Ethiopia’s Economy Projected to Grow at 8.7 % in FY 2021/22

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June 15/2021 ( ENA )  Ethiopia’s economic growth is projected to be 8.7 percent during upcoming Ethiopian fiscal year (2021/22).

It is to be recalled that the Council of Ministers last week approved some 561.7 billion Birr budget and referred it to the House of Peoples Representatives for endorsement.

The new budget has an increase of 18 percent compared to the previous budget year.

The House, in its 15th regular session today has deliberated on the new draft budget.

On the occasion, Minister of Finance, Ahmed Shede briefed the house about the economic reform activities being undertaken in the country and the challenges the economy has been facing during the concluding budget year.

He told the House that Ethiopian economy has been facing several challenges including the outbreak of COVID-19, inflation, shortages of foreign currency as well as other man made and natural disasters.  

Despite all the challenges, the economy has managed to grow by 6.1 percent and per capita income has reached to 10,080 birr.

Based on the existing indicators, the nation’s economy is also expected to register better performance in the upcoming fiscal year.  

Accordingly, the overall economic growth is projected to be 8.7 percent and inflation is expected to fall to single digit, the Minister elaborated.

Indicating that improved system will be implemented to increase government revenue he said the price of imported goods will increase by 9.9 percent.

He assured that the necessary monitoring system will be implemented with a view to ensuring the proper spending of government’s expenditure for social and economic developments.

Ahmed said the budget will focus on roads, education, health and urban sectors development.

Out of the total 561.67 billion Birr budget for the year, 162 billion Birr is allocated for recurrent spending, 183.5 billion Birr for capital expenditure, 203.95 billion Birr for subsidy to regions, and 12 billion Birr for sustained development goals.

Some 369.1 billion Birr or 84.7 percent of the total budget is expected to come from domestic sources and the remaining 123.7 billion birr from foreign loans and grant.

After an extensive deliberation of the budget draft, the House referred it to the Revenue Budget and Finance Affairs Standing Committee for further scrutiny.