US Treasury Deputy Assistant Secretary Meets with National Bank of Ethiopia Governor Amidst Economic Reforms

On August 7, 2024, Eric Meyer, the Deputy Assistant Secretary of the US Treasury, held a pivotal meeting with Mamo Mihretu, the Governor of the National Bank of Ethiopia (NBE). This meeting, which took place at the NBE headquarters, was a significant diplomatic and economic engagement aimed at addressing recent developments in Ethiopia's economic landscape and exploring future bilateral relations.

The discussions between Meyer and Mihretu come in the wake of substantial macroeconomic reforms implemented by the NBE, which were officially announced on July 29, 2024. These reforms mark a major shift in Ethiopia’s economic policy and have had a notable impact on the country's economic environment.

The macroeconomic reforms introduced by the NBE have led to dramatic changes in Ethiopia’s economic climate. One of the most immediate effects has been a sharp increase in the prices of various consumer goods. This surge in prices has sparked significant public concern and prompted the Ethiopian government to take decisive action against businesses accused of "hoarding" and "artificial price hikes." Authorities in Addis Ababa and other regions have launched a crackdown to address these issues, aiming to stabilize the market and protect consumers.

In response to the evolving economic situation, the NBE conducted its inaugural Special Forex Auction on August 7, 2024. This auction was a groundbreaking initiative, marking a new approach to managing the country's foreign exchange reserves and addressing currency valuation challenges. The auction saw participation from 27 commercial banks, with the weighted average of successful bids settling at 107.9 birr per US dollar. This move reflects the NBE’s commitment to enhancing transparency and efficiency in the foreign exchange market.

Bilateral Relations and Future Prospects

Beyond the immediate economic issues, the meeting between Meyer and Mihretu also focused on the broader context of US-Ethiopia relations. Both officials discussed ways to deepen the long-standing trade and investment ties between the two nations. The discussions underscored the mutual interest in strengthening economic collaboration and exploring new opportunities for growth.

US Ambassador to Ethiopia, Ervin Massinga, joined the meeting, further emphasizing the importance of the diplomatic and economic dialogue between the US and Ethiopia. The presence of Ambassador Massinga highlighted the US government's commitment to supporting Ethiopia through its economic transition and reinforcing bilateral cooperation.

The meeting between US Treasury Deputy Assistant Secretary Eric Meyer and National Bank of Ethiopia Governor Mamo Mihretu represents a critical moment in the evolving economic landscape of Ethiopia. As the country navigates significant macroeconomic reforms and faces challenges related to inflation and currency valuation, the support and engagement of international partners like the United States play a crucial role. The discussions held on August 7, 2024, not only addressed immediate economic concerns but also laid the groundwork for enhanced bilateral relations, paving the way for future collaboration between the two countries.

Original article:

#Ethiopia: #US Treasury Deputy Assistant Secretary meets National Bank Governor Eric Meyer, US Treasury Deputy Assistant Secretary, met today with National Bank of Ethiopia (NBE) Governor, Mamo Mihretu, “to discuss recent macroeconomic developments and the central bank’s ongoing monetary and financial sector reforms,” NBE said. Assistant Secretary Meyer’s visit comes amid the ongoing unprecedented microeconomic reforms under the auspices of NEB that was announced on 29 July. The sweeping change has since led to a dramatic rise in prices for a range of consumer goods, prompting a crackdown by authorities both in the capital Addis Abeba and outside on businesses accused of “hoarding” and “artificial price hikes.” On Wednesday this week, NBE held the first of its kind Special Forex Auction in which 27 commercial banks took part with the weighted average of successful bids ending at 107.9 birr per US dollar. In addition to the ongoing microeconomic changes, Governor Mamo and Assistant Secretary Meyer “also explored ways to deepen the long-standing bilateral trade and investment relations between the two countries,” NBE further said. They were joined by US Ambassador to Ethiopia, Ervin Massinga.

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