Ethiopian Prime Minister Abiy Ahmed says the country has slashed its foreign debt from $23 billion to $4.5 billion within six years, calling the achievement a major step toward economic independence.
Addressing lawmakers at the House of People’s Representatives on Tuesday, Abiy said the Ethiopian economy is now expanding without reliance on external borrowing.
“The economy is growing without foreign loans. We have built a system that stands on Ethiopia’s own capacity,” the prime minister stated.
He credited the success to his government’s Homegrown Economic Reform Programme, launched in 2019, which he said corrected macroeconomic imbalances and boosted domestic revenue generation.
According to him, Ethiopia’s annual revenue which once stood at 170 billion birr (about $2.95 billion) is now projected to reach 1 trillion birr (approximately $17.3 billion).
Abiy revealed that his administration spent 440 billion birr ($7.6 billion) in subsidies to stabilise inflation, which has now fallen to 11.7 percent the lowest since the reforms began. He said the subsidies targeted fuel, fertiliser, public sector wages, and social welfare initiatives such as school feeding programmes.
“We have used every possible instrument to ease the cost of living. Our economy is standing tall again,” he said.
However, economic analysts caution that the benefits of the recovery have yet to fully reach the population. Despite easing inflation, food and housing costs remain high, limiting purchasing power for many households a challenge common among African economies pursuing fiscal reforms amid global economic uncertainty.
