(Aug 16, 2012,(Daily Monitor))--The Ethiopian government has suspended the provision of foreign
currency in a decision that has been linked to the political
uncertainties surrounding Prime Minister Meles Zenawi’s deteriorating
health.
A notice to this effect has been issued by the
regulator, the National Bank of Ethiopia, to the country’s commercial
banks as Addis Ababa also appealed for food aid. According to
Agriculture minister Mitiku Kassa, the number of aid recipients was 3.2
million over the last six months, and have now increased due to the
failure of rain in some parts of the country.
The country’s foreign currency reserves are running alarmingly low and can only cover the importation of basic goods such as petroleum, medicine and food. The measure is likely to lead to a black market boom that would further weaken the country’s import-export trade, observers say.
Banking in the Horn of Africa nation of about 85 million people is highly centrally regulated. Industry insiders say massive capital flight and illegal transactions are the main reasons for the rapid depletion of forex reserves. One of the fastest growing sub-Saharan Africa countries, Ethiopia’s growth has touched seven per cent annually for the last nine years, according to the IMF. Read more from Daily Monitor »
The country’s foreign currency reserves are running alarmingly low and can only cover the importation of basic goods such as petroleum, medicine and food. The measure is likely to lead to a black market boom that would further weaken the country’s import-export trade, observers say.
Banking in the Horn of Africa nation of about 85 million people is highly centrally regulated. Industry insiders say massive capital flight and illegal transactions are the main reasons for the rapid depletion of forex reserves. One of the fastest growing sub-Saharan Africa countries, Ethiopia’s growth has touched seven per cent annually for the last nine years, according to the IMF. Read more from Daily Monitor »
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