Gov’t Embarks on Implementing Sustained Macroeconomic Policy to Achieve Continuous Growth, Says Minister of Planning and Dev't

Addis Ababa August 3/2024 (ENA) The Government has embarked on implementing sustained macroeconomic policy with the aim of achieving continuous growth and ensuring comprehensive benefits for citizens, Minister of Planning and Development, Fitsum Asefa said.

The minister gave briefings on Ethiopia's full implementation of macroeconomic reform policy.

Fitsum noted the dire consequences of economic and development situations which had  existed before the country's reform, failing to meet the development goals of the nation, where the government resorted to prepare a Homegrown Economic Reform Policy to reverse the situation. 

Low level of domestic revenue and foreign exchange earnings, substandard level of project performance policy constraints and structural shortfalls, inability of the private sector to play a leading role in the economy, low level of production and productivity as well as dwindling employment opportunities were among the major features of the economy, the minister  elaborated.

In order to alleviate this problem, she recalled that the government put in place a Homegrown Economic Reform Policy to resolve the challenges and avoid the full-fledged economic crisis the country could have faced.

The government focused on three pillars of the reform program during the first phase of the Homegrown Economic Policy implementation which registered concrete results, she said.

As a result, she explained that the financial and fiscal policy sub-sectors of the macroeconomic policy reform and measures taken to modernize government revenue administration and the level of government revenue grew to a much higher level.

Measures taken for effective management of government expenditure, enhanced investments as well as completing projects on schedule with the desired quality have ushered in promising results in major sectors of the economy, Fitsum added. 

Hence, by resolving chronic structural challenges in public development enterprises, the government has managed to ensure their profitability she said, adding by totally closing down  commercial loans, it was possible to markedly reduce the huge stockpile of state debt that was accumulated over time.

In terms of introducing viable structural reforms, a number of legal reform programs were conducted to streamline pathways to better trade and investment as well as enhance production and productivity, where achievements have been made in various sectors through raising competitiveness, she explained.

Sustaining the results obtained during the first phase of the Home Grown Economic Reform program, the government was able to effectively embark on the implementation of the macroeconomic reforms. 

According to the minister, the decision made by the government was timely and would pave the way to the prosperity of the country.

Moreover, she noted that the government was conducting rigorous researches for the last five years in collaboration with local and international professionals on how to implement the programs and reduce the resultant negative effects and pressures of the development programs.

The minister stated that the national macroeconomic reform program rests on four pillars whose implementation will enable the country to resolve outstanding economic challenges and ensure measurable and stable economic development. 

Accordingly, by managing price fluctuations through short, midterm and long term measures and increasing production and productivity, the country can obtain concrete results, Fitsum said.  

The minister added through increasing foreign direct investment and remittances as well as curbing illicit trade and contraband, the country can register tangible results..

Further, the full implementation of the macroeconomic reform policy fosters social development, alleviating poverty reduction programs of the nation, she elaborated.

The digitalization of public services which started earlier will be further strengthened, Fitsum added.   

According to her, reducing the economic vulnerability of various sectors of the society and to reduce the negative effects that may surface up, the government will continue to subsidize the prices of commodities like fuel, fertilizers, and other essential items.

She added that developmental safety net programs will be strengthened while salaries of public servants in low income bracket will be increased to enable them to withstand possible economic shocks.