Photo: Michele Spatari / AFP/FileSource: AFPEthiopia's central bank announced on Monday that it was easing curbs on its foreign exchange regime, a move which saw the value of the local currency slide by about 30 percent. There was widespread speculation that Ethiopia, whose economy is tightly controlled by the state, would have to devalue its currency, the birr, as a condition of IMF aid. The National Bank of Ethiopia announced a series of foreign exchange reforms which it said involved "significant new policy changes". The central bank also announced Monday it would allow foreign exchange to be retained by exporters and commercial banks "thus substantially boosting FX supplies to the private sector". Ethiopia has about $28 billion of external debt and is also grappling with sky-high inflation and a shortage of foreign currency reserves.
