@ECA_OFFICIAL – Ethiopian Business Review

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Ethiopia’s Special Economic Zones (SEZs) have secured nearly USD 900 million in new investments in the current fiscal year alone, a leap that signals the zones are active engines of industrial growth.

As reported by the Ethiopian Press Agency, 89% of all developed land and factory shades in the country’s 13 SEZs have been taken up. Bole Lemi and Adama Industrial Parks have reached full occupancy, while Jimma SEZ stands at 90%.

“This level of uptake shows that previously stagnant areas are now attracting serious investment,” said Zemen Junedi, Deputy CEO of Promotion and Marketing at the Industrial Parks Development Corporation (IPDC), in an interview with The Ethiopian Herald. “Most of the newly registered projects are already operational.”

Zemen attributes the turnaround to a set of government-led legal and regulatory reforms—nearly 80 policy frameworks have been revised. The goal: eliminate red tape and boost investor confidence. The results are visible. Just a few years ago, local investor participation in SEZs stood below 5%. That figure now stands at 60%, with Ethiopian firms operating alongside foreign players in zones across the country.

SEZs have also shifted from being purely export-driven to supporting import substitution, especially in textiles, pharmaceuticals, automotive assembly, logistics, and agro-processing. Parks once seen as underutilized are now actively contributing to employment, technology transfer, and foreign exchange generation.

“Zones that were struggling are now alive with factories, warehouses, and local value chains,” Zemen said.

However, recent reports highlight persistent challenges for workers within these zones. Laborers face wages as low as USD26 per month, among the lowest globally. Poor working conditions, including long hours, inadequate occupational safety, and substandard housing, contribute to high turnover rates—sometimes exceeding 10% monthly. Inflation continues to erode workers’ purchasing power, while weak enforcement of labor laws and limited union influence leave many with little protection or recourse.

Pula Advisors, an international insurtech company, in partnership with Oromia Insurance S.C. and other local partners, has provided agricultural insurance coverage to 700,000 smallholder farmers as of December 2024. Building on this success, the company aims to reach an additional 3 million farmers by the end of the current fiscal year. This scale-up effort brings together a consortium of local insurers, including Abay Insurance S.C., Africa Insurance S.C., Ethiopian Insurance Company (EIC), Nyala Insurance S.C., and Oromia Insurance S.C.

The announcement was made on Wednesday by Pula’s Ethiopia Country Director, Dagmawi Haileyesus, during the UNDP’s Financial Resilience in Agriculture (FRA) Community of Practice (CoP) 2025 high-level international forum, held at the United Nations Economic Commission for Africa (ECA) headquarters in Addis Ababa. The event brought together over 100 participants from 24 countries.

Held under the theme “Ethiopia’s Two-Decade Pilot Journey: Voices from Partners Implementing Agriculture Insurance”, the forum spotlighted Ethiopia’s evolving landscape in agricultural insurance, highlighting policy gaps, challenges, and future directions.

Solomon Zegeye, Director at Nyala Insurance, pointed out that premium affordability remains a major barrier, particularly for smallholder farmers. “Only large-scale producers can afford current rates,” he noted, adding that without strong policy intervention to enable premium financing, the scale-up of agricultural insurance will remain limited.

Other pressing issues include low awareness among smallholder farmers about the value of insurance, limited distribution channels in rural and remote areas, and the absence of robust policy frameworks to support the sector’s growth.

Also speaking at the forum, Belay Tulu, Director of the Insurance Supervision Directorate at the National Bank of Ethiopia (NBE), shared updates on regulatory reforms under way to address structural bottlenecks.

“We’re working on a new insurance proclamation that expands our mandate beyond supervision to include market development,” said Belay. “Inclusive insurance is broader than microinsurance. It targets unserved populations beyond just the poor.”

Belay added that a Microinsurance Directive is being also drafted to allow member-based institutions, such as cooperatives and community-based groups, to facilitate insurance delivery.

A key highlight of the event was the official launch of the Ethiopia Rural Finance Service Unit (RFSU) under the Ministry of Agriculture. The RFSU announced in the presence of Girma Amente (PhD), Minister of Agriculture and the State Minister of Agriculture, Sofia Kassa is set to play a central role in coordinating and scaling agricultural insurance efforts nationwide, with support from UNDP, JICA, and other development partners, through funding from the Bill & Melinda Gates Foundation.

“The revised Agricultural and Rural Development Policy places strong emphasis on improving access to financial credit for smallholder farmers,” said Dr. Girma. “The government’s focus on the sector has driven inclusive and climate-resilient economic reforms, boosting both production and productivity.”

Pula and its partner insurers are delivering Area Yield Index Insurance (AYII), a comprehensive coverage solution—through the Input Voucher System (IVS). This model links insurance directly to agricultural input purchases, leveraging the existing IVS infrastructure that reaches up to 7 million farmers, in collaboration with the Agricultural Transformation Institute (ATI).

“Pula has long anticipated the establishment of a platform like the RFSU, recognizing the sector’s need for greater coordination. With the RFSU now in place, we are well-positioned to scale our work nationally—with the potential to serve over 7 million farmers across Ethiopia.” said Dagmawi. He also added “We are confident that the RFSU will leverage key learnings from our program and help create an enabling environment that fosters better outcomes for smallholder farmers through expanded, well-coordinated agricultural insurance efforts.”

Pula operates in 20 countries globally, reaching a total of 20+ million farmers. The company entered Ethiopia in November 2022, following the Ministry of Agriculture’s pledge to work with stakeholders to deliver climate risk solutions for Ethiopian farmers and its delegation of responsibility to the Agricultural Transformation Institute (ATI), efforts began to design and pilot a scalable agricultural insurance model.

The Institute of Foreign Affairs (IFA), in collaboration with the Ministry of Foreign Affairs, held a high-level conference on Tuesday at the Sheraton Hotel under the theme “Exploring New Avenues: Economic Diplomacy as a Mainstay of Ethiopian Foreign Policy.”

The forum brought together leading government institutions — including the Ministry of Finance, Ethiopian Securities Exchange, Ethiopian Investment Holdings, Ethiopian Investment Commission, and the Ministry of Foreign Affairs — to discuss how to align foreign policy with Ethiopia’s economic ambitions.

Central to the discussions was the Homegrown Economic Reform Agenda, launched in September 2019, which aims to liberalize and modernize Ethiopia’s economy. Panelists explored how the reform program is positioning the country to better integrate with the global economy and attract quality investments.

In his opening remarks, IFA Executive Director Jafar Bedru stressed the need to shift diplomatic efforts beyond traditional political frameworks. “Our diplomatic engagements must transcend conventional paradigms and adopt a proactive, business-oriented approach — one that prioritizes investment and trade facilitation,” he said.

Ambassador Workalemahu Desta, Political and Economic Diplomacy Advisor, MoFA, acknowledged that while Ethiopia’s economic and business diplomacy is making progress, it still falls short of matching the opportunities created by recent reforms. He noted the growing global demand for competitive investment destinations, emphasizing Ethiopia’s strategic potential.

“Globally, production and labor costs are soaring. Multinational companies are actively seeking low-cost, stable, and business-friendly environments — and Ethiopia is emerging as a top destination,” he said.

Ambassador Workalemahu also underscored Africa’s growing strategic importance, pointing to the African Continental Free Trade Area (AfCFTA) as a transformative platform. “AfCFTA is unlocking a vast market for investors across Ethiopia. Additionally, our membership in BRICS and the New Development Bank enhances our positioning within the evolving global economic order,” he added.

Dr. Tilahun Kassahun, CEO of the Ethiopian Securities Exchange (ESX), highlighted the need to diversify Ethiopia’s financial landscape to sustain economic growth. He emphasized that beyond traditional financing mechanisms, both local and foreign private investors require access to alternative financial instruments such as portfolio investments. He mentioned that amid the launch of the capital market in Ethiopia, the Ministry of Foreign Affairs must attract investments from abroad as the old technical way of investment has changed to easy and Central Securities Depository. “Beyond simply counting how many remittance accounts are opened, a new key performance indicator (KPI) should be how many CSD accounts are created,” he added.

He also revealed that the capital market is expected to integrate with the interbank lending system in the first week of July. Just six months after its launch, the interbank market has already facilitated over ETB 800 billion in transactions, with daily volumes reaching several ETB billion, he reported.

This comes on the heels of the launch of a Diplomatic Guide for the Homegrown Economic Reform Agenda, unveiled on Monday by the Ministry of Foreign Affairs in collaboration with the Ministry of Finance, the Ethiopian Securities Exchange, and Ethiopian Investment Holdings.

Ethiopian Airlines has emerged as the leading player in Africa’s cargo aviation sector, now holding 35 percent of the continent’s market share, according to a new report by the African Finance Corporation (AFC). The airline has significantly expanded its annual cargo capacity, growing from 266,000 tons in 2016 to 715,000 tons by 2023.

The AFC report also highlights persistent gaps in intra-African air transport. In regions such as West Africa, European carriers continue to dominate cargo and passenger traffic. Kenyan Airways and Royal Air Maroc, the next closest competitors, together account for only 25 percent of the cargo market, signaling a sharp contrast in competitiveness.

The report commends Ethiopia and Kenya for using their national airlines to strengthen export trade and urges other African countries to adopt similar strategies. Ethiopian Airlines currently operates 16 dedicated cargo aircraft and serves 60 international destinations, with half located within Africa. The airline plans to expand its cargo fleet to 37 aircraft by the year 2035, reinforcing its long-term commitment to the sector.

In addition, the report praises Ethiopia’s advances in digital infrastructure, particularly in the rapid growth of telecom service users and the increasing adoption of digital technologies. These developments are positioning the country as a leader in Africa’s digital transformation.

Despite such progress, the AFC identifies weak infrastructure as a major constraint to the growth and competitiveness of Africa’s aviation sector. Addressing these limitations is seen as critical to unlocking further potential.

The report also identifies other high-potential sectors across the continent. These include mining, agriculture, logistics, and digital infrastructure. Ethiopia is highlighted as the top wheat producer in sub-Saharan Africa, with wheat cultivation rising from 5,000 hectares in 2018 to 650,000 hectares in 2023.

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BitX, a global mining company has signed a Memorandum of Understanding (MoU) with Ethiopia Mining Farm, paving the way for cutting-edge AI-powered mining infrastructure in Ethiopia, according to Street Insider.

The agreement marks a significant milestone in BitX’s African expansion, introducing its flagship Bit-X V2 Accelerator into local mining operations. This AI-driven technology is designed to double mining efficiency without the need for hardware upgrades, offering a more sustainable and cost-effective approach to Bitcoin mining. Ethiopia is seen as a high-potential hub, thanks to its largely untapped energy reserves and increasing momentum in digital transformation.

BitX’s CEO highlighted that the partnership goes beyond efficiency—it aims to foster a more inclusive and decentralized Web3.0 mining model, where access and fairness are prioritized. Ethiopia Mining Farm officials echoed this vision, stating that the integration of BitX’s accelerator will significantly enhance their operational performance and global competitiveness.

According to the MoU, BitX plans to roll out its technology across 20,000 mining machines in Ethiopia by the end of 2025, with ambitions to expand across other African markets. A key part of this initiative is BitX’s Shared Accelerator Program, which allows global participants to invest in decentralized mining via AI-powered contracts, starting at just $100—making it accessible to a broad base of investors, including Ethiopians.

Unlike traditional mining models that depend heavily on hardware or low-cost electricity, BitX’s approach focuses on software optimization and energy efficiency, enabling emerging economies like Ethiopia to participate in the global Bitcoin mining economy without massive capital requirements.

With a proven track record in North America and Central Asia, BitX’s move into Ethiopia underscores a growing shift in global mining strategy, one that champions decentralization, smart technology, and environmental consciousness.

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The African Development Bank Group and the Federal Government of Nigeria have signed a protocol agreement committing USD500 million over 15 years to extend the Nigeria Trust Fund (NTF), providing long-term business continuity and planning certainty through 2040.

This extension comes after multiple previous renewals, reflecting the enduring value and relevance of Nigeria’s partnership with the African Development Bank.

Dr Akinwunmi Adesina, President of the African Development Bank Group said that the commitment will allow the Bank’s ability to expand hybrid capital instruments, increase securitization, and scale up private sector operations. This move is expected to mobilize more private capital for low-income countries. “Nigeria’s decision today proves that Nigeria is always on the right side. The NTF is the largest we have at the African Development Bank, which is part of the Bank. It helps to co-finance operations in many countries, as well as feasibility studies for some other countries.” he added

The agreement also enables deployment of resources from the fund in innovative treasury, structuring, and other transactions, including balance sheet optimization, structured finance, and catalytic risk-sharing solutions.

The Bank and Nigerian authorities are working on new financial products, updating approval processes, and developing a communications strategy to raise visibility for Nigeria’s contributions.

The Nigeria Trust Fund serves as a fully-fledged financial window of the AfDB. Since its creation, the NTF has financed 92 projects in 33 countries. The Fund has played a crucial role in filling financing gaps in high-impact sectors, particularly in the continent’s least developed countries.

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The Trade and Development Bank Group (TDB Group) has been named Africa’s Bank of the Year at the 2025 African Banker Awards, held during the Annual Meetings of the African Development Bank. The honor recognizes TDB’s continued commitment to inclusive finance, service innovation, and its contribution to Africa’s sustainable economic growth.

TDB’s strength lies in its ability to adapt and lead through reform. Despite a rapidly changing financial landscape, the Bank has maintained its development impact by innovating its capital structure—most notably with the introduction of hybrid capital in 2024—and attracting institutional investors aligned with long-term development goals.

The Bank continues to deliver impactful project and trade financing, while also addressing upstream challenges through concessional finance, technical assistance, and development programs. Its work supports critical priorities such as women’s empowerment, youth employment, and responsible investment across African economies.

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In its ongoing commitment to price and external stability, the National Bank of Ethiopia (NBE) has announced that it will conduct its sixth foreign exchange auction on Thursday, May 22, 2025, offering USD 50 million to participating banks.

This move is part of NBE’s bi-weekly foreign exchange auction framework aimed at supporting a more transparent and market-responsive forex system. Banks are invited to submit bids in line with NBE’s established guidelines, with the settlement set for the end of the auction day.

The announcement follows the previous auction held on May 7, 2025, where the weighted average rate of all successful bids stood at ETB 132.9643 per USD. In that round, 16 banks successfully secured foreign exchange allocations, underscoring robust participation and demand.

By maintaining a consistent auction schedule, the central bank aims to reduce volatility, improve forex access for priority sectors, and enhance monetary policy effectiveness.

The results of the May 22 auction will be disclosed shortly after the bid submission period concludes.

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Cooperative Bank of Oromia (Coopbank) has achieved what its CEO described as an “unbelievable” milestone in expanding women’s access to finance, disbursing ETB 24.5 billion to 1.47 million loan accounts, 80% of which are held by women.

The announcement was made by CEO Derbie Asfaw during a panel discussion under the theme “Promoting Women’s Access to Finance” at the Ethiopia Finance Forum 2025, an event that brought together key stakeholders in the financial sector to address gender disparities and promote inclusive growth.

A major contributor to this achievement is Coopbank’s women-focused loan platform, Michu Kiya, which was launched just eight months ago. Since its introduction, the platform has disbursed ETB 7.3 billion to over one million accounts, signaling rapid uptake and a significant demand for targeted financial services among women.

“This is unbelievable for me,” said Derbie. “At Coopbank, we believe innovation isn’t just a tech solution, and financial inclusion isn’t a compliance box—both are part of our purpose to empower communities and transform lives.”

The milestone comes as Coopbank celebrates 20 years of operation, having grown into a ETB 189.4 billion financial institution. Over two decades, the bank has carved out a strong reputation for inclusive banking, now serving 17 million customers across Ethiopia.

Ethiopia is actively courting global investors with bold economic reforms and sectoral liberalization, as it hosts the Invest in Ethiopia – High-Level Business Forum 2025 in Addis Ababa from May 12–13. The event brings together international investors, senior government officials, and development partners to explore opportunities in priority sectors such as renewable energy, agribusiness, ICT, and manufacturing.

Organized by the Ethiopian Investment Commission (EIC), the Ministry of Finance, and the Development Partners Group, the two-day forum signals Ethiopia’s firm commitment to private sector-led growth. The country’s 8.1% GDP growth in 2024 and recent policy reforms have positioned it as one of Africa’s top destinations for investment.

The Forum features high-level ministerial roundtables, sector panels, networking sessions, and the official launch of a new Investment Deal Book, aimed at enhancing transparency and deal-making for foreign investors.

In his opening remarks, President Taye Atske Selassie emphasized the government’s efforts to improve the investment climate by addressing long-standing challenges in foreign direct investment (FDI). “Reforms have been designed to attract FDI, sustain growth, and drive structural transformation,” he noted, adding that infrastructure development and investor-friendly policies are being prioritized to meet Ethiopia’s goal of becoming Africa’s leading economy by 2030.

“We believe we are on the right track to ensure macro-financial stability,” he added. “Our reforms are fundamentally reimagining Ethiopia’s economic future.”

Foreign Minister Gedion Timothewos (PhD) echoed the president’s message, stating that Ethiopia’s young, energetic population, improved logistics, and rapid development of industrial parks make it a natural hub for international investment. He encouraged investors to explore opportunities not just in traditional sectors, but also in mining, energy, and tourism.

Finance Minister Ahmed Shide underlined the importance of macroeconomic stability and structural reforms. “Opening up sectors like telecom, finance, and logistics is already yielding results,” he said. He also highlighted the launch of the Ethiopian capital market as a game-changer in deepening private-sector participation.

EIC Commissioner Zeleke Temesgen Boru (PhD) reported that new investors from 59 countries are participating in the forum—a sign of growing international confidence. He stressed the government’s readiness to provide full support to investors and ensure predictability in policy implementation.

A presentation by Planning and Development Minister Dr. Fitsum Assefa showcased Ethiopia’s natural resources, strategic location, and investment-ready infrastructure, reinforcing the country’s competitive edge in attracting quality investments.

With AfCFTA integration on the horizon, Ethiopia is positioning itself as a regional gateway for investors seeking access to Africa’s fast-growing markets.

Older Posts

Ethiopia’s Special Economic Zones Attract USD900M in a Single Year as Occupancy Hits 89%

Pula Advisors Eyes 3 Million Ethiopian Farmers Through its Local Insurance Partnerships

Key Government Institutions Convene to Reinforce Economic Diplomacy as Pillar of Ethiopian Foreign Policy

Ethiopian Airlines Controls Over One-Third of Africa’s Cargo Market

BitX Enters Africa via Ethiopia in Major AI-Driven Mining Deal

AfDB Secures USD500 Million from Nigeria to Expand Development Fund Until 2040

TDB Group Named Africa’s Bank of the Year

NBE to Conduct USD50 Million Forex Auction as Part of Bi-Weekly Market Stabilization

Coopbank CEO Hails ‘Unbelievable’ Milestone in Women’s Financial Inclusion

Ethiopia Opens Doors to Global Investors in Energy, ICT, Manufacturing, and Agribusiness