During Parliament’s fiscal year closing session, the Government approved the FY2026/27 national budget of Birr 2.3trn (~ $14.6bn), equivalent to about 10.9% of GDP, representing a 21% nominal increase over the previous fiscal year. With inflation currently at around 11% (moving average as of June 2026), the budget implies real expenditure growth of approximately 10–11%, indicating that fiscal policy remains expansionary in real terms despite moderating inflation. The Government expects to mobilize approximately Birr 1.8trn from revenues and grants, resulting in an estimated fiscal deficit of around 2.4% of GDP, reflecting a relatively prudent fiscal stance that seeks to balance growth-oriented public spending with fiscal sustainability. However, the effectiveness of the budget will ultimately depend on the Government’s ability to achieve its ambitious revenue targets while maintaining macroeconomic stability through effective expenditure management, inflation control, and prudent public debt management.