Your weekly dose of Ethiopia’s sharpest business, economic, and finance news.
Grab your buna and catch up on what’s moving Ethiopia’s markets and economy this week.
Investment & Economy
Ethiopia Draws $4B in FDI
Ethiopia secured $4 billion in FDI in 2024/25, driven by 544 new investment permits in manufacturing, agriculture, ICT, and import-export trade. Upgrades of 14 industrial parks to Special Economic Zones attracted global investors, generating $666M in exports, while local production substituted $1B of imports. The May “Invest in Ethiopia” forum added $1.6B in commitments, and the EIC’s digitized services plus legal reforms boosted efficiency and investor confidence. Read here
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Tech & Digital Finance
Safaricom Bets on Ethiopia’s Mobile Future
Safaricom, Ethiopia’s first private telecom operator, now serves 10M users and aims for 70M by 2030. Central to its plan is M-Pesa, seeking to move the cash-heavy economy toward digital payments. Expansion from 4,000 to 10,000 base stations will improve coverage and trust, positioning Safaricom to compete with Ethio Telecom’s 83M subscribers and reshape everyday commerce and financial inclusion.
Industry & Trade
Ethiopia Saves $4.5B Through Import Substitution
Local production of 3.2M tons of goods saved Ethiopia $4.5B in 2024/25. Manufacturing operated at 65% capacity, created 352,500 jobs, and earned $318M in exports, mostly textiles, food, leather, and chemicals. Efforts to improve raw material supply and add 14 new export products are central to Ethiopia’s industrial and economic strategy. Read here
Remittances & Finance
Ethiopia Targets $8B in Remittances
The government aims to collect $8B from the diaspora in 2025/26, up from $7.17B last year. Banks like CBE are rolling out incentives and better services to tap the untapped potential of Ethiopians abroad. Remittances remain vital for business growth, investment, and global market access. Read here
Exclusive: KCB Knock
Ethiopia’s banking sector is about to get a shake-up. Kenya Commercial Bank (KCB) Group, East Africa’s largest lender, is poised to enter the market following Ethiopia’s new law allowing up to 40% foreign ownership per bank.
KCB’s digital-first model, mobile lending (KCB M-Pesa), and regional reach could transform financial inclusion, trade finance, and customer experience. For local banks, it’s a wake-up call: faster digital adoption, stronger governance, and expanded services will be key to staying competitive.
Challenges remain: regulatory favoritism, FX allocation, and infrastructure hurdles may slow impact but KCB’s presence signals the start of a new era for Ethiopia’s financial landscape.
Takeaway: One entrant could reset the rules, and the race to modernize banking has officially begun. Read here
Public Sector & Salaries
Civil Servants Get Big Pay Rise
Starting September 2018 E.C., minimum salaries jump from Birr 4,760 → 6,000, fresh graduates start at Birr 11,500, and top salaries rise to Birr 39,000. While boosting morale, the increase adds Birr 160B to the budget, pushing the annual civil service bill to Birr 560B, a relief for workers but a stress test for public finances. Read here
Tax & Revenue
VAT Reform: Ethiopia Sticks to 15%
The 2017 VAT reform kept the rate at 15%, prioritizing administration and compliance over rate hikes. With tax revenue below 7% of GDP, the government focused on enforcement gaps, exempting essentials like grains and vegetables to protect low-income households. The reform modernized tax collection, expanded the base, and strengthened development financing. Read here
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EIH Performance Dialogue: Big Wins Across Sectors
The latest rounds of Ethiopian Investment Holdings’ (EIH) annual dialogue showcased broad gains across industries, from shipping to airlines:
🚢 Shipping & Sugar – Ethiopian Shipping & Logistics earned 57.1B birr revenue, 8.8B profit, and moved 7.7M tons of cargo, injecting $421M FX; six new bulk carriers are planned. The Sugar Industry Group increased output 35% to 163K tons and revenue 92% to 15.6B birr, though efficiency gaps remain.
🏨 Hotels & Power – Hotels like Ghion and Genet grew revenue 12% and ~10%, with Hilton Addis maintaining its premium position. Ethiopian Electric Utility revenue rose 21% to 63B birr, adding 500K+ new customers.
⚙️ Engineering – Ethiopian Engineering Corp. surged 81% to 8.9B birr, winning contracts in Nigeria and Tanzania. EIH emphasized efficiency, reforms, and sustainable growth.
🎟️ Lotteries & Liquor – Ethiopian Lottery Service doubled revenue (+96%) and tripled profit (+193%), while National Alcohol & Liquor Factory reached ETB 2.6B revenue (+8%).
🛍️ Tourism & Trade – Ethiopian Tourist Trading Enterprise achieved +45% revenue growth and a 1,200% profit jump, with duty-free sales topping USD 8.5M.
🏦 Banking & Finance – Development Bank of Ethiopia grew revenue 31% and exceeded loan collection targets. Commercial Bank of Ethiopia added 3.4M new accounts, deposits hit ETB 1.67T, with most lending to the private sector.
📡 Telecom & Tech – Ethio Telecom revenue surged 72%, customer base reached 83M, while Telebirr processed ETB 2.38T in transactions.
💉 Health & Energy – National Veterinary Institute produced 250M vaccine doses, exporting to six African countries. Petroleum Supply Enterprise ensured fuel security while digitizing payments.
🚄 Transport & Industry – Railways Corp restarted stalled projects but faces heavy debt. Paper & Pulp S.C. focused on recovery and productivity. Ethiopian Airlines soared with USD 7.6B revenue (+8%) and 37% profit growth, cementing its global leadership.
Stay tuned for next week’s insights, where we unpack more sectoral trends and policy moves shaping Ethiopia’s future.
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Stay curious, stay caffeinated, — Written by the StockMarket.et Newsroom
