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His moves to liberalise the economy by opening up lucrative state-owned assets to foreign investment have been cheered by his people as well as outside investors keen to enter one of Africa’s last untapped markets. Since taking office in April, Abiy has turned politics and the economy on its head in the nation of 100 million people. The dollar shortage has also dissuaded international firms from investing out of fear they will struggle to repatriate profits. Since earlier this year, essential items including insulin, blood pressure medication and infant formula have become scarce. “All of a sudden this is happening,” said one real estate agent whose business had come to a standstill over the past year because the construction sector could not access dollars to import building materials.Ī decade-long infrastructure push aimed at industrialising the overwhelmingly agrarian nation to create jobs has as a side-effect exacerbated the dollar shortage.
* New prime minister has turned politics, economy on its headĪDDIS ABABA, July 20 (Reuters) - A “hard currency amnesty” and reform-driven confidence in Ethiopia’s economy, both at home and abroad, have helped close a once yawning gap between the official and black market exchange rates for its birr currency.Īs cash - in some cases briefcases full of dollars - pours into banks, local businesses say they are finally feeling relief from a foreign exchange crunch that had seen some segments of the economy grind to a halt.īusinesses and analysts in the capital Addis Ababa told Reuters on Friday the birr was trading on the parallel market around 28 to the dollar, close to parity with the official rate and 25 percent firmer than three months ago. * Ethiopia’s economy has faced crippling forex shortage
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