Ethiopia Tables 1.93 Trn Birr Budget to Drive Revenue, Reform

2 July 2025
The Ethiopian Herald (Addis Ababa)

- House passes bill on foreign residential ownership

ADDIS ABABA - Ethiopia's Ministry of Finance (MoF) has unveiled a historic draft federal budget of 1.93 trillion Birr for the 2025/2026 fiscal year, with a strong focus on boosting domestic revenue, improving livelihoods, and supporting macroeconomic stability.

During its 41st regular session yesterday, the House of People's Representatives (HoPRs) discussed on the draft budget, which is expected to drive the country's economic transformation while strengthening collaboration with development partners.

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Finance Minister Ahmed Shide told lawmakers that Ethiopia's macro economy can only remain stable if government revenue grows significantly. "We have launched a new financial system that prioritizes increasing revenue. The contribution of tax revenue to GDP is still lower than international standards and must rise by at least 4% over the next four years," he said.

Ahmed highlighted that improvements in tax collection during the current fiscal year were the result of a dedicated task force. He added that the government will also tap into alternative financing sources to fund key development programs.

The Council of Ministers has already approved the draft federal budget, signaling the government's commitment to a growth-oriented fiscal policy.

In a separate but related development, the HoPRs has approved a key provision granting foreign nationals the right to own immovable residential property in Ethiopia for the first time.

The approval followed a presentation by the Standing Committee on Urban, Infrastructure, and Transport Affairs. Committee Chairperson Prof. Mohammed Abdo told MPs that the policy was carefully designed to align with market realities and safeguard Ethiopian land rights.

According to the new law, foreign nationals can acquire residential properties but cannot own or transfer land, which remains under public and state ownership. A minimum investment threshold of 150,000 USD is required to qualify.

The directive also allows state governments to facilitate foreign residential ownership for investors operating outside Addis Ababa.

Prof. Mohammed emphasized that the law applies strictly to residential ownership and ensures that citizens' land rights are fully protected.

This legislative change is expected to attract foreign investment in the housing sector while supporting the country's broader economic liberalization agenda.

BY MESERET BEHAILU

THE ETHIOPIAN HERALD WEDNESDAY 2 JULY 2025

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