National Bank of Ethiopia says the new reform measure aims “responsive FX market”
Getahun Tsegaye
Staff Reporter
Addis Ababa, Ethiopia – The National Bank of Ethiopia (NBE) announced a series of new reform measures on Tuesday. It claims the reform measures are aimed at further improving the country’s foreign exchange (FX) market, enhancing flexibility for importers and travelers, and aligning pricing practices with international standards.
“These reforms are designed to support a more active, competitive, and responsive FX market that meets the evolving needs of Ethiopia’s economy,” the NBE stated in a press release.
The latest measures build on recent initiatives, including the introduction of bi-weekly foreign exchange auctions, which have helped increase the availability of foreign currency within the banking system.
According to the NBE, since the launch of a new foreign exchange system in July 2024, Ethiopia has seen “substantial improvements” in both the FX market and the broader balance of payments. The central bank highlighted that goods exports have more than doubled compared to the previous year, while services and remittances have also shown strong growth. In addition, capital inflows from both private and official sources have improved significantly.
“These developments have allowed FX reserves to reach record highs at both commercial banks and the NBE,” the statement said. “As a result, foreign currency availability has improved, helping businesses secure essential imports, increase capacity utilization, and expand operations.”
Among the key measures announced, the NBE has raised the advance payment limit for importers from USD 5,000 to USD 50,000 per import transaction. This adjustment is intended to ease long-standing constraints faced by importers and bring Ethiopia’s practice more in line with international norms.
The central bank has also increased the foreign exchange limits for Ethiopian travelers. Personal travelers may now purchase up to USD 10,000 in FX, while business travelers are eligible for up to USD 15,000. These allowances can be accessed in cash or via debit card. Additionally, individuals with foreign exchange accounts will now be permitted to use up to 20% of their FX balance through a debit card, doubling the previous limit of 10%.
To further promote transparency and reduce consumer costs, the NBE is introducing a cap on bank fees related to foreign exchange transactions. Effective May 26, 2025, all fees related to the purchase of foreign exchange—including for goods imports, service payments, and cash note purchases—will be limited to a maximum of 4%. Banks have also been instructed to avoid charging extra for minor associated services and to publicly disclose all FX-related fees on the NBE website beginning in June 2025.
The NBE expressed confidence that these reforms would sustain the positive momentum in the foreign exchange market. “The NBE is committed to building a steadily growing FX market that provides adequate access to foreign exchange for the private sector and the broader public,” the statement said.
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