Good morning! Pour the buna. 

This week’s number is 660 million. That is how many dollars Ethiopia, Djibouti and Aliko Dangote say they will spend on a fuel pipeline and storage link between the port and the highlands. The foundation stone went down on Thursday.

Hold that thought, because the whole week was about pipes. Some were made of steel. Most were made of rules. The capital market regulator finished the legal pipe that lets ordinary savers pool their money into funds, and opened a second one for crowdfunding. The central bank blocked a leak in how banks compete for deposits. The commodity exchange added one more bank to the pipe that turns stored grain into loans. And one pipe got cut: flights to three cities in Tigray.

Capital Market

Mutual funds, ETFs and REITs finally have a legal home

The Ministry of Justice registered the Ethiopian Capital Market Authority’s Collective Investment Schemes Directive (No. 1150/2026) on Wednesday. It sets the rules for pooled funds: money market funds, mutual funds, real estate funds, exchange-traded funds, alternative investment funds and special designation funds. Six types in all.

The basics are simple. No fund can be sold to the public until ECMA registers it. Fund money must sit with an independent custodian, separate from the company running the fund, so investors are protected if the manager misbehaves or goes bust. Registered funds have to keep reporting. ECMA Director General Hana Tehelku said the aim is to move Ethiopians’ savings into productive investment under professional management.

This is the most important rule the market has received since trading opened. Right now, if you want to own Ethiopian shares, you have to pick them yourself, open an account with a trading firm and watch the screen. A fund lets a teacher put in a small amount and own a slice of everything. The directive is the pipe. The water is still missing: someone has to register the first fund, and the market needs custodians with real capacity. Watch who files first.

Crowdfunding rules are out for comment

ECMA has also published a draft Crowdfunding Directive, which will govern how companies raise money from many small investors through online platforms. Anyone can send written comments to crowdfundingfeedback@ecma.gov.et until October 14. A public hearing follows on October 15 at 8:30 AM, Skylight Hotel, Abay 3 Hall. The draft is on ecma.gov.et, and the official record on it can be collected from ECMA’s head office on the 15th floor of the Minaye Corporate Building in Kirkos.

For startups, this is the rule that matters more than the stock exchange. Most young Ethiopian companies will never be big enough to list, and banks won’t lend to them without a house as collateral. If you run a startup, an angel network or a platform, read the draft and turn up on the 15th. Rules written without the people who have to live under them tend to show it.

Awash Bank wakes up the exchange

Trading on the Ethiopian Securities Exchange jumped more than fivefold on Wednesday, to about 22,014 shares from 4,009 the day before. Awash Bank did most of the work: 16,522 of its shares changed hands, nearly 17 times the previous session and about three quarters of the day’s volume. It pushed Ethio Telecom out of the top spot. Awash closed at 2,250 birr, up 1.41%, its second gain in a row.

The rest of the board was quiet. Ethio Telecom fell 1.75% to 440 birr, Wegagen slipped 1.84% to 1,180 birr, Bank of Abyssinia eased to 1,730 birr, Abay Bank rose 1.2% to 1,395 birr on just 40 shares, and Gadaa Bank did not trade at all.

One busy day in one stock is not a trend. But it shows how thin this market still is: a single buyer or seller in one bank can move the whole exchange’s numbers. That is exactly the problem funds are meant to fix.

Banking and FX

No more paying interest before it’s earned

The National Bank of Ethiopia has ordered banks to stop paying deposit interest upfront. Some banks had been crediting interest on the first day of a fixed-term deposit and adding it to the principal, so the balance looked bigger long before the money had earned anything. Vice Governor Solomon Desta said the practice distorts the market and invites misuse of public funds. He did not name the banks. The ban takes effect immediately, and banks that ignore it face enforcement.

The Ethiopian Bankers Association expects little impact, saying upfront interest is a small part of how banks win depositors. Time deposits, the category involved, were 251.7 billion birr at the end of 2024/25, just 7.2% of the system’s 3.5 trillion birr in deposits.

29th FX auction: short again, but closer

The NBE offered USD 125 million at Wednesday’s auction. Banks bid USD 123.49 million, leaving it undersubscribed by USD 1.51 million, about 1.2%. That is a smaller gap than the USD 5 million shortfall two weeks ago. All 27 banks took part, up from 20, and all were successful. The weighted average rate came in at 160.23 birr per dollar, slightly stronger for the birr than last time.

More banks came, but each asked for less: about USD 4.6 million on average, down from USD 6 million.

Analysts have blamed the shortfalls on banks being short of birr, not on a sudden fall in demand for dollars. This result fits that story. One more auction should tell us whether birr liquidity is coming back or demand has simply settled lower.

Gadaa Bank passes one billion

Gadaa Bank made a pre-tax profit of 1.05 billion birr in 2025/26, up from 444 million birr, an increase of about 136%. Total assets grew 64% to 16.5 billion birr, deposits rose 65%, and the bank now has more than one million customers, three and a half years after opening. Interest-free banking brought in 56% of its income. Shareholders agreed to turn the year’s profit into capital instead of paying it out.

Dangote’s East African Map

A fuel pipeline from Djibouti

Prime Minister Abiy Ahmed, Djibouti’s President Ismail Omar Guelleh and Aliko Dangote laid the foundation stone on Thursday for a USD 660 million petroleum project. Ethiopian Investment Holdings (EIH), Dangote Industries and Djibouti’s Great Horn Investment Holding signed the agreement. The plan links fuel receiving and storage in Djibouti to a pipeline, storage and delivery system inside Ethiopia, with completion targeted in under two years.

Today, most of Ethiopia’s imported fuel travels up from Djibouti by road tanker. EIH says a pipeline would make supply more reliable and cut transport costs. It is EIH’s second big deal with Dangote, after the USD 2.5 billion fertilizer plant planned in Gode.

And a refinery in Lamu

Next door, Kenya breaks ground on September 30 on a USD 17 billion Dangote-backed refinery in Lamu. It is designed to process up to 700,000 barrels a day for Kenya, Uganda, Tanzania, Rwanda, South Sudan and the DRC. About 70% will be financed with debt. Dangote has offered East African governments a combined 30% stake, worth about USD 1.5 billion. Kenya is considering 10%, and Ethiopia and Rwanda have said they are interested. The catch: Kenya doesn’t produce crude oil commercially yet, so the refinery depends on oil from South Sudan, Uganda and Kenya’s own future output. Completion is targeted for around 2030.

Trade and Agriculture

Almost a year into AfCFTA: USD 23.6 million

Ethiopia’s exports under the African Continental Free Trade Area reached USD 23.6 million by August 2026, less than a year after the country started exporting under the agreement last October, Trade Minister Kassahun Gofe (PhD) told a forum in Addis Ababa. The forum approved a new step-by-step guide for trading goods under AfCFTA and an online trade information portal. The guide will be translated into Amharic and other Ethiopian languages, and the portal will be filled with content before its launch.

The minister named the main obstacles himself: too few products to sell, weak private sector capacity, and trade information that is hard to find.

USD 23.6 million is a start, and a small one against the several billion dollars in goods Ethiopia exports every year. A portal helps if traders can actually use it. The ECCSA Secretary General put it well: the test is whether a trader can go from reading the guide to completing a sale.

ECX adds a 14th bank to grain-backed lending

The Ethiopian Commodity Exchange signed Ahadu Bank as the 14th lender in its warehouse-receipt financing system. Farmers, cooperatives and processors store their crop in an ECX warehouse, get a receipt, and use that receipt as collateral for a bank loan. ECX says the system has moved more than 3 billion birr in credit through 13 banks over three years.

That’s about 1 billion birr a year, which is tiny for a farm economy this size. But the idea is right: it lets a farmer borrow against his harvest instead of selling it cheaply the week it comes in. More banks in the network means more competition for that borrower.

Aviation

Flights to Mekelle, Axum and Shire suspended

Ethiopian Airlines suspended flights to Mekelle, Axum and Shire from Wednesday, citing the current situation in Tigray. It gave no date for resumption and no details on arrangements for passengers. The move follows the announcement on Sunday of an alliance of seven armed groups, including the TPLF, seeking to remove the federal government, and reports of recent clashes. It is the second suspension this year, after a short halt in late January.

🎧 On our new youtube series

Capital Market Service Providers: Who Does What?

In this series, we break down the different types of Capital Market Service Providers and explain their specific roles in Ethiopia’s capital market, from facilitating transactions to supporting investors and issuers.

Part 1: Understanding the players behind the capital market.

Watch here:  

Pipes are boring until you don’t have them. This week Ethiopia got a legal pipe for funds, a draft pipe for crowdfunding, one more bank in the pipe from grain to credit, and a stone laid for a real pipe from the sea. The water still has to flow. A fund needs its first investor, a pipeline needs two years of building, and a flight route needs peace.

See you next Monday ☕