Since 2018, the list of sectors open to foreign investment has expanded, including logistics and telecoms.
In February, the Ethiopian Parliament completed a draft law to allow partial foreign entry into the banking sector – a stark contrast to the government’s more hostile position a year ago
What are the provisions of the draft law? How will it impact the banking sector? And what are its wider ramifications?
Slow to bloom
Ethiopia showed signs of opening its banking sector to foreigners in 2016 after adhering to the African Trade Insurance Agency (ATIA)
Backed by regional and international institutions, COMESA and the World Bank, the ATIA aims to attract foreign direct investment (FDI) by offering “ insurance against political upheaval, expropriation and problems with exchange controls on trade” as noted in The Economist.
Following this, nine foreign banks have opened liaison offices: