Medicinal plants play important roles in human and animals disease treatment. 1000 medicinal plant species are identified and reported in the Ethiopian Flora. They contribute and is more preferable for new drug development. Ethiopia has the potential to become an important source country, given the diversity of plants and the rich traditional knowledge regarding their use. The main sources of medicinal plants for utilizers are the wild forests. There is also cultivation practice of medicinal plants in home garden. About 80% of human and 90% of livestock population in Ethiopia depends on utilization of medicinal plants for primary health care. The knowledge transfer of medicinal plants in Ethiopia is largely oral. Most parts of medicinal plants commonly used are leaves and roots. Utilization of leaves for drug preparation is important for conservation of medicinal plants since harvesting leaves may not cause detrimental effect on the plants compared to the root or whole plant collections. Medicinal plants play a crucial role in health care needs in Ethiopia, because modern health care do not have adequate and equitable health service. Moreover, they depend on medicinal plants due to financial limitations related to rapid population growth and poor economic performance. In Ethiopia the market for essential oils of medicinal plants is very high and increasing in alarming rate. In the year 2011, 1,596.5 tons of essential oils of medicinal plants was imported and more than 30 million USD spent. Through increasing production potential and modernizing the sector of medicinal plants, they play a great role to substitute import and export. Medicinal plants have great potential to contribute to economic development and poverty alleviation in Ethiopia. Environmental degradation, deforestation, agricultural expansion over exploitation and population growth is the principal threats to medicinal plants in Ethiopia.
Key words: Medicinal plants, utilization, economic role.
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