Abiy Ahmed began a new five-year term in October 2026 after his Prosperity Party won 438 of 547 seats in the June election, and a 22-minister cabinet was approved. The FY2026/27 federal budget is a record ETB 2.34 trillion (about $14.6bn); renewed fighting in Tigray since September and the break with Eritrea are key risks.
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Government · leader
Prime Minister Abiy Ahmed (head of government, re-elected Oct 2026 for five years) / President Taye Atske Selassie (head of state)
Key national agenda
- Continuing the Homegrown Economic Reform Agenda
- Spending focused on education, roads, health, agriculture, energy and urban development
- Completing external debt restructuring (Eurobond exchange) and FX reform
- Interim Tigray administration with regional elections within six months
- Security and diplomacy, including access to the Red Sea
Government programmes
FY2026/27 federal budgetETB 2.34tn (about $14.6bn)
ETB 2.34tn (up about 0.5tn from 1.9tn); domestic taxes ETB 1.49tn, partner loans and grants ETB 93.7bn; 15.1% to regional states
Eurobond restructuring$880m new bond
Agreement in principle (Jun 2026): $1bn bond exchanged for $880m new bond (6.15%, 3 years), 12% haircut; needs 75% holder consent, could close by end-2026
Korean cooperation portfolioOver $1.2bn
Korea Eximbank EDCF: 13 projects, about $961m (energy, transport, health, water); KOICA: 18 projects, over $200m; revised EDCF framework ceiling $1bn (2024-2028)
Tigray interim administration and reconstruction
Six-month interim government named 16 Oct 2026 to repair infrastructure and return displaced people (single source)
EEU medium-voltage distribution
World Bank-financed re-tender, two lots covering seven towns; design, supply, installation (deadline not confirmed)
Business opportunities
Equipment supply for EDCF-linked energy and water projects
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Smart airport and digital transformation solutions
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Heavy equipment for mining and construction
HD Hyundai Infracore won an order for 100 excavators from two local mining firms.
Local mining and construction firms
University and research equipment and training content
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ODA · EDCF projects
- Research equipment for Adama Science and Technology University · EDCF loan · Approved · $86m
- Bole International Airport digital transformation · KOICA grant · Ongoing · Not disclosed
- EDCF framework arrangement (2024-2028) · EDCF loan · Ongoing · Ceiling $1bn
Korean wins
- HD Hyundai Infracore — Supply of 100 36-ton excavators 2025 · Not disclosed
- Hyosung Heavy Industries — Ethiopia power grid project (single source) 2022 · KRW 235.7bn
- Incheon International Airport Corp. — Bole Airport digital transformation (KOICA) 2025 · Not disclosed
Korean support schemes
- KOTRA Addis Ababa office · KOTRA — Market research and buyer matching (no specific event confirmed in this review)
- EDCF framework (ceiling $1bn, 2024-2028) · Korea Eximbank — Concessional loans for energy, roads, irrigation, health and higher education; Ethiopia is the largest EDCF recipient in Africa
- KOICA in Ethiopia · KOICA — Active since 1995; 18 projects worth over $200m (industry, urban resilience, health)
Official notices
Office of the Prime Minister and Council of Ministers (as reported by ENA and others)
- 2026-10-16 Interim Tigray government named; elections within six months
- 2026-10-08 Parliament approved 22-minister cabinet (Finance: Fitsum Assefa)
- 2026-10-05 Abiy sworn in for a new five-year term
- 2026-06-09 Council of Ministers sent ETB 2.34tn budget to parliament
Disaster · conflict · epidemic
Watch 2026-11-07
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Sudan accused Ethiopia-based drones of attacks; bilateral tensions (10/30) · Two attacks in Oromia killed at least 60 (late Oct)
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Earth & space
Credit rating · FX
Fitch RD (LT FC, affirmed Oct 2026) / S&P SD / Moody's Caa3 (S&P and Moody's single source) · K-SURE Not confirmed · ETB -0.2%
Sanctions
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No country-wide UN, EU, UK or Korean sanctions were found; whether the US 2021 Ethiopia-related programme (EO 14046) targeting individuals and entities remains active was not re-checked.
Sources
- Dawan Africa - Ethiopia approves $14.6 billion budget for 2026/27
- Africanews - Abiy Ahmed takes oath of office
- Dawan Africa - Parliament approves 22-minister cabinet
- The Reporter - Cabinet forwards 2.34tln Birr budget
- Capital Ethiopia - Fitch maintains RD rating
- Dawan Africa - Ethiopia and South Korea $1.2bn portfolio review
