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Mamo Mihretu, the top lieutenant responsible for executing Prime Minister Abiy Ahmed’s ambitious economic reforms since 2018, is stepping down from his role as governor of Ethiopia’s central bank.
The Harvard graduate, who has led the National Bank of Ethiopia since 2023, has played a leading role in the reshaping of Ethiopia’s economy over the last seven years including roles as the country’s chief trade negotiator, with reforms including the opening up of the local banking and telecoms industries to foreign investors and competition.
As central banker he is credited with getting through a crucial $3.4 billion IMF loan as the economy buckled under the debilitating aftermath of the two-year civil war in northern Ethiopia and chronic shortages of foreign currency. He also oversaw the floating of the birr currency in July 2024 telling Semafor at the time that it would have a “transformative” impact.
“The timing of his departure is surprising,” said Amaha Bekele, a business consultant based in Addis Ababa, reflecting the feeling of economy watchers. Bekele said helped narrow the previously significant gap between the official and parallel exchange rates of the birr, which had caused economic disruptions in the market.
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In a post on X, Mihretu said he was “proud” of the reforms under his watch and that the opening up of Ethiopia’s banking sector helped secure $10.5 billion in external financing. He was the the principal negotiator as Ethiopia joined the BRICS and was out in charge of his nations ambitious pursuit of membership to the World Trade Organization.
Mihretu spent eight years with the World Bank before returning to his home country to throw himself into public service. Along the way he helped nurture a cohort of other Ethiopian returnees working on their country’s economic reform. They include Eyob Tekalegn, the junior finance minister, and Brook Taye, CEO of Ethiopia Investment Holdings, the country’s sovereign wealth fund, which Mihretu launched in December 2021.
“The succession battle has crystallised around three candidates,” according to the Ethiopian Tribune. It said the frontrunners to succeed Mamo are State Minister of Finance Eyob Tekalign, Solomon Desta, a deputy central bank governor, and Fikadu Digafe, the central bank’s chief economist.
Step Back
While Ethiopia’s reforms have been encouraged by the IMF, World Bank and other international institutions it has not always been smooth sailing and it has had its critics. Dalaya Ashenafi Esayiyas, an economic strategist with Initiative Africa, a think-tank group based in the capital, wrote on her LinkedIn page, Mamo’s IMF deal is “a smokescreen for a future deepened dependency and crippling debt”. “It represents an act of economic treason that prioritizes the interests of global finance over the well being of the Ethiopian people.”