During the reign of Emperor Haile Selassie I, the United States was a major backer of Ethiopia, and was a major supplier to the Ye Ithopya Ayer Hayl (Ethopian Air Force). On May 22, 1953, the United States and Ethiopia agreed on a 25-year American lease on the Kagnew communications station in Asmera, which monitored Soviet radio communications throughout the area. As part of this aid package, in 1966 Ethiopia received at least 12 F-5As and two F-5Bs, enough to equip a single squadron based at Havar Meda. In 1973, Ethiopia ordered a further 14 F-5Es and three F-5Fs.
The last 14 years of Haile Selassie's reign were marked by growing opposition. An abortive coup had taken place in 1960, and in response the Emperor embarked on a program of reforms, but no systematic and coherent economic and social development occurred. An attempt to impose a modern tax system that would have curtailed the power of the landed nobility failed, leading to a series of revolts. Labor unions had been allowed to organize in 1962, but union activities were sharply restricted. Faced with these problems, the Emperor chose to leave domestic issues in the charge of his prime minister, Aklilu Habte Wold, and turned to foreign affairs. However, no significant reforms took place, corruption and inflation were rampant, and there was a famine which affected several provinces.
In 1974, a group of military officers headed by Major Mengistu Haile Mariam managed to gain control of much of the government and gradually managed to deprive the emperor of his ability to govern. Although initially professing loyalty to the Emperor, they quickly moved to arrest members of the aristocracy, military, and government who were associated with the emperor and the old order. Haile Selassie was formally deposed on September 12 and placed under arrest. By this time, he was probably too old and senile to know what was happening to him. He died in August of 1975 under rather mysterious circumstances.
The new government rapidly began to take on a Marxist tint. In March of 1975, all royal titles were revoked, a program of socialism was announced under the leadership of workers, peasants, the petit bourgeoisie and various anti-feudal and anti-imperialist forces. Ethiopia was well on its way to being a one-party Marxist dictatorship.
Despite the change in government, United States military assistance to Ethiopia initially continued without interruption, since the US government was now concerned with the large amount of Soviet aid to its client state in nearby Somalia. Since the northern Red Sea ports in Eritrea were still of Cold War interest to the West, 8 F-5Es were delivered to Ethiopia in 1975. Attrition was made good by the supply of some ex-Iranian F-5s (perhaps two or three).
By early 1977, the dictatorial and Marxist nature of the new Ethiopian regime had become apparent. In February of 1977, Secretary of State Cyrus Vance recommended that American military aid be terminated because of Addis Ababa's atrocious human rights record. In response, the Ethiopian government expelled all MAAG personnel, closed all US military installations, and terminated the lease on the Kagnew station.
Ethiopia had been involved in a long-term dispute with Somalia over the status of the Ogaden desert area of Ethiopia. In early 1977, Somali guerilla organization had managed to take advantage of the turmoil in Ethiopia to launch an attack on Ethiopian government positions throughout the Ogaden. Assisted by the Somali government, the guerillas managed to capture large parts of the Ogaden. The main Somali fighter aircraft was the MiG-21MF delivered in the 1970s, supported by MiG-17s delivered in the 1960s by the Soviet Union. Ethiopian F-5E aircraft were used to gain air superiority because they could use the AIM-9B air-to-air missile, while the F-5As were kept for air interdiction and air strike. The better-trained F-5 pilots swiftly gained air superiority over the Somali Air Force,shooting down a number of aircraft, while other Somali aircraft were lost to air defense and to incidents. However at least three F-5s were shot down by air defense forces during attacks against supply bases in western Somalia
Since American military aid had largely dried up because of the poor Ethiopian human rights record, the Mengistu regime turned to the Soviet Union for help. Soviet military assistance began to pour into Ethiopia by the end of 1977, with up to 17,000 Cuban troops being sent from Angola. Somalia had been a Soviet client state up to this point, and now responded by abrogating its treaty of friendship with Moscow, expelling all Soviet advisers, and turned to the West for help. The two countries had changed sides in the Cold War.
During this time, two Ethiopian F-5s were lost to Somali AAA. However, Soviet aid managed to turn the situation around and the tide of the fighting eventually turned and the Somali forces were driven back. By March of 1978, most Somali forces had been driven out of the Ogaden, leaving the Ethiopian army in full control. In November of 1978, Addis Ababa and Moscow signed a 20-year treaty of friendship and cooperation.
The Ogaden territory remained in dispute until a treaty was signed in 1988.
Since the Ethiopian government was now a client state of the Soviet Union, no more F-5s were supplied from the USA. However, Ethiopia was supplied with a few F-5A and E fighters from the Democratic Republic of Vietnam. These planes had been seized from the South Vietnamese government following the fall of Saigon in 1975. At least two Ethiopian F-5As reportedly were flown to the Sudan, where their pilots sought political asylum. Twelve F-5As and two F-5Bs survived the fighting and were offered for sale in 1984. Ethiopia's F-5s were allegedly transferred to Iran in 1986.
During the late 1980s, as Soviet military and economic aid dwindled, Mengistu's position grew progressively weaker and regional rebellions began to spread. He was deposed by a rebellion in 1991, and fled to Zimbabwe in May 1991. A new constitution was adopted whihc led to Ethiopia's first mutiparty election in 1995 In May of 1998, a border dispute with Eritrea lead to the Eritrean-Ethiopian War, which lasted until June of 2000.