Ethiopia's Financial Sector Sees Milestones As Reform Gains Momentum

16 May 2025
The Ethiopian Herald (Addis Ababa)

ADDIS ABABA - Ethiopia's sweeping macroeconomic reforms are delivering notable progress in revitalizing the country's century-old financial sector, President Taye Atske Selassie announced yesterday.

Speaking at the opening of the Finance Forum held at the Science Museum here, the President emphasized that the ongoing reform program has modernized the formal financial system and aligned it with international standards and emerging technologies.

"In a short period, the reforms have achieved commendable outcomes," he stated, while calling on the private sector to invest more in financial technologies and innovative solutions that can sustain this momentum.

President Taye also pointed to the growing collaboration with international financial institutions, including the International Monetary Fund (IMF) and the World Bank(WB), as a testament to the reform's credibility and traction.

Echoing these remarks, National Bank of Ethiopia (NBE) Governor Mamo Miheretu highlighted key fiscal improvements, including the government's elimination of domestic borrowing for the first time in 12 years -- a move he described as a major turning point.

"The reform has curbed unsustainable financial practices that have long fueled inflation and destabilized markets," Mamo said. He added that the measures have boosted investor confidence, improved Ethiopia's credit ratings, and eased access to finance for businesses.

One of the major gains, he noted, has been in foreign exchange management. Foreign currency reserves have grown, while the disparity between the official and parallel exchange rates has narrowed significantly.

"The private sector is now gradually emerging from the constraints of forex shortages," the Governor remarked, underlining the reform's role in fostering economic inclusivity and resilience.

The two-day Finance Forum, which began yesterday, brings together stakeholders from government, financial institutions, and the private sector to deliberate on ways to deepen financial sector reforms. The event is scheduled to conclude today with discussions aimed at further strengthening policy dialogue and sector-wide coordination.

BY YESUF ENDRIS

THE ETHIOPIAN HERALD FRIDAY16 MAY 2025

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