Ethiopia proposes $7 billion budget

Thursday, 07 June 2012The Ethiopian Council of Ministers on Wednesday approved a $7 billion budget for the 2012/2013 fiscal year, the highest the country has ever passed.This is up from the $5.6 billion budget adopted last year. The budget, which has an emphasis on developmental projects, also provides for a subsidy for federal states and will be allocated in accordance with a formula crafted by the Ethiopian Federal House.

Just over $ 1.2 billion of the budget serves as the country's regular budget and more than $3 billion is allocated for capital budget.

About $2 billion of the budget would be used to subsidise regional states while $1.2 billion is earmarked for supporting activities being carried out to achieve the Millennium Development Goals.

After accepting the budget the Council of Ministers referred it to the House of People's Representatives, which will meet in a week, for approval.

The government will finance the majority of the budget, while loans from local and foreign financial institutions are expected to cover the rest, projected to amount to over $1 billion.

Priority in the budget has been given to education, agriculture, health and power generation activities, to be carried out in the coming 12 months, beginning July.

"The 2012/2013 fiscal year budget is mainly based on local sources," the Ministry of Finance and Economic Development said.

The ministry said that round 95 percent of the budget is allocated for economic and social affairs development, focusing on combating poverty in future.

source..The Africa Report