Ethiopia has commenced the sale of shares to finance the establishment of its first-ever securities exchange as part of Prime Minister Abiy Ahmed's efforts to modernize the country's economy.
The sale began in the country's capital Addis Ababa on Tuesday, with the goal of mobilizing 75 percent of the required funding, according to Michael Habte, who is in charge of the Ethiopia Securities Exchange (ESX) project.
Ethiopian Investment Holdings, the nation's sovereign wealth fund, will hold the remaining 25 percent of the shares. The government expects local banks and insurance companies to invest, and the exchange will be fully operational by 2024, with at least five state-owned enterprises listed soon after.
The ESX shares are available to both domestic and global investors, but the amount of money being raised was not disclosed.
According to the International Monetary Fund (IMF), Ethiopia's economy is expected to witness the most remarkable growth in the African continent this year. The country's GDP is projected to expand 5.3 percent to $126.2 billion, surpassing neighboring Kenya.
The Ethiopian government's ambitious economic reform measures, aimed at expanding the nation's external economic activities, are responsible for this growth.
According to the Ten-Year Perspective Development Plan for 2021-2030, Ethiopia has initiated a gradual process of private-sector led liberalization in some sectors, such as logistics and telecommunications, which marks a significant departure from the predominantly state-led development path pursued in recent decades.
According to the Ten-Year Perspective Development Plan for 2021-2030, Ethiopia has initiated a gradual process of private-sector led liberalization in some sectors, such as logistics and telecommunications, which marks a significant departure from the predominantly state-led development path pursued in recent decades.
The reforms are aimed at to creating a more conducive and inclusive environment for economic policy delivery, ultimately contributing to the long-term reduction of political turbulence and instability.
Furthermore, recently Sri Lanka investors have told the local media about the advantages of carrying out business in Ethiopia and why they want to extend their businesses there. Indochine Apparel, for instance, has reportedly become Ethiopia's largest apparel exporter within three years.
Moreover, according to another businessman, Ethiopia offers sizeable investment prospects and is accessible to all.
"I invite investors expecting to invest in Africa to invest here because Ethiopia is the best place," one of the investors said said.