Ethiopia’s Financial Revolution: Key Takeaways from Capital Market Summit 2024
The Capital Market Summit 2024 (#CMS2024) marked a turning point in Ethiopia’s financial landscape, bringing together experts, government officials, and investors to discuss the future of the country’s capital markets. Governor Mamo Mihretu highlighted the imminent launch of the Ethiopian Securities Exchange (ESX), which will provide crucial long-term financing for businesses and savings opportunities for individuals. Discussions focused on regulatory frameworks, technological advancements, and market development, with Hana Tehelku of ECMA sharing key updates, including Sharia-compliant products and new directives to enhance market transparency and integrity. Dr. Tilahun Kassahun emphasized learning from Kenya’s successful debt market, and Dr. Brook Taye discussed plans to list more companies on the ESX.
The summit also addressed the need for investor education, with Michael Habte (ESX) announcing the launch of an academy to bridge talent gaps and raise awareness. Key directives were introduced, including those on public offerings and recognizing Self-Regulatory Organizations (SROs), which will help ensure a fair and transparent market. Panel discussions underscored the growing opportunities for startups, particularly with increased access to funding, while stressing the importance of a stable policy environment. With a focus on education, regulatory reforms, and innovation, Ethiopia is poised for significant economic growth. Read more about the summit
Ethio Telecom Partners with Bishoftu for Smart City Project
Ethio Telecom has partnered with the Bishoftu city administration to launch a transformative Smart City project. The initiative will develop advanced digital infrastructure, including cloud services, a call center, data center, ultra-high-speed internet, and optical fiber.
The project aims to modernize key sectors like education, health, agriculture, transportation, and municipal services, while enhancing tax collection and ensuring a safer, more secure city.
Ethiopia Launches Modern Interbank Trading Platform
Ethiopia’s new ESX Interbank Trading Platform transforms the financial sector by enabling real-time interbank transactions and enhancing liquidity management. Supported by the National Bank of Ethiopia’s regulatory framework, it strengthens debt markets, improves Treasury Bill pricing, and fosters predictable credit access for businesses. This milestone aligns with the nation’s financial reforms, boosting investor confidence and driving economic growth, marking a significant step toward global market integration and a modernized economy. Read the full article by Michael Habte, COO of ESX on Capital Ethiopia
IMF Commends Ethiopia’s Economic Reforms, Revises Inflation Forecast
The IMF praised Ethiopia’s macroeconomic reforms, highlighting progress in controlling inflation and transitioning to a flexible exchange rate system. Inflation forecasts for 2024/25 were revised from 30.1% to 25%, with projections for single-digit inflation by 2028/29. Key reforms include enhancing the Treasury Bill market, increasing foreign exchange reserves to $3.6 billion, and adopting an interest rate-based monetary policy. While challenges like slower foreign exchange supply and undersubscribed T-bill auctions persist, measures to boost banking sector participation and improve market transparency are underway. These reforms aim to stabilize the economy, enhance monetary policy transmission, and strengthen Ethiopia’s financial market. Capital Ethiopia
KEFI Gold Offers $30M Investment Opportunity to Ethiopians
UK-based KEFI Gold and Copper PLC has invited Ethiopian investors to participate in its $500 million Tulu Kapi Gold Mines project by offering a $30 million investment opportunity. With $470 million already conditionally secured from international banks, contractors, and Ethiopian government entities, this initiative aims to promote local ownership and economic inclusivity. The project, expected to begin exports by 2025, will generate $300 million annually in gold and silver exports and create up to 10,000 jobs. KEFI predicts that by 2027, gold exports could surpass coffee, establishing Ethiopia as a leading African gold producer. 2Merkato
NBE Governor Defends Banking Reforms and Foreign Bank Entry
Governor Mamo Mihretu defended proposed amendments to Ethiopia’s banking and NBE establishment proclamations, addressing concerns over government borrowing and foreign bank entry. The reforms include capping government overdrafts at 15% of average revenue over three years, supported by IMF-backed measures to stabilize the economy and improve fiscal discipline.
Key provisions allow partial or full foreign acquisition of domestic banks under strict conditions, sparking debate over local versus foreign advantages. Critics raised concerns about foreign ownership limits and lack of opportunities for Ethiopian banks to expand abroad.
Mamo emphasized that opening the banking sector will boost competition, improve credit access, and modernize local banks without fully deregulating the financial system. He stressed reforms to strengthen tax collection and diversify government funding sources as vital for economic stability and growth. The Reporter
Hibret Insurance Reports Record Growth Amid Industry Challenges
Hibret Insurance marked its 30th anniversary with robust performance, reporting premium revenue of 1.96 billion birr for the fiscal year ending June 30, 2024—a significant rise from 507 million birr the previous year.
During its 30th shareholders’ meeting on November 8, 2024, Board Chairman Wondwossen Teshome highlighted the company’s resilience despite industry-wide challenges like unethical practices and regulatory pressures, celebrating a successful year. Capital Ethiopia
EthSwitch: P2P Transactions Hit 270.7 Billion Birr, Doubling ATM Values
EthSwitch announced that interoperable peer-to-peer (P2P) transactions in the 2023/24 fiscal year reached 49.69 million, totaling 270.7 billion birr—a 251% increase from the previous year—overtaking ATM transactions in value. While ATM usage remained higher in volume at 94.5 million transactions, their total value stood at 123.2 billion birr.
Despite challenges, including disputes with tax authorities, EthSwitch reported significant growth, increasing its assets to 3.45 billion birr, netting 789 million birr in profit, and achieving revenue growth of 86% to 1.13 billion birr. CEO Yilebes Addis emphasized the company’s commitment to expanding financial inclusion and maintaining low transaction fees to boost digital financial adoption nationwide. Shega Media
Wegagen Bank Reports Historic Profits and Strong Growth
Wegagen Bank has posted impressive results for the 2023/24 financial year, with a 22% increase in total deposits, reaching 52.1 billion birr. The bank’s Earnings Per Share (EPS) surged by 14.2% to 36.89 birr. Despite economic challenges, total income rose by 40% to 9.8 billion birr, and gross profits hit a historic high of 2.2 billion birr, an 86% increase. Wegagen also expanded its digital services, launching the Efoyta lending platform for MSMEs and a prepaid Visa card for international payments. The bank’s assets grew by 22.9%, reaching 65.7 billion birr. Shega Media
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