Ethiopia’s Commitment to Public Financial Management Reform

Addis Ababa, November 19, 2025 – The Ethiopian Ministry of Finance has reiterated the nation’s dedication to transparency, accountability, and fiscal governance. This commitment was highlighted during a high-level meeting of the Public Financial Management (PFM) Joint Working Group, where government officials outlined key reforms aimed at enhancing budgeting, cash management, procurement processes, and the oversight of public investments.

Collaborative Efforts in Fiscal Reforms

The meeting saw the attendance of various development partners, including the World Bank, IMF, European Union, African Development Bank, and organizations like the Bill & Melinda Gates Foundation, UNICEF, and UNDP. These partners are providing essential technical and financial support to advance Ethiopia’s reform agenda.

Emphasizing Strategic Goals

Semereta Sewasew, State Minister of Finance, described the Public Financial Management reforms as “a strategic pillar for Ethiopia’s recovery and long-term growth.” This approach focuses on reshaping the nation’s methods for planning, allocating, spending, and monitoring public resources.

Ethiopia aims to bolster credible budgeting practices, realistic revenue projections, and a multi-year expenditure framework. These measures are essential for ensuring fiscal discipline and safeguarding critical services for citizens.

Enhancing Financial Systems

The meeting underscored the importance of implementing a unified Treasury Single Account, integrating federal and regional accounts alongside weekly cash planning. This integration is expected to create predictable cash flows that enhance resource allocation to essential services such as schools, hospitals, and roads.

To further solidify the public financial management processes, the government is focusing on developing systems that promote transparency and accountability across all levels, including regional administrations.

Legislative Oversight and Risk Management

During the meeting, stakeholders reviewed mechanisms for overseeing public investment, managing state-owned enterprises, and engaging in regular financial reporting. Independent evaluations of large projects and the incorporation of fiscal risk assessments into the national budget were identified as critical steps for managing debt risks and ensuring sustainable economic growth.

Embracing Digital Transformation

A notable aspect of Ethiopia’s reform strategy is its commitment to digitalization. The modernization of the Integrated Financial Management Information System (IFMIS) is designed to enhance budget execution and procurement processes, including transitioning to electronic payments to minimize financial leakages.

Moreover, the government aims to strengthen audit systems through improved internal and external audits, focusing on implementing recommendations that enhance accountability.

Building Capacity and Community Trust

Development partners have reaffirmed their commitment to supporting Ethiopia’s reform initiatives, highlighting the importance of clear priorities, results-oriented frameworks, and capacity building. These elements are vital for addressing staff turnover and enhancing domestic revenue mobilization, which are crucial for sustaining fiscal stability and development.

Semereta also noted the importance of effective communication regarding reform accomplishments, stating, “building trust is just as important as building systems.” The Joint Working Group serves as a pivotal platform for coordinated problem-solving, monitoring progress, and steering the next phase of Ethiopia’s fiscal transformation.

Conclusion

Ethiopia’s rigorous focus on public financial management reforms illustrates its commitment to creating an atmosphere of trust, efficiency, and economic growth. As the nation continues on its path towards enhanced fiscal governance, collaboration with international partners will play a fundamental role in achieving these ambitious goals. Through these comprehensive reforms, Ethiopia aims to secure a stable financial future for its citizens and bolster overall national development.

For further information, explore more about Ethiopian fiscal reforms and the importance of accountable governance.