Ethiopia’s New Disaster Response Fund: What Clients Need to Know

Ethiopia’s government has introduced a new Disaster Risk Response Fund regulation (Council of Ministers Regulation No. 576/2025, effective November 11, 2025) that adds fees to a wide range of services and transactions. These fees are collected to create a national fund dedicated to disaster response. In practical terms, this means many common activities from taking out a loan to renewing a passport will now include a minor additional charge.

Key Provisions: New Levies Across Sectors

Under the new regulation, 17 types of revenue streams are tapped to finance the Disaster Response Fund. Most contributions are collected monthly and must be deposited into the Fund’s account by the responsible institutions. The major sectors and services affected and their respective levies are:

All these contributions are mandated by the regulation and will be remitted to the national Disaster Risk Response Fund. The Fund Office (a new government entity established by this law) oversees collection and administration of these funds.

What It Means for You ?

For consumers and clients, these levies will likely result in slightly higher costs for certain services and products:

• Financial services: Banks and microfinance institutions may adjust loan terms or interest rates to account for the 1% they must contribute from loans. Similarly, insurance companies might factor the 1% premium levy into premiums. In practice, borrowers and insurance customers will indirectly pay this amount (through marginally higher rates or fees), as institutions pass on the cost.
• Telecom and utilities: Mobile phone users could see a small increase in the cost of airtime or data, since 5% of what you pay for talk time and internet is now siphoned to the fund. Likewise, fuel prices have effectively increased by ETB 1 per liter due to the disaster fund fee – an additional cost at the pump that consumers bear.
• Travel and transport: If you’re flying domestically, expect a 100 Birr charge built into your ticket price for the disaster fund. This makes flights a bit more expensive. Other transport sectors (like shipping/logistics companies) have new costs too, which could trickle down into freight charges or delivery costs (though those are less directly visible to individual consumers).
• Everyday government services: Routine services such as getting or renewing a passport, visa, or trade license now include a ETB 200 surcharge for the fund. When you authenticate documents or register assets, 5% of the service fee goes to the fund – possibly causing a small fee increase for those services. These added charges mean government service fees are a bit higher than before, which individuals and businesses will need to budget for.
• In particular, the regulation introduces a notable 5% levy on all tobacco and alcohol products both locally produced and imported positioning these goods among the highest-contributing sectors to the Disaster Risk Response Fund. This measure is expected to increase retail prices or compress profit margins, depending on how businesses choose to absorb or pass on the cost.

In summary, the impact on clients is generally modest per transaction, but widespread. The regulation’s design spreads the financing across many activities so that no single fee is overwhelming. However, consumers might notice incremental price hikes in banking, telecom, fuel, travel, and administrative services as providers comply with the law.

Why This Regulation? – Purpose

This new funding mechanism was created to ensure Ethiopia can respond to disasters (like droughts, floods, or crises) more rapidly and reliably, without relying solely on ad-hoc donations or foreign aid. By embedding disaster response funding into everyday economic activities, the government is institutionalizing disaster preparedness. The collected funds go into a dedicated Disaster Risk Response Fund managed by a dedicated office with the mandate to disburse money quickly for emergency relief and recovery efforts.

Effective Date: The regulation came into force upon publication on November 11, 2025. The new fees are already in effect, so businesses and individuals should be aware of these charges now. Going forward, companies must comply by collecting these contributions, and customers will see the charges as part of prices or fees.

Bottom Line for Clients: You will encounter small additional charges on various services due to the Disaster Response Fund law. These contributions are now a legal requirement and are designed to bolster Ethiopia’s disaster response capabilities. Being aware of them helps avoid surprises for instance, when a bank loan’s cost is slightly higher or when a service fee at a government office includes a new surcharge. If you have specific questions about how this law affects your business or personal finances, consider consulting with legal counsel or the service providers.