Ethiopian Airlines to Welcome Africa’s First Airbus A350-1000 This Tuesday

Ethiopian Airlines to Welcome Africa’s First Airbus A350-1000 This Tuesday Ethiopian Airlines is set to make history this coming Tuesday as it becomes the first airline in Africa to take delivery of the Airbus A350-1000, a groundbreaking addition to its expanding fleet. Aptly named “Ethiopia, Land of Origins,” this new aircraft celebrates Ethiopia’s cultural heritage while symbolizing the airline’s commitment to connecting Africa to the world through modern and efficient air travel. The Airbus A350-1000 is the largest variant in the A350 family and features an impressive seating capacity of 400 passengers, catering to the airline’s growing customer base. Designed to deliver a superior travel experience, the aircraft offers wider seats, high ceilings, and customizable ambient lighting, which enhance comfort for long-haul travelers. The A350-1000’s quiet cabin, combined with advanced in-flight entertainment systems, ensures that passengers can relax and stay engaged throughout their journey. Beyond comfort, the A350-1000 is celebrated for its advanced technology and fuel efficiency. It is equipped with Rolls-Royce Trent XWB engines, which make it one of the most fuel-efficient aircraft in its category, reducing fuel consumption and CO₂ emissions by up to 25% compared to previous-generation models. Additionally, the aircraft has a range of 8,700 nautical miles, allowing it to connect distant destinations without stopovers, making it an ideal fit for Ethiopian Airlines’ extensive network of long-haul and short-haul routes. Ethiopian Airlines’ acquisition of the A350-1000 aligns with its Vision 2035 strategy, which aims to transport 67 million passengers annually and generate $25 billion in revenue by that year. Currently, the airline operates a fleet of 147 aircraft, serving 139 international and 22 domestic destinations. This new addition not only strengthens its position as Africa’s largest airline but also brings the continent’s aviation sector closer to global standards. With the addition of the A350-1000, Ethiopian Airlines joins an elite group of global carriers, such as Qatar Airways, Cathay Pacific, British Airways, and Japan Airlines, who already operate this advanced model. By incorporating the A350-1000 into its fleet, Ethiopian Airlines underscores its commitment to providing world-class service, positioning itself as a leader in African aviation, and bringing Africa closer to the forefront of global aviation innovation. The arrival of “Ethiopia, Land of Origins” represents Ethiopian Airlines’ continued ascent in the aviation world, a significant step towards realizing its Vision 2035 goals. This delivery not only expands Ethiopian Airlines’ capacity but also strengthens its reputation as a pioneering airline that pushes the boundaries of what African aviation can achieve. As demand for travel across the continent grows, Ethiopian Airlines is set to meet these needs with a fleet that combines technological sophistication with the capacity to serve millions. This Tuesday’s delivery of the A350-1000 will be a landmark event—a testament to Ethiopian Airlines’ pioneering spirit and a glimpse into the future of African air travel. This addition underscores Africa’s potential for growth, innovation, and connectivity, marking a new era for both the airline and the continent’s aviation industry. 1 COMMENT Mohammed Dawd November 5, 2024 At 11:33 am The Ethiopian Airlines is a model for development. It has a good start and still running with the fastest speed of all African countries. The government needs to focus on its process of development and spread to the mind of otheras ministers. It is well guided. I hope to see Ministry of Education to follow the process of development and reach the nesessar progress by looking after its regress. Bravo Ethiopian air lines for exuding confidence to the Ethiopian people and being our confidence where ever we go in the world. I always compile its progress and pass to the country I move through presentations as support to our development. i am proud of Ethiopian air lines. The Ethiopian Airlines is a model for development. It has a good start and still running with the fastest speed of all African countries. The government needs to focus on its process of development and spread to the mind of otheras ministers. It is well guided. I hope to see Ministry of Education to follow the process of development and reach the nesessar progress by looking after its regress. Bravo Ethiopian air lines for exuding confidence to the Ethiopian people and being our confidence where ever we go in the world. I always compile its progress and pass to the country I move through presentations as support to our development. i am proud of Ethiopian air lines. Comments are closed.

Lemi National Cement Factory Officially Begins Product Distribution

Lemi National Cement Factory Officially Begins Product Distribution The newly inaugurated Lemi National Cement Factory, the largest cement production facility in Ethiopia, announced yesterday that it has officially entered the market with its first batch of products. Prime Minister Abiy Ahmed (PhD) recently inaugurated the factory in the Amhara region, marking a significant milestone in Ethiopia’s industrialization efforts. With a daily production capacity of 150,000 quintals of cement, the Lemi National Cement Factory is poised to meet a substantial portion of Ethiopia’s domestic cement demand. Speaking at the inauguration, Prime Minister Abiy underscored the importance of this mega-project. “As we inaugurate the Lemi National Cement Factory, with a production capacity of 150,000 quintals per day, this mega project stands as a testament to our government’s commitment to building fast, building big, and building clean. It exemplifies the swift and efficient delivery of crucial infrastructure. Congratulations to all those involved in realizing this important project, which now produces 50% of the cement made by factories across the country,” he stated. Completed in just two years, the factory is equipped with advanced technology, including a non-human touch production system, ensuring maximum efficiency and minimal energy use. Among its innovations is the world’s longest pre-heating tower, standing at 174 meters, and an advanced Pre-Heater system, a key component of the factory’s high production capacity. This system pre-heats up to 10,000 tons of raw materials daily to 950°C, preparing them for the Rotary Kiln where they transform into clinker, a crucial cement ingredient. This technology not only enhances production but also reduces energy consumption, showcasing Ethiopia’s commitment to environmentally conscious industrial practices. Prime Minister Abiy emphasized the broader impact of the project on Ethiopia’s economy. “Returning to this site after two years, I am astounded by the progress, which reflects our governance principles. It shows that with hard work, future generations will not inherit poverty but a foundation for growth and prosperity,” he remarked, encouraging the private sector to invest in large-scale industries like steel and fertilizer production, which are vital for job creation and economic growth. The Lemi National Cement Factory is set to reduce Ethiopia’s reliance on cement imports, offering a significant boost to the construction and infrastructure sectors. 4 COMMENTS Mo Ahmed November 1, 2024 At 5:31 pm No matter how many cement factory they build Ethiopian still not enough because it’s the hand of same people that’s the big problem it’s to much insider the cement factory Michael November 2, 2024 At 3:13 am I wish I could understand what you might wanted to deliver?? Is it about corruption? or… please give me a glimpse of … Thanks No matter how many cement factory they build Ethiopian still not enough because it’s the hand of same people that’s the big problem it’s to much insider the cement factory Michael November 2, 2024 At 3:13 am I wish I could understand what you might wanted to deliver?? Is it about corruption? or… please give me a glimpse of … Thanks I wish I could understand what you might wanted to deliver?? Is it about corruption? or… please give me a glimpse of … Thanks Guesh November 2, 2024 At 8:33 am What is the cost of cement, you don’t describe it. What is the cost of cement, you don’t describe it. Gebrai November 4, 2024 At 7:54 pm As it stands , cement remains the main material in the construction industry now and future. The market shall remain open and competitive and free from intermidatory market actors. As it stands , cement remains the main material in the construction industry now and future. The market shall remain open and competitive and free from intermidatory market actors. Comments are closed.

National Bank of Ethiopia Unveils Interbank Market Platform to Boost Liquidity for Banks

National Bank of Ethiopia Unveils Interbank Market Platform to Boost Liquidity for Banks National Bank of Ethiopia Launches Online Interbank Money Market Platform to Strengthen Financial Stability Addis Ababa, Ethiopia – October 31, 2024 – In a landmark move, the National Bank of Ethiopia (NBE) announced the launch of an online Interbank Money Market platform designed to enhance liquidity management across the country’s banking sector. This initiative marks a crucial step in Ethiopia’s transition towards an interest-rate based monetary policy framework, allowing commercial banks to lend and borrow short-term funds seamlessly. The newly introduced Interbank Money Market platform provides an efficient and transparent marketplace, enabling banks to address liquidity needs by engaging in short-term transactions. The market facilitates lending and borrowing with maturities of either one day or seven days, offering flexibility to banks in managing cash surpluses and covering shortfalls. By promoting efficient liquidity allocation, the platform is expected to foster financial stability and minimize systemic risks, aligning with the NBE’s broader goal of modernizing Ethiopia’s financial sector. Key features of the platform include: Immediate Access for Banks: The Interbank Money Market is live, enabling commercial banks to initiate short-term trading to balance liquidity and maintain stability within Ethiopia’s banking ecosystem. Exclusive Operation via the Ethiopian Securities Exchange (ESX): To ensure security and transparency, transactions on the Interbank Money Market will be conducted exclusively through the NBE-approved ESX trading platform, allowing for rigorous regulatory oversight. Compliance with the Interbank Money Market Directive: All participating banks are required to adhere to NBE’s standards and guidelines, fostering a well-regulated and ethical trading environment. Eligibility Restrictions: Participation is limited to NBE-approved commercial banks that meet specific criteria, ensuring only qualified entities engage in interbank trading. Interest Rate Corridor for Transactions: Banks will trade within an interest rate corridor based on the National Bank Rate (NBR), capped at NBR+3% and floor at NBR-3%. The NBE has reserved the right to intervene to maintain stability if market rates deviate from the NBR. Encouragement of Active Participation: The NBE has urged all commercial banks to engage with the platform proactively, ensuring consistent liquidity management and contributing to the financial system’s overall resilience. A Milestone in Ethiopia’s Financial Sector Reform The NBE’s launch of this interbank platform aligns with international standards, aiming to give Ethiopian banks the tools to manage liquidity with greater independence and transparency. This online platform enables banks to adjust interest rates responsively, benefiting the broader economy by aligning market stability with the country’s macroeconomic objectives. NBE Governor emphasized that the platform marks a pivotal shift in Ethiopia’s approach to financial stability, setting the stage for more robust policy interventions. By facilitating interbank lending and borrowing within a regulated framework, the NBE seeks to bolster Ethiopia’s financial ecosystem, ultimately supporting sustainable economic growth. For further information on the Interbank Money Market platform, visit nbe.gov.et.

PM Abiy Ahmed Unveils Vision for Africa’s Largest Airport and Expanded Fleet

PM Abiy Ahmed Unveils Vision for Africa’s Largest Airport and Expanded Fleet Prime Minister Abiy Ahmed announced that Ethiopian Airlines has placed an order for 124 new aircraft, marking a significant milestone for the airline. “Ordering 124 planes is no small feat; it’s a remarkable achievement,” the Prime Minister stated. He further highlighted the scale of operations at the current airport, which accommodates 20 to 25 million travelers annually. “We have initiated steps to construct Africa’s largest airport,” he continued, emphasizing the country’s commitment to expanding its aviation infrastructure. The new airport, located 40 kilometers from Addis Ababa, will be connected to the existing Addis Ababa International Airport by a dedicated railway line, ensuring seamless transit for travelers. To support the growing demand, a feasibility study has been completed for building this new airport, which is projected to handle between 100 million to 130 million travelers annually. “This expansion not only solidifies Ethiopian Airlines as the largest aircraft operator in Africa but also positions it as a powerhouse with a substantial airport facility,” he added. The Prime Minister described this progress as a key indicator of Ethiopia’s economic growth and ambition.

Ethiopian Airlines Debunks Eritrean Airspace Ban Rumors Amid Media Claims

Ethiopian Airlines Debunks Eritrean Airspace Ban Rumors Amid Media Claims In recent days, several Ethiopian, Eritrean, and Somali online media outlets have reported that Eritrea has barred Ethiopian Airlines from using its airspace. Despite these reports, outlets like ‘Eritrean Press’ have not presented concrete evidence to support their claims, instead linking the issue to a recent limitation on the airline’s flights to Eritrea. Responding to these claims, Ethiopian Airlines clarified its position through Ethiopia Check. “Our airline continues to fly in Eritrean airspace; the information about a ban is false,” a senior airline official stated. “We still have permission to operate in Eritrean airspace, and we have not received any indication from Eritrea that this permission has been withdrawn,” the official added, noting that the status remains unchanged. Meanwhile, Flight Radar 24, a popular flight tracking website and app, responded on X (formerly Twitter), mentioning that some aircraft have opted to bypass Eritrean airspace by rerouting through Sudan. Despite these observations, many social media users have shared screenshots showing Ethiopian Airlines’ continued operations within Eritrean airspace, further suggesting that no official ban is in place.

PM Abiy Accuses Embassies of Economic Misconduct and Black Market Ties in Ethiopia

PM Abiy Accuses Embassies of Economic Misconduct and Black Market Ties in Ethiopia Prime Minister Abiy Ahmed (Dr.) today made a bold statement during a parliament address, pointing to unnamed embassies involved in activities he described as detrimental to Ethiopia’s economy. He accused certain foreign embassies of orchestrating black market operations and conducting unauthorized foreign exchange dealings. This behavior, according to the Prime Minister, has become so disruptive that Ethiopia may soon enact more stringent oversight measures. “Some embassies directly steal Ethiopia’s resources and engage in foreign currency trading as a primary operation,” said Prime Minister Abiy, emphasizing that these activities go beyond diplomatic norms and infringe upon Ethiopia’s financial stability. “If these actions continue unchecked, we will take decisive steps to enforce the law. We do not seek relationships with embassies that operate unethically; we only welcome those that uphold a sound legal framework.” Without explicitly naming any specific embassies, PM Abiy clarified that there are diplomatic missions which, by abusing their positions, play a prominent role in fostering black market economies within Ethiopia. His comments reflect a growing frustration with external interference, which, according to the Prime Minister, exploits Ethiopia’s resources and undermines local markets. “There are embassies that run the black market, but we tolerate them to avoid disturbing their operations,” he said, hinting that Ethiopia has thus far exercised restraint. Black Market and Resource Theft The Prime Minister’s statements delve deeper into how Ethiopia’s resources, particularly foreign exchange and gold, are illegally siphoned out of the country. He claimed that some individuals, operating under the guise of legitimate businesses or Franco Valuta — an arrangement that allows foreign nationals to import goods duty-free — play a key role in this exploitation. “Gold and dollars are smuggled out of the country. This theft must be stopped, and we must prevent further illegal activities carried out by internal actors colluding with external interests,” Abiy asserted. The issue, he added, is pervasive, even involving transport and other industries. “Small operators and drivers move Ethiopian black market dollars across borders, often traveling to certain countries where this illegal currency trade finds a home,” he explained. Addressing Ethiopia’s National Interests Abiy’s rhetoric underscores a strong national stance, emphasizing Ethiopia’s right to defend its resources against those who see its wealth as a commodity to be plundered. His comments come amid a backdrop of longstanding concerns around foreign influence in Ethiopia’s economy. “There are countries that consider it their right to rob Ethiopia, disregarding our national interests. We demand respect for Ethiopia’s sovereignty,” he declared. In a call to action, the Prime Minister urged Ethiopians to prepare to both give and receive in matters of economic exchange, setting the expectation for reciprocity in international relations. “It is necessary to be ready to give as much as is necessary to take from us,” he stated. Franco Valuta: A System in Need of Reform Abiy also turned his attention to Franco Valuta, suggesting the system had veered from its intended purpose and has, in recent years, become a channel for wealth flight from Ethiopia. Originally designed to facilitate trade and investment, Franco Valuta is increasingly used by foreign entities to circumvent traditional regulations, which, according to Abiy, necessitates reform. “Franco Valuta has lost its purpose. It is now contributing to capital flight from Ethiopia. This must change,” he noted. What Lies Ahead? The Prime Minister’s assertions highlight Ethiopia’s intensified efforts to tackle illegal markets, currency smuggling, and exploitative diplomatic practices. While the lack of specificity regarding embassies and countries involved leaves questions unanswered, the Ethiopian government’s stance is clear: illegal extraction of resources and economic exploitation will not be tolerated. The next steps will likely involve heightened scrutiny, reforms to trade facilitation policies, and possibly new legislative measures aimed at ensuring that diplomatic missions operate transparently and align with Ethiopia’s national interests. As the country faces mounting economic challenges, these measures signal a readiness to protect Ethiopia’s assets and sovereignty in an increasingly globalized economy. With these developments, Ethiopia is sending a strong message: embassies and foreign entities must respect Ethiopia’s resources and adhere to its legal frameworks — or face accountability.

NBE’s Directive on Fuel Imports Raises Concerns of Increased Activity in Parallel Markets

NBE’s Directive on Fuel Imports Raises Concerns of Increased Activity in Parallel Markets The National Bank of Ethiopia (NBE) has shifted a significant portion of the foreign currency responsibilities for fuel imports to commercial banks. As part of this new directive, private banks are now responsible for covering 50% of the annual fuel import costs, which amount to $3.2 billion. This translates to securing $1.6 billion for fuel imports. Previously, the NBE would hold onto up to 50% of foreign currency income to ensure adequate reserves for importing essential commodities such as fuel and fertilizers. However, due to the new macroeconomic reforms, banks and exporters are now permitted to retain a larger portion of their foreign exchange earnings. Due to the high demand for foreign currency from fuel companies, the new requirement is expected to place a significant burden on private banks. In 2023, the Ethiopian Petroleum Supply Enterprise (EPSE) reported the import of approximately 975,347 metric tons of refined petroleum products. The total value of these imports exceeded 64.2 billion Ethiopian birr during. Wasihun Belay, an economist based in Ethiopia, has been actively advocating for the country’s economic reforms and policies through his social media channels. In his recent post, he labeled the news as “bad news for commercial banks.” “With the shift of the fuel exchange system to a digital platform through Telebirr, banks are losing significant cash flow from fuel companies, which they previously held as reserve funds,” he argues. He adds that this new directive may worsen existing issues, as it provides a substantial amount of foreign currency to fuel companies, potentially causing them to lose customers due to currency shortages. This, he cautions, could push investors toward the parallel markets. Abreham Terecha, a Branch Manager at NIB Bank, acknowledges that this directive has both direct and indirect effects on the country’s economy; however, he does not perceive it as disadvantageous to the banking sector. “The bank’s foreign currency sources, such as remittances and exports, are not yielding the expected amounts. While fuel consumption requires a significant amount of foreign currency, I am doubtful that banks will be able to meet this demand,” he states. He added that even clients are struggling to access the foreign currency they need, which he considers misaligned with the bank’s capabilities. In light of this, he warns that this move should not negatively impact the overall economy, as it is heavily reliant on fuel. “It will undoubtedly impact importers and traders, which will, in turn, raise the cost of living,” he added. As for the government, Belay sees an upside. “Although challenging for commercial banks, the government stands to benefit. It will be relieved from the burden, and the foreign currency can serve various purposes, as a monetary tool during economic shocks, for auction bids, for transfers to other sectors, or to purchase goods for infrastructural development.” By shifting the responsibility to private banks, the government may alleviate the burden of managing fuel import transactions, enabling it to concentrate on other critical priorities. However, it is essential to align the capabilities of the banks with the needs of the fuel sector. Experts suggest that the government closely monitor whether the demands of fuel importers are being met. Additionally, the government should investigate the factors contributing to insufficient remittance flows. Ensuring peace and stability is also crucial for revitalizing productive areas and enabling them to generate foreign currency. Once peace and stability are established, logistical and supply chain challenges can be addressed, ultimately enhancing export productivity. 1 COMMENT Peter owar October 30, 2024 At 3:36 pm That is great for all Ethiopian to growth digital platform. That is great for all Ethiopian to growth digital platform. Comments are closed.

Parliament to Review New Urban Land Leasing Decree Allowing Negotiations

Parliament to Review New Urban Land Leasing Decree Allowing Negotiations A bill allowing the transfer of urban land through lease will be submitted to Parliament. In addition to auctions and allocations of urban land, a draft decree will be submitted to Parliament to permit the transfer of urban land through negotiations and leases. This new decree mandates that at least 20% of the land cities prepare for allotment should be used for housing construction. This proclamation, to be issued on “Leasing of Urban Land,” is scheduled for presentation at the House of Representatives’ regular meeting on Tuesday, October 19, 2017. The new law, replacing the “Declaration on Occupying Urban Space” approved in 2004, is organized into six sections and 49 paragraphs. The first part of the draft decree covers general provisions, while the second part outlines basic lease provisions. The third part details the implementation of urban land lease auctions. Section IV of the decree sets out provisions on urban land allocation and negotiations, specifying the conditions under which leases are permitted. The fifth part addresses the management of urban land leases, and the final part includes various provisions, including penalties. The new decree has been prepared in response to the country’s rapid economic growth, which has increased demand for urban land. It aims to establish a land supply and management system that meets this demand effectively. The document states that additional provisions are necessary to improve the lease system and address legal gaps in the current law. A notable addition to the draft decree is the provision allowing land transfer through negotiation and lease. The existing proclamation, now thirteen years old, only permits leasing urban space through auctions or allocations. The new “negotiation” provision enables developers to lease urban land for “services of special national interest” when it cannot be transferred by auction or allotment. This is implemented by the “relevant body” in negotiation with developers, based on the development plan, as explained in the interpretive section of the decree. The document also notes that urban land may be transferred through negotiations following the “National and Regional Urban Development Spatial Plan.” For development requests from the government and private sector, the new decree allows land transfer through negotiations. The draft decree specifies that urban land may be transferred through negotiations for projects such as federally managed industrial parks, industrial development, higher education and health institutions, and research sectors. The decree states that land requests for star hotels supporting the service sector and tourist resorts may also be handled through negotiations. Urban redevelopment projects developed by the private sector or in public-private partnerships will follow the same land allocation method. Land requests for real estate or housing development, large shopping malls, fuel tanks, distribution centers, and modern parking structures may also be obtained through negotiation, as indicated in the new decree. Negotiable projects are assessed on “the content, scope, and depth of future development; the accommodation and benefit of existing beneficiaries in the development area; benefit and harm reduction for surrounding communities; and the extent of infrastructure provision,” as specified in the draft decree. The transfer of urban land through negotiations in regions, Addis Ababa, and Dredawa administrations will require cabinet approval. The decree also stipulates that the negotiable transfer price of land should not be below the area’s average lease price. Provisions from the existing proclamation on urban land allocation are partially included in the draft bill submitted to Parliament. However, the new decree introduces a provision for the “land supply situation for housing construction.” This provision mandates that “at least 20%” of land set aside for housing in cities must be used for this purpose. An individual who benefits from a housing cooperative, joint housing development program, or individual urban land allotment cannot benefit from another allocation within the same city. The new decree also amends requirements for individuals who win land auctions. In the current Lease Proclamation, the winning bidder is determined by the highest bid price and advance payment. This is revised in the draft decree, where lease bid winners are identified based on the bid price, down payment, and lease payment calculated over the lease term. According to the new decree, the final score will consist of 65% of the auction price, 20% of the advance payment, and 15% of the lease payment. The new decree also extends the review period for the base lease price from two years to three years. The “Lease Base Price” is defined as the minimum land cost, considering infrastructure costs, removal of existing structures, developer compensation, and other relevant requirements. In the transitional provision section, the ordinance specifies that urban land requests submitted to the appropriate body before the decree’s enactment will remain valid for up to six months from the decree’s effective date. The document states that decisions will be based on the existing decree and any rules and regulations issued under it.

How Ethiopia’s Floating Birr is Reshaping Trade for Exporters and Importers

How Ethiopia’s Floating Birr is Reshaping Trade for Exporters and Importers Post Floating: Are Businesses Staying Ahead of the Curve? The recent shift to a market-based exchange regime is affecting businesses across all sectors, from small enterprises to large corporations. Exporters and importers are particularly feeling the impact as they navigate a new system where the birr’s value is determined by market forces, not the central bank. This change has introduced new challenges and opportunities, which force businesses to adapt quickly. The personal stories and challenges of those on the front lines reveal the intricate ways these changes are shaping their lives and businesses. Economic Pressures Amid Currency Devaluation and Credit Cap The business environment in Ethiopia is facing significant challenges due to the devaluation of the birr and the imposition of a 14% credit cap, which severely restricts access to capital. These factors are collectively straining the financial health and operational capacity of businesses, making it difficult for them to secure the necessary funds to sustain and grow their operations. This pressure will likely hinder the success of the floating currency regime, as it may exacerbate inflation, reduce market confidence, and limit the economic benefits that a floating exchange rate is intended to bring. Insights from Business Leaders: Challenges and Adaptations Getahun Sitotaw, Finance and Procurement Manager at Belayab Motors, noted that while recent reforms have improved foreign currency availability, demand is decreasing due to constrained working capital. He explained that the 14% credit cap, coupled with the devaluation of the birr, is making business operations challenging and pushing consumers to focus only on essential goods. “One noticeable impact of the reform is the rise in imported goods’ prices. Currently, we’re only selling cars from our existing inventory,” he shared. He also expressed concerns about a potential downturn in the future market. “In the past, consumers responded positively to price increases, but with reduced purchasing power, their reaction has shifted negatively,” he explained. Local Competition and Regulatory Barriers “Local businesses are feeling the squeeze as competition grows, and many worry they’re not ready to keep up with international players,” said Samson Tizazu, Business Partner at Proma Partners PLC. “On top of that, we’re seeing concerns about whether our regulatory framework can truly support this new market landscape. Bureaucratic red tape, outdated systems, and inefficiencies in both government and some private sectors are holding us back, making it harder to implement the policies we need for a thriving economy.” Despite these challenges, Samson noted that this shift has created opportunities for foreign investment, spurring innovation and bringing a wider range of goods and services that can boost economic growth and improve consumer options. Foreign Exchange Access and the Role of the NBE Following the shift to a free-market system, one would expect a noticeable gap between the supply and demand of foreign currency. Yet, the opposite seems to be occurring. Although it’s only been a short time since the shift, the market is behaving unusually. According to Samson, fintech companies and international corporations are major disruptors in the market, leveraging technology to offer alternative financial services while introducing competitive pricing and innovative products. These entrants are reshaping consumer expectations and pushing traditional business models to adapt. NBE Initiatives for Market Stability and Transparency After the birr was floated, the National Bank of Ethiopia (NBE) took practical steps to support market stability and ensure fair access to foreign exchange. To help manage liquidity, the NBE held a Special Foreign Exchange Auction, giving banks an equitable opportunity to access forex and promoting market steadiness. Additionally, NBE launched an initiative called “Debo” to encourage the use of formal remittance channels, making it easier for the Ethiopian diaspora to support the nation’s growth. Through Debo, NBE also introduced Unite.et, a platform designed to simplify virtual account openings and provide easy access to banking services for diaspora members. Balancing Regulation with Profitability Additionally, the NBE imposed a 2% cap on the spread between the buying and selling rates of foreign currencies to enhance market transparency and reduce arbitrage. The NBE has also mandated daily reporting of significant forex transactions and implemented an electronic trading platform for inter-bank transactions to improve efficiency. These measures aim to promote a more competitive, transparent, and stable foreign exchange market in Ethiopia. Getahun appreciated the NBE’s decision to enforce a 2% cap on the spread between buying and selling rates for foreign currencies, viewing it as a positive step towards reducing the price of foreign currencies. However, he also noted that banks may adjust to this cap by increasing service charges elsewhere to offset the reduced margins. Future Outlook: Adapting to Global Standards “The National Bank of Ethiopia (NBE) has implemented measures, such as the 2% cap on foreign currency spread rates, which can be regarded as a double-edged sword,” said Samson Tizazu. He noted that while this cap aims to enhance market stability by preventing excessive spreads that could deter foreign investment, it may also create challenges for financial institutions that rely on wider spreads for profitability. Overall, he views these regulatory actions as opportunities to foster a more stable and predictable market environment, provided they are executed with careful consideration of the broader economic context. Looking ahead, he indicated that the long-term market landscape is expected to be characterized by greater integration into the global economy, presenting both growth opportunities and challenges related to competition and regulation. To ensure market stability, it is essential for the NBE and other regulatory bodies to strengthen frameworks that support fair competition, improve access to foreign currency for small and medium enterprises, and promote innovation in financial services to meet changing consumer needs and technological advancements. Shifting to a market-based foreign exchange system is a bold move for Ethiopia’s economy. While this change undoubtedly can help drive growth and bring in investments, it’s important for the National Bank of Ethiopia (NBE) to monitor market stability closely. Balancing the interests of international lenders with the economic realities faced by the public is essential. The NBE should focus on fair regulations that support growth and make sure that everyone benefits from this new system.