New Update: The National Bank of Ethiopia has implemented long-awaited foreign exchange reforms

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The National Bank of Ethiopia has implemented long-awaited foreign exchange reforms. These measures, which importers had been eagerly anticipating, include significant changes—especially regarding Telegraphic Transfer (TT) limits and bank payment regulations. The key updates are:

• Advance Payment Limit Increase: The advance payment limit for importers has been raised from USD 5,000 to USD 50,000.

• Administrative Cost Cap on Forex Services: To streamline the system of foreign currency payments by banks, it has been decided that any administrative expenses or charges banks apply for foreign exchange services related to commercial income, service fees, or cash should not exceed 4%, effective from May 26, 2025 (Ginbot 18, 2017 EC). Source: National Bank of Ethiopia

Ethiopia and Kenya Agree to Start Cross-Border Trade at Moyale with a $1,000 Threshold

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Ethiopia and Kenya have signed an agreement to commence cross-border trade at the Moyale border with a starting threshold of 1,000 US dollars. After two years of continuous negotiation under the African Continental Free Trade Area (AfCFTA) framework, the two countries have finalized an entry-level agreement that allows the facilitation of bilateral trade exchanges.

According to the agreement, the initial trade threshold for goods traded at the Moyale border will be set at 1,000 USD. This agreement, concluded in Mombasa, aims to simplify trade procedures and boost economic activities among the border communities.

The trade zones specified in the agreement include a 50-kilometer range on the Ethiopian side and a 100-kilometer range on the Kenyan side. Traders will be allowed to conduct cross-border trade up to four times per month, based on a mutually agreed list of products, as long as the value of goods does not exceed 1,000 USD per transaction.

The agreement is the outcome of two years of extended negotiation and covers issues such as trade valuation thresholds, movement facilitation, and the establishment of cross-border trade zones. The news was reported by Capital newspaper.