Ethiopian Prime Minister, Abiy Ahmed has announced the release of new birr notes in efforts to fight financial crimes.
According to the premier, Ethiopia is withdrawing the old notes to crack down on “corruption, embezzlement and contraband”, and thereby further stimulate the economy hard-hit by factors including the Covid-19 pandemic.
“Introducing the changes in our currency notes was deemed necessary to salvage the country’s fractured economy,” PM Abiy told the country’s high profile political, financial and security officials in a meeting on Monday.
New notes of denominations 10, 50 and 100 were released Monday alongside the first-time introduction of the 200 Birr note. The new notes will circulate immediately while the old ones will be phased out within three months.
Ethiopians therefore must exchange the old notes with the new ones at all banks across the country.
Authorites believe that the designs and security features of the new notes will make production of counterfeits impossible. It is also believed that the move to demonetize the currency will enhance attempts to exchange large amounts of illegal notes held by former political leaders and businessmen.
Ethiopia had earlier instituted limitations on cash flow in which a company or individual can keep only up to 1.5 million birr ($41,000) in cash and that withdrawals from banks should also not exceed 100,000 birr ($2,737).
PM Abiy, who assumed power in April 2018, said about 3.7 billion birr ($101.2 million) was used to print the new currency and that his government took several steps “to salvage the fractured economy”.