This measure is considered as a way to ease to secure foreign exchange,” it reads. This suggests that the parallel market premium— which is calculated as the ratio of the parallel market rate to the official rate less one—has increased to a new high. Foreign currency is also siphoned via illegal money transfers, an unofficial money transfer route that works outside of the banking system. Ethiopians in the diaspora transmit foreign currency to intermediaries, who pay beneficiaries in local currency at the parallel market rate, according to the report. Several traders also rely on the parallel market to access foreign currency to import goods and services as getting foreign currency from the legal channel is increasingly difficult.

Source: Ethiopian News June 08, 2024 09:30 UTC