The Macroeconomic Working Group is a group of development partners that support the government of Ethiopia in addressing the macroeconomic challenges and imbalances that the country faces. The group works closely with the government and other development partners to coordinate policy responses and financial assistance, as well as to provide technical assistance and analytical advice. The group also aims to balance the need for growth and poverty reduction, while ensuring efficiency, transparency, and impact of development assistance.

As Ethiopia emerges from major conflict and as it looks ahead to reviving its homegrown reform agenda, an important focus of this working group will be to provide strategic support the DPG. An important strategic consideration will be how best to balance the need for high-quality and job-rich growth while also ensuring that ongoing unmet needs—especially poor, displaced, and vulnerable households—can continue to be supported at the levels needed. In an era where overall development assistance is likely to remain static in the best case or sharply declining in the worst, this will require careful consideration, more coordination and efficiency in the use of financing, and a strong commitment to aid impact and financial transparency. Reforms to improve public sector operations and systems will be as important as macroeconomic reforms to address inefficiencies and distortions that reduce aid impact. A stronger outcome focus, especially on human capital investments, will be critical to making up learning and health outcome losses in recent years. Public investments, focused on addressing critical public service and market failures, remain a major need, but with limited fiscal space and development assistance, much greater scrutiny and efficiency will be needed to prioritize the highest impact investments.

Looking ahead, supporting the government’s policy response to ongoing macroeconomic challenges will remain the highest priority for the Macroeconomic Working Group and for member development partner programs of support. Members of this group will continue to work closely in coordinating development partner support while also engaging within the broader DPG framework to inform and influence the collective engagement’s consideration of macroeconomic and economic reform issues.