Highly indebted Ethiopia appoints new central bank chief to rescue economy

The highly indebted government of Ethiopia announces the appointment of a new governor for the National Bank of Ethiopia (NBE), financial sector regulatory body of the country.

The long serving governor of NBE Teklewold Atnafu is now replaced by the former Commissioner for the National Planning under the rank of minister, Yinager Dessie (PhD).

A few days before the announcement of his appointment, Dr. Yinager who appeared on state broadcaster ETV for one-on-one interview, has indicated that Ethiopia’s foreign loan has reached $26 billion.

He further indicated that the fact that Ethiopia is expected to payback $6 billion of its loan in the coming two years and the ongoing mega projects of the government require $7 billion. These are among the factors that has forced the country recently to decide the partial privatization of the major state enterprises such as Ethiopian Airlines, Ethio telecom, Ethiopian Shipping Lines and Ethiopian Electric Power Corporation, according to Dr. Yinager.

Ethiopia currently earns less than $3 billion annually from export of goods mainly raw agricultural commodities, while the country imports over $17 billion.

Foreign Direct Investment into the country has declined in 2017 by 10% to $3.6 billion as compared to the previous year, according to the latest report of the United Nations Conference on Trade and Development (UNCTAD).

The new appointment also includes new vice governor for NBE. Mr. Bekalu Zeleke, the former President of the Commercial Bank of Ethiopia, the biggest state owned commercial bank with hare of over half of the banking market of the country, is now NBE’s vice governor.

The new appointees among others are expected to help the country come out of the foreign currency crisis and adjustments in overall macroeconomic as well as microeconomic management, which includes rescuing the highly indebted country now the verge of collapsing economy.

Speaking at the national parliament on Monday, Prime Minister of Ethiopia for indicated that Ethiopia’s increasing debt has put the nation within the category of the highly indebted countries.

With per capita income of $863, Ethiopia’s economy is now the 8th largest in Africa. Poor performances and mismanagement of state enterprises, which were supposed to start generating revenue by exporting including ten state sugar factory projects and electric power export, among other are often mentioned as among the major reasons that led Ethiopia to carry high debt burden.