Ethiopia's cabinet approves 31% budget increase for 2025/26

The East African nation, which struck a four-year deal with the International Monetary Fund last July, is in the midst of far-reaching economic reforms, including the floatation of its birr currency and a push to restructure its debt.

Last week Ethiopia and the IMF reached a staff-level agreement on the third review of the $3.4 billion loan programme from the lender.

The 2025/26 budget will support national security, increase production and productivity, and help people affected by disasters, the prime minister's office said in a statement, adding that it will be sent to the parliament for approval.

In June last year, Ethiopia set spending for 2024/25 at 971.2 billion birr, and in November said it planned to spend a further 581.98 billion birr to help subsidise costs of fertiliser, oil, fuel, and medicine.