Gov't to Focus on Fiscal Consolidation in New Ethiopia Budget Year

Addis Ababa July 7/2022/ ENA /The budget for the new Ethiopian fiscal year will focus on fiscal consolidation, PM Abiy Ahmed said.

Responding to questions raised by members of the House of People's Representatives today, the PM said some 59 percent of the new budget will be spent on poverty alleviation.

In the new budget year, the government will do everything to minimize credit from banks to cut inflation by using mechanisms such as bond purchase, he added.

The government will also focus on improving efficient use of economic resources.

According to him, reckless debt accumulation is creating big havoc in many countries.

Minimizing the risk of reckless credit and debt accumulation is, therefore, the focus of the government in the new budget year, he noted.

In a bid to reduce deficits and debt accumulation, government will focus on fiscal consolidation.

The premier stated that taming inflation will continue to be the focus in the budget year. Over the last 20 years, Ethiopia’s inflation has been galloping at a high rate.

The measures taken over the last three years have helped to minimize inflation, though not as desired, he noted.

Currently, some 25 percent of the food in Ethiopia is imported. To curb this problem, the government will focus on improving productivity, Abiy elaborated.

Boosting agricultural productivity will help to minimize inflation and even get extra income, the PM said, adding that the government is helping farmers to get water pumps and boost production.

Reconstruction and humanitarian support are also among the focus of the new budget.

The House of People's Representatives has approved 786.61 billion Birr budget for the Ethiopian Fiscal year that begins tomorrow.

The budget aims to achieve national goals, protect national security, assist displaced people and rehabilitate damaged infrastructure and services.