The UAE and Ethiopia have inked a currency swap arrangement worth up to $817 million. Both central banks also agreed to develop rules for cross-border transactions involving local currencies and integrate their payment and messaging systems.
The Central Bank of the UAE (CBUAE) and the National Bank of Ethiopia (NBE) can exchange local currencies for up to AED 3 billion and ETB 46 billion, respectively. This move aims to strengthen the two countries’ financial and commercial ties by providing liquidity in local currencies and facilitating the efficient settlement of cross-border transactions.
Khaled Mohamed Balama, Governor of the CBUAE, remarked that this agreement would improve economic, trade, and investment opportunities. He emphasised the necessity of collaborating closely with Ethiopian partners to achieve financial stability and common goals.
Mamo E. Mihretu, Governor of the National Bank of Ethiopia, cited the UAE as one of Ethiopia’s top trading partners and a significant source of foreign investment and development money. He stated that the currency exchange provides critical funding to Ethiopia and diversifies its currency options for expanding trade and investment transactions.
The agreement also involves collaboration on payment platform services, linking instant payment systems UAESWITCH and ETHSWITCH, and research into financial technology and central bank digital currencies.
