The Devaluation of the Birr- a Layman’s Guide

Seid Hassan – Murray State University , 8 September 2010- Devaluation is associated with fixed or pegged exchange rates systems whose value is not being determined by the normal (free) mechanics of supply and demand. In general, devaluation reflects the existence of serious macroeconomic problems (imbalances) and also reflects weaknesses of the government which is devaluing its currency. When it comes to Ethiopia, the economic weakness is reflected by several of the resource gaps: the savings-investment gap, the balance of payments gap which in 2009 escalated, total exports and imports amounting $1.657 billion and $7.093 billion, respectively, according to the CIA World Fact book. Read full in pdf

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Posted by on September 9, 2010. Filed under NEWS. You can follow any responses to this entry through the RSS 2.0. Both comments and pings are currently closed.