Ethiopia’s financial system is undergoing a structural shift following foreign exchange liberalisation, with sharp currency depreciation driving export growth, improving external balances and reshaping credit allocation towards trade and logistics-linked sectors.
- Birr depreciated 151.4% (Jun 2024–Sep 2025) following FX reform, improving export price competitiveness
- Export earnings increased 119.2%, supported by stronger FX inflows and improved market pricing
- Remittances rose 13%, contributing to FX liquidity and external account stabilization
- FX reserves increased 209% YoY, easing import financing constraints
- Current account deficit narrowed from $6.2bn to $289.3mn (-3.0% to -0.2% of GDP)
- Commercial bank credit expanded 38.6% to ETB 3.0tn, indicating strong domestic financing growth
- Deposits grew 40.7% to ETB 3.5tn, improving liquidity for lending
- Trade sector loan share rose to 41.5%, reflecting increased financing for import/export businesses
- Manufacturing loan share declined to 16.2%, indicating sectoral credit reallocation
- Capital goods and equipment leasing loans increased 27.2% to ETB 4.6bn, supporting truck and logistics asset financing
- Leasing NPL ratio declined to 2.7%, indicating improved asset quality and repayment capacity
- Expansion in leasing supports truck end-buyers and fleet operators amid rising trade volumes
- Digital payments reached ETB 18.5tn, doubling year-on-year, improving transaction efficiency
- RTGS transactions grew over 200% to ETB 12tn, supporting high-value trade settlements
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Why it matters
The FX regime shift is directly improving export performance while easing pressure on imports through higher reserves and FX availability. Credit is increasingly flowing into trade and logistics, with leasing growth enabling truck acquisition and supply chain expansion. This combination strengthens Ethiopia’s trade capacity, reduces external vulnerability, and supports logistics sector scaling.