In order to sustain its growth model, Ethiopia instituted economic reforms and introduced some policy adjustments to crowd-in private sector and improve competitiveness. A shift towards a more export-led model, where the private sector can play a greater role in economic growth, export diversification and employment. The Government has undertaken a series of reforms on improving investment climate; access to finance for the private sector; modernizing the financial sector; reforming public enterprises and advancing economic integration through coherent trade policies. The reform emphasis is on sustaining the current economic growth by ensuring sound macroeconomic management and promoting more open and transparent institutions that will create jobs for millions of Ethiopians.
The reform of the real sector is being led by the Macro team, chaired by the Prime Minister. The macro team has four sub-teams leading the reform in relevant sectors. Ministry of Finance leads fiscal reform and State Owned Enterprises; National Bank of Ethiopia leads Financial sector reform; Ethiopian Investment Commission leads private sector engagement and Planning and Development Commission leads real sector reform including productive sectors (agriculture, industry, trade, mining, tourism and others) and enablers such as (water, energy, transport, infrastructure, innovation and the like). The next development plan is expected to have a spatial dimension to incorporate regional aspects.
The reforms aim to leverage the achievement of the past decade by promoting private investment and creating decent jobs. The home grown economic reform has three pillars. Macroeconomic, structural and sectoral reforms. The macroeconomic reform aims at creating macro-economic and financial stability by controlling inflation; safeguarding financial stability and strengthening public sector finance. The structural reform focuses on access to power; ease of doing business; fighting corruption and red tape. The sectoral reform addresses policy issues and gaps in key sectors like agriculture, manufacturing, mining, tourism and ICT, where Ethiopia has huge potential for growth.