Ethiopia's Economic Transformation Setting Tone for Progressive Capital Markets: FSD Africa Specialist

Addis Ababa, December 16, 2025 (ENA) —Ethiopia's ongoing economic transformation and reforms are setting the tone for progressive financial and capital markets, according to Cecilia Bjerborn Murai, Sustainable Finance Principal Specialist at the Financial Sector Deepening (FSD) Africa.

In an exclusive interview with ENA, the Principal Specialist noted that the economic transformation and reforms in Ethiopia establish the tone for progressive financial markets. 

“The economic transformation and reforms in Ethiopia really set the tone for progressive financial and capital markets that can attract both African institutional capital as well as international capital,” she stated.

Recall that the country has been carrying out continued endeavors to create a more favorable business climate through significant government initiatives and economic reforms.

As global and continental investors are increasingly looking for sustainable oriented investment opportunities, there are massive amounts of capital available for such projects and sectors, Murai elaborated.  

The country’s initiatives in ensuring a favorable business climate really create opportunity for Ethiopia to attract that kind of capital, she added.

Ethiopia is actively pursuing reforms to create a more favorable business and investment climate through the Homegrown Economic Reform Agenda, involving liberalizing key economic sectors and enhancing the legal framework.

The operationalization of a capital market is a central pillar of the government's economic reform strategy, which is part of its broader Homegrown Economic Reform Agenda.

For the Principal Specialist, operationalizing capital markets is key to attract large, diversified pools of capital and allocate it to where it is needed.

Realizing the capital markets is also pivotal across all economic sectors and different sizes of companies and organizations.

“With the development of different investment products and instruments that different investors can take part in, this creates an efficient allocation of capital, which is critical for real sector economic development.”

Murai said Ethiopia's economic priorities are well aligned with sustainable finance, adding that the priorities in agricultural development, renewable energy, and digital infrastructure are really core to addressing areas of climate change and adaptation.

The comprehensive Homegrown Economic Reform (HGER) program, launched in 2019, is well underway and yielding tangible results across several key sectors, including strong GDP growth, record exports, and increased foreign investment.

Key policy shifts, including the adoption of a market-based foreign exchange system, the implementation of new fiscal and monetary policies, and legal reforms promoting investment, have collectively contributed to the positive results.