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Exchange rate to reach $1 = 20 birr in Ethiopia

Posted on by EthiopianReview.com

As hard currency reserve dwindles in Ethiopia, experts predict that exchange rate could soon reach 20 birr per 1 U.S. dollar in the black market.

The current official exchange rate is 16.76 per $1, but in the black market the rate is 17.50 and in some places it goes as high as 18.50 birr per one dollar.

The primary cause of the hard currency supply shortage in Ethiopia is said to be capital flight, and the biggest culprits are the mega corporations that are owned by the ruling Woyanne junta who are depositing a significant portion of their profits in foreign banks.

Most private businessmen in Ethiopia have little trust in the stability of the financial system and that many of them also take their money out of the country as much as they can.

22 thoughts on “Exchange rate to reach $1 = 20 birr in Ethiopia”

  1. We wish that Elias is our Eritrean brother. Brave like the red sea camels of Eritrea. Do not worry Elis we, the Eritreans, and people like you will win at last no matter how hard the road might look. We Eritreans do not give up — even if it takes 1000 years. Those crap Weyane and Hodam people in DC are useless. We Eritreans will support you till death. Your grandfathers were brave like you (Emperor Tewodros) but this young generation of Ethiopia is useless. They just live on the legacy of their ancestors. Just hold your guns up! The Weyane will die soon. Don’t mess with Eritreans or Eritrean government. Politically it is a naive for you to abandon Shaebiya coz weyane will accuse latter – in particular the fundamental Seattle based 50 years single man Ethiomedia Editor (The Raya Azebo son aka Halafi Megedi —Abreha Belay) as a Political naive person. It will be a stigma for you for years to come even if for your future plan just stick your guns and be polite to criticise Shaebiya. One thing I want to advice you – Shaebiya does not like public criticism. Everything they do is secret! They are very slow to respond as well coz they want to contain propaganda! In politics emotional people will not win. The south Sudan issue will be a new event to follow. Take advantage of fuel crisis.
    Weyane only scare one thing that is Shaebiya and Eritrea. Period!
    Be careful of Abreha belay. He is the most Weyane person. He is trying to dilute diasporas movements. He is from Raya Azebo. They are neither from tigray nor from Oromo. The Adwa and Axum people does not like to merry Raya Azebo people. That is his only problem otherwise he is hardcore weyane at heart. He is trying to put you in trap be careful. He is in fact in black list in Eritrean mind in USA. He writes lots of bad things with a nick name HALAFI MENGEDI!

  2. Elias – why you always choose to post only negative stories about Ethiopia and Ethiopians? Unfortunately, almost all developing countries suffer with shortages of foreign reserves. And it is not always a result of poor governance. It is also not because of a capital flight as claimed by you. The reasons are numerous – and to be honest Ethiopia has one of the strict policy in regard to protecting a capital flight. The governments ability to sustain enough reserves with such huge amount of import is commendable. If you want your readers to know the reasons behind devaluation, at least seek advice and comments of Economists and post an informative and educational article that best fit your site.
    God bless Ethiopia
    Kewle

  4. unfortunatly the weyane ill mannered and sick racist supporters are still not ashamed to tell us ethiopia is growing while over 20 millions live with starvation and over 25 million people rely on food aid and over 80% of the total population are suffering with unfordable cost of living that led the majority of Ethiopians to eat with shift , of course a few tplf racist and corrupted groups are living a lavish life with the aid money that tplf receives from donor govt.

    the only way to stop this inhumane nature of weyane is to unite with a corrdination and to get rid of weyane by any thing possible as same as nazi was removed.

  5. It is obvious ethiopian birr weaken time to time however the reason for that is not the one you mentioned.

    Let’s be clear and be professional because we hate the government, we shouldn’t give garbage reason for the thing happened there.

    ER can you tell us why nakffa to dollar is like that right now? why canadian dollar to USD is parrity? I think this will answer your confusion or ask financial professional to know what is going on in this world finance.

    Your mokesha Elias

  6. Unfortunately, the nation is on a course to be the second Zimbabwe in a short time. This is a slippery slope without an end in sight to control inflation which is a sure bet that the mafia junta is in its way out.

  7. Are you saying that people like Sun shine construction and some of the woyanes like Sebhat Nega and Azeb do deposit money over seas, I don’t believe that. This people are great and with out them Ethiopia would be doomed. I think that they may do that only because of the worry that there are no good fire fighting trucks and fire fighters ;therefore, incase of fire they don’t trust the banks. Please leave them alone.

  9. This artificial exchange will not be the thresh hold for much too long, you will soon see an overflow, HYPER INFLATION. As it is Woyane has been printing BIRR to satisfy the money shortage, and it will come to bite it up in the rear end. Hyper Inflation is a matter of when not if. Ethiopia will go in economic turmoil unseen in its history. Woyane controlled the economy and sold as much land possible, and with all things are said and done Meles may runaway from Ethiopia and that will mean more damage to Ethiopians who are unable to pay their daily expenses.

  10. The paid cadres have always continued to argue melese is an independent leader weyanes ever had. As a result he won’t permit western powers to influence his policies. Yet the continued devaluation of the Ethiopian Bir loudly testifies the weyane chieftain is the IMF jackal in Ethiopia. In fact, Melese Zenawi is the only African weyane leaders who continue, instead of his constituents, to prefer serving the interests of Wall Street. Therefore Meleses devaluation of the Ethiopian bir should not come as surprise,because he is in the service of these men.

    According to report by EAST AFRICAN FORUM Dc 18, 1909,
    “Meles Zenawi, a former Marxist guerilla who has spent 18 years ruling Ethiopia, Africa’s second most populous country after Nigeria, surprised delegates from most countries and displeased some of the 52 African nations that he is representing in Copenhagen by offering a US$300 billion-a-year compromise on the issue of climate finance.”

    Again, the “wiki Leaks” report just conforms what most Ethiopians all along have believed about Melese’s Somalia invasion- the western peon running his mercenary errand in the name of Ethiopia.

    Here is that statement by wiki leaks,

    “If accurate — and there is no reason to believe the contrary — the cable suggests that Ethiopia had no intention of invading Somalia in 2006 but was encouraged/pressured to do so by the United States which pushed Ethiopia behind the scenes. Already bogged down in wars in Iraq and Afghanistan at the time, the Bush Administration pushed Ethiopia to invade Somalia with an eye on crushing the Union of Islamic Courts, which was gaining strength in Somalia at the time”

    Regardless of what the weyane media lying machine says, the none weyane Ethiopians clearly know that Melese is an international pawn and his mission and direction is predictable. This is the electronic age,
    Let the dedebit boys and weyane oligarchy stash their wealth in Euro and Dollar in foreign countries, in due time it will be revealed.

    The weyane controlled media is delusional in that it continued to propagate a myth of its own making about Melese.The image weyane media portrays to its leader defies reality’s know that Melese far being an independent leader he is a full time pawn for international interests. We need new African nationalist leaders who will stand for the promotion of the interests of the continents of Africa. We need leaders who advocate African co-operation and not low life who puts out everything for bid.

  12. woyanne aggressively going against businessmen who exchange dollar over the official rate. but the problem is not the the average Kebede who owns a small store and wants to take his money out of the country. As Elias reported, the biggest money exchangers are woyanne themselves. But who will dare touch them?

  14. It is good to boost the economy as the country has started exporting many goods. The Ethiopian government should make the exchange rate as high as 25 Birr per a dollar so that the country will benefit from the goods it is exporting.

  15. what is going on here? Those woyane cadres are not well educated but they are good at barking every where when they smell oppositions. I don’t blame those cadres who are working for food like Zerihun Teshome and Aba Mela of Wollega who are blineded to see the big picture infront of their nose. Woyanes are not good managers but they are good at looting and shipping from south to north to gain few pounds. Inflation, depreciation, microeconomic policy or macro policy or monetary policy etc are useless for woyane who doesn’t have any clue but woyane are interested in selling land to Arabs and chinese and leave the rest to starve to death. As my grand father says, I will be back!

  16. Gebre,

    Apparently you are in pocket of Weyane and IMF/WB, you wouldn’t be saying this otherwise. LIsten, other Africans have tried this before, do your research instead of regurgitating Weyane’s policy. It left countries like Nigeria in turmoil and corruption. Today, Nigeria is trying to get back to normal with good leadership. The only people that benefit from this devaluation are the foreigners who are owning the lands now to make lots and lots of money.

    The true evilness finally revealed to me really finally realized these guys are out of control, when on the recent documentary on Ethiopia about “cooking in the danger zone” where it showed the livelihood of the rural and street dewllers are staggering, no where in the past history, even under Mengistu without “foreign aid” was there desperation as there is today under Weyane! The document showed lots of homeless in Addis and rural area. The young did nto have jobs, begging, and eating filth this shows how the government is using these people to get more foreign aid by deliberately starving them and putting them out of street. In addition, every homeless as the film maker tries to approach them, they will beg him not to be seen because the police will arrest them! So these homeless are not only poor they are constantly being harassed by the police! How sick is that? One poor lady, who is not aware of that she might be in trouble if she revealed her condition, was telling the filmmaker how the times under Mengistu and Hailesealssie were the greatest time where no one went to straved despite even during under the famine! The police has probably arrested this poor old lady by now. She told the filmaker she eats only one meal a day!

    BTW, the way the famine was a good public relations for the West and Weyane to attack Mengistu and let us not forget that Weyane by their own words have said they deliberately diverted food from the famine victims for their own agenda. So technically, there would not have been famine in the first place if it wasn’t staged by Weyane and West

  17. SAWA 19TH ROUND #1,
    I wish you were one of our brave service men/women that we are fighting hard to set them free off the shacles and handcuffs that your masters put on them for years.Then again,you wouldn’t ramble like this if you were one,you certainly feel the pain that they have been going through for all these years.If we knew then what we know now about Issaias/Higdef which is synonymous with corruption,killings,imprisonments,human rights abuses and so on,we would have acted differently.Its not too late and as a matter of fact,its days of existance are dewindling every passing day.I like one thing you said though,”shaebia doesn’t like criticism”Its true and that is the nature of dictators and the trademark of the band of shiftas.Isaias and his shiftas don’t want to be criticized for every horrble atrocities worse than the Dergue that they have been committing against our defenceless people for years.Let me highlight some of the crimes of your masters,
    -They ordered the massacre of disabled veterans in 1994 in Mai habar for demanding kitchin table issues,
    -They instigated wars here and there resulting a loss of thousands of lives and destruction of incalculable amount of properties.
    -He even jailed his own comreds in arms for demanding a reform.They have been held in communicado for 10 years with no access to their loved ones.It has been reported that most of them were dead and imagine none of them even made it the doorsteps of the court nor any charges brought against them.
    -The worst thing of all though,citizens were made to be disappeared without a trace for years and it still continues unabated.
    The crimes of your masters are too many and too long to list.Issaias and his band of shiftas have been working hard and with due deligence to destroy our nation and they have been successful in all fronts.Today our nation is on the edge of a cliff and she is calling her children to rescue her and that includes you.Whether you twist,mislead or cover up the situation,the reality in our country speaks for itself.We have a serious problem that needs an immediate attention at home than meddling in Ethiopia’s affair.Ethiopia is not in crises but we are,thanks to the greedy and nasty dictator who betrayed and shattered the vision and dreams of thousands of our selfless martyrs who perished their prcious lives for the sake of justice and democracy.Trying to cover up and twist or overlook the reality will only make you on the wrong side of history.

    Death to dictatorship,
    Justice and rule of law will prvail,
    Long live Eritrea,
    Ezi wedhanka,

  18. Ethiopian government need to devaluate its currency otherwise it wouldn’t get enough dollar from folks in the diaspora.If the National/Commercial Banks of Ethiopia get huge amount of dollars from abroad ,let us say,with a rate of 20 birr/dollar,banks can sell it at a rate of 25-30 birr/dollar.At any rate banks will be profitable and competitive to the world market by moderately devaluating the currency.

  19. December 21, 2010

    African Farmers Displaced as Investors Move In

    By NEIL MacFARQUHAR SOUMOUNI, Mali

    — The half-dozen strangers who descended on this remote West African village brought its hand-to-mouth farmers alarming news: their humble fields, tilled from one generation to the next, were now controlled by Libya’s leader, Col. Muammar el-Qaddafi, and the farmers would all have to leave. “They told us this would be the last rainy season for us to cultivate our fields; after that, they will level all the houses and take the land,” said Mama Keita, 73, the leader of this village veiled behind dense, thorny scrubland. “We were told that Qaddafi owns this land.” Across Africa and the developing world, a new global land rush is gobbling up large expanses of arable land. Despite their ageless traditions, stunned villagers are discovering that African governments typically own their land and have been leasing it, often at bargain prices, to private investors and foreign governments for decades to come. Organizations like the United Nations and the World Bank say the practice, if done equitably, could help feed the growing global population by introducing large-scale commercial farming to places without it. But others condemn the deals as neocolonial land grabs that destroy villages, uproot tens of thousands of farmers and create a volatile mass of landless poor. Making matters worse, they contend, much of the food is bound for wealthier nations. “The food security of the country concerned must be first and foremost in everybody’s mind,” said Kofi Annan, the former United Nations secretary general, now working on the issue of African agriculture. “Otherwise it is straightforward exploitation and it won’t work. We have seen a scramble for Africa before. I don’t think we want to see a second scramble of that kind.” A World Bank study released in September tallied farmland deals covering at least 110 million acres — the size of California and West Virginia combined — announced during the first 11 months of 2009 alone. More than 70 percent of those deals were for land in Africa, with Sudan, Mozambique and Ethiopia among those nations transferring millions of acres to investors. Before 2008, the global average for such deals was less than 10 million acres per year, the report said. But the food crisis that spring, which set off riots in at least a dozen countries, prompted the spree. The prospect of future scarcity attracted both wealthy governments lacking the arable land needed to feed their own people and hedge funds drawn to a dwindling commodity. “You see interest in land acquisition continuing at a very high level,” said Klaus Deininger, the World Bank economist who wrote the report, taking many figures from a Web site run by Grain, an advocacy organization, because governments would not reveal the agreements. “Clearly, this is not over.” The report, while generally supportive of the investments, detailed mixed results. Foreign aid for agriculture has dwindled from about 20 percent of all aid in 1980 to about 5 percent now, creating a need for other investment to bolster production. But many investments appear to be pure speculation that leaves land fallow, the report found. Farmers have been displaced without compensation, land has been leased well below value, those evicted end up encroaching on parkland and the new ventures have created far fewer jobs than promised, it said. The breathtaking scope of some deals galvanizes opponents. In Madagascar, a deal that would have handed over almost half the country’s arable land to a South Korean conglomerate helped crystallize opposition to an already unpopular president and contributed to his overthrow in 2009. People have been pushed off land in countries like Ethiopia, Uganda, the Democratic Republic of Congo, Liberia and Zambia. It is not even uncommon for investors to arrive on land that was supposedly empty. In Mozambique, one investment company discovered an entire village with its own post office on what had been described as vacant land, said Olivier De Schutter, the United Nations food rapporteur. In Mali, about three million acres along the Niger River and its inland delta are controlled by a state-run trust called the Office du Niger. In nearly 80 years, only 200,000 acres of the land have been irrigated, so the government considers new investors a boon. “Even if you gave the population there the land, they do not have the means to develop it, nor does the state,” said Abou Sow, the executive director of Office du Niger. He listed countries whose governments or private sectors have already made investments or expressed interest: China and South Africa in sugar cane; Libya and Saudi Arabia in rice; and Canada, Belgium, France, South Korea, India, the Netherlands and multinational organizations like the West African Development Bank. In all, Mr. Sow said about 60 deals covered at least 600,000 acres in Mali, although some organizations said more than 1.5 million acres had been committed. He argued that the bulk of the investors were Malians growing food for the domestic market. But he acknowledged that outside investors like the Libyans, who are leasing 250,000 acres here, are expected to ship their rice, beef and other agricultural products home. “What advantage would they gain by investing in Mali if they could not even take their own production?” Mr. Sow said. As with many of the deals, the money Mali might earn from the leases remains murky. The agreement signed with the Libyans grants them the land for at least 50 years simply in exchange for developing it. “The Libyans want to produce rice for Libyans, not for Malians,” said Mamadou Goita, the director of a nonprofit research organization in Mali. He and other opponents contend that the government is privatizing a scarce national resource without improving the domestic food supply, and that politics, not economics, are driving events because Mali wants to improve ties with Libya and others. The huge tracts granted to private investors are many years from production. But officials noted that Libya already spent more than $50 million building a 24-mile canal and road, constructed by a Chinese company, benefiting local villages. Every farmer affected, Mr. Sow added, including as many as 20,000 affected by the Libyan project, will receive compensation. “If they lose a single tree, we will pay them the value of that tree,” he said. But anger and distrust run high. In a rally last month, hundreds of farmers demanded that the government halt such deals until they get a voice. Several said that they had been beaten and jailed by soldiers, but that they were ready to die to keep their land. “The famine will start very soon,” shouted Ibrahima Coulibaly, the head of the coordinating committee for farmer organizations in Mali. “If people do not stand up for their rights, they will lose everything!” “Ante!” members of the crowd shouted in Bamanankan, the local language. “We refuse!” Kassoum Denon, the regional head for the Office du Niger, accused the Malian opponents of being paid by Western groups that are ideologically opposed to large-scale farming. “We are responsible for developing Mali,” he said. “If the civil society does not agree with the way we are doing it, they can go jump in a lake.” The looming problem, experts noted, is that Mali remains an agrarian society. Kicking farmers off the land with no alternative livelihood risks flooding the capital, Bamako, with unemployed, rootless people who could become a political problem. “The land is a natural resource that 70 percent of the population uses to survive,” said Kalfa Sanogo, an economist at the United Nations Development Program in Mali. “You cannot just push 70 percent of the population off the land, nor can you say they can just become agriculture workers.” In a different approach, a $224 million American project will help about 800 Malian farmers each acquire title to 12 acres of newly cleared land, protecting them against being kicked off. Jon C. Anderson, the project director, argued that no country has developed economically with a large percentage of its population on farms. Small farmers with titles will either succeed or have to sell the land to finance another life, he said, though critics have said villagers will still be displaced. “We want a revolutionized relationship between the farmer and the state, one where the farmer is more in charge,” Mr. Anderson said. Soumouni sits about 20 miles from the nearest road, with wandering cattle herders in their distinctive pointed straw hats offering directions like, “Bear right at the termite mound with the hole in it.” Sekou Traoré, 69, a village elder, was dumbfounded when government officials said last year that Libya now controlled his land and began measuring the fields. He had always considered it his own, passed down from grandfather to father to son. “All we want before they break our houses and take our fields is for them to show us the new houses where we will live, and the new fields where we will work,” he said at the rally last month. “We are all so afraid,” he said of the village’s 2,229 residents. “We will be the victims of this situation, we are sure of that.”

    African Farmers Displaced

  20. Elias,
    I wish your article is based on monetary policy theory.Currency devaluation is a forefront for international trade.That is why countries like China and USA fight about their currency value.China devalues its currency artificially to make their export cheap which is against the princpal of market economy.However,US is trying to force China to appriciate their currency through World TradeOrganisatin(WTO)and other monetary organisation.
    Monetary issue isn’t a simple issue, it is the sum of differnt complex economic variables.That is the main reason even the mighty and wealthy countries fight over this issue.
    The same is true, regarding Ethiopia’s monetary situation. The country plan to bump up its export dramatically. To achieve this goal the country’s currency has to be cheaper against the other hard currencies.
    This is the mere fact whether we like it or not.However, is it a right policy for Ethiopia whose balance of trade hugely negative?That is another argument that should be discussed professionally.
    I wish the monetary issue governed by a simple talk as you mentioned.We are talking about one big country economy, not some individuals.
    It would be wise reporting based on some basic analysis, that improves the credtials of the site.

  21. Dear My Eritrean Brother Fithawi,N# 17

    I agree with you but let’s not export our problem to the WEB YEMIBELU ETHIOPINS. I know what is going on in Eritrea. NO need to post our problem about Eritrea in the Internet. This benefits our enemy and uses as a propaganda. Most Ethiopians talk shit about Eritrea. Most of that crap opposition talk shit about Eritrea. I defend Eritrea till death. I want to talk about Eritrean problem with an Eritrean citizens not exporting to Ethiopia and USA.

    Never Trust Tigraway and Amhara

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