Expert Voices

Ethiopia opens the door to privatization, foreign investment

Ethiopian Prime Minister Abiy Ahmed is welcomed by Sudanese President Omar al-Bashir following his arrival in Khartoum for an official visit to Sudan on May 2, 2018.
Ethiopian Prime Minister Abiy Ahmed arrives in Khartoum for a visit to Sudan on May 2, 2018. Ethiopian Airlines is one of the companies that is likely to spur investor interest. Photo: Ashraf Shazly/AFP via Getty Images.

Ethiopia's government announced plans last week to allow private-sector participation in key economic areas that have long operated as government monopolies, including energy, telecommunications and aviation. The announcement comes two months into Prime Minister Abiy Ahmed’s term, and may be his first clear signal of opening the economy.

Why it matters: With public infrastructure investment generating almost 10% annual GDP growth over the last decade, Ethiopia is one of the fastest-growing countries in the world. However, Ethiopia has also accumulated large amounts of debt, and businesses are eager for foreign exchange.