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· Ethiopia has announced its plan to create a stock market authority.
· A bill has been drafted to this effect and the authority is expected to come into effect before the end of the year
Ministry of Finance, Ethiopia has announced its plan to create a stock market authority. A bill has been drafted to this effect and the authority is expected to come into effect before the end of the year. Despite being one among the biggest five economies in sub-Saharan Africa and the second-largest by population, Ethiopia doesn’t have a stock market.
After Prime Minister Abiy Ahmed came to power in 2018, the country has pursued economic reforms, opening up several critical sectors like telecommunications. With the onset of economic reforms, private sector players became active and ready to list their companies in the stock exchange. Eyob Tekalign, the state minister for finance, remarked that the ministry was working on building the necessary infrastructure and human skills to introduce a stock market in the country. Setting up a stock market is expected to boost investment by facilitating foreign and diaspora financing as well as significantly raise government revenue in the form of tax.
Both academia and practitioners have been vehemently advocating the issue of exchange market establishment in Ethiopia. Setting up of the mechanism will lead to enhanced applications of modern technology in relation to financial transactions, establishing a system that enables e-commerce, introducing digital financing technologies and commencing capital market.
