Ethiopia Securities Exchange roars to life

Ethiopia, a country known for its vibrant culture and rich history, is now making headlines for its rapid economic growth and drive towards becoming an economic powerhouse in Eastern Africa. In a recent interview with CNBC Africa, Dr. Tilahun Kasahun, the CEO of the Ethiopia Stock Securities Exchange (ESX), shared insights into the exciting developments taking place in the country's capital markets ecosystem. The ESX, established as a public-private partnership with the Ethiopian Investment Holding holding a 25% stake, has been actively working towards setting up the exchange to unlock numerous investment opportunities for both domestic and foreign investors. Over the past year and a half, the ESX team has been diligently building a solid foundation, raising capital, and engaging with strategic investors from various sectors. The exchange has surpassed its capital-raising targets, attracting investments from domestic financial institutions, insurance companies, non-financial institutions, as well as foreign investors including the Nigerian Stock Exchange, TDB Bank Group, and FSD Africa. This milestone marks a significant step forward in the journey of the ESX towards becoming operational and facilitating the trading of securities in Ethiopia. Dr. Tilahun emphasized the importance of strategic investors and the role they play in developing the debt market. With a focus on creating a consensus around the exchange, the ESX aims to position itself as a multi-faceted financial infrastructure that not only facilitates trading but also fosters liquidity in the interbank money market. The exchange's unique approach to incorporating various financial services and offerings sets it apart in the African market and paves the way for a robust and dynamic financial ecosystem. Looking ahead, the ESX is gearing up to kick off operations in the coming months, with plans to deploy its technology and trading platform by October or November. The exchange is poised to welcome a diverse range of companies for listing and trading, with a particular focus on state-owned enterprises such as Ethiopian Airlines, Ethiopian Telecom, and the Commercial Bank of Ethiopia. Additionally, the ESX aims to attract private sector companies and startups looking to raise capital and expand their operations. With a goal of listing up to 90 companies within the first five to seven years of operation, the exchange is set to become a hub for public and private sector entities across various industries. The ESX's integration into the East African community marks a significant milestone for Ethiopia, positioning the country as a key player in the regional securities market. As the exchange prepares to launch its equity market, Dr. Tilahun highlighted the importance of fostering a diverse investor base and supporting startups and SMEs through alternative funding mechanisms. By introducing a growth market and equity and debt crowdfunding platforms, the ESX aims to cater to a wide range of companies and investors, driving growth and innovation in the Ethiopian financial sector. With a strong focus on promoting saving, investment, and liquidity in the market, the ESX is poised to revolutionize the capital markets landscape in Ethiopia and contribute to the country's economic development and growth.