The delicate and time-consuming state-managed account management process that existed in Ethiopia during military rule (1974-1991) constituted a significant obstacle to financial development. Since taking control in 1991, the current government has implemented several changes. For example, in 1994, the legislator legitimized local private interest in managing the banking sector. Furthermore, he reconstructed the two advance banks as merchant banks and presented another Banking and Monetary Proclamation that gave greater self-governance and further clarified the activities of the National Bank of Ethiopia as controller and administrator of the management segment of an account. Say no to plagiarism. Get a tailor-made essay on "Why Violent Video Games Shouldn't Be Banned"? Get Original Essay Although the process has taken two decades, the money saving segment remains stifled as the process of change has been meticulously moderated and the approach measures implemented so far are not entirely satisfactory. So far these measures fail to substantially improve the account management part. It is not yet focused and productive, nor is it capable of accelerating the country's monetary growth, which remains minimal. Likewise lost is the administration's concern that money-related advances could cause a monetary savings emergency that could close the loop on a monetary emergency. Careful examinations confirm that as administrative and supervisory tools are redesigned, and as supervision becomes progressively forceful, the likelihood of a money-saving emergency decreases substantially. The time has come to perceive this logical inconsistency and it is wise to begin the process of great change to achieve monetary quality. Global experience suggests that greater rivalry between domestic and external banks can acquire more important benefits in the form of increased productivity. Key market-related measures are thus expected to further strengthen the budgetary division so as to accelerate Ethiopia's financial development. In order to maximize and accelerate the financial development process, the current administration of Ethiopia has initiated various changes to improve the proficiency and intensity of the money saving part. Change measures attempted so far by the administration include addressing the broad problem of bad loans experienced by state banks; reconstituting both the Development Bank of Ethiopia and the Bank for Construction and Business as commercial banks, opening the money custody portion to private household speculation; and inform another who operates a demonstration account to give greater self-governance to the National Bank of Ethiopia. The key arrangements of these changes in Ethiopian savings governments have been fundamentally tailor-made to extend access to customers, improve effectiveness and strengthen rivalry. Although the money custody sector has developed quite a bit since 1994, when the above-mentioned change measures were adopted, to this day the account management sector remains monopolistic, wasteful and is not capable of improving the intermediation of private funds. . As a result, the money holding system's commitment to encouraging Ethiopia's monetary development is marginal. This article, as the title suggests, aims to critique and complement the banking sector reform in Ethiopia by Drs. Desta Asayehgn and Admassu Bezabeh which was published by (IDEA) Inc. (www.africanidea.org/Banking_sector_in_Ethiopia.html). I found them to beinteresting abstracts, especially in some parts where the authors present valid arguments and rail against government policies as constructive criticism and I will support ideas I agree with. However, I have different opinions, reservations and disagreements on some of their ideas; I will then critique those ideas in an attempt to provide input and insights for future considerations. In this way, when I evaluate and integrate the banking sector reform in Ethiopia, I expect to grasp from a broader point of view those connections with the approach of the Ethiopian economy by and large and, specifically, the budget. Broader viewpoints, therefore, allow us to consider the degree and scope of the overall performance of local Ethiopian banks and how they are influenced by the external banking section. This document, therefore, goes beyond study and integration, recommending and taking care of an important issue that affects (sometimes fascinates) the Ethiopian economy. Problems are addressed when we pay a lot of attention in an imaginative way and in this specific circumstance, I found that Dr. The Abstract of Desta and Admassu not as a casual commitment but as a fundamental part of the innovative procedure in addressing the problems of Ethiopia. It is ultimately that I welcome the opportunity to show this article to readers, but the central proposition of my article highlights Ethiopia's needs according to a set of criteria that should be developed by the Ethiopian government. In any case, the Ethiopian government should also open up regarding understanding external data sources provided by Ethiopian educated people which could have broad ramifications in strategy formulation. For Ethiopia to achieve significant economic growth, the authors enumerate the following suggestions the administrative and supervisory capacity of the National Bank of Ethiopia to restore the confidence of the society at large in the party holding the currency. The privatization of the state-owned Commercial Bank of Ethiopia is not a major concern; Allow the passage of external banks (foreign banks) into Ethiopia; and allow market forces to determine interest rates and the value of the Ethiopian birr (ETB). I disagree with points 2 and 3 and agree with points 1 and 4. I would like to begin my analysis.1. Review the administrative and supervisory capacity of the National Bank of Ethiopia to restore the confidence of the society at large in the maintenance of the banking sector. I agree with the creators that the National Bank of Ethiopia (NBE) must attempt periodic fundamental changes within itself and upgrade its administration and supervisory capacity "to re-establish the general confidence of the population" and to ensure the smooth functioning of money-related institutions in Ethiopia. In any case, we recognize that the NBE definitely needs to make some upgrade by presenting another technological and structural innovation so as to incorporate the accounting management framework in Ethiopia. Yoseph Mekonnen, writing for Addis Fortune, for example, reports how NBE has promoted new COREs that manage an accounting framework: "The National Bank of Ethiopia (NBE) has launched its new pooled, online, continuous, electronic monetary savings framework (CORE), called Quantum Intellect, Monday 18, 2013. This will supplant the past Bank Master System.... The Intellect Arrangement, which was created specifically for national banks, is needed to solve these problems by allowing the incorporation of the monetary, securities, installment and settlement administration and the overall effort. Likewise, it should speed up the Bank's operations and enable it to maintain accurate administrative and administrative records, asindicated by the official Polaris press release at the time of signing the agreement. … The NBE has brought and dispatched new administrations and programs to support its CORE monetary savings framework. After plc secured a million-dollar contract in April 2013 to supply IBM 3650-M3 servers and Oracle programming for information storage, the NBA also ensures, by supervising that special savings accounts are cleared for appropriate tasks such as Condominium special savings both 40/60 and 20/8 0. Construction cannot be delayed due to shortage of money as long as the client retains his money periodically and appropriately, in order to gain the trust of the company and speeding up its service is also much preferable and appreciable.2. Privatization of state banks to level the playing field of competition is not a major concern. Although the authors encourage the privatization of banks to make the banking sector more productive, I believe that it is not the privatization of a state-owned company, organization or bank that makes it productive. It is competent stewardship and cutting-edge innovation in these particular endeavors that would go a long way in changing, improving and creating wealth. Furthermore, privatization alone cannot be a viable panacea, especially in the context of recession and depression. We know how governments occasionally mediate to revive an economy in an emergency or restore a crumbling economy. In the midst of the last significant misery of the twentieth century, John Maynard Keynes pushed Franklin D. Roosevelt to recover the U.S. economy. In his well-regarded book, The General Theory of Employment, Interest and Money, Keynes contemplated that the state could strengthen financial development and increase security in the private sector through loan commissions, tax assessments and open initiatives and expert personnel. Despite the government's initiative To improve the regulatory and supervisory capacity of the National Bank of Ethiopia (NBE), and also try to achieve positive results in improving the quality of NBE staff and technological innovation, the progress achieved up to today they remain unsatisfactory. As a result, the SNB's supervisory capacity remains weak. In its recent November 2010 report on Ethiopia, the International Monetary Fund “urged the Ethiopian government to improve the NBA's capacity to recruit and retain qualified personnel to ensure institutional absorption of technical assistance provided by the Fund and other partners in this area.”3. Do not allow foreign banks to enter Ethiopia The authors encourage allowing banks to enter Ethiopia. emphasize the centrality of productivity and rivalry due to the entry of external banks into the country, and it is very likely that foreign banks can bring progress, new innovation, refined skills, gigantic resources or, even more, all the connections with the world economy on the market. on the basis that these remote or foreign banks are a vital part of transnational corporations (TNCs). Be that as it may, their entry into Ethiopia cannot appear in light of the fact that “no one except Ethiopians can work and own financial organizations,” as stipulated by national law. But I disagree because of the reception outside the banks in Ethiopia at this stage, when Ethiopia is still a beautiful developing baby country, it could mean allowing a fantastic white shark into a seal pool where the last ones are eaten one by one by the ocean mammoth. The similarity betweenthe white shark and the seal could also be attributed to the supposedly transitional economies of Eastern Europe, in which domestic banks are overrun by banks outside Western Europe. American banks have not yet entered Eastern Europe, with the exception of Citibank. External banks now lay claim to a critical number of former Eastern European banks; Italian banks now have a dominant role in Croatia; other Eastern European banks are owned by Sweden. Another reason why I am not encouraged to enter Ethiopia is that Ethiopian banks, both state and private, are making money and some of them are also useful banks and financial organizations organized by individuals and provide Ethiopian subjects with a point of view unequivocally preferred that external banks would not consider, in any case, as part of their financial ethics. Some examples of affiliated banks are Addis International Bank (AdIB), CooperativaBanca d'Oromia and Banca Enat. among the real investors or shareholders of these banks are traditional Ethiopian credit cooperatives, farmers and women, this means encouraging local citizens and businesses, as well as an affirmative action policy. The authors advocate the entry of foreign banks into the country because of their advanced knowledge, skills and technological improvement, in my opinion, to acquire high-quality knowledge, skills and technologies from foreign banks it is better to acquire their knowledge and technological progress not by letting their banks enter the country at this stage, but rather by training and educating the workforce. In light of the above perspectives and related investigations on the shift of foreign banks to certain emerging countries or even central wage status countries, and furthermore given Ethiopia's new rise in the provincial and even global economy, I strongly suggest that The Ethiopian government should maintain the current existing banking and monetary approach, especially in countering what happens to foreign banks in Ethiopia. This arrangement must remain so until the new private banks reach a certain level of quality and aggressiveness and until the modern Ethiopian base shows a surprising phase of improvement. Allowing market forces to determine interest rates and the value of the Ethiopian Birr (ETB) The authors agree and encourage this idea. I also embrace and support their idea for the following reason: eliminating government interference at all times in the banking sector is critical to the efficient mobilization of savings and allocation of deposits to profitable businesses. Examples of government interference that has disrupted the banking sector include the following: First, the savings deposit rate is set by the National Bank of Ethiopia. Until 2 December 2010 the deposit rate was 4%. Since the inflation rate has averaged 19% over the last 5 years, the negative real savings rate has been 15%. Although the National Bank of Ethiopia increased the deposit rate from 4% to 5% starting December 2, 2010, and due to the increase in the exchange rate, it became 7% compared to 2017, this move did not led to a higher level of savings. This would be avoidable if all interest rates could be determined by the market. As a result, Ethiopia's savings rate in 2009, according to the World Bank, was 2.3 percent of gross domestic product, hardly comparable to the 25.7 percent rate achieved by Sudan. Second, the government imposed credit ceilings on private banks, thereby reducing the volume of credit. I appreciate this measure because it has contributed significantly to the reduction of the rate.