The National Bank of Ethiopia (NBE) and the Central Bank of the United Arab Emirates (CBUAE) have signed a preliminary memorandum of understanding (MoU) on the use of the two countries' national currencies in bilateral transactions.
In addition, Abu Dhabi and Addis Ababa, which is facing a significant foreign exchange shortage, signed a bilateral national currency swap agreement of up to 3 billion dirhams for 46 billion birr, or nearly $817 million.
"The bilateral currency swap agreement and the MoUs signed today reflect the robust economic cooperation between the UAE and Ethiopia, specifically in the areas of trade and investment." said CBUAE Governor Khaled Mohamed Balama.
The preliminary deal also lays the groundwork for linking the payment and bank messaging systems of the two countries, facilitating cross-border transactions.
NBE Governor Mammo Mihretu, for his part, said the UAE, which joined the BRICS economic grouping along with Ethiopia and three other countries on January 1 this year, is "a significant source of foreign investment and development finance."