The Council of Ministers of Ethiopia has approved a record 2.34 trillion birr (approximately 13.8 billion USD) draft federal budget for the 2026/27 fiscal year, marking a significant expansion in government spending.
The decision was made during the Council’s 56th regular session held on Tuesday, where members unanimously endorsed the draft budget proclamation and agreed to submit it to the House of Peoples’ Representatives for final approval.
The proposed budget represents an increase of nearly 400 billion birr (about 2.35 billion USD), or 21.2 percent, compared to the 1.93 trillion birr (around 11.35 billion USD) approved for the 2025/26 fiscal year.
In a statement issued following the meeting, the Council said the draft budget was prepared in line with the recently approved Medium-Term Macroeconomic and Fiscal Framework covering the 2019–2023 Ethiopian fiscal years. The framework reflects ongoing macroeconomic reforms aimed at stabilizing the economy and strengthening its structural foundations.
According to the statement, the budget will be allocated across four major expenditure categories: recurrent spending, capital investment, subsidies to regional states, and financing for the implementation of the Sustainable Development Goals (SDGs).
The Council noted that funding requests from federal institutions were carefully assessed based on their mandates, operational responsibilities, and implementation capacity. The draft budget is also aligned with the 2019–2021 Development and Investment Plan, a key component of Ethiopia’s Ten-Year Perspective Development Plan.
Prior to approving the draft budget, the Council held extensive deliberations on the Medium-Term Macroeconomic and Fiscal Framework, which was also unanimously endorsed. Following further discussions and adjustments to the proposed allocations, the Council agreed to forward the draft proclamation to parliament for deliberation and approval.
