The Vice Governor of the Central Bank of Ethiopia, Solomon Desta told reporters that Ethiopia will give up to five banking licenses to foreign investors over the next five years as part of preparations to open up the financial services sector to global competition.
Prime Minister Abiy Ahmed’s government has committed to liberalising areas traditionally controlled by state-owned enterprises in order to boost international investment and economic growth.
“We will give three to five licenses within five years,” vice governor of the central bank Solomon Desta told reporters.
The Ethiopian banking sector is dominated by the state-owned Commercial Bank of Ethiopia, with the sector having 29 banks, all locally owned.
Vice Governor Desta stated that there will be a variety of entry points for international investors into the market, including the creation of local subsidiaries or joint ventures with domestic competitors.
Ethiopia, a nation of more than 100 million people and one of the largest economies in Sub-Saharan Africa, has long attracted the attention of foreign investors who are interested in the banking, telecom, transportation, and aviation sectors.
To end the monopoly of state-owned Ethio Telecom in that industry, Ethiopia’s government awarded a private operator a telecommunications license two years ago.
The license cost $850 million, and the operator—a group that included Vodafone, Sumitomo, and Kenya’s Safaricom—paid for it.
Along with issuing a third telecoms license, Ethiopia has also started a bidding procedure to sell a 45% interest in Ethio Telecom.
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