During World War II, when major military expansion programs began, the government devoted approximately 38 percent of the national budget to defense. From 1948 to 1958, the proportion of the budget dedicated to defense dropped from 27 to 17 percent of the total, not because of a decrease in military expenditures but because the size of the overall national budget had increased sharply. Throughout the 1960s and early 1970s, money for defense remained the largest single item in the budget, varying from 19 to 24 percent of the total funds appropriated for all national programs.

Beginning in the mid-1970s, defense expenditures started to rise. In 1974 Addis Ababa allocated the equivalent of US$80 million for defense, in 1976 US$103 million, and in 1979, US$526 million. By 1987-88 defense expenditures had declined to approximately US$472 million however, it should be pointed out that between 1977 and 1990, the Soviet Union had provided approximately US$13 billion in military assistance to the Mengistu regime.

Data as of 1991