Ethiopia Central Bank Governor Mamo Mihretu resigns after reform-driven tenure

Ethiopian Central Bank Governor Mamo Mihretu has stepped down after two years in office, bringing to a close a reform-driven tenure that saw the country’s financial sector undergo some of its most sweeping changes in decades.

Mamo, who was appointed on January 20, 2023, announced his resignation on Wednesday, saying he wanted to explore new challenges beyond government service after more than seven years in public roles.

“After seven years of dedicated public service in different capacities, the time has come for me to leave government to pursue other passions and tackle other challenges. It has been a great honour and source of satisfaction to be of service to our beloved nation,” he said in his statement.

He expressed gratitude to Prime Minister Abiy Ahmed, noting that his rise to the helm of the National Bank of Ethiopia (NBE) was made possible by the premier’s support. “I know this extraordinary opportunity for service was made possible because of the invitation, leadership, and guidance of Prime Minister Abiy Ahmed. For that and a lot more, I remain immensely grateful to him,” he added.

During his tenure, Mamo spearheaded major economic and financial reforms. He oversaw the shift to a market-based exchange rate, strengthened the central bank’s independence through new legislation, and introduced a modern monetary policy framework.

“As Governor of the National Bank of Ethiopia, I led this venerable institution through the country’s most significant economic reforms in over 50 years. Thanks to the unparalleled professionalism and selfless work ethic of the NBE team and colleagues in the rest of the government, we introduced a modern monetary policy framework, transitioned to a market-based exchange rate system, and helped establish the Bank’s autonomy through new legislation,” he said.

The outgoing governor also highlighted achievements such as opening Ethiopia’s financial sector to foreign banks, advancing digital inclusion, and securing record external financing.

“We opened the financial sector to foreign banks, advanced digital inclusion, and secured $10.5 billion in external financing from partners including the IMF and World Bank, while stabilising the macroeconomy and restoring investor confidence. As a result of these reforms, foreign currency holdings increased by more than threefold, reaching historically its highest level in a matter of a year. Inflation reached its lowest in seven years,” he said.

He pointed to rapid growth in financial technology and banking capacity during his time in office. “Digital payments increased by more than tenfold. The financial sector strengthened and expanded tremendously, reaching more than 5 trillion in assets. These and other historic achievements of the government are nothing short of remarkable,” he added.

Before leading the central bank, Mamo was the founding CEO of Ethiopian Investment Holdings, the sovereign wealth fund charged with building long-term wealth through investment partnerships. He had also played a senior role in designing the Home-Grown Economic Reform Programme, which sought to transform Ethiopia’s economy and restore macro stability.

Despite these advances, he acknowledged that some of the reforms, especially the gradual floating of the birr, had sparked controversy as they pushed up living costs, even while addressing foreign exchange shortages and boosting competitiveness.

On his departure, Mamo voiced optimism that the progress made laid a strong foundation for the future of the central bank. “On leaving the NBE today, I am confident that the vision of a modern central bank that is fit for purpose is within reach,” he said.