ADDIS ABABA — In a major move to streamline international trade and enhance business community confidence, the National Bank of Ethiopia (NBE) has officially decentralized key foreign exchange (FX) administration powers.
The central bank has issued Directive No. FXD/05/2026, which amends the landmark Foreign Exchange Directive No. FXD/01/2024. Signed by the newly appointed NBE Governor, Eyob Tekalign (PhD), the new directive officially entered into force on May 25, 2026.
Key Regulatory Shifts
The amendment specifically targets operational bottlenecks for importers by removing the requirement for prior central bank approval on several key trade mechanics. The core changes include:
- Letter of Credit (LC) on Acceptance: Commercial banks are now fully authorized to approve deferred-payment letters of credit for any institution holding a foreign currency account, including holders of forex retention accounts, without seeking prior approval from the NBE.
- Cash Against Documents (CAD) on Acceptance: Commercial banks can now independently approve CAD on acceptance transactions for foreign currency and retention account holders.
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