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The government's imposition of foreign exchange restrictions on certain products is important to stabilize the rising inflation

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Economics teacher Dr. Birhanu Danu said that the government's imposition of foreign currency restrictions on certain products is important to encourage domestic production and stabilize inflation by spending the money on basic consumer goods.

In a statement issued yesterday, the National Bank has announced an indefinite foreign exchange ban on 38 products.

Among the temporarily banned products are candies, crackers, sweets, fruit juices, bottled water, soft drinks, cigarettes, beauty products and jewellery.

The statement also states that the banned products include assembled motor vehicles and tricycles, assembled motor vehicles excluding electric motorcycles.

It is said that the provision of foreign exchange will mainly be given priority to basic food commodities, medicines, medicine and equipment and products used for production inputs.

Addis Ababa University economics lecturer Dr. Birhanu Denu, who spoke to ESA about this measure taken by the government, said that if the corrective measure is implemented properly, it will contribute to stabilizing the economy.

When countries face a shortage of foreign exchange and a slowdown in foreign direct investment, and investment inflows and remittances are imbalanced, they take corrective action.

He said that the corrective measures are taken to stabilize the macro economy and ensure growth.

He stated that the foreign currency ban on certain items is especially in the medium and long term to replace imported products with local products.

Japan, China and Latin American countries have reached their current economic levels by increasing domestic production instead of imported goods during financial crisis and economic sanctions.

He said that if the private investor in the country can produce local products in quality and in a large scale in partnership with the government, it will bring growth and solve the shortage of supply of products and stabilize the prices.

He said that foreign currency can be used for basic consumption goods such as medicine, food and production materials.

He also said that it is beneficial to increase domestic savings and reduce reliance on foreign loans and debt burden.

In the past, the government has been allowing products to be imported in franco currency to stabilize prices, but some parties have raised the issue of improperly using it to stabilize prices.

He mentioned that the economy has become unstable because the control system has not been established in advance, and it should be controlled to prevent such a problem from happening again.

He also stated that the government should keep the economy in line by keeping a good control over the distribution of money, foreign currency and so on.

The government to stabilize the market for products that are offered by consumer cooperatives