Ethiopia has officially inaugurated its first stock exchange in almost five decades. On January 10, 2025, Prime Minister Abiy Ahmed opened the Ethiopian Securities Exchange (ESX), marking an important milestone in the country’s economic progress.
The country’s sovereign wealth fund, Ethiopia Investment Holdings (EIH), established the exchange in partnership with the Ministry of Finance, with support from FSD Africa and FSD Ethiopia.
የካፒታል ገበያ በገንዘብ እጥረት ምክንያት ሃሳብ እያላቸውና ስራ መስራት ለሚቸገሩ ወጣቶች በከፍተኛ ደረጃ የገንዘብ ምንጭ እንዲያገኙ ያደርጋቸዋል። pic.twitter.com/bpaKI53ey3
— Abiy Ahmed Ali 🇪🇹 (@AbiyAhmedAli) January 10, 2025
The ESX aspires to reform Ethiopia’s financial industry by creating a transparent market for securities trading. It works in three market segments: stock, fixed income, and money markets. This varied set of financial instruments is projected to boost access to long-term finance, stimulate investment-led growth, and increase savings mobilization.
Prime Minister Abiy Ahmed hailed the launch as a “historic milestone” in Ethiopia’s economic and financial development.
In a historic milestone for our economic and financial landscape, we have officially rung the bell to launch the Ethiopian Securities Exchange – the first stock exchange for our country. Invest in Ethiopia — a fast-growing economy with immense potential and a dynamic trajectory… pic.twitter.com/SGMwOUATj8
— Abiy Ahmed Ali 🇪🇹 (@AbiyAhmedAli) January 10, 2025
According to a press release issued, the exchange’s interbank trading platform has facilitated trades worth over ETB 135 billion (USD 1.1 billion) since its launch in October 2024, enhancing credit flow and liquidity in the banking system. Its price transparency and lower transaction costs have improved loan accessibility for businesses, enabling growth and innovation.
ESX CEO Tilahun Esmael Kassahun, ”We see the new securities exchange as a multi-faceted financial infrastructure, providing multiple markets and a variety of products, catering to different types of issuers and investors. The fixed income market will provide a platform to list and trade debt instruments, including treasury bills and bonds, corporate bonds, and Shariah-compliant securities such as Sukuk bonds.”
The launch of ESX follows significant economic reforms in Ethiopia over the past year, including floating the national currency, the Birr, opening the banking sector to foreign competition, and advancing capital market development. The exchange is poised to become a vital platform for raising capital, trading securities, and driving economic transformation.
“The launch of the ESX is a true game-changer for the country. As an organization running development finance programs in well over thirty African countries, we know only too well the impact well-functioning and modern capital markets can have in catalyzing economic growth. We are proud to have played a role in the development of this exchange, which will undoubtedly spur equity, fixed income, and other innovative financial instruments,” FSD Africa CEO Mark Napier concluded.