Ethiopia plans to conduct international trade using currencies other than the U.S. dollar as part of a broader effort to diversify its foreign exchange mechanisms and strengthen economic sovereignty.

The Finance Ministry said the plan reflects Ethiopia’s intent to reduce reliance on a single currency and foster more resilient international trade relationships. It also aligns with the government’s broader diplomatic strategy of expanding and deepening economic ties that serve national interests.

State Minister of Finance Eyob Tekalign (PhD) announced the plan in an interview with state broadcaster Ethiopian Broadcasting Corporation. He said the shift is part of Ethiopia’s ongoing macroeconomic reforms, which aim to reshape the country's trade and financial systems.

“This agreement not only brings additional capacity to our nation,” Eyob said, “but the willingness of our partner countries to engage in these currency exchanges also serves as a strong testament to their growing confidence in the Ethiopian economy.”

Tekalign noted that under the new framework, Ethiopia would be able to import goods using alternative currencies, while trading partners could also purchase Ethiopian exports without using the dollar.

The country has already begun the shift through recent currency swap agreements. In July 2024, Ethiopia signed a bilateral currency swap deal with the United Arab Emirates, valued at about $817 million, allowing transactions in Ethiopian birr and Emirati dirhams. The agreement includes memorandums of understanding to promote the use of domestic currencies and interlink payment systems.

In September 2024, Ethiopia signed a similar currency swap agreement with China, permitting trade in Ethiopian birr and Chinese yuan. Central banks from both countries are working to implement the deal.

The shift comes amid a growing global trend of countries exploring alternatives to the dollar in cross-border trade, driven by economic uncertainty and shifting geopolitical dynamics.