Good morning!
Markets may be calming, but uncertainty still lingers. From the Strait of Hormuz to coffee prices and reform talks, Ethiopia’s economy is moving in step with global shifts, where headlines abroad quickly become realities at home.
Now grab your buna. Let’s get into it.
Continuing Story: The Strait of Hormuz, Open, Blocked, or Something in Between?
The most consequential story for global markets and for Ethiopia’s fuel and commodity costs, remains the standoff over the Strait of Hormuz. Here’s where things landed this week.
Iran says the strait is open. The US says the blockade stays. Ships aren’t sure who to believe.
Iran declared that the Strait of Hormuz has “returned to its previous state,” reopening the waterway to commercial shipping and unsealing six airports as part of a partial easing of airspace restrictions during the ceasefire. Iran’s Foreign Minister confirmed unrestricted passage for all commercial vessels. Oil markets responded fast, Brent crude dropped from above $98 to around $88 per barrel. US equities rallied: the S&P 500 gained 0.8%, and the Nasdaq and Dow each rose over 1%. European indices in Paris and Frankfurt climbed more than 2%.
But here’s the catch: Washington isn’t backing down. President Trump said the naval blockade will remain in force until negotiations are “100% complete.” Iran, meanwhile, accused the US of “piracy.” And on the water, confusion persists. Many shipping companies are holding back, unwilling to send vessels through until the security picture clears. The ceasefire has brought price relief, but not certainty.
Before the conflict, oil traded below $70. The spike above $119 in March didn’t just hit energy markets, it disrupted fertilizer supply chains (a third of global supply transits the strait), drove up aviation fuel costs, and pushed food prices higher in import-dependent economies. For Ethiopia, which imports nearly all its fuel, every dollar on the barrel matters. The Hormuz situation is not a distant geopolitical headline. It is a direct input cost story.
Guess what, now the Strait is not fully open and not formally closed, it’s in a high-risk, semi-blocked state.
Global Commodity Watch
Global coffee prices slide and Ethiopia is caught in the crosscurrent
The easing of Middle East shipping tensions has had a visible knock-on effect: global coffee prices dropped sharply this week. Arabica fell 2.28% and Robusta declined 2.50%, pushing Arabica to its lowest weekly price in recent sessions.
The price decline isn’t just about geopolitics. Brazil is projected to produce up to 75.9 million bags in the 2026/27 season, a potential record, and the global market is expected to register a surplus of approximately 10 million bags this year. Vietnam’s coffee exports are up 14%, adding further downward pressure on Robusta. Total global output for 2025/26 is forecast to grow 2% to 178.8 million bags.
For Ethiopia, the world’s fifth-largest coffee producer, falling prices are a double-edged sword. Export earnings take a near-term hit at a time when foreign exchange is still tight.
The bottom line: Ethiopia’s coffee sector is watching two stories at once, a geopolitical one about shipping lanes, and a supply one about Brazilian harvests. Both are moving fast.
Economy & Reform
Ethiopia, Italy, and the World Bank agree on coordinated budget support framework
Finance Minister Ahmed Shide led trilateral talks with senior Italian and World Bank officials this week, concluding with an agreement on a coordinated budget support framework aimed at strengthening Ethiopia’s macroeconomic reform agenda. The discussions focused on mobilizing timely, predictable financing, aligning aid with national development priorities, and reinforcing fiscal discipline.
All three parties agreed that well-coordinated development partner support is essential for sustaining reform momentum in a challenging global economic environment. Italy reaffirmed its commitment to deepening bilateral cooperation and aligning with multilateral frameworks. The World Bank confirmed its continued backing and readiness to enhance financial coordination with partners. The meeting concluded with a shared commitment to accelerate progress toward formalizing the partnership framework.
This wasn’t a standalone event. It sits within a rapidly expanding Italy-Ethiopia relationship that now spans debt restructuring (a bilateral deal was signed under the G20 Common Framework in March), a Global Skills Partnership linking Ethiopian vocational training to Italian labor markets, joint nuclear research discussions, a rail infrastructure agreement with COIPA Italia, and the broader Mattei Plan for Africa, which identifies Ethiopia as a priority partner.
Around 150 Italian companies now operate in Ethiopia across key sectors
The deepening government-to-government ties are mirrored on the ground. Roughly 150 Italian companies are active in Ethiopia, spanning construction, infrastructure, agriculture, energy, and manufacturing. Italian firms participated in the inaugural Ethio-Italy Business Forum on Construction, Infrastructure and Urban Engineering earlier this month in Addis Ababa, where Ethiopian officials urged Italian companies to go beyond product supply and embrace technology transfer, public-private partnerships, and innovative financing. Ethiopia cited a $2 billion infrastructure financing gap and called for expertise in corridors, expressways, airport expansion, and mass housing. Source: Birrmetrics
Congo overtakes Ethiopia as sub-Saharan Africa’s fifth-largest economy but context matters
The IMF now projects the Democratic Republic of Congo’s GDP at $123 billion for 2026, edging past Ethiopia’s $122 billion to claim fifth place among sub-Saharan African economies. South Africa, Nigeria, Angola, and Kenya remain ahead.
Congo’s rise is powered by a mining boom, it’s a top global cobalt producer and a major copper source and a strengthening currency. The country raised $1.25 billion through its first international dollar bond this year, signaling growing investor confidence. Ethiopia’s birr, by contrast, has weakened following the 2024 exchange rate liberalization.
But here’s the nuance that the ranking alone doesn’t capture: Ethiopia is expected to grow at 9.2% in 2026 versus Congo’s 5.9%. Ethiopia’s reform program unlocked a $3.4 billion IMF package and significant World Bank support. The ranking shift is largely currency arithmetic and commodity windfalls, not a signal that Ethiopia’s economy is slowing.
EU and AfCFTA sign MoU backed by €1.2 billion under Team Europe Initiative
At an EU-Ethiopia trade forum opening ceremony this week, the European Commission signed a Memorandum of Understanding with the African Continental Free Trade Area Secretariat. The MoU is part of the “Team Europe Initiative,” pooling resources from the EU Commission and eight member states, Denmark, Germany, Ireland, France, the Netherlands, Finland, Portugal, and Sweden, with a total budget of €1.2 billion.
The initiative currently encompasses more than 80 active projects aimed at supporting Africa’s economic integration and translating the AfCFTA agreement into operational reality through financial and technical assistance. For Ethiopia, which hosted the forum and continues positioning itself as a trade and logistics gateway for the Horn of Africa, the timing underscores its growing centrality in continental economic diplomacy.
One in four Ethiopian businesses fail compliance checks amid 2.9 million online registrations
Ethiopia’s Ministry of Trade and Regional Integration delivered more than 2.9 million business registration and licensing services online, reflecting the government’s digital modernization push. But alongside the expansion, enforcement intensified. The ministry inspected over 1.5 million businesses, surpassing its target by 5% and found that roughly 362,000 businesses, about 24%, were operating in violation of licensing conditions or legal requirements. Corrective measures have been taken, and officials signaled further enforcement ahead.
The numbers reveal a two-part story: digital service delivery is scaling impressively, but a significant share of the formal business landscape still operates outside compliance frameworks. Closing that gap is essential, not just for regulatory credibility, but for building the kind of business environment that sustains foreign investor confidence as the capital market matures.
Free trade zone importers granted income tax exemption
The Ministry of Finance issued a directive granting income tax exemptions to investors operating in free trade zones on earnings from imported goods they sell. The decision, grounded in Council of Ministers Regulation No. 586/2018, is aimed at strengthening import-focused investors within the zones, entities the government views as critical to maintaining stable input supply and preventing production disruptions for manufacturers and service providers operating in the same zones.
The directive has been sent to the Ministry of Revenue, the Ethiopian Investment Commission, and the Industrial Parks Development Corporation for immediate implementation. It’s the latest in a series of incremental moves to refine Ethiopia’s investment incentive framework and improve supply chain efficiency within its industrial zones.
Business & Tech
Wildberries appoints country manager, picks Ethiopia for first African market
Russia’s largest e-commerce platform, Wildberries, appointed Biruk Genene as its country manager for Ethiopia, the company’s first expansion into Africa. Biruk transitions from beU Delivery, where he spent over four years leading business development, marketing, partnerships, and go-to-market execution, working across sales, logistics, and customer operations.
Wildberries operates at massive scale globally, processing tens of millions of daily orders, working with over one million sellers, and reporting $73.3 billion in gross merchandise value in 2025. Its pitch to Ethiopian merchants: access a global marketplace without needing to build independent logistics, payment, or marketing infrastructure. The company has already begun onboarding local sellers through introductory sessions.
The challenge is real. Ethiopia’s e-commerce landscape is fragmented, cash-heavy, and largely informal, most online commerce activity still flows through social media channels. Success won’t come from replicating the Eurasian playbook. It will depend on adapting to local realities around payments, last-mile logistics, and buyer-seller trust. Industry observers say the structural opportunity exists, but execution in a market where foundational digital systems are still evolving will be the defining test.
Aviation & Transport
Ethiopian Airlines restarts Tel Aviv flights after weeks-long suspension
Ethiopian Airlines resumed passenger flights between Addis Ababa and Tel Aviv on April 16, returning to a route suspended since February 28 due to regional security concerns tied to the Iran conflict. The airline is operating two daily flights and is among roughly nine international carriers that have resumed or are preparing to resume Tel Aviv operations following the ceasefire.
Other airlines returning include Etihad Airways (two daily Abu Dhabi–Tel Aviv flights), Bluebird Airways, TUS Airways, flydubai, HiSky, and Georgian Airways. Hainan Airlines and Red Wings Airlines are also expected to restart services. However, the EU Aviation Safety Agency extended its advisory against flying over parts of the Middle East, including Israel, until April 24, and European carriers are unlikely to resume before late April at the earliest.
For Ethiopian Airlines, Africa’s largest carrier by passengers and fleet size, the Gulf and Middle East corridor is a critical revenue artery, serving diaspora labor mobility, business travel, and the transit passenger model that makes Addis Ababa a continental hub. The resumption is a positive step.
Capital Market Spotlight
Call for Applications: SIE Exam Sponsorship Opportunity
The Ethiopian Capital Market Authority, in collaboration with the Indiana Project and Timar Ethiopia, has opened applications for a sponsored program designed to prepare candidates for the Securities Industry Essentials (SIE) Certification.
The SIE exam, administered by the Financial Industry Regulatory Authority (FINRA), is a globally recognized entry-level certification providing a foundation in the securities industry. The program is open to junior professionals with 1–2 years of work experience, university students with a strong interest in capital markets, and individuals who demonstrate commitment to learning and professional development.
Interested candidates can apply through the official link: Apply Here
As Ethiopia’s capital market moves from framework-building to operational reality, initiatives like this are laying the human capital groundwork. The market needs not just institutions and regulations, but a pipeline of professionals who understand how securities markets actually work. This is a step in that direction.
That’s your Monday Breakfast Stories for this week. The threads connecting the Strait of Hormuz to Ethiopian coffee prices, Italian boardrooms to Addis Ababa reform talks, and Russian e-commerce to Ethiopian merchants are all part of the same picture, an economy that’s increasingly plugged into global flows, for better and for exposure. Keep your coffee strong and your tabs open.
See you next Monday. ☕
