Ethiopia’s economic development and political transformation have been affected by the COVID-19，which is compounded by the domestic security and governance problems. As a second most populous country and aviation hub in Africa，the epidemic situation in Ethiopia is related to the prevention and control of COVID-19 across Africa. To mitigate the negative impact of COVID-19，the Ethiopian government has taken restrictive measures and mobilized domestic and international medical resources. Ethiopia’s fiscal revenue，debt repayment，foreign investment and employment have been seriously affected by the epidemic. Also，the shortening of global value chains has put pressure on Ethiopia’s manufacturing development and economic transformation. Facing economic challenges，Ahmed Administration will continue the economic reform path transforming from government-led to market-oriented economy. The postponement of the election caused by the epidemic，coupled with domestic political differences，has led to increasing political turmoil in Ethiopia. Most worryingly，the armed conflict in Tigray region and its subsequent impact may deepen the gloom of Ethiopia’s future. However，Ethiopia remains one of the most capable and resilient countries in Africa to deal with COVID-19. The extent of COVID-19 pandemic impact on Ethiopia’s economy and politics depends on the spread of the epidemic，distribution of vaccines，effectiveness of the government’s anti-epidemic measures and economic recovery measures，as well as the ongoing economic and political transformation of Ethiopia.