-House approves 1.93 trn Birr budget for 2025/26
ADDIS ABABA – Ethiopia will begin extracting and supplying natural gas to the market for the first time in the near future, Prime Minister Abiy Ahmed (PhD) announced during the 42nd regular session of the House of People’s Representatives yesterday.
The Prime Minister stated that the government has signed agreements for the establishment of gas production plants, marking a significant step in the development of the country’s untapped energy sector. He emphasized that previous challenges such as high permit costs and bureaucratic delays have been resolved to encourage greater private sector participation.
“We will prove that our talk about gas is not for show. This time, we are making it real,” the Premier told lawmakers. He added that the upcoming fiscal year will witness Ethiopia’s first commercial gas output reaching the market.
During the same session, the House approved the national budget for the 2025/26 fiscal year, which totals 1.93 trillion birr. Of this, 1.2 trillion Birr is allocated for regular expenditures, 415 billion Birr for capital investments, 315 billion Birr for regional state support, and 14 billion Birr for sustainable regional development initiatives.
The Premier also shared several economic performance highlights. Over 4.5 million jobs were created in the outgoing fiscal year. The country’s total road network has reached 175,000 kilometers, with more than 300 projects valued at 1.5 trillion Birr currently underway.
These include 169 road projects covering 11,000 kilometers. Over 1,000 kilometers of new roads are expected to be inaugurated this year, and 28,000 kilometers are currently under reconstruction.
Ethiopia repaid 92 billion Birr in foreign debt over the past year and has not taken any new commercial loans in the last seven years. A recent debt restructuring agreement worth 3.5 billion USD was signed to ease future repayment burdens.
The export sector registered significant progress, generating 8.1 billion USD exceeding the initial target of 5.1 billion USD. Remittance inflows contributed a further 7 billion USD, bringing total foreign currency earnings, including debt, to 32 billion USD an increase from 24 billion USD the previous year.
The financial sector also showed strong performance, with mobile money users reaching 55 million. Digital transactions now surpass cash transactions, indicating rapid digital transformation in financial services.
The mining sector, once overlooked, is now emerging as a key revenue source. Ethiopia exported 37 tons of gold last year, earning 3.5 billion USD—a record high in national history. The Prime Minister stated that gold has become one of the highest contributors to the national economy due to recent sectoral reforms. He also announced that a large-scale soil fertilizer factory is under construction and is expected to begin operation within 40 months.
Tourism saw a rebound, with 1.3 million foreign tourists visiting Ethiopia last year. In agriculture, over 23 million citizens exited the safety net program, and the sector is projected to grow by 6.1 percent in the 2025/26 fiscal year.
The overall economy is projected to grow by 8.1 percent, with the service sector including tourism, telecommunications, trade, and transportation expected to mirror that growth. Foreign Direct Investment (FDI) reached 4 billion USD, reflecting renewed investor confidence.
“These numbers are beyond statistics,” the Prime Minister said. “They represent meaningful change in the lives of our people and tangible outcomes of our ongoing reform journey.”
BY YESUF ENDRIS
THE ETHIOPIAN HERALD FRIDAY 4 JULY 2025
