Amana Insurance Share Company, Ethiopia’s first fully interest-free insurance firm, has reached the final stage before launching its official operations. Capital has confirmed from the company’s forming board that the pioneering institution is expected to receive its final operational license from the National Bank of Ethiopia (NBE) within the next two to four weeks, enabling it to become fully operational in the first quarter of 2026.

The milestone is seen as a major turning point for the country’s rapidly growing interest-free financial sector, which previously lacked a Sharia-compliant risk insurance partner.

In a report published in August 2025, Capital revealed that Amana Insurance had laid the groundwork to become Ethiopia’s first fully interest-free insurance provider. While the company was initially named “Amana Takaful Insurance,” the name was later changed to “Amana Insurance” in compliance with NBE directives.

“We have submitted all regulatory feedback and operational responses requested by the central bank,” said Abduselam Kemal, board chairperson of Hijra Bank and company promoter. “We continue to work diligently to address all requirements and await the NBE’s official decision in due course.”

One of the crucial preparatory steps for the launch was completed recently when the National Bank officially approved Amana’s executive management. According to Abdusalam, the company has finalized its main preparatory phases, and the Sudanese expert nominated for the institution’s presidency has received the green light from the National Bank of Ethiopia.

The company has raised ETB 260.4 million in ‘subscribed capital’. While this meets the initial minimum requirement, the organizers are actively planning to meet the NBE’s new ETB 400 million capital requirement over the grace period provided under Directive No. SIB/57/2022.

Amana Insurance was established through a collaborative effort among major actors in Ethiopia’s interest-free banking industry. Instead of each Islamic financial institution opening separate small Takaful windows, the organizers coordinated key stakeholders to build a single, well-capitalized institution capable of serving the entire ecosystem.

The company has grown to around 83 shareholders, including figures from manufacturing, import-export and general retail businesses. Pioneer interest-free banks such as Hijra Bank, Rammis Bank and Shebele Bank founded the institution, each holding a 5 percent founding stake.

Regarding share payments and settlements, Abdusalam confirmed that the main institutional backers have fully met their financial obligations to ensure smooth operations. “Currently, leading institutions like Hijra Bank and Shebele Bank have paid 100 percent of their shares, and other major stakeholders have also finalized their obligations,” he said.

“The board has decided to call the first General Assembly shortly after operations begin, urging the remaining shareholders to complete their outstanding payments and move to the next capital increase plan.”

ZamZam Bank, which could not be among the three founding financial institutions for technical reasons, is also expected to join Amana’s ownership through a second-round share float after the company begins operations.

For years, Ethiopia’s interest-free financial ecosystem has faced a major structural gap. Although fully interest-free banks have grown rapidly and captured a substantial share of the domestic market, the financing and assets they generated lacked a fully Sharia-compliant domestic insurance product to support them.

Market consultants dismiss concerns that Amana will cannibalize existing insurance lines. Instead, data from the expansion of interest-free banking suggests that a standalone Takaful provider will open an entirely new segment of consumers and businesses that have long avoided conventional insurance for religious reasons.

Data shows that up to 2025, no fewer than seven insurance companies in Ethiopia were licensed to offer Takaful services through dedicated windows. The window-based market grew by 92 percent to reach 445 million birr in the 2024/25 fiscal year. However, Takaful’s contribution to Ethiopia’s total gross written premium remained below 1 percent, leaving significant room for a fully dedicated player like Amana Insurance to grow.

The Ethiopian Electric Utility (EEU) has formalized a landmark power supply agreement with the Kenya Power and Lighting Company (KPLC), marking a significant milestone in cross-border energy trade and regional infrastructure integration.

Under the newly ratified framework, Kenya’s primary electricity distributor will purchase power from Ethiopia at a tariff 15.5 U.S. cents—per kilowatt-hour (kWh).

In addition to the baseline consumption tariff, the financial structure of the agreement mandates a monthly demand charge of approximately $6.52 USD. The strategic partnership is designed to optimize bilateral electricity monetization, guarantee a reliable power supply for border populations, and advance the broader geopolitical objective of an interconnected East African energy grid.

The power purchase agreement (PPA) was signed by EEU Chief Executive Officer Getu Geremew and KPLC Managing Director and CEO Joseph Siror during a bilateral ceremony.

Speaking at the event, Geremew underscored the agreement as a prime model of regional synergy, demonstrating the economic outcomes achievable when East African nations align their utility frameworks. He noted that the initiative materializes the long-standing vision of a “Connected East Africa,” framing infrastructure development not merely as a commodity exchange, but as a critical macroeconomic catalyst for sustainable regional growth.

Echoing these remarks, Siror emphasized that the strategic impact of the pact extends far beyond cross-border transmission infrastructure. He stated that the contract serves as a foundational pillar for long-term peace and economic diplomacy between Nairobi and Addis Ababa. Crucially, Siror highlighted that communities situated along the shared corridor will gain direct access to stabilized grid electricity, strengthening economic and social ties between the two nations.

Data from Kenya’s Energy and Petroleum Regulatory Authority (EPRA) underscores the urgency of the deal. With Kenya’s domestic generation capacity struggling to keep pace with skyrocketing demand, Nairobi has become increasingly reliant on imported power to mitigate systemic rationing and blackouts. In the fiscal year ending June 2025, electricity imports accounted for over 10% of Kenya’s total supply grid, with Ethiopia supplying an overwhelming 83% of those imports.

Furthermore, during the first half of the 2024–2025 financial year, Kenya’s power imports from Ethiopia surged by 79% year-on-year. This spike firmly positioned Ethiopian Electric Power (EEP) as the second-largest supplier to the Kenyan grid, surpassed only by Kenya’s state-owned generator, KenGen.

This compounding dependence stems largely from a regulatory bottleneck in Nairobi, where a moratorium on new PPAs with Independent Power Producers (IPPs) has severely restricted local generation capacity expansion. Originally instituted in 2018 and renewed in 2023, the ban has forced Kenya to seek external remedies, positioning Ethiopian hydropower as a vital, cost-effective safety valve.

While the new tariff of 15.5 U.S. cents per kWh marks a steep incline from the 6.5 cents initially cited in early 2022, energy experts emphasize that the figure must be viewed against Kenya’s domestic cost realities. Currently, Kenyan households face steep retail tariffs ranging between 28 and 32 Shillings (approximately 22 to 25 U.S. cents) per unit once base rates, fuel cost adjustments, and foreign exchange fluctuations are factored in. Given that domestic thermal power from IPPs can run as high as 23 cents per kWh, the Ethiopian import remains a highly competitive alternative, projected to save Kenya nearly $10 million USD annually.

The Addis Ababa City Council has ratified a new revenue-generating regulation tailored to the city’s rapidly expanding hospitality and tourism sector.

Under Regulation No. 204/2026, a 5 percent flat municipal tax has been imposed on all hotel and lodging establishments operating within the capital. Published in the Negarit Gazeta, the regulation introduces several new provisions designed to streamline operations between service providers and municipal authorities.

The city administration said the policy aims to strengthen Addis Ababa’s position as a leading African tourist destination and an international diplomatic and conference hub. Revenue generated from the municipal tax will be allocated to the development of urban infrastructure, the creation of new tourist attractions and the upgrading and expansion of public recreational spaces.

According to reports obtained by Capital, the tax directive will have broad implications for the city’s accommodation sector. It covers graded luxury hotels ranging from one to seven stars, as well as unrated local hotels, resorts, lodges, motels, pensions and guesthouses.

The 5 percent tax will be calculated solely on the baseline daily room tariff, excluding value-added tax (VAT). The regulation also states that auxiliary services such as food, beverages, spa treatments and other personal care amenities will be excluded from the tax base.

The Addis Ababa City Administration Revenues Bureau has been granted broad enforcement powers to ensure compliance and prevent tax evasion. As a result, all lodging establishments must register in person at their designated medium- or large-taxpayer branch offices.
Under the new compliance rules, establishments must maintain detailed physical or digital visitor registers.

Businesses required to keep standard books of accounts must also reconfigure their point-of-sale (POS) systems or manual receipts to include the line item “Lodging Municipal Tax.”

For smaller lodging operators that do not keep formal financial records, a simplified presumptive tax will apply. In such cases, the 5 percent tax rate will be levied on an assumed 70 percent of gross accommodation revenue.

Tax filing deadlines are structured according to the taxpayer’s category. Category A taxpayers must submit monthly reports and remit payments within 30 days of the end of each month, while Category B taxpayers will file returns on a quarterly basis.
Failure to submit tax reports on time will result in a 5 percent monthly penalty, capped at 50 percent of the total tax liability. Entities that delay remitting collected funds to the government will face an additional 15 percent penalty, indexed to the Commercial Bank of Ethiopia’s prevailing lending rates.

The regulation also states that any establishment found intentionally concealing revenue or submitting fraudulent declarations will face criminal prosecution under the country’s penal code.