July 13, 2009

Ethiopia Devalues Birr 9.9% After Foreign Currency Shortages

By Jason McLure

July 13 (Bloomberg) -- Ethiopia devalued its currency, the birr, 9.9 percent against the dollar on July 10 after difficulty obtaining foreign exchange led to shortages of imported goods such as auto parts and medical supplies.

The country’s official exchange rate fell to 12.444 against the dollar from 11.3247 on July 9, according to the Web site of the National Bank of Ethiopia, the country’s central bank.

Ethiopia has been in talks with the International Monetary Fund over loans to help it cope with the global economic downturn. In an interview on June 19, Prime Minister Meles Zenawi said the country was likely to devalue the birr as a condition of getting IMF financing.

The Horn of Africa nation’s trade deficit was $4.5 billion last year, according to the World Bank.

To contact the reporter on this story: Jason McLure in Addis Ababa via Johannesburg on pmrichardson@bloomberg.net.

Source: www.bloomberg.com

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