In his inaugural policy speech at the joint session of the HPR and HF, the newly appointed President of Ethiopia, Taye Atsekeselassie highlighted major government achievements during the previous fiscal year and planned activities for the current fiscal year.
The President highlighted the major achievements of the previous fiscal year stating that that Ethiopia’s economy is at a new turning point, highlighting the country’s transition to a multi-sector economy. He noted that this shift is gradually increasing the number of citizens who benefit from economic growth. Ethiopia’s economy recorded a growth rate of 8.1 % in the concluded Ethiopian fiscal year. He mentioned that the agricultural sector alone registered a growth of 6.9 % and added that some 700 million quintals of major crops were produced in the last fiscal year.
He indicated that 230 million quintals of production were achieved through harvesting in the Meher irrigation season. The President pointed out that efforts to supply wheat to the export market have also been strengthened. He added that initiatives like Ye Lemat Tirufat (Bounty of the Basket) and fruit cultivation have contributed to stabilizing inflation.
Taye stated that 3.8 billion USD in revenue was generated from the export of goods, which also managed to substitute local products worth of 2.8 billion USD. In connection with the economic revival, more than 4.2 million jobs were created in the last fiscal year, he explained. President Taye also noted that 379,000 citizens have been provided with employment opportunities abroad.
The author of this contribution wishes to enumerate some of the major areas of planned activities for the current fiscal year highlighted by the President.
Accelerating the pace of sustainable agricultural development in the context of promoting climate resilient green economy was mentioned as one of the top priority areas of the government in line with the promotion of Home Grown National Economic Policy as stated by the President.
According to the National Agricultural Investment Plan issued in 2022, agriculture accounts for 34% of GDP, 75% OF national export earnings and 73% of employment as well as 70% of raw material sources for the manufacturing sector of Ethiopia. Various policy documents were prepared for improving the agriculture sector of the country including ADLI in the early 1990s, PRSP in 2000-2001, SDPRP from 2002-2004 and PASDEP 2005-2010.
Reports from the Ministry of Agriculture show that the Ministry is focusing on enhancing the national production of ten strategic crops which include rice, wheat, maize, coffee, and sesame, soybeans, avocado, mango, onion, tomatoes. Livestock production also focuses on sheep, goats, and fish while large-scale irrigation is being developed giving rise to summer and dry season production of wheat in clusters on which the country has now become self-sufficient and imports no wheat. In two years, Ethiopia will fully substitute the import of rice by producing enough that will also be imported.
Agriculture, mechanization, agriculture trade, research and development in agriculture for disease-resistant varieties are already being conducted. Ethiopia is already registering huge achievements in the Basket Bounty Program and Made in Ethiopia. In his speech, the president touched upon the plan to accelerate the financial reform in the current fiscal year.
The author recalls that Ethiopia has recently undertaken significant financial reforms aimed at liberalizing its economy and strengthening its financial sector.
Ethiopia has traditionally maintained a closed financial system with restrictions on foreign banks operating within the country. However, recent reforms are opening up the sector to allow foreign banks to operate in Ethiopia. This is expected to increase competition, improve efficiency, and attract foreign investment. In his speech, the President noted that the financial and monetary reforms will be given due attention during the current fiscal year.
The nation has continued to implement a floating and more flexible exchange rate system. This shift aims to address the foreign currency shortage, a major issue affecting businesses and foreign investment in Ethiopia. The reforms are expected to gradually allow the Ethiopian birr to float in a market-determined exchange rate system, reducing distortions in the economy caused by artificial currency controls.
Ethiopia is working on expanding financial services to underserved regions and populations. The government has promoted digital financial services, such as mobile banking, to improve access to financial services for the rural population. This is part of Ethiopia’s broader digital transformation agenda.
Recent reforms include enhancing the regulatory and supervisory capacity of the National Bank of Ethiopia (NBE). This includes measures to improve the governance and operational efficiency of both public and private banks, ensuring the financial sector remains resilient to external shocks.
Ethiopia has been working to improve its debt management strategies as part of its financial reform agenda. The government has also initiated the privatization of key state-owned enterprises, including Ethio Telecom, which is expected to boost the economy and enhance competitiveness in critical sectors.
These reforms are aligned with the government’s broader objective of moving Ethiopia towards a more market-driven economy, stimulating growth, and attracting foreign direct investment.
BY SOLOMON DIBABA
THE ETHIOPIAN HERALD FRIDAY 18 OCTOBER 2024
