The National Bank of Ethiopia announced plans to allow individuals and entities that legally earn foreign currency to deposit it in commercial banks without limits, aiming to ease challenges faced by importers and exporters.

Eyob Tekalign(PhD), governor of the National Bank of Ethiopia, said the reform is part of the central bank’s efforts to modernise foreign exchange management and support the country’s economic reform agenda. “Strict enforcement of foreign exchange management has been a core element of the economic reform programme, and we are now moving to expand the system to facilitate legal foreign currency flows,” he told lawmakers during a presentation of the bank’s six-month performance report on Monday.

The central bank has been conducting biweekly foreign currency auctions, which collected 1.3 trillion birr in the first half of the fiscal year. The governor said the new measures will complement these auctions, helping to reduce pressure from dollar shortages and supporting macroeconomic stability.

Members of parliament welcomed the plan but highlighted persistent challenges in credit supply and trade balance. Desalegn Wedajo, chairperson of the Standing Committee for Planning, Budget, and Finance, emphasised the importance of reforms that maintain low inflation while narrowing the gap between imports and exports.

“Addressing the longstanding trade imbalance is critical, and the National Bank’s planned reforms should prioritise both financial system efficiency and economic stability,” Desalegn said.

Committee members also called for careful monitoring of foreign exchange demand and banking activity to ensure reforms achieve sustainable results without triggering renewed inflation.