The Ethiopian Government has exerted tremendous efforts in captivating the hearts and minds of Ethiopian diaspora residing in all corners of the globe. The establishment of Ethiopian Diaspora Agency has paved ways to bring together the needs and interests of millions of Diaspora in different socio-economic activities. Investment and financial laws and regulations have been designed and amended with the participation of the diaspora and their representatives.
In this regard, the Diaspora banking service being provided at the Commercial Bank of Ethiopia /CBE/ is worth mentioning. The commercial bank of Ethiopia is the largest state owned bank. After the governmental reform and overhaul in 2018, the bank established a special body that deals with the affairs called the Diaspora Affairs bureau.
The special section is headed by Lemma Wakeyo, an economist who earned his bachelor’s degree in Economics in 2011 from Addis Ababa University. He also earned his MA degree in the same discipline. He has been serving as the head of the Diaspora affairs bureau at CBE from October 4, 2019 onwards. ABN’s Daniel Tiruneh sat down to discuss the contributions and responsibilities of the bureau in light of “The Great Ethiopian Homecoming” national call.
The first of its kind in Ethiopian banking system, the Diaspora Affairs Bureau at CBE gives special attention to the issues of the diaspora and has provisions that are tailored to the needs and wants of the diaspora community. This includes special services such as one-stop shops that cater and facilitate the demands of the diaspora community.
“The department is ready to respond to the impromptu homecoming call by Prime Minister Abiy Ahmed since the arrival of 1 million diaspora benefits the bank at this time of need,” said Lemma, pointing out that the nation is in dire need of foreign currency in the wake of the northern conflict. Hence, the diaspora affairs bureau at CBE is working in collaboration with stakeholders and is also the member of the national homecoming committee which oversees the activities of the homecoming event.
For the effective organization of the ceremonial event, CBE’s Diaspora affairs bureau’s activities are overseen by the senior management team which leads the technical support committee. The activities of the homecoming event are also trickled and distributed all the way down to branches and sub-branches of the CBE structure. This is done to make conditions conducive to the diaspora so that such conditions prompt the community to exchange a significant amount of foreign currency through CBE.
In the special homecoming call, there are special package provisions for the members of the diaspora community. Special saving accounts that are only designed for the diaspora community to deposit foreign cash is one of them. Besides, the bureau is working to create awareness about these special incentives and offers through promotion and description of the products.
“The increment in the amount of remittance is attributed to the fact that the diaspora community is avoiding the black market and even some members of the diaspora are working to create awareness about the need to deposit and exchange foreign currency through the legal system.”
Another special offer by the CBE is the loan packages. This package includes multiple offers that are furnished for diaspora and the packages differ based on the amount of foreign currency the members contribute to the nation. The offer includes housing and business loans which have 4-5 different packages. “These packages are available for members of the diaspora community who can bring innovative business ideas. The details of the loan offers will be elaborated during the homecoming week,” Lemma explained. He also said that the diaspora affairs bureau will work with the diaspora in close collaboration so that the attachment of the community becomes long lasting.
With regards to remittance, which is an essential contribution of the diaspora community, Lemma said that appreciable data are seen when it comes to the rate at which remittance currency is increasing. However, he pointed out that the amount is below the projected potential of the community’s capacity.
The increment in the amount of remittance is attributed to the fact that the diaspora community is avoiding the black market and even some members of the diaspora are working to create awareness about the need to deposit and exchange foreign currency through the legal system. This is an important contribution since the capacity of the government of Ethiopia to control international cash exchange is limited, as Lemma elaborated.
“These foreign exchange branches are located in designated branches, in the compound of the Ethiopian Diaspora Agency, and the Ethiopian Airlines. The task force has also a well-organized chain of command that reports and evaluates its actions on a regular basis.”
Another challenge to the Ethiopian banking sector is the black market which poses a serious threat as it is becoming more influential and deep rooted in the economy. One of the main contributing factors for this reality is the fact that the diaspora community and other entities who possess foreign currency are widely using the parallel market which puts a dent on the normal functioning of the economic structure.
However, things are taking a turn for the better as black market users are beginning to turn their back on this market. Despite this fact, however, some bureaucracies in other service delivery organizations can pose a threat to the involvement of the diaspora in exchanging foreign currency through legal system. To eliminate this, the homecoming event task force is working in three shifts to aid exchange foreign currency exchange at every service facilities and organizations that the diaspora community will potentially use.
These foreign exchange branches are located in designated branches, in the compound of the Ethiopian Diaspora Agency, and the Ethiopian Airlines. The task force has also a well-organized chain of command that reports and evaluates its actions on a regular basis. Additionally, a call center that provides information is on standby, as Lemma explained.
Mr. Lemma closed off the interview with a message to the diaspora. He urged members of the diaspora to exchange their foreign currencies through banks only. He also called on members of the diaspora community to who bought bonds of the Grand Ethiopian Renaissance Dam to exchange their mature bonds and reinvest in the country. Mr. Lemma also said that most of the diaspora community members are customers of the CBE and called on unsubscribed customers to use the CBE as the bank of their choice and make their stay worthwhile.