2.34 Trillion Birr: Inside Ethiopia's Record Budget and the War Costs Behind It

As reported by CNBC Africa

Summary

• Ethiopia's Finance Minister Ahmed Shide projected total spending of about 2.34 trillion birr, or roughly $14.69 billion, for the 2026/27 fiscal year that starts in July 2026. That is up from 1.92 trillion birr in the current fiscal year. The increase is driven mainly by higher fuel subsidy costs linked to the war in the Middle East. The government expects a budget deficit of 1.4 percent of GDP next year, smaller than the 2.2 percent of GDP forecast for the current year.
• The government projects economic growth of about 10.1 percent next fiscal year, close to the 10.2 percent growth Prime Minister Abiy Ahmed cited for the year ending in July. The plan reflects both the cost of the external shock and the government's continued push to keep its macroeconomic reform program on track.
• For BirrValue users, a larger budget with a controlled deficit signals the government is trying to balance war-related costs against fiscal discipline. Tighter deficits generally support the birr over time, while heavy fuel subsidies drain reserves. Keep an eye on policy updates and compare bank rates on [BirrValue](/banks) before you convert.