Ethiopia: Bold Move for Rescuing Macroeconomic Echelon

Passing through a number of processes and serving the citizenry under various regimes, the currency Ethiopia has had reaches at this level. It is also important to recall that the country has been employing paper money since 1906. The long used, for twenty-five plus years perhaps, Birr note has been altered in Ethiopia with a view to hitting a range of objectives comprising many representing emblems. An additional note, a 200 Birr note with great care and secrecy, appears to be part of the market for the first time in the history of the country.

The purposes of the currency change are numerous. To mention but a few, in the first place, since there is a huge amount of money syringed out of the banking system and found in and out of the nation, myriads of illicit activities have been witnessed and financial operators playing under the domain of the normal track are getting out of the game. The alteration will absolutely get these sources dried.

Secondly, the macroeconomic hurdles emanating from corruption, embezzlement, fraud and treachery can be easily mitigated if not abolished, which are resulted from contraband, illicit money flow and hoarding of money.

Thirdly, the cash holding limit recently declared by the government stating that an individual or company could not hold more than 1.5 million Birr can easily be put in place. Hadn't it been the effect of the alteration, it would have been pretty tough, time consuming and monotonous to make the limit practical.

Fourth, the money hoarded out the nation following maladministration and self-first belief will undoubtedly be pumped into anti-peace traffic at the expense of the mass. The note change has devised a lasting solution to this, too.

Fifth, a great deal of money is flown in the informal sector than the formal one. Obviously, the money that is found out of the banking scheme is highly susceptible to illicit activities. Hence, this money has to be driven to banks and get functional in a proper manner in a bid to boost the economy of the country and play its part to rejuvenate the livelihood of all walks of life. Otherwise, the money deviated from the banking channel has baffled the economic system and got the nation entangled with lack of secure trade. Yes, the measure taken can absolutely be an unparalleled remedy for this cancer.

Finally, the abundant flow of money against the finance structure apart from deteriorating the normal trajectory of country's economic growth, it is extremely affecting the proper running of banks and businessmen who have a direct and immense contribution to the overall development of the nation. The change is a remedial for this.

In simple terms, during the time of high cost of living hiding a lot of money and exposing citizens to illegal activities is really adding fuel to fire.

Hence, the note change has come up with security trade aiming at containing forgery and sophisticated dishonesty, and the very value added to the Birr notes that needs to be well acknowledged is the presence of dots that help visually impaired citizens easily identify the notes.

In sum, the measure recently taken is a timely and relevant to help the nation secure economic prestige, contain forgery, rein inflation, combat corruption as well as enable the banking system flourish well, whose cumulative effect enables the nation to ensure prosperity.

More From: Ethiopian Herald

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