Ethiopia has floated its currency, the birr, as part of economic reforms to secure international loans and stabilize its economy. With this move, Ethiopia aims to ease its chronic foreign currency shortage and attract loans from institutions like the IMF and the World Bank. It has already led to a devaluation of the birr, which fell by 30% against the dollar after the announcement. According to Central Bank Governor Mamo Mihretu, the East African country will receive $13.5 billion in coordinated financing to support the reforms, including $10.7 billion from external partners and $2.8 billion in bilateral support. The reforms also include ending mandatory forex surrender requirements for exporters, liberalizing import and capital flow rules, and allowing non-bank currency exchanges. Prime Minister Abiy Ahmed has promised temporary support, including subsidized fuel and salary hikes for public servants, to minimize the impact of the reforms.
SOURCE: SEMAFOR
#Ethiopia #Floats #Currency #Pursuit #International #Loans
