Cash-strapped ased foreign exchange curbs on Monday as part of a broad economic reform package as the International Monetary Fund approved a loan to the Horn of Africa nation seeking a multibillion-dollar bailout. The value of the local currency, the birr, plunged by around 30% after the move by the country’s central bank. “The reform introduces a competitive market-based determination of the exchange rate and addresses a long-standing distortion within the Ethiopian economy,” the National Bank of Ethiopia (NBE) said in a statement. The International Monetary Fund’s board on Monday approved a four-year loan programme worth around $3.4 billion to support the reforms, with around $1 billion immediately disbursed. Among other measures, it said it would allow foreign exchange to be retained by exporters and commercial banks to boost supplies to the private sector, and announced the introduction of non-bank foreign exchange bureaus.

Source: Ethiopian News July 31, 2024 03:04 UTC