Ethiopia’s Economy Growing Without Foreign Loans, Prime Minister Ahmed Claims

Ethiopia’s economy is experiencing growth independent of foreign loans, Prime Minister Abiy Ahmed announced yesterday, attributing the success to the country’s Homegrown Economic Reform Programme.

Addressing the House of People’s Representatives on Tuesday, Ahmed stated the reforms, launched in 2019, have addressed macroeconomic imbalances and boosted domestic revenue. He projected annual revenue will climb to 1 trillion birr (approximately $17.3 billion), a significant increase from the previous 170 billion birr (about $2.95 billion). This economic shift is particularly notable given Ethiopia’s historical reliance on international aid and lending.

The Prime Minister revealed the government allocated 440 billion birr ($7.6 billion) towards subsidies aimed at stabilizing inflation, which has reportedly fallen to 11.7%, the lowest rate since the reform program began. Most of this expenditure covered fuel, fertilizer, public sector salaries, and social programs like school feeding initiatives. “We have used every possible instrument to ease the cost of living. Our economy is standing tall again,” Ahmed said. For more on Ethiopia’s economic landscape, see the World Bank’s Ethiopia page.

Officials indicated the government will continue to prioritize policies supporting domestic economic strength and managing the cost of living. Further details on Ethiopia’s economic reforms can be found here.