Ethiopia was relatively isolated from major movements of world politics until the 1895 and 1935 Italian invasions. Since World War II, it has played an active role in world and African affairs. Ethiopia was a charter member of the United Nations and took part in UN operations in Korea in 1951 and the Congo in 1960. Former Emperor Haile Selassie was a founder of the Organization of African Unity (OAU). Addis Ababa is the host capital for the UN Economic Commission for Africa and the OAU.

Although nominally a member of the Non-Aligned Movement, after the 1974 revolution, Ethiopia moved into a close relationship with the Soviet Union and its allies and supported their international policies and positions until the change of government in 1991.

Today, Ethiopia has very good relations with the U.S. and the West, especially in responding to regional instability and, increasingly, through economic involvement. Ethiopia's relations with Eritrea are extremely close, reflecting the shared revolutionary struggle against the Derg. Continuing instability along Ethiopia's borders with Sudan and Somalia contributes to tension with the National Islamic Front regime in Sudan and several groups in Somalia.

International Disputes:

• Somalia
  • Most of the southern half of the boundary with Somalia is a Provisional Administrative Line, not an international boundary
  • maintains alliances with local clans in opposition to the Transitional National Government, which lost its mandate in August 2003, in Mogadishu
  • "Somaliland" secessionists provide port facilities and trade ties to landlocked Ethiopia
  • Territorial dispute with Somalia over the Ogaden

• Eritrea
  • Dispute over alignment of boundary with Eritrea led to armed conflict between 1998 - 2000, which was resolved by the 2002 independent boundary commission's delimitation decision, but demarcation has been delayed, despite intense international intervention, by Ethiopian insistence that the decision ignored "human geography," made technical errors in the delimitation, and incorrectly awarded Badme and other areas to Eritrea; Eritrea meanwhile insists on not deviating from the commission's decision

• Sudan
  • Efforts to demarcate the porous boundary with Sudan have been delayed by civil war

Illicit drugs:

• Transit hub for heroin originating in Southwest and Southeast Asia and destined for Europe and North America, as well as cocaine destined for markets in southern Africa.
• Cultivates qat (chat) for local use and regional export, principally to Djibouti and Somalia.
• Lack of a well-developed financial system limits the country's usefulness as a money-laundering center