Ethiopia officially launched a securities exchange on Friday, January 10, 2025, in what officials touted as a milestone in Prime Minister Abiy Ahmed’s drive to open up the country’s tightly controlled economy to private investment.
Just one company, Wegagen Bank, was initially listed on the Ethiopian Security Exchange (ESX), although ESX chief executive Tilahun Kassahun said he expected 90 companies to eventually join.
State-owned telecom Ethio Telecom, which is preparing for an initial public offering, is also widely expected to list shares on the exchange.
Ethiopia, Africa’s second most populous country with around 130 million people, had a securities exchange in the 1960s and 70s, but it was abolished by the socialist military government that overthrew the monarchy in 1974.
It has registered some of the continent’s fastest economic growth rates for years. Abiy’s moves to liberalise the economy since coming to power in 2018 have attracted interest from foreign companies, including Kenya’s Safaricom, which won the country’s first private telecoms licence in 2021.
Prime minister Abiy Ahmed inaugurated and opened the Ethiopian Entrepreneur's Market (ESX).
" This action is a step towards modernizing the financial sector of Ethiopia. ESX creates a market place that is equipped with transparency for the sector. In the second shadow of the country's economic reform, it will open the door for investment-led growth. It has been decided to expand financial inclusion in both government and private sectors, to increase saving and protecting investors." the Prime Minister said.
ESX operates across three market segments. These are also property market, fixed income market and financial market for business institutions, government and other institutions.
The government revealed that More than 100 billion birr movement has taken place in the experimental financial market, adding that the market has shown its capacity to strengthen the financial system of Ethiopia and to raise capital for sustainable development.
" The ESX will create a transparent marketplace for securities trading, enhancing access to long-term financing and driving investment-led growth under the Home-Grown Economic Reform II (HGER II). It aims to improve savings mobilization, corporate governance, and investor protection while fostering financial inclusion for both public and private sectors." Government reiterated.