import sufficient fuel. Understanding the economic context requires looking at eight years of Abiy Ahmed's record and the structural constraints he inherited and deepened.

The question this raises is not simply economic. It is political. Governments across the world have discovered, often too late, that the cost of bread and the price of fuel are not technical problems for finance ministries, they are legitimacy problems for heads of state. In Ethiopia, where Abiy Ahmed has now governed for eight years, the pressure is building in ways that deserve more analytical attention than they are getting.

The numbers behind the queues

Ethiopia's inflation reached 33 percent at its peak in 2023 and has remained stubbornly elevated since. The National Bank of Ethiopia devalued the birr sharply in mid-2024 under IMF structural adjustment conditions, cutting its official value by approximately 30 percent in a single move. The effect on import-dependent goods, fuel, medicine, wheat, was immediate and severe. The parallel market, which had long priced the dollar well above the official rate, offered little relief once the official and black-market rates converged: prices adjusted upward, but wages did not.

Ethiopia is not an oil producer. Every litre of petrol and diesel is imported, priced in dollars the country struggles to accumulate. Foreign exchange reserves have been a persistent vulnerability. Ethiopia's current account deficit and debt service obligations leave the central bank with limited room to cushion the market. When dollars are scarce, fuel is scarce. The relationship is direct, and the government knows it.

Why this matters politically

Ethiopia's protest tradition has been channelled almost exclusively through ethnic and regional identities. The Oromo protests of 2014–2018 that carried Abiy to power were animated by land grievances and political exclusion, not abstract cost-of-living statistics. The Amhara unrest that followed, now evolved into an armed conflict with the Fano militia, has its own ethnic and sovereignty dimensions. A purely bread-and-butter protest movement of the kind that toppled governments in Sudan in 2019 or nearly did in Kenya in 2024 has not been Ethiopia's pattern.

But patterns can change, and three factors make the current moment different from previous economic downturns.

First, urban youth, the demographic most likely to organise, most connected to social media, and most economically marginalised, are no longer available as a political resource for Abiy. In 2018 they were his base: Oromo, Amhara, and multi-ethnic city youth who saw him as a generational break from the TPLF's drab authoritarianism. That coalition has fragmented. The Tigray war, the suppression of the OFC, and the ongoing Oromia insurgency have all burned through goodwill. What remains is exhaustion and cynicism, conditions that historically precede mobilisation, not prevent it.

Second, there is no longer a convenient scapegoat. For much of 2020–2022, economic difficulties could be credibly attributed to the war in Tigray, to TPLF sabotage of infrastructure, to the extraordinary costs of military mobilisation. That narrative has a shelf life, and it has expired. The Pretoria agreement is now almost four years old. The question Ethiopians in fuel queues are asking is not "why is there a war?" but "why is there still no petrol?"

Third, the IMF-mandated devaluation of 2024 removed a buffer that had protected ordinary Ethiopians from the full force of global commodity prices. The government chose macroeconomic stabilisation, necessary for continued external financing, over short-term price protection. That is a defensible choice. It is also a politically costly one, and the costs are being paid by exactly the urban workers and small traders who have the fewest resources to absorb them.

What the government can, and cannot, do

The government's short-term options are genuinely limited. Reversing the devaluation would jeopardise the IMF programme and the $10.7 billion in debt restructuring under the G20 Common Framework that Ethiopia needs to avoid default. Subsidising fuel would require foreign currency the government does not have. Printing birr to cover shortfalls would accelerate inflation further. These are not excuses, they are the actual constraints of a country that borrowed heavily during a period of conflict and is now paying compound interest on those choices.

The Sudan comparison, and why it matters

In December 2018, Sudanese citizens began protesting in Atbara over the price of bread. Within three months, Omar al-Bashir, who had governed Sudan for thirty years and survived wars, sanctions, and an ICC indictment, was removed by his own military. The protests were not primarily organised by political parties. They were organised by a Sudanese Professionals Association and sustained by ordinary people who had simply had enough. The trigger was bread. The fuel was accumulated grievance.

Ethiopia is not Sudan. Its military is more directly tied to the ruling party. Its opposition is more fragmented. Its protest tradition, as noted, is ethnic rather than class-based. And Abiy, unlike Bashir in his final years, retains some genuine political legitimacy among at least part of the population.

But the Sudan case illustrates a principle that applies everywhere: economic pain does not need to be organised to be politically destabilising. It needs only to reach the point where enough people conclude that their situation cannot continue, and that the government is responsible. Ethiopia is not at that point. The trajectory, however, is worth watching.

The verdict

Abiy Ahmed is not in immediate danger of being toppled by fuel queues. His security apparatus is intact, his opposition is fractured, and the ethnic complexity of Ethiopian politics makes coordinated national protest structurally difficult. In the near term, he survives.

But surviving is not the same as governing effectively, and governing effectively is not the same as maintaining legitimacy over time. The cost-of-living crisis is eroding the patience of urban Ethiopians at a moment when Abiy has few political assets left to spend. He cannot offer them the reform narrative of 2018, that story is over. He cannot blame the war, that excuse has expired. What he can offer is competence and results, and on the economy, results are not yet visible to the people waiting in the petrol queue at dawn.

The risk is not revolution. The risk is the slow withdrawal of consent, a population that stops believing its government can deliver, stops participating in the institutions that give governments their authority, and starts looking for alternatives that may be far more disruptive than a protest movement. That process, once started, is very difficult to reverse.