A Near Trillion Birr Budget Bill Makes its Way to Parliament

Jun 11 , 2024

A near one trillion Birr budget was proposed by the Council of Ministers for the next fiscal year, currently under review by lawmakers. The Standing Committee for Plan, Budget and Finance Affairs will review the draft budget with relevant stakeholders before pushing it for voting before the general assembly. Ahmed Shide, minister of Finance and his deputy Eyob Tekalign (PhD) have been deliberating on the budget hearings for the past months, carefully reviewing the proposals from the 170 federal institutions in the country. Budget ceilings are strictly implemented as the government looks to apply contractionary fiscal policies amid high debt servicing costs and a global funding squeeze. Last year, the budget of 801.6 billion Br was distinctly austere, with a 1.96pc growth from the previous year through major cutbacks on capital expenditure of 6.7pc devoid of new large projects nationwide. Major attention was given to debt servicing costs, which took up nearly 20pc of the whole budget at 159 billion Br while being highly reliant on domestic revenue mobilisation. As Ethiopia looks to get a debt restructuring arrangement facilitated through the G-20 Common Framework mechanism contingent on a reform program proposed by the International Monetary Fund (IMF), fiscal consolidation is an important theme in the budget.