Happy Arsenal Fans’ Week 🙂 The week, the streets, and the media were all about Arsenal and if you’re an Arsenal fan, congratulations. Let’s just hope you don’t have to wait another “adult lifetime” for the next trophy.
Anyway, back to this week’s business and economic wrap-up.
Diplomacy & International Relations
EU Lifts Ethiopia Visa Restrictions
The European Union has officially lifted the visa restrictions it imposed on Ethiopia two years ago, citing improved cooperation from the Ethiopian government on migration and citizen readmission processes.
According to the European Commission, Ethiopia has recently strengthened its efforts in identifying citizens residing illegally in Europe, issuing emergency travel documents, and facilitating repatriation operations.
The move is expected to improve Ethiopia-EU diplomatic relations and support smoother legal mobility between the two sides.
Trade, Export Strategy & Market Liberalization
Ethiopia Plans New Export Authority
The Ethiopian government is preparing to establish a dedicated export authority as part of post-election economic reforms aimed at improving the country’s export performance.
The proposed body is expected to streamline oversight currently spread across multiple ministries and focus on boosting competitiveness, market access, and export diversification.
The move comes as Ethiopia targets more than $10 billion in export earnings this fiscal year, driven mainly by gold and coffee exports. Source: Capital Ethiopia
Ethiopia to Open Logistics Sector to Foreign Investors
Ethiopia is preparing to liberalize its logistics sector, allowing foreign companies to enter an industry previously reserved for local operators.
The reform, expected to take effect in the coming budget year, is part of the government’s broader economic liberalization agenda. While officials see the move as a step toward improving efficiency and attracting investment, local logistics firms have raised concerns over increased competition and limited government support for domestic operators.
The sector remains one of Ethiopia’s biggest business bottlenecks, with logistics costs among the highest in the region. Source: Capital Ethiopia
Infrastructure & Regional Investment
Dangote Expands East Africa Energy Push
The Dangote Group and Ethiopian Investment Holdings (EIH) have secured approval to develop major oil and gas pipelines through Djibouti, marking a significant step in East Africa’s energy infrastructure expansion.
The project will connect Ethiopia to international shipping routes through Djibouti, with the first phase focusing on refined oil transport and the second phase targeting natural gas and crude oil exports from Ethiopia’s Somali region.
The agreement further strengthens Aliko Dangote’s growing investments in Ethiopia, including a $4 billion fertilizer and energy complex currently under development.
Digital Economy & Infrastructure
Ethio telecom, AfDB Deepen Partnership on Digital Expansion Financing
Ethio telecom and the African Development Bank (AfDB) are in advanced discussions to strengthen financing and infrastructure cooperation aimed at accelerating Ethiopia’s digital transformation.
In a meeting on May 21, Ethio telecom CEO Frehiwot Tamru and AfDB Vice President Solomon Quaynor reviewed collaboration under Ethio telecom’s “Next Horizon: Digital & Beyond 2028” strategy.
The discussions center on expanding 4G and 5G networks, rural connectivity, cloud infrastructure, AI systems, and green digital technologies. The partnership also supports the growth of Ethio telecom’s digital platforms, including telebirr, Zemen GEBEYA, and znexus, which are widening access to digital finance and e-commerce.
AfDB reaffirmed its support for Ethiopia’s digital infrastructure push, framing it as part of broader efforts toward Africa’s digital integration and inclusive growth.
Macroeconomy, FX & National Statistics
NBE Allocates $500 Million in Latest FX Auction Amid Strong Demand
The National Bank of Ethiopia (NBE) has announced the results of its Special Foreign Exchange Auction held on May 19, 2026, allocating USD 500 million to commercial banks as part of ongoing efforts to stabilize the foreign exchange market.
Total bids reached USD 1.06 billion, more than double the amount offered, reflecting sustained strong demand for foreign currency across the banking sector. A total of 30 banks participated, with 14 securing allocations.
The marginal rate was set at 159.6299 birr per dollar, while the weighted average successful bid stood at 159.9865 birr. The highest accepted bid reached 160.9064 birr, and the lowest was 157.3005 birr.
The auction is part of Ethiopia’s broader FX reform program aimed at improving liquidity and moving toward a more market-oriented exchange rate system.
Ethiopia to Rebase GDP in Major Statistical Overhaul
Ethiopia will adopt a new GDP base year by September 2026, a move expected to significantly reshape how the size and structure of the economy is measured.
The Ministry of Planning and Development announced that the country will shift to the 2017 Ethiopian calendar year (2024/25) as the new benchmark for national accounts, replacing the current base year used in official statistics.
Officials say the update reflects major structural changes in the economy, where services now account for roughly two-fifths of GDP, followed by industry at about a quarter and agriculture slightly above one-third.
The rebasing is part of a broader Statistical Development Program aimed at improving data quality, integrating federal and regional statistics, and expanding coverage of both formal and informal economic activity.
The reform also includes updated survey systems, digital data collection tools, and improvements to CPI and welfare measurement frameworks, alongside efforts to strengthen administrative datasets.
Government officials say the overhaul is designed to enhance the accuracy and credibility of economic indicators used for planning and policy decisions, as Ethiopia’s economic structure continues to evolve rapidly. Source: Birrmetrics
Banking & Regional Finance
Afreximbank Q1 Profit Rises 25% to $268.9 Million as Exposure Expands to $42 Billion
Afreximbank reported a 25% year-on-year increase in first-quarter profit, supported by stronger lending activity across Africa and the Caribbean.
Net income rose to $268.9 million for the quarter ending March 31, up from $215.4 million a year earlier, while gross income climbed to $874.1 million.
The bank’s total credit exposure reached $42 billion, reflecting continued expansion in trade and infrastructure financing. Average loans increased 8% year-on-year to $32 billion, driving a 24% rise in net interest income to $510 million.
Despite global rate pressures, total interest income rose to $813.6 million. Afreximbank also maintained a strong balance sheet, with a capital adequacy ratio of 23% and non-performing loans at 2.40%.
The bank highlighted continued resilience and expanding regional reach, alongside ongoing initiatives such as its $10 billion Gulf Crisis Response Programme and South Africa’s full ratification of its membership agreement.
Capital Markets & Regulation
ECMA Warns Public Over Unregistered Share Sale by Gezana General Trading
The Ethiopian Capital Market Authority (ECMA) has issued a public warning against an unregistered share offering promoted by Gezana General Trading Joint Stock Company.
According to ECMA, the company has been marketing investment opportunities without regulatory approval, claiming links to planned asset acquisitions including schools, hospitals, financial branches, vehicle dealerships, and other businesses across northern Ethiopia.
The offer reportedly promised investors a 15% dividend for three years, along with additional benefits such as loan access and training opportunities. However, the Authority confirmed that the securities were not registered as required under Ethiopia’s capital market regulations.
ECMA noted that the promotion was widely circulated on social media without authorization, and emphasized that offering unregistered securities is a criminal offense under the country’s capital market law.
An investigation is currently ongoing, and the regulator has urged the public to avoid engaging with the scheme while reinforcing its commitment to investor protection and market oversight.
Deep Dives of the Week
Ethiopia’s Capital Market: A Liquidity Story, Not a Size Story
Ethiopia’s stock market story is often told in dramatic terms: a 50-year delay, a long-awaited exchange, and a late entry into Africa’s capital-market map. But the more important story is quieter—and more structural.
The Ethiopian Securities Exchange (ESX), launched in July 2025, may not become Africa’s largest market by valuation. Instead, its real test is whether it can become one of the most liquid.
That distinction matters more than headlines.
Across Africa, most exchanges struggle not with size, but with thin trading. Many markets sit below 5% turnover velocity, meaning shares rarely change hands and price discovery remains weak. Even relatively developed markets like Nigeria and Kenya have historically faced liquidity ceilings despite strong economic narratives.
Liquidity, not market capitalization, is what determines whether investors can actually enter and exit positions efficiently. Read more
Love in Ethiopia’s Paycheck Economy
This week’s deep dive explores the growing financial pressure behind modern dating in urban Ethiopia. From expensive cafés and social-media-driven relationship expectations to inflation, rent, and stagnant wages, romance is increasingly becoming an economic challenge for young people.
The piece follows the stories of ordinary couples navigating love in a city where a simple date night can consume a significant share of monthly income. It examines how inflation, lifestyle pressure, and performative social media culture are reshaping relationships, delaying marriage, and creating emotional stress across Ethiopia’s urban middle class.
At its core, the article asks a difficult but timely question: can love survive in an economy where affection increasingly comes with a price tag? Read more
From visa diplomacy with Europe to FX reforms, capital market enforcement, and structural economic redesign, Ethiopia’s economic landscape continues to shift across multiple layers at once, policy, markets, infrastructure, and social behavior.
If you feel dizzy from Arsenal’s yesterday celebration, don’t forget to take two to three cup of coffee.
Bye <3
