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Ethiopia: New Currency Unveiled to Salvage Economy
Category :- Economy and Finance Author :- N Gelmin S 
Posted on September 14, 2020, 12:00 am
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Ethiopia has today, September 14th, 2020 demonetized banknotes in a bid to salvage its economy. The new bank notes, Birr notes for Birr 10, 50 & 100 denominations, with an additional introduction of a new Birr 200 note were unveiled by their Prime Minister, Abiy Ahmed.

PM Abiy unveils new currency

“Introducing the changes in our currency notes was deemed necessary to salvage the country’s fractured economy,” the prime minister told a gathering of bank governors, and heads of the security agencies.

“The new notes will curb financing of illegal activities; corruption and contraband. Enhanced security features on the new notes will also cease counterfeit production,” the PM added.

Many have appreciated this decision as a better step for the revival of the country’s economy. “Mr. prime minister, I had some doubts about the administration, but today's move has changed my skepticism about the administration to some extent. I call it the best gift of the year for the people of Ethiopia. I also wish you a radical change under other issues,” a citizen twitted.

new currency for ethiopia

The Prime Minister explained that this step will combat hoarding, counterfeiting, corruption, and other ills afflicting the economy. The banks have been asked to start immediately issuing new notes.

Meanwhile, the government has given three months window for people to exchange old currency notes from the banks.

During the three-month period, both the new and old notes will remain in circulation but notes of 100, 50, and 10 denominations will stand canceled after the period. Meanwhile, the 200 Birr notes is a completely new bank note.

According to PM Abiy, the new currency with its better design, security features, and quality of paper will have more longevity and end the menace of counterfeiting.

Ethiopia intorduces new bank notes

To print this new currency, the prime minister said the country has spent 3.7 billion birrs, equivalent to $101.2 million.

Before this revelation, the country is said to have passed directions that any company or an individual can keep cash only up to 1.5 million birrs. Meanwhile, the cash withdrawal from banks should not also exceed 100,000 birrs.

PM Abiy said since his coming to power in April 2018, him and his officials have put into place diverse measures to salvage the fractured economy.

“We inherited a situation where the country had not enough money to make payments for the civil servants,” he said, adding the country had a significant budget deficit and more than the sustainable level of debt.

new bank note for ethiopia

He mentioned that over the past two years, his government has brought down sovereign debt from 35 percent to 25 percent of country’s Gross Domestic Product.

For some people, the introduction of 200 Birr notes shows how Ethiopian currency is depreciating, arguing that “1 dollar is almost 50 Birr in the black market! The economy is collapsing and no measures are being taken or discussed by officials!! The currency is in ICU!!,” a commentator said.

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