However, the current state of affairs has reached unprecedented levels, with the exchange rate soaring to unparalleled heights. According to a report published in May 2022 by Cepheus Growth Capital, an investment management firm, Ethiopia’s foreign currency reserves have reached a critical level of $1.3 billion. Over the past two years, external assistance has accounted for less than 22% of the planned amount, contributing to the foreign currency crisis. In October 2022, over 1,000 bank accounts were frozen, and shops suspected of involvement in the black market were closed. However, the World Bank and the IMF have been urging a shift to a floating exchange rate to effectively dismantle the parallel market and establish a stable exchange rate regime.

Source: Ethiopian News July 04, 2023 08:32 UTC