This week, Ethio Telecom will become the first company to list on Ethiopia's newly established stock exchange : Ethiopian Securities Exchange (ESX), with the government selling a 10% stake in the state-owned telecom provider. This move marks a major milestone in Prime Minister Abiy Ahmed's ambitious strategy to open Ethiopia’s economy to private investment and privatize key state-owned enterprises.

The creation of the Ethiopian Securities Exchange (ESX) is a key part of these economic reforms. Established as the country’s first formal stock market, it aims to provide a platform for companies to raise capital and allow investors to trade shares more transparently. This is a significant shift, as prior to the ESX, trading in Ethiopia was limited to over-the-counter deals. The exchange is a joint effort between the government and private partners, designed to modernize the country’s financial infrastructure and attract foreign investment.

The sale of a 10% stake in Ethio Telecom also signals the government's intention to divest an additional 45% of the telecom company to investors. The telecom sector, which serves a population of 120 million people, has been at the center of Ethiopia's economic liberalization. Ethio Telecom held a monopoly until 2022, when a consortium led by Kenya's Safaricom won the country’s first private telecom license.

Brook Taye, CEO of Ethiopia Investment Holdings, also mentioned the possibility of issuing a second private telecom license in the future. In addition, he highlighted a new financial sector bill currently being debated in parliament, which would pave the way for international banks to operate in Ethiopia. This could attract significant interest from regional and continental financial institutions, making Ethiopia a major destination for foreign banking investments.