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Ethiopia is opening a stock exchange after a five-decade gap, in its latest step to lure investors to a nation that’s struggling to control regional strife as it recovers from a civil war.
Ethiopia Investment Holdings, which controls 40 state-run companies, is selling shares in Ethio Telecom to raise as much as 30 billion birr US($234 million) in an initial public offering.
The company’s debut, along with the government’s plan to list other firms, will herald the start of the new bourse, according to Tilahun Kassahun, chief executive officer of the Ethiopian Securities Exchange, which opens on Friday.
Eastern Africa’s biggest economy expanded an average 8 percent in the past decade, even as it suffered a conflict that resulted in 600 000 casualties.
Prime Minister Abiy Ahmed’s government — after agreeing on a peace accord in 2022 — now wants to woo investors in an attempt to create jobs in a nation where more than a quarter of the youth are unemployed.
“The opening of a domestic stock exchange is a key part of the economic and political transition of a frontier market,” said James Johnstone, co-head of emerging and frontier markets at Redwheel, which manages US$8 billion in assets.
“There’s currently very limited international investment in these fast growing economies. So we remain very excited by the opportunities.” The biggest move by the government was to end half a century of control over the currency. — Bloomberg
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