The National Bank of Ethiopia (NBE) has officially enacted a comprehensive new legal framework governing “Franco Valuta” import arrangements, significantly shifting how foreign investors, diaspora traders, and domestic economic zones utilize alternative foreign exchange channels.
Signed into law by NBE Governor Eyob Tekalign, the Import on Franco Valuta Directive No. FVD/01/2026 officially took effect on May 29, 2026.
This policy effectively repeals the previous, broad provision under Article 8 of the 2024 Foreign Exchange Directive, replacing it with a heavily regulated, centralized framework designed to boost investment while aggressively curbing illicit financial flows.
The Franco Valuta arrangement allows entities to import goods into Ethiopia without drawing foreign exchange from the country’s heavily constrained domestic banking system. Under the new directive, the NBE has explicitly designated specific “Eligible Users” permitted to leverage this system to stimulate economic growth.
These include licensed domestic economic zones, diaspora investors, foreign investors, manufacturing and industrial enterprises owned by foreign investors, development projects of strategic national importance, as well as the diplomatic corps, regional or international non-governmental organizations (NGOs), and religious institutions.
For medium and large-scale manufacturing, as well as investment sectors, the directive permits the import of critical capital goods, industrial machinery, raw materials, agricultural inputs, and renewable energy equipment.
Crucially, the policy opens doors for trading purposes, explicitly allowing the wholesale or retail import of commercial goods by eligible Foreign Direct Investment (FDI) and diaspora traders, alongside specialized clearances for free trade zones.
While the NBE acknowledged that Franco Valuta is vital for facilitating trade without depleting national foreign currency reserves, bank officials emphasized that the previous regulatory vacuum posed substantial economic threats.
To eliminate risks like misreporting and the circumvention of foreign exchange regulations, the Ethiopian Customs Commission has been ordered to integrate all transactions into the digital system known as the Foreign Exchange Monitoring and Orchestration Unified System (FEMoUS).
The directive features strict provisions capping Free-on-Board (FOB) dollar values across 24 distinct categories of goods. For instance, diaspora investors or returning nationals holding an investment license can import raw materials for pilot production and personal effects capped at a value of $10,000 FOB.
Meanwhile, individual personal effects for first-time movers to the country are capped at $5,000 FOB. The National Bank has warned that any attempt to circumvent these digital controls or make false customs declarations will result in severe administrative and legal consequences.
