Previously, Ethiopian exporters were obliged to sell half of their foreign currency earnings to banks immediately, with the remaining balance converted to local currency within a month.
Under the new regulations, exporters are now mandated to deposit the remaining 50% with commercial banks, a shift aimed at ensuring a steady flow of foreign currency.
In a public media interview, NBE Governor Mamo Mihretu described the policy change as a “temporary” measure designed to bolster the availability of foreign currency.
Mihretu highlighted Ethiopia’s recent progress, noting that the country’s foreign currency reserves have risen from $1.4 billion before recent macroeconomic reforms to the current level of $3.4 billion.
He further stated that commercial banks have successfully cleared their outstanding foreign currency debts, which had previously exceeded $500 million under letters of credit (LC).
“Consequently, they are now debt-free and will focus solely on managing payments for new letters of credit moving forward,” Mihretu explained.
Over the past three months, Ethiopia’s commercial banks have averaged monthly acquisitions of roughly $500 million in foreign exchange from export revenues.
Collectively, banks acquired approximately $1.2 billion during this period and subsequently sold up to $1.7 billion to currency demanders.
“The macroeconomic reforms implemented over the past 100 days are already yielding significant positive outcomes,” Mihretu stated, emphasizing the benefits of the measures for Ethiopia’s financial stability.
