Awash Bank Secures Over $498 Million in Foreign Exchange for Over 2,200 Customers

Awash Bank Secures Over $498 Million in Foreign Exchange for Over 2,200 Customers Amid Ethiopia’s Currency Challenges Addis Ababa, March 27, 2017 (FM C) — Awash Bank has taken a leading role in addressing Ethiopia’s ongoing foreign exchange shortage, securing over $498 million in foreign exchange for its customers during the first quarter of 2017. This comes as the country continues to struggle with a scarcity of foreign currency, which has impacted businesses, essential imports, and the broader economy. In addition to serving over 2,200 customers with foreign exchange, Awash Bank reported that it also facilitated more than $100 million in foreign exchange transactions for various domestic banks. This step is part of the bank’s larger effort to stabilize the market and ensure that businesses and individuals have access to the required foreign currency. Despite these efforts, Awash Bank highlighted the challenges posed by the government’s inability to fully meet all short-term foreign exchange needs. Specifically, the government has been unable to provide $50 million for oil imports, $79 million for fuel imports, $20 million for sugar, and $11 million for rice—items critical to Ethiopia’s daily functioning and food security. The bank has also prioritized foreign exchange allocations to strategic sectors such as education and healthcare, recognizing their critical importance in sustaining the country’s development and public services. By ensuring that these sectors receive their required foreign exchange, the bank is helping mitigate the impacts of the shortage on the population. Currently, the National Bank of Ethiopia (NBE) is distributing foreign exchange to commercial banks on a 15-day cycle, which has helped alleviate some of the pressure on the market. As a result, Awash Bank has observed improvements in the flow of foreign currency, contributing to greater stability in the foreign exchange market. The bank has expressed optimism that the foreign exchange supply will continue to increase in the coming months, as both the government and private banks work together to address the shortages. Awash Bank has reassured its customers that it will continue to meet their foreign exchange needs and maintain a steady supply of foreign currency. In its statement, the bank emphasized that its ongoing foreign exchange efforts are crucial for supporting Ethiopia’s economy, particularly in light of the country’s increasing demand for imports and the need to service foreign debt obligations. The situation remains challenging, but Awash Bank’s proactive approach aims to play a significant role in stabilizing the foreign exchange market in the short and long term. The bank remains committed to providing essential services to its customers as the economy moves forward.

NBE audit reveals scale of forex losses, mounting government debt

Audit conducted under terms of IMF deal The latest audit report of the National Bank of Ethiopia (NBE) details the central bank’s struggle with losses in forex dealing and gold trading, as well as mounting government debt. MSE Audit Service LLP conducted the audit covering the year beginning July 2022 as part of the terms of the government’s agreement with the International Monetary Fund (IMF), which included the NBE in its demands for audits of state-owned enterprises. The audit report was approved at the end of last month and published on the NBE website on April 4, 2025. Wholly owned by the government, the NBE operates as the central bank of Ethiopia and acts as the banker, fiscal agent and financing advisor to the government. Auditors found the central bank had a negative general reserve balance of close to one billion birr at the end of the reporting period, arising from losses of 1.8 billion birr in 2022 and 1.4 billion birr the year prior. The losses were due to impairments on government and state-owned bank securities and loans and advances, disparities in gold purchase and selling prices, and the depreciation of the local currency, according to the report. Auditors stated the concerns will likely impact the NBE’s ability to meet its operational and debt obligations as they come due, while placing pressure on its ability to fulfil policy mandates such as maintaining price stability and exchange rates. The central bank incurred net forex losses of more than 12 billion birr during the reporting period, and a similar amount the year prior. The report cites devaluation policies and the NBE’s high exposure to forex-denominated assets and liabilities, including obligations to international financial institutions, as reasons behind the sizable losses. Auditors warn the government’s sweeping forex regime reforms enacted in July 2024 could introduce further volatility, jeopardizing the central bank’s already shaky position. The NBE recorded losses on currency notes of 6.4 billion birr, down from 10 billion birr in 2022. The central bank faced losses in its gold trading activity, with revenue from sales of gold dwindling from 22 billion birr in 2022 to 14 billion birr in 2023. This was because “revenue from sale of gold was less than the gold purchase cost due to the increase on premium price which was paid to the suppliers of gold on the world gold price,” reads the audit report. The NBE’s gold purchases also halved from 27 billion birr in 2022 to 15.5 billion birr in 2023. The central bank managed to reverse net operating income losses in 2021 and 2022 to record a 588 percent increase to nine billion birr in 2023. The upsurge was driven by interest earned on loans and advances and deposit investments held abroad, and fees and charges, according to the report. It also managed to slightly reduce its general and administrative expenses, from 15 billion birr in 2022 to 13 billion birr in 2023. The central bank extended 137 billion birr in credit to state-owned banks and 15 billion birr to private commercial banks in 2023, according to the report. The NBE generated 11 billion from commissions on exchange services, and a further 852 million birr from service charge commissions. The NBE is legally obligated to transfer 20 percent of its net profit to the general reserve, which showed an improvement of 64 percent to reach a negative balance of 986 million birr during the reporting period. Meanwhile, the central bank registered net interest income of 17.4 billion birr in 2022/23, up from 11.6 billion birr the year before. Its assets also grew by more than 25 percent to 833 billion birr, with dues from the government accounting for 583 billion birr in the form of direct advance bearing a three percent interest rate and bonds bearing a two percent rate and set to mature in batches in 2044 and 2047. Another batch of non-interest bearing bonds are expected to mature in 2034. As of June 30, 2023, the value of direct advances to the government stood at 130 billion birr while it held 430 billion birr in interest-bearing bonds. The central bank’s authorized capital stood at half a billion birr in 2023, but a new proclamation introduced by Parliament this year has raised the figure to a staggering 20 billion birr. The total cost of printing bank notes and minting of coins jumped from 2.4 billion to 3.8 billion birr, according to the audit report, while currency in circulation exhibited an increase from 209 billion birr to 255 billion birr over 2023. The figure was adjusted to reflect an estimated 60 million birr that was lost during the state of armed unrest in parts of the country, according to the report. At the end of June 2023, the NBE’s forex reserves had dropped to the equivalent of 655 million birr. The central bank has recently reported a significant improvement in reserve levels following the IMF deal. NBE held shares in Afrexim bank, Africa Reinsurance and EthSwitch valued at a total of 913 million birr in 2023, according to the report. It reveals the NBE received a time deposit of USD one billion from Saudi Arabia in late 2015 for a period of six years at a three percent interest rate, and additional deposit of half the amount in June 2019 after it repaid the same amount. The two parties have agreed to a new repayment plan and the NBE did not offer any form of collateral for the time deposit, according to the report. The central bank also received a USD one billion time deposit from the UAE in 2019 at a fixed rate of three percent payable semi-annually.

Ethiopia Secures Debt Restructuring Deal, Extends Payment Deadlines

Ethiopia’s official creditors are nearing the completion of a debt restructuring agreement that will extend payment deadlines, but will not involve any reduction of the country’s outstanding debt, as confirmed by William Roos, co-chair of the Official Creditor Committee (OCC). Following its default in December 2023, Ethiopia reached a preliminary deal in March with its creditors to restructure $8.4 billion in debt, marking a key milestone in addressing its sovereign default. The deal will provide the country with around $2.5 billion in debt relief, which will be applied through 2028 and is in line with the country’s program with the International Monetary Fund (IMF). Roos explained that the deal aims to reduce Ethiopia’s overall debt burden by extending the maturity dates, thereby easing the pressure on payments during the IMF program. Although some bondholders view the country’s financial crisis as a liquidity problem, Roos emphasized that Ethiopia’s situation is a combination of liquidity challenges and the need to significantly reduce its debt stock. The restructuring process follows the G20 Common Framework guidelines, but Ethiopia is still at odds with holders of its $1 billion Eurobond. Bondholders have rejected the proposed 18% reduction in debt, arguing that the IMF’s debt sustainability analysis is flawed, particularly in its valuation of the country’s gold and coffee exports. Roos highlighted that cooperation between the two OCC co-chairs, France and China, has been highly effective, but noted that three creditors— the United Arab Emirates, Kuwait, and Poland—have opted to pursue separate renegotiations.

Authority doles out five capital market service provider licenses

Wegagen, CBE nab first investment banking permits The Ethiopian Capital Market Authority (ECMA) has approved licenses for five businesses to operate as capital market service providers (CMSPs). CBE Capital SC and Wegagen Capital Investment Bank SC have acquired investment banking licenses, while HST Investment Advisory Services PLC and Equation Securities Investment Advisor PLC join the expanding Ethiopian financial sector as investment advisors, and Ethio-Fidelity Securities SC nabs the first securities dealer license. The licenses were approved during a ceremony on Friday, marking a significant milestone in the journey towards the operationalization of the country’s first capital market—the Ethiopian Securities Exchange (ESX). The new batch of licenses brings the total number of authorized capital market service providers to nine. The Authority continues to introduce new legislations and process license applications for several other service providers required to install a functional capital market ecosystem. The first four licenses were doled out to investment advisors, but the inclusion of investment banks and a securities dealer represents a transformative moment for the market. The licensing of CBE Capital, Wegagen Capital Investment Bank is especially significant as both institutions are substantially owned by two major commercial banks—the state-owned Commercial Bank of Ethiopia (CBE) and Wegagen Bank, respectively. A central bank directive introduced in July 2024 allows banks to acquire up to 100 percent equity shares in a capital market service provider, while limiting bank ownership in an insurance firm to not more than five percent of the firm’s subscribed capital. Banks can also own up to 10 percent of a non-banking business other than insurance. “The licensing of these five new capital market service providers is a clear sign that Ethiopia is on track to create a functional, diverse, and well-regulated capital market that will drive the country’s economic growth. The Ethiopian Capital Market Authority remains committed to providing the support and regulatory framework necessary for the continued success of the capital market and its participants.  The ECMA also reaffirms its commitment to building a market that can foster innovation, attract investments, and contribute to sustainable economic development. With the growth of licensed CMSPs and the continual enhancement of regulatory frameworks, Ethiopia is positioned to become an increasingly attractive destination for both local and international investors,” reads a statement from the Authority.

How Investment Banks Will Unlock New Opportunities for Ethiopian Entrepreneurs

Ethiopia’s historic decision to allow investment banks in the country is a significant move that has the potential to transform its business landscape and foster economic growth. By opening up the financial sector to investment banks, Ethiopia will create a more robust and diverse financial environment, enabling businesses to access capital more efficiently, enhance corporate governance, and expand their operations. The entry of investment banks into Ethiopia is a transformative development that will significantly benefit the country’s business environment. It will provide companies with new avenues for raising capital, expanding internationally, executing mergers and acquisitions, and receiving expert financial advice. Drawing on the successes of investment banks globally and across Africa, Ethiopian businesses are poised to unlock new growth opportunities, helping them to become more competitive both locally and internationally. This historic move positions Ethiopia as a key player in the evolving African financial landscape, attracting both local and foreign investors to the country’s emerging markets.

Ethiopian Capital Market Authority Licenses Five New Service Providers,

Addis Ababa, Ethiopia – The Ethiopian Capital Market Authority (ECMA) marked a major milestone in the country’s financial development by granting licenses to five new capital market service providers (CMSPs) on March 21, 2025. This event increases the number of licensed CMSPs from four to nine, signaling a significant expansion in Ethiopia’s capital markets. The newly licensed entities include: The introduction of these five new firms is pivotal to diversifying Ethiopia’s financial markets, with services ranging from investment banking to securities dealing and advisory. This expansion helps lay the groundwork for a more mature and competitive capital market, offering improved capital raising and investment opportunities, both for local and international investors. For the first time, Ethiopia sees the entry of investment banks and securities dealing companies into the market. This move marks a transformative period for the country’s financial sector, which previously only had investment advisers as licensed providers. Notably, CBE Capital S.C. and Wegagen Capital Investment Bank S.C. stand out, as both are owned by major commercial banks – the Commercial Bank of Ethiopia (CBE) and Wegagen Bank, respectively. These banks were given permission to own up to 100% equity in capital market service providers under the recently issued National Bank of Ethiopia Directive SBB/92/2024, which enhances the integration of banking services within the capital market framework. The new entrants not only strengthen the market’s infrastructure but also reflect the growing influence of women in Ethiopia’s financial industry. Both Wegagen Capital Investment Bank and HST Investment Advisory Services PLC are led by female CEOs, showcasing a positive shift toward greater gender inclusivity. In her address at the licensing ceremony, the Director-General of the Ethiopian Capital Market Authority emphasized the responsibility these new service providers have in maintaining the integrity and growth of the capital market. She underscored that their operations would be critical to fostering investor confidence, increasing market liquidity, and ensuring the success and sustainability of Ethiopia’s financial system. The ECMA remains committed to developing a robust, diversified, and well-regulated market. As Ethiopia’s capital market continues to grow, it is expected to attract more investments, support sustainable economic development, and position the country as an increasingly attractive destination for both local and international investors. This licensing event marks just one step in the larger effort to build a dynamic financial ecosystem capable of supporting Ethiopia’s economic aspirations. With the growing number of licensed CMSPs, the country is laying the foundation for a prosperous financial future.

Ethiopian Airlines and Etihad Airways Forge Landmark Partnership to Boost Connectivity Across Africa, the Middle East, and Asia

Addis Ababa, Ethiopia – March 19, 2025 – Ethiopian Airlines and Etihad Airways have announced a strategic Joint Business Agreement to enhance connectivity between Africa, the Middle East, and Asia. This partnership includes a codeshare arrangement and the introduction of new direct flights between Addis Ababa and Abu Dhabi, facilitating seamless travel for passengers and boosting economic ties between the regions. As part of this expansion, Ethiopian Airlines will launch flights to Abu Dhabi on July 15, while Etihad Airways will commence daily flights to Addis Ababa starting October 1. This move strengthens both airlines’ networks, offering travelers enhanced flexibility and increased flight options. Ethiopian Airlines, the continent’s largest airline, operates a modern and diverse fleet of over 140 aircraft, ensuring efficiency and global connectivity. Its fleet includes: Ethiopian Airlines continues to expand its fleet, aiming to reach more than 150 aircraft in the coming years as part of its Vision 2035 strategy. Etihad Airways, the national airline of the United Arab Emirates, operates a fleet of around 80 aircraft, specializing in premium services and long-haul connectivity. Its fleet includes: Etihad Airways has been focusing on sustainability, incorporating modern fuel-efficient aircraft to reduce its environmental footprint while maintaining its reputation as a luxury airline. The Ethiopian-Etihad partnership will allow passengers to connect through both airlines’ networks, offering expanded route options across Africa, the Middle East, Asia, and beyond. The codeshare agreement will facilitate smoother transit experiences, frequent flyer benefits, and shared operational efficiencies. This agreement further cements Abu Dhabi and Addis Ababa as key aviation hubs, strengthening their roles in global connectivity and economic development. For more details, visit the official websites of Ethiopian Airlines and Etihad Airways.

Ethiopian Airlines to Launch Direct Flights to Hanoi, Vietnam

Ethiopian Airlines has officially announced the launch of four weekly flights to Hanoi, the capital city of Vietnam, set to begin on July 10, 2025. This new route is part of the airline’s ongoing expansion strategy to enhance its international network and provide more travel options between Africa and Southeast Asia. Ethiopian Airlines Group CEO, Ato Mesfin Tassew, emphasized the importance of this new route, noting that it marks a significant milestone in the airline’s growth in the Southeast Asian market. “The addition of Hanoi to our network will not only increase our reach in Southeast Asia but also strengthen our relationship with Vietnam and other countries in the region,” Tassew said. This expansion aligns with Ethiopian Airlines’ goal of offering more diverse and accessible flight options for travelers across continents. The new flights will directly connect Addis Ababa, Ethiopia’s capital and Ethiopian Airlines’ hub, with Hanoi, Vietnam’s vibrant political and cultural heart. Passengers will now have a convenient travel option for both business and leisure trips to the region. The route will significantly improve connectivity between Africa and Southeast Asia, providing passengers with easier access to both regions. CEO Ato Mesfin Tassew further explained that the new Hanoi flights would play a crucial role in enhancing bilateral relations between Ethiopia and Vietnam, particularly in terms of trade, tourism, and cultural exchange. “This new service will contribute to strengthening the economic ties between Ethiopia and Vietnam, supporting both business and tourism growth,” Tassew said. The flights will also help improve trade opportunities between Ethiopia and Vietnam, especially as the two countries explore new avenues for cooperation in areas such as agriculture, technology, and education. Additionally, the route will encourage Vietnamese travelers to explore Ethiopia’s rich history, culture, and growing tourist attractions, further boosting Ethiopia’s tourism sector. The direct flights to Hanoi come as part of Ethiopian Airlines’ broader strategy to expand its reach in Southeast Asia, which also includes existing routes to cities like Bangkok, Singapore, and Kuala Lumpur. This continued growth in the region allows Ethiopian Airlines to further cement its position as a leading global airline, connecting Africa to key destinations across Asia, Europe, and beyond. The new Hanoi route is expected to increase Ethiopia’s visibility and presence in the rapidly developing Southeast Asian market, which has been experiencing significant growth in trade, tourism, and investment opportunities. By adding Hanoi to its network, Ethiopian Airlines is positioning itself to tap into these expanding opportunities and contribute to fostering greater international cooperation and connectivity.

Feres Increases Fare by 30 Birr Following Ride’s Price Adjustment

Feres, a major ride-hailing service in Ethiopia, has raised its base fare from 100 birr to 130 birr, implementing a 30 birr price increase effective this week. This adjustment comes months after Ride, another leading ride-hailing platform, increased its base fare to 130 birr, making Feres one of the last major platforms to adopt the new pricing model. According to Feres drivers, the fare hike is primarily driven by rising fuel prices, vehicle maintenance costs, and foreign exchange rate fluctuations. Many drivers have been requesting a fare adjustment for months, citing financial difficulties due to increased operational expenses. Industry reports indicate that Feres initially maintained its 100 birr fare even after Ride adjusted its pricing, which resulted in some drivers moving to platforms that had already raised fares. Drivers claim that without the adjustment, their earnings were insufficient to cover increasing fuel prices, spare parts costs, and platform commissions. The fare adjustment applies to all rides booked through the Feres platform. Some drivers have welcomed the change, stating that it helps offset rising expenses, while others note that the delay in adjusting fares caused many drivers to shift to competing services. For passengers, the fare increase means that ride costs across multiple platforms are now standardized, with both Feres and Ride charging 130 birr as a base fare. While some riders acknowledge the rising costs of transportation services, others have raised concerns about affordability, particularly for those who rely on ride-hailing services for daily commuting. The Ethiopian ride-hailing market has seen multiple fare adjustments over the past year as companies respond to economic conditions, inflation, and foreign currency shortages. The latest fare increase by Feres aligns its pricing with competitors and reflects broader market trends affecting the transportation sector. With ongoing economic fluctuations, further adjustments in ride-hailing fares could be subject to fuel price changes, regulatory decisions, and platform strategies.