Since 1992 the government of Ethiopia has introduced a variety of reforms aimed at improving
macroeconomic stability, accelerating economic growth, and reducing poverty. Tariffs have been
cut, quota constraints relaxed, licensing procedures simplified, foreign exchange controls eased,
compulsory grain delivery and forced membership to cooperatives discontinued, a privatisation
process begun, private banks authorised, interest rates decontrolled, and an inter-bank money
and foreign exchange market introduced.
Until recently, one important departure from the past was the abandonment of planning, at least
as an explicit mode of government economic policy formulation and implementation. However,
beginning 2002 the Ethiopian government has adopted a development strategy centred on the
principal goal of poverty reduction. This strategy is officially known as Sustainable Development
and Poverty Reduction Program. In line with this Program, the government has recently
launched deeper fiscal decentralisation, judicial and civil service reform, and public sector
capacity building.