Macro-economic Adjustments Resulting Positive Impacts: Ministry of Finance

March 1/2021(ENA) Ministry of Finance announced that the performing adjustments on macro-economic imbalance, which stalled the nation from generating sufficient finance to pay off its accumulated debt, has been bringing positive outcomes.

Despite the rigorous adjustments on macro-economic imbalance, the latest evidence indicated that country has suffered from high inflationary experience and high cost of lives, it was indicated.

In his press conference today, State Minister of Finance, Eyob Tekalign said those measures and critical adjustments on macro-economic imbalances have registered important developments during the past two years.

As the macroeconomic imbalance is characterized mainly by imbalance between revenue and expenditure, the government has been working to address structural and identified challenges properly. 

“From the onset, we have begun to identify macroeconomic and structural challenges and pursue the right direction in a way these problems must be addressed,” Eyob noted.

Accordingly, the reforms are progressing well in the time frame, the State Minister pointed out.

“In this regard, the economic reforms are progressing well per the schedule. For example, one of the biggest problems in the Ethiopian economy is the lack of increasing production and productivity. Therefore, tremendous activities being underway to solve the supply problem completely,” he said. 

Noting that unless the supply problem is solved in Ethiopia’s economy, the desired prosperity that the country aspires will not be realized fully, Eyob underscored.

Therefore, the country is hugely investing in some selected sub-agricultural commodities including wheat, coffee seedling, and mango among others, for export and import substitution, he pointed out.

On the other side, the State Minister revealed that the macro-economic measure helps the country to modernize its monetary policy and establish a treasury bill market worth of 50 billion Birr last year describing “it is one of the biggest achievements.”

He furthermore stated that the macro-economic imbalance adjustment has also enabled to reduce the country's debt burden as much as possible. 

Following Ethiopia pursue a new borrowing scheme, which shifted from commercial to concessional loans, the country's debt has been reduced by 7 percent and brought opportunities to emerge from economic crisis, Eyob said.

He also acknowledged that Ethiopia has suffered from high inflationary experience and high cost of living currently. However, he argued the current inflationary experience is the result of the accumulation of inflation over the past 10 to 15 years. 

But, he noted that the government is committed to solve major economic bottlenecks and corrective measure has been taking to resolve the inflation crisis.