After the Supermajority: Ethiopia’s Trajectory Following the 2026 Election

Ethiopia held its general elections on June 1, and with the majority of votes now finalized, all signs point to Prime Minister Abiy Ahmed Ali’s Prosperity Party having secured a vast majority. While many analysts confidently predicted these outcomes well in advance, the election results alongside the country’s economic reforms and recent growth, internal conflicts, and regional tensions invite critical analysis of how this supermajority will shape Ethiopia’s political, social, and economic trajectory, raising important questions about the broader implications for the nation’s future.

Q1: What does a Prosperity Party supermajority mean for the trajectory of Ethiopia’s economic reform agenda?

A1: Launched in 2019, Ethiopia’s Homegrown Economic Reform (HGER) program has driven a deliberate transition toward a more market-oriented, private sector–friendly economy. Efforts to open the banking sector to foreign institutions, along with reforms such as easing foreign exchange controls and floating Ethiopia’s currency, have been accompanied by sector-specific liberalization, most notably in telecoms with Safaricom’s entry.

Economic reforms initially led to high inflation, which diminished household purchasing power. Inflation remains relatively high but has fallen sharply from its peak and stabilized around 12 percent. Additionally, recently released government data shows substantial increases in foreign exchange reserves, a stronger balance of payments, and rising exports. Yet these gains accrue unevenly. If the data is accurate, those benefits are felt more by exporters, banks, and capital-intensive firms than by the majority of Ethiopians navigating cost-of-living pressures.

The supermajority presents a tradeoff. On one hand, it removes any legislative impediment to the next phase of economic reform, offering policy predictability for investors and international financial institutions. On the other, the absence of meaningful legislative opposition creates an accountability deficit.

Despite reduced formal political friction, several tensions endure. First, even with economic liberalization and reform, the Prosperity Party is essentially statist. The state, and increasingly the party, retain decisive leverage over land, strategic enterprises, and financial flows. Partial divestitures of Ethio Telecom through the securities exchange illustrate how limited liberalization is used to attract capital without ceding strategic control. Whether this reflects prudent industrial policy or rent-preserving restraint is difficult to observe from the outside.

Second, cost-of-living pressures are a major concern. High inflation and strained household spending power are being compounded by global crises. Since the launch of the HGER program, Covid-19, Russia’s invasion of Ukraine, and the recent U.S.-Israel war with Iran have all created external shocks to the Ethiopian—and global—economy. Alongside the short-term implications of the national economic reforms, average Ethiopians have struggled with increased day-to-day cost-of-living pressures.

A third source of friction concerns the country’s internal security and conflict. Military and police spending, conflict-induced displacement, and the impact of internal insecurity on investor risk perception ultimately limit the extent to which macroeconomic reform can achieve its objectives. Similarly to how these elections were only held in certain areas of the country, if economic reform is selectively implemented, there is a risk that regional and urban-rural inequality could grow significantly, further exacerbating tensions between the federal government, regional entities, and organizations representing different constituencies.

The post-election moment provides a politically convenient window to release an updated version of HGER, even if the general expectation is continuity of economic reforms. In a new iteration of HGER, one can expect accelerated execution where the government has already made commitments, little movement where reform would threaten political control, and a widening gap between the formal liberalization narrative and the governance environment surrounding it.

Q2: What are the implications of the elections for Ethiopia’s system of ethnic federalism?

A2: One of the election’s most consequential long-range implications concerns not who governs, but rather the architecture of government. Ethiopia’s federal system is unusually robust in the formal powers it grants to ethnic groups. The Prosperity Party was conceived in part as a response to this, merging ethnically based parties into a single national entity that claims to pursue a more unified identity.

Commentators remark that the Prosperity Party holds little regard for the 1995 settlement that marked the beginning of the current Ethiopian constitution and the country’s ethnic federalism framework. The National Dialogue Commission, which launched in 2022, is expected by some to recommend changes leading to greater executive power and reducing subnational autonomy. By this reading, reduced legislative friction creates an enabling environment for the administration to move forward with these changes.

The difficulty is that centralization does not dissolve ethnic mobilization. The Tigray war began when a regional government asserted electoral autonomy against federal timelines. Similarly, the ongoing regional insurgencies led by the Fano in Amhara and the Oromo Liberation Army (OLA) in Oromia are, at root, contests over the terms of the federal arrangement. Efforts to undermine the federalist model are therefore likely to exacerbate ethnic tension rather than transcend it.

One nuance complicates a purely centralizing reading. A July 2025 revision adjusted the threshold for parliamentary participation, resulting in 48 opposition parties for the 2026 elections, suggesting the government seeks the appearance of pluralist enfranchisement even as it consolidates. Another interpretation is that the lower party participation threshold dilutes competition. The likely trajectory is a hybrid with a formal federal architecture retained on paper while substantive authority migrates to the center. Whether that produces stability or fracture depends on whether centralization is paired with genuine accommodation. On current evidence, it is not.

Q3: Does a renewed Prosperity Party mandate improve or worsen Ethiopia’s internal security outlook?

A3: A renewed mandate is likely to worsen the structural security outlook while marginally stabilizing the short-term operational picture. Generally speaking, when parliament is dominated by the ruling party, holding the executive to account becomes structurally difficult, and dissent migrates outside formal institutions. Given multiple ongoing internal conflicts, these trends are already playing out.

The insurgencies in Amhara and Oromia continue to produce considerable instability. Even so, both Fano and the OLA have fallen short of holding sizeable and strategic territory. Additionally, the success of the economic reform package provides the government with useful capital to fund salaries and weapons needed to sustain its military and policing efforts in these regions.

Although they have not achieved large strategic gains, the OLA and Fano have maintained their presence and organization. These conflicts persist because they are fueled by the federal system’s contested legitimacy. A supermajority that resolves elite competition through electoral dominance forces the opposition to seek other outlets, often armed ones. In March 2026, Fano warned that any entity assisting the voting process would be “considered enemies of the Amhara people.” An election conducted under such conditions confirms rather than dissolves the marginalization narrative driving the insurgency.

Tigray is a grave flashpoint, and the election is directly implicated in its deterioration. The 2022 Pretoria Agreement, ending the previous two years of hostilities between the Tigray People’s Liberation Front (TPLF) and the federal government, held for nearly three years, even though implementation faltered. However, in early 2025, analysts began warning of the potential for renewed violence in Tigray. In early 2026, several actions escalated tensions. In February, the federal House of Federation stripped multiple constituencies from the Tigrayan administration and postponed regional elections until “ownership claims” were addressed. Additionally, the TPLF, already deregistered after holding its congress against federal wishes, moved in April 2026 to restore the regional government. In the end, no vote was held in Tigray, which continues to see ongoing displacement and threats of fighting.

The decisive risk is that the supermajority mandate removes the incentive to accommodate precisely where it is most needed. Abiy publicly warned that the TPLF congress could lead to open conflict in similar language to what he used before fighting broke out in 2020.

Q4: How do the elections shape Ethiopia’s foreign relations in the Horn of Africa?

A4: Ethiopia’s internal and external security are intertwined. Fragile relations with Eritrea and mounting tensions with Sudan, both characterized by mutual accusations of proxy support, mean that a regime insulated from domestic accountability faces fewer constraints on its assertive regional behavior. The mandate does not alter Ethiopia’s foreign policy goals; it merely lowers the internal cost of pursuing them aggressively.

Reelection clears the way for Abiy’s Red Sea ambitions, which he frames as an existential imperative for a state of more than 130 million people. The clearest illustration of Ethiopia’s pursuit of sea access is the January 2024 memorandum of understanding between Ethiopia and Somaliland, in which Somaliland would lease a stretch of Gulf of Aden coastline to Ethiopia in exchange for eventual recognition of Somaliland’s independence. Through Turkish mediation, Ethiopia walked back on the agreement but has not confirmed its cancellation. The push for sea access has already catalyzed an opposing, if loose, alignment among Eritrea, Somalia, and Egypt. The aggressive approach is altering the region’s geopolitical and security alliances.

A newer and more dangerous entanglement is Sudan. Since December 2025, Sudanese officials have accused Ethiopia of training Rapid Support Forces (RSF) fighters and allied militias. The allegations increased in 2026. In March, a Sudanese Armed Forces–aligned governor accused Ethiopia of backing an RSF offensive on the border town of Kurmuk. Satellite imagery analyzed by Yale’s Humanitarian Research Lab documented activity at an Ethiopian National Defense Force base near Asosa in western Ethiopia consistent with military support operations. However, this evidence is contested rather than conclusive, showing the genuine uncertainty around the developing engagement.

The sharpest near-term flashpoint lies with Eritrea, as a centralized government attempt to resolve Tigray by force risks direct confrontation with Asmara. Eritrea-Ethiopia relations have deteriorated, reversing the rapprochement that earned Abiy the 2019 Nobel Peace Prize. Eritrea has treated the question of sea access and the identification of the Eritrean coastal port city of Assab as a potential access location as a threat to its sovereignty and territorial integrity. Another tension has been in Tigray, where the previous coalition between Ethiopia and Eritrea has fully collapsed. Ethiopia maintains that Eritrea’s support for the TPLF is increasing and that Eritrea is supporting armed groups in Amhara. This includes claims that Eritrean troops are in Tigray, which Eritrea has denied. Many observers believe that off-ramps from conflict are narrowing and that the 2026 election and the unresolved situation in Tigray could be a tipping point.

Ethiopia’s internal stability can serve as a “system-level variable” for the region, meaning that changes within Ethiopia have large-scale repercussions in the Horn of Africa. This has played out in the regional repercussions generated by Ethiopia’s calls for sea access, and an electoral mandate reduces the friction for Abiy to pursue sea access more assertively. Yet, this dynamic raises important questions regarding the broader impact of Ethiopia’s actions. If assertive moves fuel countercoalitions and increase the risk of escalation, the government’s gains may be offset by heightened regional instability. Reflecting on this pattern suggests that Ethiopia’s domestic political consolidation could paradoxically undermine both its regional ambitions and the wider stability of the Horn.

Aaron Stanley is deputy director and fellow of the Africa Program at the Center for Strategic and International Studies in Washington, D.C.