Ethiopia Faces Uncertainty as Governor Mamo Mihretu Stepped Down, Leaving Ethiopia’s Reform Efforts in Limbo

From Addis Ababa: when Mamo Mihretu took the helm of Ethiopia’s central bank in early 2023, he was cast as the technocrat who would steady the country’s fragile economy and steer it through the most ambitious reforms in decades. Just over two years later, his abrupt resignation has reopened questions about the direction of those reforms, the durability of IMF-backed programs and the political will behind Ethiopia’s economic transformation.

Mamo, who had previously served in senior economic advisory and policy roles, announced his departure on September 3, 2025, via social media, writing that his seven years of public service had “run their course.” He added that the vision of building “a modern central bank… fit for purpose” was within reach but offered no indication of his next move.

His resignation comes at a delicate moment. Ethiopia, Africa’s second-most populous country, is grappling with soaring inflation, foreign currency shortages, and a heavy debt burden exacerbated by conflict, drought, and global price shocks. The central bank’s credibility had been seen as pivotal in restoring investor confidence, stabilizing the currency, and unlocking billions of dollars in concessional loans under an IMF-led reform agenda.

Seen as an unfinished project to many Ethiopians, Mamo’s departure feels like the loss of a steady hand at a time of turbulence. He had been central to efforts to modernize monetary policy, strengthen financial supervision and push toward a more market-driven exchange rate. Reforms that are seen as prerequisites for international assistance.

By senior Addis Ababa-based economist – “His leadership gave hope that the central bank could become more independent, more data-driven, and more transparent. Now, with him gone, there is uncertainty about whether those reforms will stall or even reverse.”

Critics, however, argue that Mamo’s tenure fell short of expectations. Inflation remained stubbornly high, eroding household purchasing power. Banks continued to face liquidity challenges, while exporters struggled under currency distortions. Ordinary Ethiopians, already battered by food and fuel price hikes, saw little relief from policies that were often framed in technocratic terms.

Mamo’s resignation also carries political undercurrents. The central bank sits at the intersection of government policy, market pressures, and social expectations. Analysts note that Ethiopia’s ruling Prosperity Party has struggled to balance the urgency of reform with the political risks of austerity measures.

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