The inflation rate in Ethiopia has declined from 40% to 19% as a result of measures taken by the government to stabilize the market said Prime Minister Hailemariam addressing the House of Representatives yesterday.

The government has subsidized the export of staple food products such as wheat and food oil and has overseen the equitable distribution to stabilize the inflationary pressures.

The government will continue to take steps to stabilize the inflation rates even further to reach single digits by the end of the financial year said Hailemariam. The anticipated bumper agricultural harvest project this fiscal year will also contribute towards overcoming price hikes he added.

The economy has grown at an average rate of 11% in the last few years and the government expects to maintain the growth rate in the current financial year said Hailemariam.

It is to be remembered that the International Monetary Fund revised its forecast of the growth rate of the Ethiopian economy from 5.5% to 7% last June. The IMF raised its growth forecast due to the slowing rates of inflation.

Tight monetary and fiscal policies including the suspension funding of the national budget from the central bank and sales of foreign currency have played an important role in lowering the rates of inflation noted the IMF.  

The IMF had warned the Ethiopian government to ease monetary restrictions contributing to inflation.

Source: Walta Info