The massive urbanization and primacy of Addis Ababa in the last 50 years is a new phenomenon in Ethiopia, historically a nation of small villages and homesteads (Tarver 184).
The earliest settlements in Ethiopia were the ketemas, towns that developed inside military garrissons. These defenses provided protection from European invaders and other Ethiopian tribes (McClellan 33-35). The ketemas were often established by peasants in zones between the territories of several constantly warring ethnic groups. Small market centers developed in many of the ketemas, which were supplied with agricultural products by gabbars, peasants who sold their surplus goods (McClellan 33-35).
Addis Ababa, merely a century old, is only the last in a long succession of capital cities dating back to the first century B.C. The capital has shifted every few centuries over the past two-thousand years along with the nomadic people of the Amharic and Somali plateaus. The Pre-Christian city of Axum was followed as capital by Lalibela, Gorgora, Gondar and Mekele, all of which are located in northern Ethiopia (see map of Ethiopia)(Tarver 184).
The primary reason for the continuing relocation of capitals was exhaustion of wood resources for fuel and construction. New capitals were prosperous for several decades until the sparse forests around the city became depleted. Each capital went through a stage of decline and was finally abandoned in favor of a new site.
In 1881, the powerful emperor Emperor Menelik II and his followers moved to the foothills of the Entotto mountains near present day Addis Ababa (Zewde 68). This temporary encampment in central Ethiopia had several advantages for Menelik II. Firstly, its location further south than any previous capital allowed him to unite the southern reaches of the empire with the more populated north under his rule. Secondly, the site had historical significance as a legendary camp of medieval kings (Zewde 68).
In November 1886, while Menelik was off in a distant corner of the empire, his wife Taytu moved the encampment from the hills down onto the current site of Addis Ababa. She reportedly left the Entotto mountain camp because of the unpleasantly cool temperatures at that high elevation and was drawn to the site of Addis by the Fel Weha hot springs (Zewde 68).
More important than the comforts of the Addis Ababa site, was its potential for expansion. The Entotto site was perched on a ridge and offered little room for development of the grand city Menelik envisioned. The hills were also limited in proximity to water and commerce routes (McClellan 37) Upon his return, Menelik apparently became fond of the new location and in 1892 named the settlement, Addis Ababa, proclaiming it the new and permanent capital of the Ethiopian Empire (Area Handbook 49).
In the 1890's and early 1900's, Addis Ababa had not yet become the grand capital city Menelik dreamed of. Throughout the 1890's, laborers worked in construction of the two oldest structures in Addis Ababa, Menelikıs Gebbi (palace) at the highest point in the area, and the St. George Church to the west (Zewde 69). Addis Ababa's earliest market opened adjacent to the church in the Arada district.
Part of the city's indigenous character was established by the early settlement patterns of the followers and subjects of Menelik II and his nobles. The lesser nobles were each granted land on one of the hilltops of Addis Ababa as ³gults², or rewards for their loyalty (Zewde 69). The servants and dependents of each noble settled on the flanks of his hill, surrounding his hilltop Gebbi, and forming clustered neighborhoods called safars(Zewde 69). These Safars eventually became the distinct sectors known today as Ras Berru Safar, Ras Tasomma Safar, and Fitaurari Habta-Giyorgis Safar (Zewde 69). The servants settlements on the great hill of Menelikıs Gebbi gave rise to neighborhoods differentiated by occupation: Saratagna Safar (Worker's quarters), Zabagna Safar (Guards' quarters), and Weha Senqu Safar (the "Quarters of the Unprovisioned", an imperial army camp with no amenities but water) (Zewde 71).
Four primary factors allowed Addis Ababa to escape the fate of its predecessors and become the permanent capital and city of 2 million it is today:
When Addis Ababa, like capitals before, was stricken by shortages of wood for fuel and building materials, Menelik plotted another relocation of the capital to a site 40 miles away, but foreign merchants and legations objected fiercely. Effort was taken to plant Eucalyptus trees, imported from Australia, on every available plot of land in and around the city. Menelik recognized the potential for the development of this resource, not only distributing seedlings at low prices, but exempting lands planted with Eucalyptus from taxation (Ellis 680).
This massive reforestation effort created a greenbelt surrounding the city which has solved the everpresent dilemma of wood shortages. Since 1925, when the capital was sometimes referred to as 'Eucalyptopolis', this greenbelt has spread further, covering 20 square kilometers by 1936 and more than doubling in area to 45 square kilometers by 1964 (Horvath 313). In 1969, ninety percent of the buildings in the burgeoning metropolis of Addis Ababa were constructed of Eucalyptus wood (Horvath 314-315).

Read bout the Italian Occupation of Addis Ababa: 1936-1941


Macalester Geography: World Urbanization Page