It is abundantly clear that the freshly applied macroeconomic reform policy beyond a shadow of a doubt plays a huge role in taking the country’s economy to new frontiers through the passage of time. In addition to boosting substantially the competitive capacity of exports and imports, the reform has already jumpstarted boosting competitiveness and getting to the bottom of predicaments revolving around foreign currency shortage.
It has to be borne in mind that shortage of foreign currency in numerous occasions had been throwing cold water on the various export and import sector of the country. However, on the heels of the newly implemented macroeconomic reforms policy, the country’s economy has set in motion attaining the intended target and moving forward in the right direction in the face of some challenges that need a quick fix.
It is widely acknowledged that since the implementation of the macroeconomic reforms, satisfactory results have been witnessed in a wide spectrum of sectors in a short period of time. It is envisioned that this successful move will take the country to new horizons and prospects at the earliest possible juncture.
In the present climate, investors have got going making the most of the newly implemented macroeconomic reform policy by increasing the export of goods and bolstering capacity. More to the point, the reform has been fashioning favorable conditions for Ethiopian Diasporas residing in the length and breadth of the world.
It is an undeniable fact that Ethiopia’s macroeconomic reform policy has been getting involved in unlocking and transforming the country’s economy. Moreover, it is anticipated that the new policy injects a new release of life into tackling deeply-ingrained economic structural issues encompassing foreign exchange distortions and macroeconomic inequities in every nook and cranny of the country.
The new macroeconomic reform has created favorable conditions geared to benefit the diaspora community by providing substantial benefits to it, according to the Ethiopian Diaspora Service (EDS).
As part of the country’s macroeconomic reform, an application called “unite.et” and that enables the opening of accounts and transfer of foreign currency has been launched, it was learned.
Through this application, it is possible to open foreign currency accounts with the desired amount, including current, savings, and fixed-term options. Ethiopians living inside the country and abroad as well as foreigners of Ethiopian origin and foreigners residing in Ethiopia can access the service.
Ethiopian Diaspora Service Deputy Director General, Belayneh Akinaw told ENA that the macroeconomic reform has brought numerous benefits to the Diaspora community. One of these benefits is enabling the diaspora community to legally exchange foreign currency and prevent illegal transfers.
Allowing the Diaspora community to open foreign currency accounts within the country will enable them to participate in various investment sectors, he added. According to him, this will increase the country’s foreign currency reserves.
The reform provides opportunity for the diaspora community to significantly contribute to the country’s economy, both directly and indirectly.
The deputy director general revealed that the country expects to get 10 billion USD in remittances this Ethiopian fiscal year. In addition, the Diaspora community has been strengthening its participation in the construction of the Grand Ethiopian Renaissance Dam (GERD). For instance, 329,000 USD has been raised through a recently launched platform, Belayneh stated.
Since the beginning of the GERD project, the diaspora community has contributed 50 million USD, and efforts are being made to raise three million USD this year through various initiatives. It is evident that the complete realization of the macroeconomic reform policy will attract investors from various parts of the world.
Notwithstanding the fact that some doomsayers bend over backwards with the objective of badmouthing the positive moves surfacing on a national scale regarding the implementation of macroeconomic reform policy, all their endeavors ended up going for nothing.
In addition to assisting the progress of foreign market expansion by revenue enhancement and strengthening capacities, the macroeconomic reform policy has jumpstarted yielding results and making progress in the right direction. It is true that the recently implemented macroeconomic reform policy gives birth to open the door for export earnings, uplift competitiveness and other things of a similar kind.
Taking the benefits they secure out of the newly implemented policy, Ethiopian Diasporas in the present circumstances have begun undertaking the diaspora community to legally exchange foreign exchange system and open foreign currency accounts and which enable them to play a part in a wide spectrum of investments sectors.
Prime Minister Abiy Ahmed recently announced that Ethiopia has embarked on full implementation of macroeconomic reform policy, according to sources.
In a macro-economic reform policy statement issued, Prime Minister Abiy elaborated that the government has been implementing numerous economic reforms to address longstanding structural problems, including debt burden, inflation, unemployment, and low productivity following the political change which ushered in 2018.
The first phase of the Home-Grown Economic Reform Program (HGER 1.0), introduced in 2019, included policy ideas from macro-financial to structural and sectoral, Abiy pointed out.
Through HGER 1.0, Ethiopia has achieved significant economic objectives, correcting imbalances, alleviating debt, and expanding growth sources, despite remaining reform areas.
Ethiopia has become one of the fastest-growing economies in the world, achieving an average GDP growth rate of 7.1% from 2019 to 2023, he said.
Consequently, the premier added that Ethiopia has become a significant player in the African economy and demonstrated commitment to the Sustainable Development Goals, building the largest economy in East Africa and the third-largest in Sub-Saharan Africa.
The policy statement detailed the key pillars of the Homegrown Economic Reform Program (HGER 2.0), the second phase of the country’s economic transformation efforts including establishing a modern macroeconomic policy framework to ensure stability and resilience as well as boosting competitiveness by improving the investment and trade environment, expanding productive capacity and productivity across sectors, enhancing public sector capabilities for efficient service delivery.
“This comprehensive reform agenda will enable us to achieve high and stable economic growth, maintain single-digit inflation, and build a globally competitive economic system,” he said.
The reform measures target a range of issues, including foreign exchange distortions, financial sector strengthening, inflation control, tax revenue mobilization, and improving the business climate.
Speaking to the Ethiopian Press Agency (EPA), Ethiopian Economics Association Senior Analyst Arega Shumetie (PhD) recently emphasized that the reform would address the foreign currency shortage, thereby enhancing the nation’s export performance.
He highlighted that the association’s survey indicated the reform would significantly influence the cereals and oilseeds sector by reducing parallel market activities and illegal trading, both of which have long plagued the industry. Beyond increasing investment, the reform is expected to create new market opportunities. “By addressing the foreign currency shortage, the reform will stabilize market costs and open doors for traders,” he said.
While acknowledging that internal and external factors might challenge the reform’s timing, the analyst warned of potential concerns related to brokers emerging within the system. He also noted that 85% of input for local manufacturing companies is imported, with exporters previously benefiting from this system. However, he stressed the need for cautious oversight in import-export operations with a focus on adding value to products.
State Minister for Foreign Affairs, Ambassador Mesganu Arga, welcomed Alexis LeMek, the French Ambassador- Designate to Ethiopia, during a meeting held at his office, according to MoFA.
The two sides exchanged views on strengthening bilateral relations between Ethiopia and France, emphasizing opportunities for deeper collaboration.
Ambassador Mesganu reaffirmed Ethiopia’s commitment to enhancing ties in the areas of trade, investment, and economic cooperation, highlighting the country’s potential and extending an invitation to French investors.
The State Minister took note of France’s role as a strategic partner and appreciated the growing relationship between the two nations. He further commended France’s support for Ethiopia’s macroeconomic reforms and its assistance in Ethiopia’s efforts to join the World Trade Organization (WTO).
In response, Ambassador Alexis reiterated France’s strong support for Ethiopia’s economic reforms and expressed commitment to further strengthening the economic partnership between the two countries.
There is no doubt that the reform policy is crucial to manage the economy, raise overseas market, encourage investment, and enhance overseas currency earnings. Other than that the newly implemented macroeconomic reform policy from time to time will lessen exchange rate variations.
It is certain that the macroeconomic reform policy chips in on fashioning great opportunity for competitive funding opportunities on a national scale. The implementation of the reform policy of Ethiopia has created competitive income generation option in the country.
Ethiopia’s historic macroeconomic reforms are designed to increase private sector involvement and ensure efficiency within a stable macroeconomic framework, according to the Governor of the National Bank of Ethiopia (NBE), Mamo Miheretu.
Addressing investors’ concerns in the recent past, Governor Mamo stated that the government has implemented key measures in the macroeconomic reform sector, which are already yielding positive results. The primary goal of the reforms is to strengthen private sector participation by creating a stable macroeconomic environment.
The Governor emphasized that these efforts will enhance the competitiveness and efficiency of the private sector, leading to job creation and improved performance. Additionally, the reforms will address foreign exchange distortions, balance trade, and reduce inflation, creating a healthier economic environment for businesses.
