The National Bank of Ethiopia (NBE) has announced plans to introduce a modernized system for government treasury bills (T-bills), aiming to make these financial instruments more accessible to citizens and investors. This initiative is part of the central bank’s broader efforts to enhance transparency, efficiency, and competitiveness in Ethiopia’s financial markets.
The announcement was made during a ceremony where the Ethiopian Capital Market Authority (ECMA) granted licenses to five new capital market service companies. NBE Governor Mamo Mihretu emphasized that the new system will provide citizens and investors with an additional investment option while encouraging a culture of savings and contributing to economic growth.
“This system will create a transparent and efficient framework for T-bill transactions, making them accessible to the public and investors alike,” Mamo stated. He added that the reforms are aligned with international best practices and aim to strengthen Ethiopia’s financial system.
The modernization of the T-bill market is part of NBE’s ongoing monetary policy reforms, which include transitioning to an interest rate system, promoting open market operations, and revising policy standards. These measures are designed to stabilize inflation, improve financial inclusion, and deepen the financial market.
Since December 2019, financial institutions have been allowed to purchase treasury bills through auctions—a shift from the previous system where T-bills were exclusively controlled by social security agencies, state-owned banks, and other public institutions. The new framework seeks to democratize access to T-bills, enabling broader participation from private investors and citizens.
The reforms are expected to accelerate Ethiopia’s economic growth by creating new investment opportunities and fostering a competitive financial market. Treasury bills will serve as a secure investment tool for individuals while providing the government with an efficient mechanism for raising funds.
Mamo highlighted that these changes align with NBE’s strategic goals of enhancing financial stability, promoting savings culture, and improving transparency in Ethiopia’s financial sector.
While the modernization efforts promise significant benefits, experts note challenges such as ensuring widespread awareness of T-bill investment opportunities and addressing potential barriers for individual investors. However, the involvement of newly licensed capital market service companies is expected to facilitate smoother implementation of these reforms.
