Ethiopia’s launch of the Ethiopian Securities Exchange (ESX) and the listing of Ethio Telecom have marked a major step in the country’s effort to build a domestic capital market, but the OECD says the market remains at an early stage, with limited depth, liquidity and investor participation.
In its Africa Capital Markets Report 2026, the OECD describes Ethiopia as an example of how state-owned enterprise reform can support the emergence of a new securities market. It says the creation of ESX in 2025 established initial trading infrastructure and a framework for domestic securities activity.
Ethio Telecom became the first state-owned enterprise listed on the exchange in May 2026, following its transformation into a joint-stock company and a public offering of a minority stake to Ethiopian citizens. The OECD describes the listing as a milestone for both state-enterprise reform and capital-market development.
The report links Ethiopia’s capital-market strategy to its broader Homegrown Economic Reform Agenda, launched in 2019. It says the reform programme combines market liberalisation, improved governance of state-owned enterprises and the gradual introduction of private capital to support investment, competition and efficiency.
Ethiopian Investment Holdings (EIH), established in 2021, manages many of the country’s largest commercial state enterprises, including Ethio Telecom, Ethiopian Airlines and the Commercial Bank of Ethiopia. The OECD says the holding company represents a move towards a more centralised model of state ownership.
According to the report, ESX was designed partly as a platform for listing some of Ethiopia’s largest state-owned enterprises, giving them a route to private capital, broader ownership and improved transparency.
Despite the progress, the OECD warns that Ethiopia’s market remains shallow. It says there is limited depth, liquidity and investor participation, and that no additional state-owned enterprise listings are currently under preparation.
The report also identifies persistent gaps in corporate governance, transparency, disclosure and fiscal risk management. It says EIH has published only one set of consolidated financial statements, covering the 2022/23 fiscal year, and that the statements were unaudited.
To expand the pipeline of listed companies, the OECD recommends stronger financial reporting and disclosure, greater board independence, improved accountability and oversight, and measures to build investor confidence and market capacity.
The OECD’s assessment places Ethiopia within a broader African market that remains small and concentrated. Africa accounted for just 0.4 per cent of global market capitalisation in 2024, while capital-market activity is concentrated mainly in South Africa, Egypt, Nigeria and Morocco.
The report says African equity markets grew by 49 per cent in 2025, outperforming emerging and global markets, but notes that much of the increase came from higher valuations and secondary offerings rather than a broad expansion in new listings.
It also highlights the importance of local-currency financing, diversified investors and stronger institutions. Deeper capital markets, the OECD says, can reduce reliance on external financing, improve resilience during economic shocks and channel domestic savings into long-term investment.
