Ethiopia Bans Foreign Exchange Requests for ‘Non-Priority Products’
CoinEdition
Published Oct 19, 2022 07:45AM ET
Updated Oct 19, 2022 08:00AM ET
Ethiopia Bans Foreign Exchange Requests for ‘Non-Priority Products’
- The Ethiopian government has directed banks to deny foreign currency requests for non-priority products.
- Minister Melaku Alebel Addis said the move would help local businesses expand
- The limitations are in place indefinitely.
The Ethiopian government has ordered the country’s banks to deny customers who request foreign currency to buy “non-priority” goods.
According to a letter sent to the country’s central bank, the ministry has instructed banks to deny customers’ requests for foreign exchange unless the money would be used to import food, medication, or medical equipment.
However, the regulators recommended making foreign exchange available to import raw materials.
Ethiopia’s Minister of Industry, Melaku Alebel Addis, noted that the new forex limitations are vital because they give local products a chance, despite the fact that this seems like a protectionist approach.
Per Addis, highly industrialized nations were able to develop by removing or severely reducing the impact of imported goods. Similarly, he believes that the move would help local businesses flourish.
The minister then said that the second phase would be “their products entering the global market and competing.” He concludes by urging local manufacturers to take advantage of the amended policy.
Addis added that the new forex limitations imposed by his administration would be in place for an indefinite period of time.
In September, the National Bank of Ethiopia stated that it had reduced the amount of forex and local currency Ethiopians are allowed to carry outside of the country in order to combat the foreign exchange shortages and the devaluation of the Ethiopian birr. The central bank has previously issued a similar warning against crypto trading and use. The National Bank of Ethiopia (NBE) issued a statement earlier this year citing “legal measures” against those found using crypto in the nation.
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