<\/p>\n

Ethiopia\u2019s political and economic reforms have raised confidence in the \u2018hard currency\u2019 market, helping to close a once yawning gap between the official and black market exchange rates for its birr currency.<\/p>\n

As cash \u2013 in some cases briefcases full of dollars \u2013 pours into banks, local businesses say they are finally feeling relief from a foreign exchange crunch that had seen some segments of the economy\u00a0grind to a halt.<\/p>\n

Businesses and analysts in the capital Addis Ababa noted on Friday 20 July that the birr was trading on the parallel market around 28 to the dollar, close to parity with the official rate and 25 per cent firmer than three months ago.<\/p>\n

\u201cAll of a sudden this is happening,\u201d said one real estate agent whose business had come to a standstill over the past year because the construction sector could not access dollars to import building materials.<\/p>\n

\u201cI\u2019m not sure of the source of the foreign exchange, but psychologically the scarcity mentality has changed overnight,\u201d the woman, who asked not to be named, said.<\/p>\n

In a televised address earlier this week, 41-year-old reformist Prime Minister Abiy Ahmed called upon those hoarding hard currency to deposit it in banks.<\/p>\n

The call, which has come to be known locally as a \u201chard currency amnesty\u201d, came with a warning: those who refused would be tracked down.<\/p>\n

The government also opened a diaspora fund bank account and is asking Ethiopians abroad to contribute. And the United Arab Emirates last month agreed to deposit $1 billion in Ethiopia\u2019s central bank.<\/p>\n

Though it\u2019s among Africa\u2019s fastest-growing economies, Ethiopia\u2019s export sector \u2013 mainly garment manufacturing and agricultural produce \u2013 has struggled to take off, and the economy is not generating enough dollars to pay for imports.<\/p>\n

A decade-long infrastructure push aimed at industrialising the overwhelmingly agrarian nation to create jobs has as a side-effect exacerbated the dollar shortage.<\/p>\n

Since earlier this year, essential items including insulin, blood pressure medication and infant formula have become scarce. The dollar shortage has also dissuaded international firms from investing out of fear they will struggle to repatriate profits.<\/p>\n

That could now change.<\/p>\n

On 19 July, Abiy\u2019s newly appointed central bank governor, Yinager Dessie, pledged to meet the business community regularly and pledged that their main concerns \u2013 scant access to credit and foreign exchange \u2013 were government priorities.<\/p>\n

Businesses in the capital said their letters of credit, which banks had declined to honour for months, were finally being approved.<\/p>\n

Source; Reuters<\/p>\n","protected":false},"excerpt":{"rendered":"

Ethiopia\u2019s political and economic reforms have raised confidence in the \u2018hard currency\u2019 market, helping to close a once yawning gap between the official and black market exchange rates for its birr currency. As cash \u2013 in some cases briefcases full of dollars \u2013 pours into banks, local businesses say they are finally feeling relief from …<\/p>\n","protected":false},"author":16,"featured_media":11553,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[3],"tags":[],"class_list":["post-11552","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-embassy-news"],"jetpack_featured_media_url":"https:\/\/ethiopianembassy.be\/wp-content\/uploads\/1024x576_500459.jpg","_links":{"self":[{"href":"https:\/\/ethiopianembassy.be\/index.php?rest_route=\/wp\/v2\/posts\/11552","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/ethiopianembassy.be\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/ethiopianembassy.be\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/ethiopianembassy.be\/index.php?rest_route=\/wp\/v2\/users\/16"}],"replies":[{"embeddable":true,"href":"https:\/\/ethiopianembassy.be\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=11552"}],"version-history":[{"count":1,"href":"https:\/\/ethiopianembassy.be\/index.php?rest_route=\/wp\/v2\/posts\/11552\/revisions"}],"predecessor-version":[{"id":11554,"href":"https:\/\/ethiopianembassy.be\/index.php?rest_route=\/wp\/v2\/posts\/11552\/revisions\/11554"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/ethiopianembassy.be\/index.php?rest_route=\/wp\/v2\/media\/11553"}],"wp:attachment":[{"href":"https:\/\/ethiopianembassy.be\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=11552"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/ethiopianembassy.be\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=11552"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/ethiopianembassy.be\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=11552"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}