Ethiopia on Track to Launch Capital Market

Addis Ababa, November 29/2023 (ENA)- Several foreign and domestic investors have been showing keenness to engage in capital market in Ethiopia, according to the Ethiopian Capital Market Authority. 

Ethiopia is on track to launch capital market during the current Ethiopian year with a view to supporting the development of the national economy, Authority Senior Legal Adviser Solomon Zewde disclosed. 

A Capital Market Establishment Proclamation that provides the legal foundation for the development of capital market in the country and to support economic development through increased capital mobilization, financial innovation, and risk sharing in investment was issued  in 2021.

The establishment of capital market is crucial to the economy as it would raise capital from external and domestic sources of finance vital to expediting implementation of development and investment projects.  

Ethiopian Capital Market Authority Senior Legal Adviser, Solomon Zewde told ENA that several foreign and domestic investors have shown keenness to engage in Ethiopia’s capital market.  

He said that the authority is at the final phase of preparations to kick off the operation of the country’s capital market. 

According to him, five public enterprises have been making preparations to take part in the market while companies from Kenya, Nigeria and South Africa are interested to participate too. 

The government has established an institution and appointed leaders as part of efforts being carried out over the last years to kick off the first ever capital market in the country.

Various activities have been carried out, including the issuance of directives and awareness creation efforts, identification of participating enterprises, the adviser stated, pointing out that a legal framework has been drafted and will soon be functional to administrate individuals and companies in the capital market.       

The senior legal adviser further noted that directives are developed with a view to issuing licenses to entities that render services in capital market in 15 sectors, including capital market operators, investment banks, agent administrators, and managers of joint investment banks.  

Capital market would be instrumental in enhancing investment and savings in the country as well as expediting digital marketing in Ethiopia.