Devaluation of Ethiopia's currency

The surprise devaluation of the Ethiopian birr on August 31, 2010 was apparently undertaken to boost export performance and bring about structural change in the economy. This was a bold and important move because it indicates recognition by the Ethiopian government that its policy setting had been a factor in inhibiting Ethiopia’s external performance and industrial development.

In a commentary published by AddisFortune weargue that, by itself, this move might fall short of addressing the trade problem, which is manifest in a low trade share of GDP and a yawning trade deficit and which reflects numerous and complex factors, while raising other questions regarding the government’s approach to macroeconomic stability that now need to be answered.

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