Road accidents have many negative costs that are regarded as socio-economic costs. In recentrnyears, road traffic accidents have caused a significant and increasing socio-economic loss inrndeveloping countries in general and in Ethiopia in particular. With the high growth of roadrnaccidents throughout the developing world, it is essential that adequate sums of money are spentrnin dealing with the problem. In the absence of an estimate of accident-related economic issues, itrnis difficult to identify the sums of money that should be invested each year on road safetyrncountermeasures. Nevertheless, the estimation of the national explicit costs of road accidents asrnwell as the implicit value of the accidents is rarely highlighted to policy makers.rnThis paper aims to review accident costing methodologies in developing countries and apply it inrnestimating the economic loss of road traffic accidents in the country, Ethiopia. And also itrnfocuses to insight the challenges of estimating the costs of road accidents in low incomerncountries where vital registration and relevant statistics concerning road accidents are scarce. Arnfeasible method for costing road accidents in such instances is identified, and the severity andrncostliness of road accidents in the country is demonstrated. Accident data and cost figures ofrn2009/10 are considered to make the estimation of the annual traffic accident cost in Ethiopia. Thernanalysis shows, among other things, road accidents erode more than 0.49% of the countryâ€™srnGross Domestic Product (GDP).