The Ethiopian Capital Markets Authority ECMA has released its first regulatory guidelines for the Ethiopian Securities Exchange ESX in a bid to attract investor confidence in the new market, which is due to be launched imminently.
The Ethiopian government has been working to launch a securities exchange for the past four years as part of its broader programme of economic reform and liberalisation, which has also involved the Ethiopian birr ETB being freely floated for the first time and strategic sectors such as banking and telecommunications being exposed to competition.
The launch of the exchange will also see several major state-owned enterprises being listed , such as Ethio Telecom, the Ethiopian Insurance Corporation, and the Ethiopian Shipping and Logistics Services Enterprise ESLSE. The government hopes that by ending the decades-long domination of nationalised entities in the economy, it can boost Ethiopias competitiveness and attract foreign direct investment.
Local media in Ethiopia reports that ESX expects more than 90 businesses to list on the exchange in its opening weeks. The exchange has already raised around 1.6bn birr 13m in capital.
Now, ECMA has announced transparency and disclosure requirements in a bid to shore up this interest and reassure potential investors, domestic and foreign, that their capital is safe on the exchange.
