The country's state media, Fana Broadcasting Corporate, was quoted by Agence France-Presse (AFP) as saying that the plane, which departed the Ethiopian capital at 8:38 am, crashed minutes after takeoff, "killing all the 149 passengers and eight crew aboard".
This is the second recent crash of the relatively new 737 MAX 8, the latest version of Boeing's workhorse narrowbody jet that first entered service in 2017.
Swedish flight tracker flightradar24.com said on its Twitter account that: "Additional data from Flightradar24 ADS-B network show that vertical speed was unstable after take off".
The reason for the crash is not yet known.
"Some of them, as you know, they are very distressed", he said. Boeing sent condolences to the families and said it was ready to help investigate. Southwest Airlines flies 31 MAX 8 jets while American Airlines and Air Canada each have 24 in their fleet.
Flight ET302, operated on a Boeing 737-800 Max aircraft, crashed near the town of Bishoftu, some 60 kilometres southeast of the Ethiopian capital, six minutes after takeoff.
Caribbean airline Cayman Airways said it would also temporarily ground its two 737 Max 8 planes.
Under worldwide rules, responsibility for leading the crash investigation lies with Ethiopian authorities, while the US National Transportation Safety Board (NTSB) will automatically take part because the Boeing aircraft was designed and built in the United States.
At least 21 staff members from the United Nations were killed in the crash, said U.N. Secretary-General Antonio Guterres, who led a moment of silence at a meeting where he said "a global tragedy has hit close to home". "The villagers said that it was a plane crash, and we rushed to the site". Its last major accident occurred in 2010 when it crashed into the Mediterranean shortly after takeoff from Beirut, killing all 90 people on board. It has flown more than 1,200 hours.
Ethiopian officials declared Monday a national day of mourning.
"The pilot mentioned that he had difficulties and that he wanted to return", Tewolde told a news conference.
Ethiopian authorities are leading the investigation into the crash, assisted by the U.S., Kenya and others. Boeing planned to send a technical team to Ethiopia.
"Ethiopian Airlines is establishing a passenger information center and telephone number will be available shortly for family or friends of those who may have been on" the flight.
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