Ethiopia: Will Monetary Reform Save the Economy?

 Ethiopia Insight published on 5 November 2024 a commentary titled "Now the Birr Floats, Will Ethiopia Sink or Swim?" by Muktar Ismail, regional analyst and former advisor to the president of Somali Region.  

Last July, Ethiopia adopted a market-determined exchange rate, lifted most current account restrictions, and modernized its monetary policy framework in order to pave the way for International Monetary Fund and World Bank bailouts.

Ethiopia has regressed from two decades of economic and social progress and faces growing economic challenges.  The recent economic policy reform has witnessed a plummeting depreciation of the currency and strong inflationary pressure.  The author concludes that IMF and donor financing are unlikely to stabilize an economy plagued by conflict, poor management, and rapid currency depreciation.  

Is South Sudan Hyperinflating?

The Johns Hopkins Institute for Applied Economics, Global Health, and Study of Business Enterprise published in February 2017 a study titled "Is South Sudan Hyperinflating?" by Steve H. Hanke.

The author concluded that at the end of 2016 the annual (year over year) inflation rate was an elevated 390 percent. But South Sudan did not sustain a monthly inflation rate above 50 percent for 30 consecutive days and, thus, did not experience hyperinflation.

Illegal Wildlife Trade in Africa

The Proceedings of the National Academy of Sciences has just published a highly technical analysis titled "Illegal Killing for Ivory Drives Global Decline in African Elephants" by George Wittemyer and a number of other authors.  Based on a study of illegal wildlife trade in Samburu, Kenya, the study concludes that the problem increased markedly after 2008 and was correlated strongly with the local black market ivory price and increased seizures of ivory destined for China. 

Foreign Policy magazine summarized the study in an article dated 20 August 2014 titled "These Two Charts Show How China is Helping Decimate Africa's Elephants" by Elias Groll. 

Devaluation of South Sudanese Pound

The Sudd Institute, an independent research institution based in Juba, published a brief report by Adel Sandrai on 17 November 2013 titled "Devaluation of South Sudanese Pound: A Sound Economic Policy in Unsound Economic Environment."  The Bank of South Sudan surprised South Sudanese on 12 November 2013 when it announced a 34 percent devaluation of South Sudan's pound.  The National Legislative Assembly immediately expressed concern about the announcement.  The decision does close the gap between the official exchange rate and the black market rate.