The Ministry of Finance and National Bank of Ethiopia of Government of Ethiopia announces the successful completion of the joint Fourth Review of its economic reform program, marking an important milestone in the implementation of the Homegrown Economic Reform Agenda.

The review confirms that Ethiopia’s economic performance has been stronger than initially expected, with all quantitative performance criteria met and most indicative targets exceeded, despite a challenging global and regional environment.

As a result of this performance, the IMF Executive Board approved the release of US$261 million in additional financing, bringing total disbursements under the current arrangement to over US$2.18 billion.

Ethiopia’s economy is now experiencing a rare combination of outcomes:

o strong and sustained economic growth,

o a rapid decline in inflation,

o improved fiscal discipline,

o and a steady rebuilding of foreign exchange reserves.

These outcomes reflect the Government’s firmcommitment to macroeconomic stability, reform consistency, and national ownership of policy choices, rather than short-term fixes.

Progress in foreign exchange market reform, including the shift to transparent FX auctions and steps toward a market-based system, has restored confidence, improved export competitiveness, and supported private sector activity.

On the fiscal side, revenue mobilization has exceeded expectations, supported by recent tax policy and tax administration reforms, while spending has been managed prudently to protect priority investments and social protection programs.

The Government also welcomes the progress made in restoring debt sustainability, including the completion of the Official Creditor Committee Memorandum of Understanding under the G20 Common Framework, which represents a critical step toward reducing uncertainty and unlocking investment.

Financial sector reforms continue to advance, with steps underway to modernize monetary policy, strengthen banking supervision, and reinforce the autonomy and capacity of the National Bank of Ethiopia.

The Government remains focused on translating macroeconomic stabilization into job creation, private investment, and rising incomes, while deepening reforms that support inclusive and resilient growth.