The involvement of international companies in the Ethiopian market is critical in creating competition and bringing capital into the country, United Nations Development Program (UNDP) Ethiopia Economic Advisor Zafar said.
The primary objective of Ethiopia’s Home-grown Economic Reform is to sustain growth through creating an economic environment supportive of private investment and structural transformation.
In an exclusive interview with ENA, advisor Ali Zafar said the involvement of international companies in the Ethiopian market is vital in creating competition and bringing capital into the country.
Praising the introduction of Safaricom which has helped a lot the telecom industry by creating competition in the sector, he stressed that such moves have to be further encouraged.
Granted a nationwide full-service Unified Telecommunications Service License in July 2021, Safaricom Ethiopia is the first company in the country to launch a competitive mobile service to the state-owned Ethio Telecom.
Financial sector reform has been also one of the priorities of the government as the National Bank of Ethiopia (NBE) is working to finalize the regulatory framework that allows foreign banks to operate in Ethiopia.
According to Zafar, allowing foreign banks into the country will bring new money, new ideas, and innovation.
Simultaneously, Ethiopia has been working to establish a robust capital market to attract domestic and foreign investments.
The country approved the Capital Markets Establishment Proclamation in 2021 to provide the legal foundation for the development of capital markets in the country.
Following the approval of the Proclamation, several activities have been carried out to create a conducive environment for its implementation.
Commenting on Ethiopia’s move to realize a capital market, the UNDP Ethiopia Economic Advisor said capital market creates the opportunity to build a market with long-term bonds.
Capital market is a long process, but the government is pushing in a good way, he noted.
The Ethiopian capital market is expected to present numerous investment opportunities for both domestic and foreign investors as the country’s vast natural resources and a young and dynamic population, among others, make it an attractive destination for investment.
The economic advisor stated that UNDP has been working in close partnership with the government. “We support them with analytical work, including studies, policy proposals with international experience, and capacity-building programs.”
The GoE has launched a comprehensive and well-coordinated Home-grown Economic Reform Program to safeguard macro-financial stability and re-balance and sustain economic growth.