UAE to give Ethiopia $3 billion to ease foreign currency shortage And the United Arab Emirates last month agreed to deposit $1 billion in Ethiopia’s central bank. The government this week also opened a diaspora fund bank account and is asking Ethiopians abroad to contribute. The call, which has come to be known locally as a “hard currency amnesty”, came with a warning: those who refused would be tracked down. 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. “I’m not sure of the source of the foreign exchange, but psychologically the scarcity mentality has changed overnight,” the woman, who asked not to be named, told Reuters.
“All of a sudden this is happening,” 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. Ethiopia’s political and economic reforms have raised confidence in the ‘hard currency’ market, helping to close a once yawning gap between the official and black market exchange rates for its birr currency.Īs cash – in some cases briefcases full of dollars – pours into banks, local businesses say they are finally feeling relief from a foreign exchange crunch that had seen some segments of the economyīusinesses and analysts in the capital Addis Ababa told Reuters on Friday the birr was trading on the parallel market around 28 to the dollar, close to parity with the official rate and 25 percent firmer than three months ago.
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