Ethiopia Embarking on Full Implementation of Macroeconomic Reform Policy
Addis Ababa: Prime Minister Abiy Ahmed announced today that Ethiopia has embarked on full implementation of macroeconomic reform policy.
In a macro-economic reform program policy statement issued today, Prime Minister Abiy elaborated that the government has been implementing numerous economic reforms to address longstanding structural problems, including debt burden, inflation, unemployment, and low productivity following the political change which ushered in 2018.
The first phase of the Home-Grown Economic Reform Program (HGER 1.0), introduced in 2019, included policy ideas from macro-financial to structural and sectoral, Abiy pointed out.
Through HGER 1.0, Ethiopia has achieved significant economic objectives, correcting imbalances, alleviating debt, and expanding growth sources, despite remaining reform areas.
Ethiopia has become one of the fastest-growing economies in the world, achieving an average GDP growth rate of 7.1% from 2019 to 2023, he said.
Consequently, the premier added that Ethiopia has
become a significant player in the African economy and demonstrated commitment to the Sustainable Development Goals, building the largest economy in East Africa and the third-largest in sub-Saharan Africa
The policy statement detailed the key pillars of the Homegrown Economic Reform Program (HGER 2.0), the second phase of the country’s economic transformation efforts including establishing a modern macroeconomic policy framework to ensure stability and resilience as well as boosting competitiveness by improving the investment and trade environment, expanding productive capacity and productivity across sectors, enhancing public sector capabilities for efficient service delivery.
“This comprehensive reform agenda will enable us to achieve high and stable economic growth, maintain single-digit inflation, and build a globally competitive economic system,” PM Abiy said.
The reform measures target a range of issues, including foreign exchange distortions, financial sector strengthening, inflation control, tax re
venue mobilization, and improving the business climate.
Notably, the government has secured significant development financing to support the implementation of HGER 2.0, Abiy expressed confidence that this reform effort will lay the foundation for strong, private sector-led, inclusive growth and job creation.
To mitigate any short-term negative impacts, the government has pledged to enhance social safety nets and provide subsidies for low-income workers and fuel prices.
The macroeconomic reform program will be subject to continuous monitoring and evaluation, with government’s readiness to make timely policy adjustments as needed. Transparency and stakeholder engagement will be key priorities throughout the process.
“This is a critical moment for Ethiopia’s economic transformation. With decisive leadership and effective implementation, we are poised to unleash our full growth potential,” the premier underscored.
Source: Ethiopian News Agency