Ethiopia’s Parallel Forex Rate Surges to 174 ETB, Testing Government Reforms

Ethiopia’s Parallel Forex Rate Surges to 174 ETB, Testing Government Reforms Ethiopia’s parallel forex market continues to spiral upward, with the exchange rate hitting a staggering 174 ETB per USD—a sharp rise from 160 ETB just weeks ago and a significant jump from the official rates. This widening gap highlights the deepening strain on the government’s reform agenda and foreign exchange market liberalization efforts. Reform Momentum Meets Structural Headwinds As part of its reform agreement with the International Monetary Fund (IMF), Ethiopia has undertaken ambitious steps to unify its exchange rate system. By eliminating most official FX rationing in mid-2024, the country initially reduced the black market premium to nearly zero. However, that trend has since reversed. According to the IMF’s Country Report No. 25/189, the premium had already climbed to 17% by May 2025—and recent market data suggests the gap has now widened even further. With the official rates hovering at ETB 154.17 per USD at Rooha Forex Bureau and ETB 134.4486 per USD at CBE, the new black market rate of 174 ETB reflects a premium of over 38%, undermining reform credibility and fueling public skepticism. The IMF attributes the persistent parallel market demand to several structural challenges: Ongoing FX restrictions, including a 2.5% commission on sales via the National Bank of Ethiopia (NBE) Strict capital controls and negative real returns on local currency assets A shallow, uncompetitive financial sector that lacks instruments for hedging against depreciation Diaspora Remittances: A Bright Spot Despite the headwinds, Ethiopia’s financial sector has seen some success in formalizing diaspora remittances. One standout initiative is the CashGo mobile app, developed by EagleLion and backed by leading banks such as CBE, Dashen Bank, and Bank of Abyssinia. The platform has helped channel remittances through official banking channels, contributing to a 24% increase in inflows over the past three months. Complementing these efforts is the Debo initiative—a nationwide awareness campaign launched by the NBE to encourage the use of Foreign Currency Accounts (FCY) and highlight legal remittance pathways. In tandem, the NBE has allocated 100 billion birr across 31 banks, accessible to the diaspora through the unite.et app for a variety of investment and savings purposes. IMF’s Roadmap for Stability While acknowledging Ethiopia’s progress, the IMF has stressed the need for sustained and deeper reforms to prevent backsliding. Key policy recommendations include: Phasing out the remaining current account restrictions Offering positive real interest rates to incentivize savings in birr Strengthening the interbank market and introducing hedging instruments Encouraging foreign bank entry to boost sectoral competition and resilience The IMF also draws lessons from global peers. It notes that Ethiopia’s challenges resemble Angola’s FX liberalization experience, where the parallel market premium lingered for years, unlike in Egypt or Nigeria, where reforms led to rapid stabilization. Official Optimism Amid Market Skepticism In a recent parliamentary address, Prime Minister Abiy Ahmed (PhD) celebrated major reform outcomes, including a 161% increase in forex reserves, 29% growth in private bank reserves, and $1.5 billion in export earnings—surpassing a $1.1 billion target. While these numbers are encouraging, the growing disparity between official and parallel rates continues to raise questions about sustainability. The IMF also praised Ethiopia’s transition to an interest-rate-based monetary policy framework, introduced in July 2024. While interbank and Treasury bill rates have risen above inflation, reflecting improved policy tools, the country still faces limitations in market depth, inflation control, and financial access. The new black market rate of 174 ETB per USD is a stark reminder that structural bottlenecks continue to constrain Ethiopia’s forex market reforms. While gains in remittances and reserve accumulation are promising, bridging the growing divide between official and parallel rates will require bold, sustained action—from capital market development to real interest rate reform and enhanced investor confidence. 1 COMMENT Hussen Ali Seid July 30, 2025 At 8:48 pm You’re ONE Person investors gets BTC coin but love me world digital assets Crypto currency coin Reply You’re ONE Person investors gets BTC coin but love me world digital assets Crypto currency coin LEAVE A REPLY Cancel reply Save my name, email, and website in this browser for the next time I comment. Δdocument.getElementById( "ak_js_1" ).setAttribute( "value", ( new Date() ).getTime() );

Asset Recovery Proclamation No. 1364/2025 Published in the Federal Negarit Gazette

Asset Recovery Proclamation No. 1364/2025 Published in the Federal Negarit Gazette ADDIS ABABA – The Federal Democratic Republic of Ethiopia has instituted a comprehensive new legal framework, the Asset Recovery Proclamation No. 1364/2025, aimed at combating economic crime and recovering illicitly obtained assets. Published in the Federal Negarit Gazette on May 2, 2025, the law introduces powerful new measures, including the confiscation of “unexplained assets” and the seizure of property without a criminal conviction in certain circumstances The proclamation is designed to create a unified and comprehensive legal framework for asset recovery, consolidating provisions that were previously scattered across various laws. Its stated goals are to suppress the detrimental effects of economic crimes on the nation’s economy, address the negative impacts of unexplained wealth on the tax and financial systems, and align Ethiopia with international agreements on asset recovery Key Provisions of the New Law: Targeting Unexplained Wealth: A central feature of the new law is its focus on “unexplained assets”5. Any person whose assets or lifestyle is disproportionate to their known legitimate income, past or present, and where there is reasonable suspicion of a crime, faces confiscation of those assets unless they can prove the legal source to a court’s satisfaction6. The law has a retrospective reach, allowing authorities to bring claims on unexplained assets acquired up to 10 years prior to the proclamation’s enactment, provided the estimated value of the assets is more than 10 million Birr. Non-Conviction Based Confiscation: The proclamation introduces “Non-Conviction Based Confiscation,” which allows for the seizure of assets even if the accused is not found guilty of a crime8. This can occur under several conditions, including when: A suspect dies, absconds, cannot be identified, or has immunity from prosecution. A conviction cannot be obtained due to the statute of limitations. Evidence is insufficient for a criminal conviction but indicates the assets were generated from criminal activity. Criminal charges are dropped for reasons such as amnesty. Expanded Investigative Powers: The Ministry of Justice will establish a dedicated department of prosecutors and investigators to lead asset recovery efforts. These officials are granted expanded powers to use special investigation techniques with court authorization. These methods include monitoring bank accounts, intercepting communications, conducting undercover operations, and using audio or video surveillance Victims, Whistleblowers, and Use of Funds: The law provides for the compensation of victims. If a victim’s property is recovered in its original form, it will be returned; if it has been altered or intermingled, the victim will be paid its value in cash16. Any remaining assets after victim compensation will be confiscated. Confiscated funds and proceeds from the sale of confiscated assets will be deposited into a special account opened by the Ministry of Finance and used to enhance the justice system. The proclamation also establishes a reward system for whistleblowers who provide information leading to the successful recovery of assets. International Cooperation: The Ministry of Justice is designated as the central authority for international cooperation in asset recovery. The law facilitates mutual legal assistance with other countries for joint investigations, freezing, seizure, and confiscation of assets. This proclamation repeals asset recovery provisions in several previous laws, including the Revised Anti-Corruption Special Procedure and Rules of Evidence Proclamation and the Prevention and Suppression of Terrorism Crime Proclamation, creating a single governing law for such matters. Cases that were pending before the issuance of this law will proceed under the pre-existing legal frameworks. The law is effective as of its publication date, May 2, 2025.

Gasoline, White Diesel, and Kerosene Prices to Remain Unchanged for August, Says Ministry

Gasoline, White Diesel, and Kerosene Prices to Remain Unchanged for August, Says Ministry Addis Ababa, July 20, 2017 (FMC) – The Ministry of Trade and Regional Cooperation announced today that the retail prices of key petroleum products — including gasoline, white diesel, kerosene, and aviation fuel — will remain unchanged for the month of August. The decision takes effect starting at 12:00 a.m. tonight. In a public statement issued by the ministry, it was confirmed that the government has decided to maintain the current prices of these essential fuels in order to stabilize transportation and household energy costs amid ongoing inflationary pressures and volatile global oil markets. Fixed Prices, Effective from Midnight Wondimu Flate, Director of Communication Affairs at the ministry, told Fana Digital that this pricing decision comes as part of the government’s monthly fuel price adjustment mechanism. He explained that while prices of some fuel types will stay the same, others — particularly industrial-grade products — will see changes. “After reviewing international fuel price trends and considering their impact on the domestic economy, the ministry decided to leave the prices of gasoline, white diesel, kerosene, and aviation fuel unchanged,” Wondimu stated. Adjusted Prices for Industrial Fuels The updated price schedule reflects new rates for black diesel variants, which are primarily used in manufacturing, construction, and other heavy industries: Light Black Diesel: 127.22 birr per liter Heavy Black Diesel: 124.55 birr per liter These rates represent moderate adjustments aligned with international market trends and cost recovery considerations. Call for Compliance The ministry also issued a directive to fuel distribution companies and gas station operators across the country, instructing them to strictly adhere to the updated price schedule. It reminded stakeholders that compliance is mandatory under the Proclamation for the Administration and Regulation of Petroleum Products, which outlines penalties for price manipulation and non-compliance. “The sale of petroleum products must be conducted transparently and in line with national laws and operational guidelines. We expect full cooperation from all retail and wholesale distributors,” Wondimu emphasized. Background: Monthly Fuel Price Adjustments Ethiopia introduced a flexible pricing system for petroleum products in 2022, which allows the government to adjust retail fuel prices on a monthly basis in response to fluctuations in the global oil market. The aim is to reduce the burden of fuel subsidies on the state budget while protecting consumers from sudden price shocks. Although global oil prices have experienced volatility in recent months — partly due to geopolitical tensions and supply chain disruptions — Ethiopia has taken a cautious approach by absorbing some of the cost to avoid passing it fully onto consumers. The ministry reiterated its commitment to ensuring fuel availability, price transparency, and energy sector stability across the country.

Abyssinia Bank Launches Paperless Banking Service Across All Branches

Abyssinia Bank Launches Paperless Banking Service Across All Branches Abyssinia Bank has officially launched its new paperless banking service at its newly established Ras Special Branch. The inauguration was attended by the Governor of the National Bank of Ethiopia, Ato Mamo Mehret, the CEO of Abyssinia Bank, Ato Bekalu Zeleke, along with senior executives, employees, and invited guests. This new system allows customers to transfer funds, deposit and withdraw cash, open accounts, and access other branch services quickly and securely—either independently or with assistance from bank staff. The service utilizes smart kiosks and tablets, along with fingerprint and facial recognition technologies, significantly enhancing the bank’s service delivery by eliminating time-consuming procedures and making operations faster, more reliable, and more transparent. Additionally, cash recyclers and bulk deposit machines have been installed at selected branches to provide customers with quick, queue-free service. These machines will be rolled out to all branches in the near future. The service is available in multiple national languages—Amharic, Afan Oromo, Somali, Tigrinya, Afar, Sidama—as well as English. It is designed to be user-friendly, inclusive, and accessible to all customers, regardless of age, education level, or technological proficiency.

Private Banks in Uproar over NBE’s Forced Merger Scheme

Banks unable to raise 5bln before June 2026 will be forced to consolidate, regulators warn The executives of private commercial banks are pushing back against a proposal from the National Bank of Ethiopia (NBE) seeking to force banks that fail to meet a five billion Birr minimum paid-up capital requirement before the June 2026 deadline into mergers. NBE regulators first introduced the requirement in a directive in April 2021, more than doubling the capital threshold and granting banks five years to comply with the new minimum. With less than a year to go, the central bank says it is ready to step in and actively oversee the consolidation process, which could affect even the oldest names in the industry. Speaking during the Ethiopian Finance Forum at the Commercial Bank of Ethiopia (CBE) headquarters last week, NBE Vice Governor Solomon Desta announced that commercial banks that cannot meet the requirement before the end of the fiscal year will be forced into mergers. “The NBE will decide which banks merge and will enforce that decision. Banks should prepare for this regulatory action,” he stated, eliciting a mix of laughter and uncertainty from industry leaders in attendance. Despite the NBE’s firm stance, the executives of private commercial banks who spoke to The Reporter voiced their strong opposition to the decision. “We have no plans to merge with another bank,” a senior manager at a mid-sized bank told The Reporter, speaking anonymously. “We’re already working toward fulfilling the five billion Birr minimum capital requirement. We are not opposed to mergers in principle, but the industry needs the right environment and adequate preparation for it.” His bank has a paid up capital of over 3.5 billion Birr. Nonetheless, the manager emphasized that mergers are not a concept to be pursued blindly. “Mergers are not a cure-all. Before merging, banks need to understand each other’s operational environment, philosophies, strategies, strengths, and weaknesses,” he said. The manager concedes that mergers are inevitable in the global context, but argues they should be approached strategically rather than enforced through regulatory compulsion. He also noted that foreign partnerships could be a better path forward for capital enhancement, particularly through strategic investors—an option allowed under the recently amended Banking Business Proclamation. “If local capital mobilization is insufficient, partnering with foreign investors could enhance competitiveness,” he said. The manager warned that without groundwork, forced mergers may result in internal conflicts and inefficiencies. His peers and industry experts seem to agree. Wolde Bulto serves as president of Gadaa Bank, which benefits from a three-year extension on the capital requirement deadline as a result of it still being under formation when the directive was issued in 2021. He says that while mergers are a potential option, Gadaa is not considering one at the moment. “Mergers and acquisitions remain a possible strategy, but we haven’t initiated local merger talks. We’re focusing on building capital and exploring strategic partnerships, including foreign investments,” Wolde told The Reporter. <img decoding="async" class="alignnone size-full wp-image-46203" src="https://www.thereporterethiopia.com/wp-content/uploads/2025/07/PRIVATE-BANKS-.jpg" alt="Private Banks in Uproar over NBE’s Forced Merger Scheme | The Reporter | #1 Latest Ethiopian News Today" width="911" height="456" title="Private Banks in Uproar over NBE’s Forced Merger Scheme | The Reporter | #1 Latest Ethiopian News Today" srcset="https://www.thereporterethiopia.com/wp-content/uploads/2025/07/PRIVATE-BANKS-.jpg 911w, https://www.thereporterethiopia.com/wp-content/uploads/2025/07/PRIVATE-BANKS--300x150.jpg 300w, https://www.thereporterethiopia.com/wp-content/uploads/2025/07/PRIVATE-BANKS--705x353.jpg 705w, https://www.thereporterethiopia.com/wp-content/uploads/2025/07/PRIVATE-BANKS--150x75.jpg 150w, https://www.thereporterethiopia.com/wp-content/uploads/2025/07/PRIVATE-BANKS--768x384.jpg 768w, https://www.thereporterethiopia.com/wp-content/uploads/2025/07/PRIVATE-BANKS--696x348.jpg 696w" sizes="(max-width: 911px) 100vw, 911px" /> Industry observers like Abdulmenan Mohammed (PhD), a London-based financial analyst keeping a close eye on Ethiopian banking, question the validity of the reasoning behind the requirement. He expressed dissatisfaction with the NBE’s claims that the directive is aimed at strengthening the industry ahead of the foreign banks’ entry. “Forced mergers don’t necessarily offer more benefits than drawbacks,” Abdulmenan told The Reporter. “Many banks established before 2012 can meet the capital requirement. It’s the newer banks that face challenges.” At the time the directive was introduced, the banking industry was awash with a flood of new entrants which nearly doubled the number of commercial banks in Ethiopia over the space of a few years. Entrants like Siinqee and Amhara banks have long since surpassed the capital threshold. Abdulmenan notes the feat may be too much for banks like Hijra and Zamzam, despite them performing well in operational terms. Others, such as Rammis and Tsehay, have incurred substantial losses and require urgent interventions—but not necessarily forced mergers, according to the expert. “Merging a healthy bank with a struggling one poses serious governance and valuation issues,” he warned. “How will shareholders of a bank with eight percent returns accept merging with one earning just three? The stronger bank’s shareholders will be diluted, and that creates dissatisfaction across the board,” Abdulmenan explained. He also pointed to the complex socio-political dynamics at many private banks, which were established along ethnic or religious lines. “How can two such banks with vastly different cultures and priorities collaborate effectively?” he asked, adding that large-scale staff layoffs and branch closures would likely follow any mergers. “In developed countries like the US or UK, thousands of banks exist. More banks mean better financial access and competition. Consolidation only for the sake of reducing numbers doesn’t make sense,” said Abdulmenan. The analyst also dismissed fears over foreign competition. “Kenya’s KCB Bank, which is expected to enter the Ethiopian market, has assets that are not significantly greater than Awash Bank’s, which holds only about five percent market share in Ethiopia. Is KCB really such a threat to local banks?” asked Abdulmenan. He estimates that close to a dozen of the 32 commercial banks may struggle to meet the capital requirement, but insists that mergers should be evaluated case by case, not through a blanket policy. However, not all experts oppose the NBE’s approach. Dakito Alemu (PhD), an associate professor of accounting and finance at Addis Ababa University, argues the NBE is within its legal rights in forcing banks into mergers. He cites the Banking Business Proclamation, which grants the central bank the mandate to enforce statutory mergers to protect the stability of the financial sector. Dakito argues the NBE’s move is a proactive measure to help local banks withstand foreign competition and ensure financial stability. “If some banks cannot meet the minimum requirement, they can still enter voluntary mergers with others under NBE guidance,” he said. The expert encourages banks to consider raising capital by listing on the Ethiopian Securities Exchange (ESX), which offers an opportunity to attract investment by selling shares to the public. Although Dakito’s advice is sound, a former banker with a deep understanding of the industry told The Reporter he believes the intention to force mergers has nothing to do with the pending entry of foreign competition. Speaking anonymously, the ex-banker observes Ethiopian banks currently lack the capital strength necessary to withstand potential macroeconomic shocks. He emphasized that meeting the capital adequacy ratio—or the minimum required paid-up capital—is a globally accepted standard in banking. To illustrate his point, he compared it to building a house: “A house without a strong foundation can be washed away by floods or other natural disasters. Similarly, the NBE is preparing for potential economic disruptions as the country opens up—not just in banking, but across the broader economy,” the ex-banker told The Reporter. He noted that protecting depositors’ funds and ensuring banks have the capacity to absorb economic shocks is critical, especially as various risks could emerge from multiple sectors. The global standard for capital adequacy is eight percent, but the NBE requires Ethiopian banks to maintain a 15 percent ratio, he noted. “Many banks are struggling to meet this requirement, which indicates that they are undercapitalized,” he said. The insider also highlighted the USD 700 million recently injected into the state-owned CBE by the World Bank as a move aimed at strengthening its shock absorption capacity.

Auto Assemblers on Verge of Collapse as Gov’t Pulls Break on Component Imports

Dozens of domestic vehicle assemblers say they are on the verge of shutting down their plants as a result of an abrupt decision from officials at the Ministry of Industry prohibiting the import of components used to build fuel-powered cars. A recent memo from the Industry Minister to the central bank, Customs Commission, and the Transport and Finance ministries declares that components for the local assembly of combustion engine vehicles will no longer be allowed to enter the country. Melaku and policymakers at the Ministry want to see Ethiopia’s fledgling vehicle assembly industry shift towards electric vehicles (EVs) and hybrids, but investors who spoke to The Reporter caution that a sudden transition is infeasible and could wind up costing thousands of jobs. “Existing local fuel-powered car assemblers have been instructed to shift to assembling only EVs and hybrids. This aligns with Ethiopia’s policy of transitioning from fuel cars to cars that only use renewable energy,” Tilahun Abay, an advisor at the Ministry of Industry, told The Reporter. Since the government enacted its ban on the import of combustion engine vehicles last year, the number of EVs on the country’s roads has surged, with a report from the Transport Ministry putting the total at more than 42,000 as of March 2025. “However, the continued operation of local fuel car assemblers is compromising this overarching policy. Therefore, any import of components used for local fuel car assembly is ordered to cease,” reads Melaku’s memo. While the government sees the proscription as a key part of its overarching green transition policy, the operators of more than 30 assembly plants say the move is a death sentence for an industry that had just begun to reap the fruits of decades of struggle when the government kicked off its green transport drive last year. Ahmedin Mohammed serves as president of the Association of Automotive and Sparepart Manufacturers—an industry lobby group—and heads O’clock Motors, a company that runs a sizable vehicle assembly plant on the outskirts of Addis Ababa. He described the dilemma faced by assemblers such as O’clock, Marathon Motors, and Belayab Motors to The Reporter. “We’ve already been stuck since the government banned the import of fuel cars. Now, it has proscribed domestic vehicle assemblers. This is a devastating blow to investors who have put huge amounts of money, skill, energy, and manpower into the business,” said Ahmedin. He argues the government’s instructions to switch over to EV and hybrid assembly are simply not feasible. “We have a 20 percent or more profit margin in assembling fuel cars. Assembling EVs locally has no profit margin. Importing [built-up] EVs is much more profitable than importing EV components assembling them here,” Ahmedin told The Reporter. He revealed that assembly plants are sitting idle, but still paying employee salaries including for the automotive experts who run the assembly lines. O’Clock Motors alone employs around 100 people, and Ahmedin says the factory can only stay open for three more months at best. “All auto factories are on the verge of extinction. Many are already cutting jobs,” he told The Reporter. Another problem, according to Ahmedin, is the lack of regulation and control around EV imports in Ethiopia. “Second-hand EVs are flowing in from China and elsewhere. There are so many types of EVs coming in, but Ethiopia has no standards as to which ones should be adopted,” he said. Ahmedin observes that many EV buyers lack access to the after-sale services offered by local assemblers. He also expressed doubts about the government’s ambitions to produce batteries for EVs domestically. “Which EV would we produce [batteries] for? There isn’t a selective approach. There is also no manpower on EVs,” said the Association President. “Unless the government reverses this policy, O’clock will shut down within a maximum of three months. Other assemblers are also on the verge of closing.” He argues the small number of cars assembled by domestic plants each year (around 1,000 cars) is negligible and should not have a bearing on the policy. “This does not affect or compromise the policy. The government should allow them to continue,” said Ahmedin. He urges the government to encourage and incentivize local EV assembly rather than EV imports. A study submitted to the Ministry of Industry by Ahmedin’s lobby group, which counts more than 30 members, recommends tax exemptions and other incentives for assemblers, while calling for officials to introduce regulatory mechanisms for EV imports. “For instance, there are currently no EV spare parts in Ethiopia. We recently imported a single part for 1.2 million Birr, via air transport. Auto factories have invested a huge amount of resources. Destroying all that at once is a bad decision,” said Amhedin. He foresees that investors will be reluctant to venture into EV assembly without a solid regulatory framework. “Unless Ethiopia introduces its own selective, study-based policy for EV adoption, investors cannot front the cash. This is also difficult for FDI. There are innovative engineers and entrepreneurs in Ethiopia. If Ethiopia has a proper EV policy, they could engage in producing EV spare parts. EVs have software that also needs to be updated periodically. There is no such trend in Ethiopia. EV imports in Ethiopia are unregulated,” said Ahmedin. The Association and the managers of local assembly plants are scheduled for a sit down with officials at the Ministry of Industry next week.

Doubled Deposit Interest Tax Rate Troubles Bankers

Bankers have opposed the government’s decision to double the tax rate on deposit interest, arguing the move will discourage saving. The government is upping the rate to 10 percent as part of its aggressive drive to boost tax revenue. Bank executives decried the change during the Ethiopian Finance Forum held Tuesday. Among them was Zemen Bank chief Dereje Zebene, who called on the government to reverse the decision and explore other options. Dereje, who joined Zemen as president in 2018, fears the move will shrink the incentive for depositors to save money at banks, which will in turn lead to liquidity problems and ultimately hurt loan disbursements and investment. “Without mobilizing more money from depositors, banks cannot provide more capital for investors. Government policy should prioritize how to incentivize saving, not the other way round,” said the President. “I doubt whether serious research was conducted before doubling the tax rate on deposit income. We expected new policy packages that encourage depositors to save more money—what we see now is otherwise.” Experts who spoke to The Reporter also worry the move is untimely and detached from the economic context. They observe that high inflation rates already negate bank deposit interest rates, which sit near seven percent. The government’s latest figures put headline inflation at more than double that figure. Deposit interest rates also pale in comparison the interest banks charge on loans, which can go as high as 24 percent. The discrepancies were noted by Dereje. “Inflation is higher than the deposit interest rate. This means the saving rate is negative,” he said. Experts also foresee the increased tax rate could push banks to raise loan interest rates. During the forum, bankers and investors asked NBE regulators and Ministry of Finance officials why loan interest rates for critical sectors like agriculture are not lowered. Abie Sano, president of the Commercial Bank of Ethiopia, said the state-owned giant offers credit to the agriculture sector with a reduced interest rate—one percentage point lower than the rate offered by private banks. NBE Governor Mamo Mihretu and Agriculture Minister Girma Amente (PhD), stated they are developing packages to lower loan interest for agriculture, as well as mechanisms to allow farmers to borrow without collateral. Ethiopia’s savings-to-GDP ratio increased from 20 percent in 2000 to 33 percent in 2018, before it declined to 18 percent in 2024, according to an UNDP report from April 2024. The African Development Bank (AfDB) has slightly different figures. Its latest reports indicate that Ethiopia’s gross domestic savings has grown from 9.5 percent of GDP in 2004 to 24.3 percent in 2020 through its banking nonbank financial institutions.

Only a Third of SDG Targets on Track: UN

– USD 4tln financing gap persists as ODA declines by 7pct The 2025 Sustainable Development Goals (SDG) report issued by the UN Secretary-General indicates only 35 percent of the 137 SDG targets are on track, while progress is insufficient on 47 percent of the targets, and 18 percent show regression. The report called for special acceleration efforts for SDG implementation in Africa, while noting an annual USD four trillion financing gap with official development assistance (ODA) suffering from a seven percent decline. A UN forum on SDGs concluded in New York this week. An Ethiopian delegation led by Fitsum Assefa, minister of Planning and Development, presented a report that emphasized key achievements across the five goals selected for review, which include health, gender equality, and economic growth. The Minister reported achievements in food security, social protection, economic growth, and productivity. Ethiopia’s achievements in agricultural productivity, including through irrigated heat-resistant wheat farming, and its role in ending hunger and ensuring food security took centre stage. Progress in access to education at lower levels with targeted investment in pre-primary schools that have quadrupled was also noted. The expansion of school feeding programs, and a related decrease in school dropouts, was highlighted, while Fitsum reported significant reductions in maternal and under-five mortality rates. In the area of climate change, Ethiopia showcased its Green Legacy Initiative that officials claim saw the planting of over 40 billion seedlings over the past six years. The initiative has reportedly expanded Ethiopia’s forest coverage to 24 percent. The report also touched on improvements in electricity access and road infrastructure. The report outlined challenges Ethiopia, along with other developing countries, face in the implementation of the SDGs. These include inadequate youth employment, fiscal constraints, climate shocks, global price volatility, and declining development assistance. Several speakers praised Ethiopia’s progress and recommended measures in the fields of job creation and health finance. The Secretary-General of the UN, in launching the report, warned the international community about regression and appealed for urgent multilateralism to apply the available tools in alleviating poverty.

2025 Guide: How Diasporas and Foreigners Can Legally Buy Property in Ethiopia

2025 Guide: How Diasporas and Foreigners Can Legally Buy Property in Ethiopia By Live Ethio Real Estate Consulting PLC Ethiopia’s Real Estate Market is Booming – But Can Foreigners Join In? Ethiopia’s real estate sector is on the rise, now valued at over US $1.15 trillion, according to recent data from Statista. Fueled by rapid urbanization, an expanding middle class, and growing interest from the diaspora and foreign investors, cities like Addis Ababa are seeing rising demand for residential, commercial, and mixed-use developments. Rental yields in prime locations are averaging 7–10%, making Ethiopia increasingly attractive for both long-term investors and lifestyle buyers. Despite challenges such as limited mortgage access and high construction costs, recent legal reforms are opening new doors—especially for foreign nationals. New Law Now Allows Foreigners to Buy Property in Ethiopia In a landmark move, Ethiopia’s government has passed legislation permitting foreign nationals to own property under certain conditions. For the first time, non-citizens can legally purchase residential or commercial real estate—though land ownership remains off-limits. Key Provisions: Minimum investment: $150,000 USD per property Ownership limit: Up to 5 properties per foreign individual or company Mortgage access: Foreigners cannot access local home loans Public housing restriction: No access to government-subsidized housing Step-by-Step Guide to Buying Property in Ethiopia Live Ethio simplifies the purchasing journey with a five-step process—whether you’re a diaspora investor or a foreign national abroad: Property Search & Visit – Work with licensed agents to identify listings. Start browsing curated properties for sale in Addis Ababa, Ethiopia. Offer & Negotiation – Submit a formal offer and negotiate terms. Preliminary Agreement (“Mender Wul”) – Secure the deal with a 10% down payment. Final Sale Agreement – Signed at DARA (Document Authentication and Registration Agency) and prepared with legal counsel. Registration & Title Transfer – Pay a 6% stamp duty and officially transfer ownership at the sub-city land office. Can’t travel to Ethiopia? You can buy legally through a notarized Power of Attorney, handled by our in-house legal partners. What Foreign and Diaspora Buyers Must Know To qualify for property ownership, you’ll need: Valid passport and visa Proof of investment activity Bank statements Marital status documentation Formal bank transfer (no cash payments allowed) Explore houses for sale in Addis Ababa or real estate developments with verified title deeds and trusted brokers. Due Diligence Checklist: Don’t Skip These Steps Whether buying a finished home or off-plan unit, proper vetting is essential: Verify the title deed at the land bureau Ensure zoning compliance Check for existing debts or disputes Survey land area, especially when buying land for sale Avoid unlicensed agents and informal deals Understand the Costs In addition to the purchase price, factor in: Stamp Duty: 6% Agent Fees: ~2% (shared or paid by buyer/seller) Legal Fees: Varies Other Costs: Registration, document authentication, and loan processing (if applicable) Avoid These Common Pitfalls Buying without verifying the title deed Falling for “too good to be true” off-plan schemes Skipping legal review Using informal payment methods Trusting unlicensed brokers Explore our 2025 Ethiopia Real Estate Guide for Foreigners & Diaspora for detailed information on purchasing property in Ethiopia. Why Work With Live Ethio? At Live Ethio, we specialize in helping diasporas and international investors safely and legally enter Ethiopia’s real estate market. From land to luxury homes, from legal guidance to project development—we’re the trusted partner behind hundreds of successful property transactions. 📍 Visit us: Merkeb Plaza, Bole Dembel, Addis Ababa📞 Call or WhatsApp: +251 947 00 22 33 | +251 974 29 94 72📧 Email: contact@livingethio.com🌐 Explore properties or book your free consultation: https://livingethio.com/