GFDRE joins with the U.S. government, Ireland, and the Netherlands to accelerate public finance management reform in Ethiopia

The United States government through its Agency for International Development (USAID), Development Cooperation Ireland (DCI), and the Netherlands Minister for Development Cooperation have joined hands with the Government of the Federal Democratic Republic of Ethiopia (GFDRE) to support fiscal decentralization in Ethiopia. The donors and the GFDRE have collectively pledged $13.6 million to support roll-out of the highly successful Decentralization Support Activity (DSA), implemented by Harvard University, to all regions of Ethiopia, as well as the administrative zones of Addis Ababa and Dire Dawa.

The Kennedy School of Government’s technical assistance has been instrumental in helping to enhance governmental transparency and accountability in Ethiopia. DSA supports the GFDRE’s Expenditure Management and Control (EMC) sub-program of the Civil Service Reform program, which is managed by the Ministry of Finance and Economic Development (MOFED). The Budget Information System (BIS) and the Budget Disbursement and Accounts (BDA) System, implemented with Harvard/DSA’s assistance, have also helped the Ministry of Finance and Economic Development (MOFED) produce the national budget in a timely manner. This year, the budget was ready six weeks ahead of deadline. When implemented nationally, the BIS/BDA system will enable speedy consolidation of the national budget and accounts, efficient tracking of sector expenditures, and improve fiscal transparency nationwide.

Since 1997, the United States Government through USAID has been supporting public financial reform and fiscal decentralization in Ethiopia through Harvard University’s DSA. Support for regional public finance management reform was piloted beginning in 2000 in the Southern Nations, Nationalities, and Peoples Region (SNNPR), which at the time was the most up-to-date in its accounts.

In December 2002, Development Cooperation Ireland (DCI) joined USAID in supporting the DSA, enabling rollout of the budget reform to Tigray and Amhara regions and deepening the reform in SNNPR. The Netherlands Minister for Cooperation is also now joining in supporting DSA, enabling national rollout of the budget, accounts, and budget planning reforms.