Ethiopia marked one year since launching its sweeping macroeconomic reform program, highlighting a surge in foreign currency inflows alongside a disciplined approach that avoided commercial borrowing.

The milestone was commemorated at the second Ethiopia Finance Forum – Investors’ Series, held at the Commercial Bank of Ethiopia headquarters. The forum brought together senior government officials, private sector leaders, policymakers and financial institutions to assess progress, share insights and chart a path forward.

Finance Minister Ahmed Shide told the forum the country secured more than $8.3 billion in foreign currency from trade alone this fiscal year. He credited a narrowing trade deficit and broad structural reforms for the improvement, stressing the indispensable role of the private sector.

“For the first time in recent history, Ethiopia has achieved these results without resorting to commercial loans,” Ahmed said.

National Bank of Ethiopia Governor Mamo Mihretu confirmed that foreign trade grew from $24.7 billion in 2024 to $32.1 billion in 2025, pointing to tight monetary policy and currency management as key drivers of stability.

“The early gains of reform are evident,” Mamo said. “Inflation has been halved, reserves strengthened and the trade environment steadied. But sustainable success depends on private-sector leadership.”

Yet the forum also exposed deep frustrations with Ethiopia’s tax authorities. Investors and tax professionals unleashed sharp criticism of the tax regime, denouncing it as overly complex, unpredictable and burdensome.

The Ministry of Revenues reported that the tax-to-GDP ratio stands at a modest 6.9%, far below the sub-Saharan African average of 15% to 16% and well under the 27% to 34% typical in emerging markets.

Revenues Minister Aynalem Nigussie defended ongoing tax reforms during a panel discussion held at the forum. She said revenue collection crossed 900 billion birr this fiscal year. The minister attributed this achievement to the ministry’s 2025–2027 strategy focused on expanding the tax base, improving compliance and harmonizing regional and federal tax systems.

Aynalem said the authority is not taxing businesses to meet targets.

She acknowledged that while digital transactions have exceeded 16 billion birr, their contribution to tax revenue remains limited. To ease compliance burdens, the ministry is preparing to introduce a minimum tax regime for small and medium-sized enterprises.

As Ethiopia enters the second year of reforms, officials promised stronger interministerial coordination, expanded digitization and targeted support for sectors with high growth potential.

“We do not claim victory yet,” Ahmed said. “But we are firmly on a path to economic recovery rooted in discipline, growth and private-sector confidence.”