Sunday, September 24, 2023
BusinessChina tops Ethiopia's external budgetary source

China tops Ethiopia’s external budgetary source

The Ministry of Finance and Economic Cooperation (MoFEC) revealed on Tuesday that China is the leading source of finance among several foreign countries that the Ethiopian government has identified as its lenders and donors to cover the budgetary requirements.

Abdulaziz Mohamed, Minister at MoFEC, who presented his office’s six-month performance report to the House of People’s Representatives (HPR) on Tuesday, said that during the past six months out out the targeted USD 6.47 billion USD 1.5 billion has been secured from development partners. According to the Minister, the performance rate that has so far been achieved is 67.7 percent of what was expected for the first half of the fiscal year.

The Minister told MPs that out of the total finance USD 799.36 million was secured from bilateral sources while the remaining USD 701.82 million was fetched from multilateral sources.

Similarly, out of the total amount, USD 1.02 billion, which has a share of 68 percent, was secured as loan while the remaining USD 480 million was fetched as donation.

Hence, China is the leading country contributing USD 569.05 million, which is about 37.9 percent of the total finance secured. Similarly, international financial institutions generated USD 496.15 million or 33.05 percent of the total amount while USD 230.31 million (15.34 percent) came from bilateral sources. USD 165.12 million (11 percent) came from the UN and continental economic cooperation institution while USD 40.54 million (2.7 percent) came from the European Union.

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On top of that, according to the Minister’s report, parts of the finances that were already mobilized from external sources, which is some USD 565.4 million, will be used for development activities that are being carried out by public enterprises.

According to the national budget document, which was approved last year in June, the government has been expecting a combination of 30 billion birr from external sources both in terms of loan and assistance to meet the total budgetary requirement, which was set at whopping 223.3 billion birr.

Out of the total budget 84 billion birr has been designated for capital expenditure while 50 billion birr was accorded for regular expenditure. Where else, 34.4 percent of the budget was set to subsidize regional governments as 5.4 percent of the budget has also been allocated for projects aimed at achieving the UN’s Sustainable Development Goals (SDGs).

The total revenue the government was able to mobilize in the first half of the fiscal year is some 80.58 billion birr while its expenditure amounts to some 95.005 billion birr. Despite the deficit, which currently stands at 14.43 billion birr, Abdulaziz described the fiscal implementation that is being witnessed during the reported period to be healthy.

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