@MoF_Ethiopia – Page 4 – Ethiopian Business Review

The Ministry of Finance has announced that it disbursed over ETB 300 billion in subsidies for basic inputs over the past eight months, while effectively managing the national budget deficit, mobilizing unprecedented levels of foreign resources, raising domestic revenue, and ensuring sound financial governance. According to Finance Minister Ahmed Shide, these measures are part of the government’s broader macroeconomic reform program, which he says is being implemented successfully through the Ministry’s adherence to fiscal discipline, inflation control, and tax policy enforcement.

The remarks were made during a review meeting with the House of People’s Representatives’ Standing Committee on Planning, Budget, and Finance, which assessed the ministry’s performance over the past eight months. Minister Shide emphasized that prudent financial management has strengthened the macroeconomic reform agenda, enabling the government to support key sectors and maintain fiscal discipline.

State Minister Dr. Eyob Tekalign highlighted additional achievements, including efforts to curb rising living costs, public awareness campaigns on tax policies, and improved cash flow management—particularly in ensuring timely budget disbursements to regional administrations. He also noted corrective actions taken on audit findings and reaffirmed the ministry’s commitment to further reducing inflationary pressures in the coming fiscal year.

Committee Chairman Desalegn Wedaje commended the ministry’s overall performance but called for improvements in public project execution, government asset management, and electronic procurement systems. He also stressed the need for better oversight of regional project financing and audit compliance.

The Ethiopian Securities Exchange (ESX) has joined forces with FSD Africa and FSD Ethiopia in a landmark partnership aimed at strengthening Ethiopia’s capital markets.This partnership, announced following ESX’s successful launch, signals a coordinated commitment to deepen the financial sector by mobilizing technical, financial, and strategic resources across the three organizations.

Under the agreement, ESX aims to list more than 50 companies across its main and growth markets while establishing a dedicated platform for government and corporate bonds, including Sharia-compliant instruments such as Sukuks. The partnership will also focus on issuer support, investor education, product development, and institutional capacity building to ensure ESX operates at international standards.

The collaboration brings together technical expertise, financial resources, and strategic oversight from all three entities. ESX will lead project management and implementation, while FSD Ethiopia and FSD Africa will provide funding and advisory support. A dedicated ESX Market Development Committee will coordinate efforts to drive sustainable market growth.

Tilahun Esmael Kassahun, CEO of ESX, underscored the significance of the partnership, stating, “Developing a strong and transparent securities exchange is a milestone in Ethiopia’s financial history.” He emphasized that the initiative will broaden funding options for businesses while equipping investors with the knowledge to engage confidently in the market.

Hikmet Abdella, CEO of FSD Ethiopia, highlighted the transformative potential of the collaboration, noting that robust capital markets are critical for economic growth. “By working together, we are creating a sustainable financial system that will support businesses and provide investment opportunities for individuals and institutions participating in Ethiopia’s economic expansion,” she said.

Mark Napier, CEO of FSD Africa, reinforced the broader continental vision behind the partnership. “Building robust capital markets is essential to unlocking Africa’s economic potential,” he said. Napier pointed to Africa’s vast pool of domestic institutional capital—valued at over USD2.3 trillion—as a key driver for sustainable growth, adding that the collaboration with ESX aligns with FSD Africa’s mission to make finance a transformative force across the continent.

The Ethiopia Securities Exchange (ESX) has announced that Ethiopia’s interbank money market (IMM) has surpassed ETB 500 billion in total transaction volume within just six months of operation, marking a significant milestone in the country’s financial sector.

Launched in October 2024 by the National Bank of Ethiopia (NBE), the IMM was established to facilitate short-term borrowing and lending among banks, enhancing liquidity management and improving financial market efficiency. Governed by the Interbank Money Market Rules, the platform has rapidly gained traction, reflecting growing investor confidence and increasing market activity.

The milestone underscores the evolving landscape of Ethiopia’s banking sector, where structured platforms like the IMM are strengthening market transparency and fostering economic stability. As momentum builds, this achievement highlights the potential for further financial sector reforms, deeper investor participation, and a more resilient financial ecosystem in Ethiopia.

In a move to support Ethiopia’s agricultural sector, the Japanese government has provided over 63,000 quintals of urea fertilizer through a grant aid program. The fertilizer, which arrived in Addis Ababa, is expected to help farmers enhance productivity amid growing challenges in the sector.

During the handover ceremony, Deputy Minister of Agriculture Sofia Kassa expressed gratitude for Japan’s continued support. She emphasized that the ministry is working to ensure the fertilizer reaches farmers efficiently and is used for its intended purpose.

Japan’s Ambassador to Ethiopia, Shibata Hironari, reaffirmed his country’s commitment to Ethiopia’s agricultural development and broader economic cooperation. “Japan remains a strong development partner for Ethiopia, and we will continue supporting key sectors, including agriculture, to improve food security and farmers’ livelihoods,” he said.

The ceremony was attended by State Minister of Finance Semereta Sewasew and State Minister of Agriculture Sofiya Kassan, among other government officials. The fertilizer, procured through Japan’s aid grant, has been transported to the Ethiopian Agricultural Business Corporation (EABC) warehouse in Addis Ababa for distribution to farmers.

According to the Japanese Embassy, the grant not only addresses Ethiopia’s urgent agricultural needs but also aims to improve farmers’ incomes and strengthen food security. Japan’s support comes at a crucial time, as Ethiopian farmers continue to navigate challenges such as fluctuating input prices and climate-related risks.

The Commercial Bank of Ethiopia (CBE), in collaboration with global payment leader MasterCard, has introduced both plastic and virtual international prepaid cards, a move set to enhance digital payment accessibility in Ethiopia.

The launch, officiated by CBE President Abe Sano and MasterCard Africa President Mark Elliott, marks a major step toward modernizing Ethiopia’s financial ecosystem. These prepaid cards will enable users to conduct international transactions with greater convenience, supporting online purchases, travel expenses, and cross-border payments.

CBE officials emphasized that the initiative aligns with the bank’s ongoing efforts to expand digital financial services and provide customers with secure, flexible, and globally accepted payment solutions. The virtual card, in particular, is expected to cater to the rising demand for secure online transactions, while the plastic version offers a physical alternative for international spending.

Ethiopia’s Ministry of Innovation and Technology is under intense scrutiny after a parliamentary committee uncovered a budget deficit exceeding half a billion birr (USD 9 million), alongside allegations of financial mismanagement and procedural violations.

The House of People’s Representatives’ Standing Committee on Public Expenditure Management and Control Affairs flagged multiple irregularities, including the misuse of public funds, failure to conduct pre-feasibility studies for key projects, and unauthorized budget reallocations. According to Chairperson Yeshimebet Demise (PhD), several government-funded and donor-financed initiatives were launched without proper consultation, leading to significant inefficiencies and unclear project statuses.

The audit findings revealed that multiple projects suffered from delayed execution and financial mismanagement, with some being terminated prematurely and their budgets reassigned without legal oversight. The committee has instructed the ministry to provide a detailed report on unauthorized expenditures—including transportation rentals, data center construction, and inflated employee salaries—within 15 days.

Concerns were also raised over the ministry’s human resource management, with recruitment processes failing to align with legal frameworks. Officials stressed the urgent need for systematic hiring reforms and the recovery of high-value government assets still unreturned by former employees.

Federal Auditor General Meseret Damte criticized the ministry for its failure to take corrective measures, stating that funds were allocated to projects that remain incomplete. The audit further exposed weaknesses in human resource and asset management, along with payments made outside legal provisions. The Federal Anti-Corruption Commission has been called upon to enforce accountability measures and oversee financial discipline within the institution.

Responding to the scrutiny, Minister of Innovation and Technology Belete Molla (PhD) admitted that audit deficiencies had occurred due to the complex nature of the ministry’s operations. He pledged to implement an action plan to address the financial and operational gaps, with updates to be presented to the standing committee.

He also highlighted that the ministry is engaged in numerous projects under the Digital Ethiopia 2025 initiative, in collaboration with the World Bank and other international partners. The minister assured that steps would be taken to rectify the shortcomings and enhance transparency in project execution.

In a groundbreaking move set to transform Ethiopia’s digital financial ecosystem, Ethio Telecom and MasterCard Africa are exploring a strategic collaboration to introduce cutting-edge digital financial services.

A high-level delegation, led by Ethio Telecom CEO Frehiwot Tamiru and MasterCard Africa President Mark Elliott, engaged in discussions to leverage their respective platforms—Telebirr and MasterCard—to expand financial access, accelerate digital payments, and drive sustainable economic growth.

CEO Frehiwot Tamiru emphasized Ethio Telecom’s strong market position, highlighting its vast customer base and robust infrastructure as key enablers in unlocking new digital opportunities. “Our partnership with MasterCard is driven by a shared vision to revolutionize Ethiopia’s financial sector and empower millions through innovative digital solutions,” she stated.

Echoing this sentiment, Mark Elliott, Division President, Mastercard Africa underscored MasterCard’s commitment to the Ethiopian market, citing Ethio Telecom’s rapid growth and infrastructure capabilities as a solid foundation for success. “This collaboration aligns with our mission to drive financial inclusion and create a more connected and competitive digital economy,” he said.

The Ethiopian Capital Market Authority (ECMA) has announced a one-month extension for publicly held companies to submit required regulatory documents, offering a final opportunity for compliance with the newly enacted Public Offer and Trading of Securities Directive No. 1030/2024.

The extension, granted in response to industry requests, pushes the deadline to April 9, 2025. This move underscores the Authority’s commitment to fostering transparency and investor protection as Ethiopia’s capital market takes shape.

Companies with over 50 shareholders—whether publicly listed or in the process of raising capital—are urged to submit key details about their securities. This includes the total number of shares issued, their valuation, historical offering details, and relevant promotional materials.

ECMA emphasized that failure to comply by the new deadline will have regulatory consequences, with any share issuance by non-compliant companies being considered as occurring after the directive’s effective date of November 14, 2024.

Hard copies of the required documents must be delivered to ECMA’s head office at Minaye Building, Addis Ababa, while digital copies should be sent via email.

The Authority reiterated that this submission does not equate to formal registration of existing securities. Companies will still need to complete the full registration process within a year from the directive’s enactment.

The Ethiopian Investment Board has convened at the Ethiopian Investment Commission (EIC) headquarters today, reviewing ongoing initiatives and making key investment-related decisions.

Among the critical agendas discussed was a proposal from a private investor seeking approval to establish a multi-sector special economic zone with an initial capital investment exceeding $78 million. Following extensive deliberations, the board approved the request and officially designated the project as a multi-sector special economic zone, paving the way for immediate implementation.

In addition to this decision, the board also addressed matters related to the zone’s design, land allocation, and usage, reinforcing its commitment to streamlining investment procedures.

According to the Ethiopian Investment Commission, the board remains dedicated to fostering a competitive and investor-friendly business environment and will continue strengthening its support to the Commission.

The National Bank of Ethiopia (NBE) and the Ethiopian Securities Exchange (ESX) have signed a landmark Memorandum of Understanding (MoU) to enhance the governance and transparency of Ethiopia’s interbank money market using the ESX trading platform.

H.E. Mamo Mihretu, Governor of NBE, emphasized the crucial role of this initiative in modernizing financial markets, improving liquidity, and strengthening monetary policy transmission.

Since its launch in October 2024, the platform has facilitated transactions exceeding 377 billion ETB, marking a significant leap in Ethiopia’s financial sector development. The agreement sets the foundation for enhanced cooperation, risk mitigation, and market integrity, ensuring that the interbank money market operates with efficiency and confidence.

As Ethiopia deepens its financial sector reforms, this collaboration is expected to enhance market confidence, promote transparency, and drive financial stability, positioning Ethiopia as an emerging player in regional capital markets.

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Ethiopian Govt Disburses ETB 300 Billion in Subsidies, Cuts Inflation Amid Economic Reforms

ESX Partners with FSD Africa and FSD Ethiopia to Boost Capital Market Growth

Ethiopia’s Interbank Money Market Surpasses ETB 500 Billion in Transactions

Japan Donates 63,000 Quintals of Urea Fertilizer to Support Ethiopian Farmers

CBE and MasterCard Launch International Prepaid Cards

Ethiopian Innovation Ministry Under Fire for USD9 Million Budget Deficit and Unauthorized Spending

Telebirr and MasterCard Platforms to Power Ethiopia’s Digital Finance Expansion

ECMA Extends Deadline for Public Companies’ Compliance Submissions

Ethiopian Investment Board Greenlights $78 Million Multi-Sector Special Economic Zone

NBE and ESX Forge Strategic Partnership to Strengthen Ethiopia’s Interbank Money Market