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.
Global & Multilateral Affairs
IMF Leadership Transition for Africa
Abebe Aemro Selassie will retire as Director of the IMF’s African Department on May 1, 2026, IMF Managing Director Kristalina Georgieva announced. An Ethiopian national, Abebe has led IMF engagement with 45 Sub-Saharan African countries since 2016, steering the region through major shocks including COVID-19, high inflation, and shifting global trade dynamics.
During his tenure, IMF program support to Africa expanded significantly, assistance to fragile states deepened, and Africa’s voice at the IMF was strengthened with the addition of a 25th Executive Board chair. No successor has yet been named.
U.S. Withdraws from 66 International Organizations
The United States has announced its exit from 66 international organizations following a review under Executive Order 14199. Affected bodies include UNECA (based in Addis Ababa), UNCTAD, UNFPA, UN-Habitat, and major climate institutions such as the UNFCCC and IPCC.
While Washington says it will continue selective engagement, the move may have spillover effects on development finance, technical assistance, and climate support for African economies, including Ethiopia.
Macroeconomy & Public Finance
UN Flags Ethiopia as a High-Risk Borrower
Despite strong growth projections, a new UN report has classified Ethiopia as a high-risk borrower in East Africa. The World Economic Situation and Prospects 2026 forecasts Ethiopia’s economy to grow by 6.3% in 2026, among the strongest performances in the LDC group.
However, debt vulnerabilities persist, driven by high borrowing costs, external shocks, and declining aid flows. The UN stresses that growth alone will not translate into improved living standards without stronger debt management and sustained international support. Source: Birrmetrics
Inflation Cools to Single Digits
Ethiopia’s year-on-year inflation eased to 9.7% in December EFY 2018, down from 17% a year earlier. This marks a notable slowdown after three years of intense price pressures.
Food inflation fell to 9.8%, while non-food inflation stood at 9.6%, influenced by transport, clothing, and communication costs. Expanded CPI coverage to 200 markets has also improved data credibility. Read more
Monetary Policy & Financial Markets
Interest Rate Deregulation Takes Effect
The National Bank of Ethiopia has officially ended centrally administered interest rates under Directive No. NBE/INT/13/2026. Banks can now set deposit and lending rates based on market conditions, subject to board approval and transparency requirements.
Existing contracts remain protected, and interbank lending will move to negotiated rates. The reform marks a decisive shift toward market-based monetary transmission.
FX Auction Clears at Birr 154.87
The NBE’s Foreign Exchange Auction No. 14 cleared at a weighted average rate of Birr 154.87 per US dollar. Thirty-two commercial banks participated. The central bank reaffirmed that FX auctions will continue biweekly as part of broader efforts to improve liquidity, transparency, and price discovery.
Governance & Regulation
Leadership Concentration Raises Governance Questions in Ethiopia’s Capital Market
As Ethiopia builds its formal securities market, concerns are emerging around leadership concentration across regulatory and market institutions. International standards from IOSCO and the OECD emphasize clear separation between rule-making, supervision, and market operation.
While coordination can help early-stage development, excessive overlap risks undermining investor confidence at a critical moment for market credibility. Read more
Taxation & Business Environment
QR-Coded Receipts Now Mandatory
From January 8, sales receipts without authorized QR codes are no longer valid for tax purposes. Handwritten receipts have been withdrawn, and Berhanena Selam Printing Enterprise has been designated as the sole authorized printer.
The reform enables digital verification of transactions and strengthens enforcement against tax evasion. Authorities warn that non-compliance will result in legal action. Source: Birrmetrics
Over 80% of Federal Business Licenses Inactive
More than 470,000 federally registered business licenses became inactive in 2025, leaving just over 100,000 active entities. The decline cuts across all sectors and firm sizes, with micro and small enterprises hit hardest.
The sharp drop raises concerns about job creation and may reflect regulatory changes, macroeconomic stress, tighter credit, or a cleanup of dormant registrations. Source: The Reporter Ethiopia
Infrastructure, Trade & Investment
Ethiopia Launches $12.5bn Mega Airport
Ethiopian Airlines has begun construction of the $12.5 billion Bishoftu International Airport, expected to become Africa’s largest by 2030. The four-runway airport will handle 110 million passengers annually and park up to 270 aircraft.
The airline will finance 30% of the project, with international lenders, including the African Development Bank, covering the rest.
Zenith Bank Eyes Ethiopia
Nigeria’s Zenith Bank is accelerating its pan-African expansion, with Ethiopia emerging as a key target following banking sector liberalization. The lender aims to generate 50% of group profits from foreign subsidiaries, positioning Ethiopia as a strategic growth market due to its size, demographics, and reform momentum.
Carrefour’s Entry Signals Reform in Practice
Carrefour’s franchise entry through MIDROC’s Queens Supermarket marks more than a retail launch, it reflects Ethiopia’s gradual opening of wholesale and retail trade.
While the footprint is still small, Carrefour’s standardized pricing, sourcing, and logistics could reshape supply chains, pressure local players to formalize, and signal that economic liberalization is moving from policy announcements to on-the-ground change.
Stay tuned for next week’s insights, where we unpack more sectoral trends and policy moves shaping Ethiopia’s future.
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