The National Bank of Ethiopia (NBE) has prepared two proclamations as part of an economic reform plan. One of them includes the establishment of a legal framework for introducing a central bank digital currency (CBDC).
The policy changes foreseen by the NBE Proclamation include creating a legal framework for a CBDC “as necessary,” as well as increasing the NBE’s capital and creating a legal basis for consumer protection. The accompanying Banking Business Proclamation addresses liberalization of foreign investment in banking, corrective measures regarding “problem” banks and the creation of a regulatory sandbox for innovative financial solutions.
The Council of Ministers has approved the proclamations and will soon be introduced into the House of Representatives.
The central bank has broad reforms in mind
The proclamations are part of the government’s Homegrown Economic Reform Agenda. The privately owned Ethiopian newspaper The Reporter mentioned the government’s interest in a CBDC in April. It said a study would be launched in June. It added that the NBE also aims to join “the Cross Border Payment System” by December. It did not provide any specifics about that system.
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