Ethiopia’s Council of Ministers has approved a bilateral agreement with the Federal Republic of Nigeria on the issuance of diplomatic and service visas. The decision was made during the Council’s 48th regular session on July 4, 2025.

The agreement facilitates the streamlined issuance of visas for officials and diplomats traveling between the two countries, reflecting a commitment to removing procedural barriers that often hinder smooth diplomatic interactions. By easing visa formalities, Ethiopia and Nigeria aim to foster closer political, economic, and cultural ties.

Alongside this diplomatic milestone,  the Council endorsed two foreign loan agreements totaling approximately $486 million USD (equivalent to 285.4 million Special Drawing Rights (SDRs)). One loan is directed toward financing Ethiopia’s second Sustainable Development Policy, while the other is allocated to road sector development. Both agreements come with a 0.75% service charge and a six-year grace period, although the financing institutions have not yet been disclosed.

In legislative matters, the Cabinet also greenlit reforms to the Income Tax Proclamation, designed to modernize Ethiopia’s tax system and better align it with evolving domestic and global economic realities. The revised law is slated for submission to the House of Peoples’ Representatives for further consideration.

Awash Insurance S.C. has registered a record Gross Written Premium (GWP) exceeding ETB 4.5 billion for the 2024/25 fiscal year, reflecting a 44% year-on-year growth, underpinned by strong underwriting discipline, expanded distribution channels, and enhanced customer retention initiatives, the company said in an official statement.

In the Life Assurance segment, Awash Insurance generated over ETB 656 million, posting an impressive 48% increase compared to the previous year. Plus, through its Sharia-compliant Takaful window—Salaam Takaful, the company mobilized over ETB 150 million in contributions, realizing an 120% growth rate.

Taken together, Awash Insurance achieved a consolidated premium growth of 46% across all business lines. This historic performance showcases Awash Insurance’s ability to generate strong and diversified premium growth across its core portfolios.

The Board of Directors praised these remarkable achievements and highlighted the impressive results attained despite numerous challenges. Tadese Gemeda, the chairman of the Board, acknowledged the company’s exceptional performance across all business lines. He congratulated the employees and management, expressing his gratitude to the board, management, staff, and stakeholders for their invaluable contributions.

The Ministry of Finance has signed a series of major project agreements with various private developers under Ethiopia’s growing public-private partnership (PPP) framework. The signing ceremony, held at the Ministry’s conference hall, marks a new chapter in the government’s effort to mobilize private capital for national development.

Finance Minister Ahmed Shide highlighted that the legal and institutional framework now in place enables effective implementation of PPP projects. He stressed that the agreements signed will have “a significant impact on the economic and social development of the country.”

Seven new projects spanning housing, tourism, health, and diagnostics were formalized during the event. These include: Partial Forest Housing Development Projects in lmi Kura Sub-City:

Lot A1 Plot 4 and 7: ICE Home Development and Construction PLC will build a G+6 shopping mall and 1,200 residential units on 5.7 hectares, with a total investment of 32.37 billion birr.

Lot A1 Plot 12: OVID Chaka Housing Development PLC will construct two shopping malls and 1,852 homes across 9.45 hectares at a cost of 23.06 billion birr.

Additional Plot: The Ethiopian Construction Works Corporation, in collaboration with private investors, will develop 1,123 homes and 48 shops on 9.45 hectares for 11.7 billion birr.

Teyt Bet Housing Project in Arada Sub-City: OVID Kings Tower PLC will develop 1,823 housing units and a shopping center on 4.5 hectares for 4.31 billion birr.

Tourism Projects: Awash Waterfall Resort: Boston Partners PLC will build 50 luxury villas and related infrastructure on 11.6 hectares in Awash Park, investing 813.51 million birr.

Denbi Lake Lodge: MIDROC Investment Group will construct 15 bungalows, a restaurant, and amenities on 36.67 hectares for 125.89 million birr. Integrated Diagnostic Services Center: Aimed at boosting healthcare access, this $5.2 million initiative will provide laboratory and imaging services across six hospitals, including St. Peter’s Specialized Hospital. It will be executed by a consortium of Ceraba Lancet Africa, International Clinical Laboratories, and Pioneer Diagnostic Center.

The government has identified 34 projects across energy, transport, health, housing, logistics, and tourism as suitable for PPP implementation. These projects are at different stages, with selected developers expected to secure financing through loans and equity investments.

As part of this framework, on August 17, 2024, Ethiopia signed a power purchase and operation agreement with AMEA Power Aysha Wind One PLC for the USD620 million Aysha-1 Wind Power Project. The 300 MW project will be implemented under the MGA (Management Grant Agreement) model.

The Ministry’s Economic Development Department will continue to coordinate with stakeholders to ensure all PPP projects meet environmental and regulatory prerequisites. Future projects will also be screened and supported under this expanding development framework.

The House of Peoples’ Representatives has unanimously voted to repeal the outdated Foreign Employment Affairs Proclamation No. 923/2024 and replace it with Proclamation No. 1389/2025 during its 41st regular session held yesterday.

Presenting the resolution to parliament, Dr. Negeri Lencho, Chair of the Standing Committee on Human Resource Development, Employment, and Technology Affairs highlighted that the previous law contained segmented clauses restricting categories of overseas work, including domestic service, unskilled labor, and partially foreign-educated roles, which hindered citizens’ ability to access timely and efficient overseas employment. 

The revised law clarifies that it will prevent illegal foreign work permits, enable a modern centralized work permit agency, protect the rights and security of citizens working abroad, and require sending agencies to deposit standby funds, all to safeguard citizens. 

This will provide a streamlined pathway for overseas work, emphasizing professional and technical skills, and supporting individuals with varied vocational backgrounds, including those lacking formal credentials or having non-traditional experience. 

Minister Muferihat Kamil of Labor and Skills contrasted the changes, noting the repeal will eliminate previous restrictions and promote technology-backed professional development aligned with national competitiveness objectives. “Previously marginalized professions and semi-skilled workers faced legal barriers,” noted the Minister, praising the repeal as a victory for legal clarity and equal opportunity. 

Lawmakers noted that the draft proclamation will save citizens from illegal brokers and prevent illegal trafficking. 

The African Development Bank has granted 400,000 dollars to help the country’s two key capital market institutions: the Ethiopian Capital Market Authority (ECMA) and the Ethiopian Securities Exchange (ESX). This support is aimed at giving Ethiopia’s young capital market the tools it needs to grow, attract investment, and ultimately become a meaningful player in the regional financial landscape.

The grant will support ECMA in launching a modern public disclosure platform designed to enhance transparency and ensure that investors, issuers, and stakeholders have timely access to market-relevant information. This system is expected to promote informed decision-making, enable fair price discovery, and foster investor confidence. For the ESX, the grant will enable the introduction of innovative financial instruments, including exchange-traded funds (ETFs), sukuks, and green bonds.

Speaking on the development, Hana Tehelku, Director General of ECMA, called the partnership “a critical step in building a vibrant and resilient Ethiopian capital market.” ESX CEO Tilahun Kassahun noted the importance of transitioning from foundational setup to real market impact, while AfDB’s Financial Sector Development Director Ahmed Attout highlighted Ethiopia’s potential to become a regional financial hub. 

At a recent session in the House of Peoples’ Representatives, Finance Minister Ahmed Shide reaffirmed the government’s firm position that spending must be contained within the country’s revenue capacity. Addressing questions from parliamentarians on the draft federal budget for the 2025/2026 Ethiopian fiscal year, the minister emphasized the need to balance ambitious expenditure plans with realistic revenue projections.

The proposed budget, totaling ETB 1.93 trillion, reflects a significant allocation toward recurrent spending, which accounts for the largest portion of expenditures. Minister Shide explained that while recurrent costs have risen, particularly due to debt servicing and social service obligations such as salaries and essential programs, the government remains committed to maintaining fiscal discipline and gradually improving capital investments.

Lawmakers expressed concern over the growing share of recurrent expenditures relative to capital spending, questioning how this shift might affect Ethiopia’s long-term economic growth and development goals. In response, the minister acknowledged these challenges but stressed that meeting recurrent obligations remains necessary to sustain the government’s functions and social commitments.

During the discussion, the minister also addressed ongoing tax reforms. He highlighted that the government is actively revising tax laws to enhance collection and ensure fairness, but he acknowledged that previous adjustments have already impacted households and businesses, raising legitimate concerns among the public.

Questions about the value-added tax on fuel also surfaced, with some parliamentarians asking whether the VAT diminishes the effect of fuel subsidies intended to ease consumer costs. Ahmed responded that subsidies need to be implemented in a targeted and fiscally sustainable manner, hinting at potential future reviews of subsidy and tax policies.

The National Bank of Ethiopia (NBE) has announced a full transition to electronic government and NBE securities with the issuance of Directive No. MFAD/001/2025, marking a major step in modernizing the country’s financial markets.

The directive designates the Central Securities Depository (CSD) as the sole official registry for all government securities. Electronic records will now serve as the definitive proof of ownership, replacing paper-based certificates in a shift aimed at improving market efficiency, transparency, and reducing risks.

All existing holders of government securities are required to submit their physical certificates to authorized CSD members — including commercial banks and licensed brokers — for conversion into electronic form. Failure to comply by the specified deadline could result in penalties of up to 5% of the bond’s face value.

Each security will be assigned a unique International Securities Identification Number (ISIN) to streamline clearing processes and facilitate global recognition.

The directive also outlines procedures for handling pledged securities, which will be electronically marked to protect the rights of borrowers and lenders. Securities not tendered within five years will be transferred to a special account administered by the Ministry of Finance.

According to the NBE, this reform is part of Ethiopia’s broader financial sector modernization agenda and is aligned with international standards. It is grounded in the legal framework of the National Bank of Ethiopia Proclamation No. 1359/2025 and the Capital Market Proclamation No. 1248/2021.

CSD member institutions are responsible for facilitating the transition, including document verification, electronic conversion, and record-keeping. The NBE has committed to closely monitoring the rollout and providing regular updates through official channels.