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.
Tax & Labor | Private Sector Faces Heavy Headwinds
Business Leaders Sound Alarm Over Tax Burden
At the 22nd International Ethiopian Economic Conference, industry voices described the tax environment as a heavy weight dragging businesses down. Dr. Addis Kasahun called it a “war economy” where survival is the daily task. The lack of a clear legal framework for a national living wage was flagged as a major gap in protecting workers, spotlighting issues in the 2019 Labor Act. Source: Capital Ethiopia
Jobs & Inflation: A Puzzling Disconnect
Despite Ethiopia’s 6% GDP growth, unemployment remains high, and inflation steadily erodes worker incomes. Most jobs are informal, offering little to no social protection, Dr. Martha Kibru explained. The Ministry of Labour confirmed a minimum wage study is ready, with a gradual, sector-based rollout planned — alongside new policies aiming to spur private investment and job creation.
Exports & Trade | Ethiopia’s Rising Regional Role
Halal Meat Exports Soar on Gulf Demand
Ethiopia’s halal meat exports jumped 53% in FY2024/25 to $120 million, driven by strong demand from the UAE and Saudi Arabia. Improved livestock breeding and veterinary services have boosted supply, though exporters still face hurdles meeting strict halal certification and upgrading logistics. Source: Addis Insight
Power Sales Expand Across East Africa
Electricity exports generated $118.1 million, primarily to Kenya and Djibouti, with a promising new trial supply to Tanzania. Ethiopian Electric Power exceeded generation targets, producing over 29,000 GWh and cementing Ethiopia’s role as a clean energy hub. Read here
Infrastructure & Finance | Big Bets on Growth
Mega Airport Project Gains Momentum
The African Development Bank will lead efforts to finance Ethiopia’s upcoming mega airport near Bishoftu, projected as Africa’s largest with 100 million passengers annually by 2029. Ethiopian Airlines will cover 20% of the estimated $10 billion cost, aiming to relieve Bole International Airport’s capacity crunch. Source: Reuters
Trade Finance Boost for Exporters
Wegagen Bank secured an $85 million guarantee facility from Afreximbank and TDB, enhancing its ability to support import-export transactions. This deal strengthens regional financial partnerships and aims to close Africa’s massive $80 billion trade finance gap. Read here
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Monetary Policy & FX | Market Reforms Underway
$150M FX Auction Restart Signals Reform Commitment
The National Bank of Ethiopia resumed FX auctions with a $150 million injection, distributing currency to 28 banks at an average rate of 138.26 birr/USD. This move aims to stabilize the market after last year’s birr float and narrow the gap with parallel rates. Read here
Tightening the Grip on Illicit Forex
Following the auction, the Financial Intelligence Service froze 138 bank accounts linked to illegal currency trading, targeting operators accused of fueling the parallel market. NBE Governor Mamo Mihretu vowed legal action and asset seizures, emphasizing a crackdown to reinforce trust in formal channels. Read here
Parallel Market Persists Despite Interventions
Even as official rates adjust, the parallel FX market remains elevated above 160 birr/USD, reflecting lingering trust issues and market gaps. Banks quickly adapted their selling rates, signaling ongoing volatility amid reform progress. Read here
Energy & Industry | Powering Growth & Innovation
Electricity Production Exceeds Expectations
Ethiopian Electric Power generated nearly 30,000 GWh, with the Grand Ethiopian Renaissance Dam providing a third of output. A notable 27% of power served the expanding Bitcoin mining sector, while exports and national grid supply rounded out the balance. Despite impressive revenues, challenges such as infrastructure theft and conflict remain obstacles. Read here
Banking & Inclusion | Financing Ethiopia’s Future
Oromia Cooperative Bank’s Digital Loans Empower Youth
Oromia Cooperative Bank’s Michu platform has disbursed 30 billion birr in collateral-free loans since 2014, mainly supporting youth traders in the informal sector. With tailored products for SMEs and women entrepreneurs, and initiatives digitally linking nearly 600,000 farmers to credit and markets, the bank is advancing financial inclusion through technology. Read here
Ethiopia’s economic journey is a complex blend of encouraging progress and stubborn challenges. As reforms deepen, the focus remains on balancing growth with inclusive job creation, infrastructure development, and financial stability.
Stay tuned for next week’s insights where we unpack more sectoral trends and policy moves shaping Ethiopia’s future.
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— Written by the StockMarket.et Newsroom
