Austria, Vienna

At a time when Western green-tech and logistics companies are racing to secure positions within East Africa’s rapidly expanding economic corridors, deep-seated risk aversion within the European financial sector has become a major bottleneck for large-scale infrastructure investments.

According to officials, private commercial banks are increasingly hesitant to finance operations outside traditional European markets, which is hindering potentially lucrative business partnerships in emerging economies like Ethiopia.

Roberto Thym, Deputy Director of the Business Services Department at the Austrian Ministry of Foreign Affairs, told Capital that it is becoming increasingly difficult for domestic companies to enter the Sub-Saharan African market on their own.

According to Thym, the solution lies in implementing sophisticated and multi-faceted financial instruments, as well as public-private “Package Deals” designed to shift and distribute risk away from risk-averse commercial lenders.

Through the framework of the African Continental Free Trade Area (AfCFTA), a major renewable energy and infrastructure boom has been created in East Africa. While Austrian logistics and green technology providers possess the high-level technical expertise required to strengthen supply chains and build sustainable networks, turning these projects into reality requires substantial capital—capital that European banks are currently holding onto with extreme caution.

“We know that the Austrian financial sector is a bit hesitant when it comes to financing extra-European markets where they don’t have much experience,” Thym said during an official statement on trade relations. “There appears to be a certain hesitation for any single actor to take on the entire risk alone.”

To break this financial deadlock, the Ministry of Foreign Affairs is encouraging project developers to move away from conventional, straightforward bank loans and instead design comprehensive financing plans that combine commercial finance with development assistance funds (concessional capital/low-interest loans).

At the core of this strategy is the involvement of Oesterreichische Kontrollbank (OeKB), the country’s main provider of export credits and international investment guarantees. By backing commercial bank loans with OeKB’s state guarantees, the overall risk profile of an East African business deal can be lowered to a level acceptable to conservative European banks.

Under this model, the Ministry of Foreign Affairs views its role not as a direct source of funding, but as an institutional matchmaker. “When we receive concrete requests, what we do as a networker is bring the relevant partners together and facilitate the creation of this kind of package deal,” Thym explained.

It was noted that the backbone of the Austrian export economy is built entirely on Small and Medium Enterprises (SMEs). Although these smaller entities are pioneers in green innovation, they have limited capacity to withstand the heavy administrative burdens associated with international project finance and regulatory compliance.

This structural vulnerability is currently facing a major test as the deadline for the European Union’s revised Deforestation Regulation (EUDR) approaches. Under this deadline, international exporters—including Ethiopia’s vital agricultural sector—must deploy strict digital traceability systems to prove that their products did not originate from deforested land.

Building and expanding such national tracking databases is extremely complex. Even though the EU allocates significant financial resources for such infrastructure through its Global Gateway initiative, Austrian SMEs are frequently locked out of these opportunities due to excessive bureaucracy.

“The backbone of the Austrian economy consists of small and medium-sized companies,” Thym explained to *Capital*. “Therefore, we face a slight challenge in connecting Austrian companies with EU fund opportunities because their sizes do not align. Austrian companies are too small to handle the comprehensive paperwork required behind it.”

To fill this structural gap and prevent innovative small companies from being excluded from international contracts, the official confirmed that the Austrian government has launched an institutional initiative called “Team Austria.”

This initiative brings independent domestic SMEs together into a single, coordinated consortia, providing them with the collective weight, administrative assistance, and legal resources required to participate in large EU infrastructure financing.

Meanwhile, following the EU Council’s decision to lift the restrictive Schengen visa measures previously imposed on Ethiopian citizens, it has been indicated that Austria is moving swiftly to capitalize on this regulatory reform.

This policy shift, unveiled this week, lifts the strict restrictions placed on short-term visas issued to Ethiopian citizens. Under the previous restrictive system—sparked by a diplomatic dispute regarding migrant readmission processes—the standard visa processing time had been extended to 45 days, additional fees were imposed, and multi-entry privileges were widely suspended.

Now, acknowledging that Addis Ababa has shown “substantial and sustained improvement” in identity verification and return logistics, the EU has reinstated the standard 15-day processing time and the basic €80 visa application fee across all member states.

Speaking to Capital, Roberto, the Deputy Head of the Ministry’s Business Services Department, emphasized the necessity of smooth trade exchanges between people and organizations. He noted that travel disruptions remain a global challenge and particularly impact exchanges with many African nations.

To forge robust economic ties, Roberto highlighted that ensuring the travel process is “as smooth as possible” is a key area from which both sides can mutually benefit.

To achieve this and facilitate convenient corporate travel for Ethiopian officials coming to Vienna, the Ministry of Foreign Affairs plans to work closely with the Federal Economic Chamber, which bears primary responsibility for managing these high-level business visits. He explained that by coordinating visa pathways and business logistics, Austria aims to transform these diplomatic relations into active and prosperous economic partnerships.

Kigali, Rwanda

East African economies should treat insurance and reinsurance as essential tools for growth, resilience and fiscal stability, according to a new Africa Re white paper presented at the 2026 Africa CEO Forum. The report argues that the region’s governments and insurers need to move beyond viewing insurance as a niche financial product and instead use it to manage climate shocks, support investment and protect development gains.

The paper says East Africa is among the continent’s most promising growth regions, but it is also highly exposed to droughts, floods and other climate-related shocks. That vulnerability is especially costly because insurance penetration remains low across the region, with Kenya leading at 2.25 percent of GDP, followed by Uganda at 0.87 percent, Tanzania at 0.60 percent and Ethiopia at 0.30 percent, according to the East Africa Insurance Outlook Report 2025.

Africa Re says this gap leaves households, businesses and governments to absorb most of the financial damage when disasters strike. The report notes that across Africa more than 90 percent of natural disaster losses remain uninsured, forcing public budgets to shoulder emergency spending and slowing recovery.

Kenya is highlighted as an example of how the region can respond. The paper points to Kenya’s disaster risk financing reforms, including the use of index-based insurance for drought and flood risks, as part of a broader effort to embed risk transfer into public financial management.

The report also points to progress in East Africa’s insurance distribution models. It cites mobile and index-based products that have expanded cover for smallholder farmers in Kenya, Tanzania and Rwanda, and says digital platforms, bancassurance and insurtech are helping insurers reach customers that traditional models have missed.

According to Africa Re, the wider opportunity is to turn insurance into a development asset by mobilizing long-term savings, supporting infrastructure financing and reducing pressure on public finances. It says stronger reinsurance capacity, better regulation and deeper regional integration through the African Continental Free Trade Area could help build a more resilient East African insurance market.

Austria, Vienna

The Austrian Federal Government has announced a comprehensive overhaul of its foreign policy toward the African continent, shifting from traditional development aid to a “whole-of-nation” partnership.

Stefan Scholz, Head of the Department for Sub-Saharan Africa and the African Union at the Austrian Ministry of Foreign Affairs, stated that this policy shift is driven by changes in the global balance of power, the relocation of supply chains, and domestic budget deficits, necessitating a departure from conventional development aid spending.

Speaking at the Austria-Africa Media Fellowship Programme, Scholz explained, “We are moving away from a recipient-donor approach toward interdependent, multi-sectoral, and comprehensive partnerships.” He elaborated, “Due to the budget deficits we are all facing, development cooperation will not increase significantly over the next decade. Therefore, we must now make our activities across various sectors much more effective.”

Instead of creating new, rigid bureaucracy, Austria’s new approach integrates ten sectoral strategies from various ministries into a single framework. These strategies span areas from foreign security policy and humanitarian aid to industrial strategy, hydrogen development, and climate protection.

This initiative further distinguishes itself by incorporating the Austrian Parliament, the Constitutional Court, trade unions, and industrial federations into a unified structure.

“This means Africa is a major reform project for us, unprecedented in Austria,” Scholz explained. “Beyond inter-governmental coordination, we aim for a comprehensive approach that involves the entire nation.”

A primary driver for this policy shift is the significant imbalance in Austria’s foreign trade. Scholz highlighted that Austria’s export volume to the entire African continent is only about 50 percent of its exports to neighboring Slovenia, a nation with a population of approximately two million.

“There is a huge gap,” Scholz admitted. “Until now, we viewed Africa solely as a developing continent. Austrian businesses previously did not recognize the economic benefits of engaging in Africa’s private sector development. Now, however, Austria aims to change this through de-risking.”

To bridge this gap, the Austrian government is implementing plans to enhance the competitiveness of its businesses. These measures include eliminating double taxation, accelerating investment protection and social security agreements, and launching a €30 million Austria-Africa SME Investment Fund, managed by the Ministry of Finance, to support Austrian small and medium enterprises entering the African market.

Scholz emphasized that Austria’s new strategy is built on the principle of African Leadership, aligning directly with the African Union’s Agenda 2063 and regional integration master plans, rather than imposing Western interests.

This strategy was unveiled during comprehensive briefings and discussions held for journalists from various African countries at the recent Austria-Africa Media Fellowship Programme in Vienna. Organized by the International Press Institute (IPI) in cooperation with the Austrian Federal Ministry for European and International Affairs, the session at the Austrian Ministry of Foreign Affairs also provided insights into Austria’s communication philosophy, diplomatic priorities, and its campaign for a non-permanent seat on the United Nations Security Council (UNSC) for the 2027–2028 term.

Officials stated that instead of extracting raw materials, Austria now aims to share its institutional strengths. For instance, while Austria lacks its own mineral reserves, it is home to some of the world’s oldest mining and technical universities. Scholz noted that Austria is actively working to train talented African students, enabling indigenous populations to manage their own mining and refining processes.

Additionally, Austria seeks to share its renowned “dual education” vocational training system. This system allows 14- and 15-year-old youths to combine school education with paid on-the-job apprenticeships, fostering domestic entrepreneurship. This geopolitical shift comes at a time when African countries are heavily impacted by the global energy crisis—a crisis Scholz summarized as the “4Fs”: Finance, Fuel, Food, and Fertilizer.

In response, Austria plans to export its specialized expertise in renewable energy, environmental technology, and infrastructure. Under the new strategy, the country is moving away from projects focused only on specific nations, shifting instead toward broad regional connectivity corridors—such as green technology infrastructure partnerships like the one with Ethiopia. This approach aims to help African nations strengthen their economic benefits and regional integration.

To ensure this framework remains dynamic and continuously evolving, the Austrian Foreign Ministry has conducted 121 meetings with its African partners and is organizing “listening forums” with civil society and youth groups through its embassies.

Kigali, Rwanda 

East African governments are being urged to rethink how they regulate satellite internet as a new Africa CEO Forum report warns that offshore telecom operators could weaken local investment, reduce public revenues and reshape the region’s digital future. The report says satellite providers such as Starlink are expanding quickly across Africa, but their direct-to-consumer model raises questions about sovereignty, taxation and fair competition.

The report argues that Africa’s biggest internet challenge is no longer coverage alone, but affordability. It says about 86 percent of people in sub-Saharan Africa live within coverage areas, yet only 38 to 43 percent are actually connected, meaning the region’s digital divide is now driven more by cost than infrastructure gaps.

For East Africa, the issue is especially relevant because countries such as Kenya, Rwanda, Tanzania and Ethiopia are already weighing how to balance satellite services with mobile and fibre networks. The report says Kenya and Rwanda are among the markets where satellite internet has gained traction, while Tanzania and Ethiopia still face major affordability and access gaps that make hybrid connectivity models more attractive.

The report says satellite internet can help connect remote schools, clinics and rural communities, but warns that offshore operators may also draw away high-value urban and enterprise customers that traditionally help fund broader network expansion. That, it says, could squeeze incumbent telecom operators, discourage investment in fibre and towers, and reduce the flow of licensing and tax revenue to governments.

The paper cites Kenya as an example of how policy can adapt, pointing to the country’s growing use of disaster-risk financing and hybrid connectivity approaches. It says governments should require satellite operators to comply with the same rules as terrestrial providers on licensing, taxation, security and data handling.

The report also urges East African states to coordinate more closely through regional and continental frameworks so they can negotiate from a stronger position. It recommends a hybrid model in which satellite services complement, rather than replace, local telecom infrastructure, with more emphasis on African-owned gateways, data centres and network capacity.