Wed Jan 08 10:24:38 UTC 2025: ## Ethiopia Reopens Stock Exchange After 50 Years, Seeking to Attract Investors
**ADDIS ABABA** – Ethiopia is relaunching its stock exchange after a five-decade hiatus, aiming to attract foreign investment and boost its economy following a devastating civil war. The Ethiopian Securities Exchange (ESE), which opens on Friday, will begin with an initial public offering (IPO) of shares in Ethio Telecom, the state-run telecommunications company, expected to raise up to 30 billion birr. This is part of a broader government plan to list up to 50 companies over the next five years.
The move comes as the government, under Prime Minister Abiy Ahmed, implements significant economic reforms. These include ending decades of currency control, unlocking $20 billion in financing from the World Bank and IMF, and creating favorable conditions for foreign investors to repatriate funds. A $3.4 billion bailout agreement with the IMF further supports the initiative.
However, challenges remain. The country’s foreign exchange reserves are still low, and ongoing ethnic tensions in some regions raise concerns about political stability. While the government is implementing measures to discourage short-term investments (“hot money”), the ongoing insurgencies and the need to restructure $1 billion in eurobonds pose risks for potential investors. The ESE currently lacks brokers and custodians, representing another hurdle to overcome.
Despite these challenges, the reopening of the stock exchange is seen as a crucial step towards economic recovery and job creation in a nation grappling with high youth unemployment. International investors, while expressing excitement about the potential, are closely monitoring the situation, weighing the economic opportunities against the political and economic risks.
First Piper 