Ethiopia has launched a security exchange system in a bid to accelerate its economic growth and create a more structured investment environment.
Officially launching the Ethiopian Security Exchange (ESX) on Friday, Prime Minister Abiy Ahmed said the exchange provides Ethiopian businesses with an organised platform to issue stocks and bonds, helping them attract investors.
“In a historic step for our economy and financial system, we have officially rung the bell to launch Ethiopia’s securities exchange,” Ahmed in a statement shared on his social media.
Contrary to popular belief, this is not Ethiopia’s first securities exchange. Ethiopia had an earlier form of a stock market in the 1960s, but it ceased operations following the nationalisation policies of the Derg regime in the 1970s.
The ESX is, thus, a revival of Ethiopia’s capital market rather than a brand-new initiative.
The ESX is expected to encourage private investment, allowing local and foreign investors to have more opportunities to participate in the country’s economic progress.
A well-functioning stock market is believed to improve liquidity, encourage savings, and strengthen financial institutions.
“As Ethiopia lays the foundation for long-term financial stability and growth, we invite investors to seize this opportunity and help build a strong capital market,” Ahmed said.
He said with this launch ESX, Ethiopia is taking a decisive step towards integrating with global financial markets and strengthening its financial ecosystem.
MG/as/APA