As Ethiopia Gears Up for Launch of Capital Markets, AAU Hosts Forum on Nation’s Latest Liberalization Move

Addis Ababa University held a capital markets forum that brought together leading experts and industry leaders who spoke on the eminent launch of capital markets in Ethiopia and the path to capital markets development. The experts discussed the role of capital markets, currency issues, experiences of other countries, and a host of other crucial topics. They emphasized the role of capital markets in the efficiency of financial markets and the promotion of foreign investment as well as attainment of the sustainable development goals.

Speakers Dr. Brook Taye, the Director General of the Ethiopian Capital Market Authority, and Ato Solomon Gizaw, CEO, HST shared experiences and insights, highlighting the vitality of enhancing capital market operations to harness economic growth in Ethiopia.

According to the panellists, Capital Market is crucial to strengthen Ethiopia’s investment activities and economic development creating opportunities for investors and companies to engage in a new way of investment to raise funds and encourage private investment. They added that domestic Capital Markets provide an alternative source of funding that can complement bank financing for a company in need of funding.

The panel discussion overall indicated that a well-developed and vibrant capital market can promote economic growth. It can also play a key role in the efficient allocation of financial resources to areas where they are needed most, generating the highest return for firms, enabling risk sharing, and facilitating the flow of finance to more risky but high-return projects.

The discussion highlighted that capital markets can offer better pricing, longer maturities, and access to a wider investor base. They can also offer to fund riskier activities traditionally not served by the banking sector and contribute significantly to innovation in an economy. A vibrant capital market would also allow governments to finance fiscal deficits without financial repression or foreign borrowing.

The President of AAU, Dr Samuel Kifle, leading scholars, and other guests attended the event.