ADDIS ABABA (Ethiopia Today):– The newly-appointed Governor of the National Bank of Ethiopia (NBE) Mamo Mihretu has revealed his priority to contain the soaring increase in the price of goods and services and to stabiliz the market.
The governor made the above remark while presenting the financial sector’s six-month performance yesterday in the presence of leaders of commercial banks and other relevant stakeholders.
Noting inflation has been one of the most pressing challenges to the national macro-economy in recent years, Mamo stated that the central bank plans to meticulously deal with the problem. Though Ethiopia manages to reduce the inflation in the price of food items by five and six percent compared to last June, the price of non-food items increased by six percent in the reported period.
“Accordingly, arresting the soaring increase in the price of commodities and services will remain our most important concern in the future. In conclusion, we will take viable financial measures to stabilize the market and ease the challenge inflation has created in the low-income communities.”
Furthermore, creating a healthy financial sector and curbing the alarming parallel market will remain priorities of the regulatory bank. “This time, creating stable prices and stable foreign currency exchange as well as enhancing financial institutions’ performance are indisputable; I join NBE to act based on this mission.”
The governor also directed financial institutions including non-bank entities to contribute to the success of the NBE directive that has been set to contain the staggering inflation. “All measures and tasks of all financial institutions should be to halt the inflation. The loan service, for instance, shall be to support the development of the country. If not, the national bank will take possible legal measures.”
He continued: “Along with financial development support to institutions, we planned to reinforce supervision works and we will supervise all financial institutions whether they are acting based on international principles.”
Meanwhile, Mamo emphasized the role financial institutions have played in the overall economy and mentioned that the Treasury bill contributed by banks hit over 157 billion Birr in six months. Indeed, the contribution of the financial sector to fix the national budget deficit is growing immensely.
NBE’s Deputy Governor Solomon Desta said that the total asset of Ethiopia’s financial institutions has reached 2.91 trillion Birr while the deposit hits the two trillion Birr mark with 33.33 percent annual growth.
“Despite some glitches, both government-owned and private financial institutions have registered healthy growth.”