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Author: Yeabkal

Capital Market Tribunal Steps onto the Field

Posted on by Yeabkal

After four years of legislative gestation and eight months of bureaucratic buildup, the first dedicated capital markets court, the Ethiopian Capital Market Administrative Tribunal (ECMAT), is on the brink of hearing its first cases.

Housed in Addis Abeba’s Wastena Commercial Centre on General Wingate St., a short walk from the Central Statistics Agency, the Tribunal commands an annual budget of 87 million Br and a sweeping mandate to adjudicate insider trading, market manipulation, regulatory breaches, and investor grievances.

Its design blends judicial gravitas with market literacy, placing Federal High Court–qualified judges alongside financial and commercial specialists.

Prime Minister Abiy Ahmed (PhD) has appointed Abenet Zerfu as a presiding judge, marking a shift from his longstanding advisory role in government to the bench. Abenet brings over a decade of legal and policy experience, having served six years as head of legal opinion and international law affairs at the Prime Minister’s Office, where he played a central role in interpreting and advising on administrative and international legal matters.

Before his tenure in the federal executive branch, he served as an administrative law judge at the Ethiopian Commodity Exchange (ECX), where he adjudicated disputes. His academic credentials span multiple disciplines, from an undergraduate degree in international law from the Ethiopian Civil Service University, postgraduate studies in gender and development at Bahir Dar University, and ongoing professional training in International Financial Compliance with the Chartered Institute for Securities & Investment in the UK.

He plans to cut the legally permissible 90-day ruling window to 30 days when feasible.

“For business, things move by days and hours,” he told Fortune.

The Tribunal’s process mirrors established administrative law frameworks. Investors have 28 days to appeal decisions made by the Ethiopian Capital Market Authority (ECMA); late filings are accepted only in exceptional cases. Hearings are collegial but chaired by the presiding judge, and rulings can affirm, overturn, or remand regulatory actions.

Appeals are permitted solely on points of law to the Federal High Court, insulating ECMAT’s fact-finding from endless review. Enforcement powers match those of civil courts, giving the Tribunal teeth beyond mere recommendation.

Institutional credibility is an early priority. FSD Ethiopia is underwriting the drafting of procedural rules and a guidebook for judges and lawyers, complete with case studies, to ensure predictability and legal rigour in rulings.

Market actors are cautiously optimistic.

Anteneh Kassa, CEO of Ethio Fidelity Securities, calls the Tribunal overdue but vital to instilling investor trust as ECMA pushes to list nine institutions in the coming year. However, the secondary market for Treasury bills (T-bills), a bellwether of market depth, has fallen short of expectations.

Still, shadows of political capture loom large. Girum Amha, an economist with expertise in capital markets, warns that Ethiopia’s appointment system resembles politically vulnerable models in Kenya and the United States. In such setups, administrative courts risk becoming appendages of executive will, undermining their oversight role.

“This leaves parties with no meaningful recourse,” Girum said, “which can be abused for political or personal gain.”

There are also professional discipline gaps. According to ECMA legal adviser, Solomon Bekele, the authority has plans for an approval regime to exclude repeat offenders from the market in he absence of authority to revoke licences from legal advisers.

Minister Alemu Sets to Pull Polluting Cars Off Roads in Looming Emissions Purge

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All diesel and gasoline vehicles will be barred from operating without an official emissions certificate or approved emission-reduction technology in two months, according to the Ministry of Transport & Logistics.

The directive was issued in March, after it was signed by Alemu Semie (PhD), minister of Transport & Logistics. The Ministry set a six-month transition period for vehicle owners to test emissions and obtain certificates, with only two months remaining before enforcement begins.

“When the directive completes six months, no car will move without a certificate or emission curbing technology,” warned Assefa Addis, transport service and supervision advisor at the Ministry.

The rules apply to all vehicles that are subject to annual inspections, as well as to vehicle assemblers, manufacturers, importers, and owners. The standard applies to both new and used cars, whether imported or assembled domestically. The Ministry or authorised regional and city transport bureaus will handle technical inspections and enforcement.

“Vehicle importers, assemblers, and manufacturers should ensure that all new or used vehicles comply with the emission standards,” Assefa said.

Owners are required to have their cars inspected annually for emissions, maintain them to meet the standards, use fuel from licensed stations, and carry proof of compliance.

Service fees will be set by future regulations issued by the Council of Ministers.

Vehicles that fail inspections will be given 15 days to make the necessary repairs and present the required documentation. Failure to comply will result in a 15-day suspension from operation, followed by a three-month suspension for continued violations. Persistent non-compliance may lead to permanent suspension.

Transport officials frame the policy as an environmental and public-health step with legal backing. They argue that the directive supports the Paris Agreement’s goal of limiting global temperature increases to 1.5 degrees Celsius.

“This is not only about environmental protection,” Assefa said. “It’s also about sustainable economic growth, public health, and the country’s role in the global climate effort.”

Ethiopia is home to approximately 1.5 million vehicles, including 200,000 under federal and regional states, and already has 100,000 electric cars on its roads, according to official data. Road transport accounts for 20pc of emissions in the transport sector.

Private-sector involvement is growing alongside the policy.

TBK Trading Plc became the country’s first licensed importer of “Fuel Saving Devices” compliant with the directive. TBK advertises GreenTech as a device that can be installed inside a fuel tank without altering a vehicle’s structure. The company claims the device absorbs heat from the surrounding air and releases it at a specific wavelength, breaking down larger fuel molecules into smaller ones.

Bekele Mamo, co-founder and technical director, introduced GreenTech, a device his company claims can cut exhaust emissions by up to 97pc while reducing fuel consumption by as much as 30pc.

The company, along with others seeking permits, should meet the Ministry’s technical standards.

“It’s a game-changing eco-technology,” Bekele said.

TBK says it spent more than three years bringing the product to market and sources it from the Taiwan-based nanotechnology firm Molotech Group. The device has a 10-year lifespan before expiry. Prices range from 15,000 Br to 50,000 Br, depending on a vehicle’s fuel tank capacity, with a price of 29,000 Br for a 200Ltrs tank.

Public reaction is a mix of support and concern over costs and readiness.

Hailemariam Chekol, a 41-year-old meter taxi driver, backs efforts to reduce emissions but doubts the country’s preparedness for strict enforcement. He worries about expenses, especially after paying 40,000 Br in revenue taxes this year amid rising fuel prices.

“The directive is good for the environment,” he told Fortune, “but it shouldn’t become an extra burden for the public.”

Early adopters include Awash Insurance, Oromia Construction, Ethiopian Electric Power, the Federal Police, Sheger and Anbesa buses. The Transport Ministry continues to encourage broader uptake. According to State Minister Bereo Hassan, the need is to remove older and high-emission vehicles from the roads while taking into account the sector’s economic realities.

Industry practitioners warn that the task is complex and resource-intensive. Mikiyas Aweke, a private transportation consultant, blamed a lack of spare parts, foreign-currency shortages, and tax burdens as major barriers to compliance.

“There is no way to cut emissions until you replace the worn-out part,” he said. “Newer cars can sometimes emit more than older ones if maintenance is neglected.”

As the two-month countdown to full enforcement continues, officials face a dual test of advancing environmental goals and public health while ensuring that economic and technical realities do not stall progress.

Gov’t to Pour Billions Into Horticulture Dream With Stakes as High as the Harvest

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Federal agriculture authorities have unveiled their most ambitious horticulture drive yet, pledging to invest 24.5 billion dollars over the next seven years in a bid to transform a largely domestic and smallholder-dominated industry into a globally competitive export sector.

The National Horticulture Strategy, launched by the Ministry of Agriculture and introduced by Girma Amente (PhD), its former minister and now African Union ambassador to Geneva, aspires to lift horticulture’s GDP share from 4.5pc to 12pc, quadruple annual foreign exchange earnings to 3.3 billion dollars, and create two million permanent jobs by 2033. It sets out eight policy pillars from research, extension services, institutional capacity, and a new production map that identifies eight horticultural corridors, 200 clusters, and 10 specialised parks.

Officials cast the strategy as both a course correction and a scaling-up. State Minister for Agriculture Meles Mekonen (PhD) told regional agriculture bureau heads and investors on July 21 at the Skylight Hotel that the plan would “change everything from the bottom up.” It is designed to substitute imports with quality domestic output and align with green economy targets by reducing carbon emissions.

The redesign follows an admission that the previous strategy did not deliver. According to Mekonnen Solomon, the Ministry’s horticulture export coordinator, the old plan was scrapped because it failed to support commercialisation and cluster growth.

“The new plan is grounded in current realities,” he told Fortune. “It’s well-studied and based on the data, not on theory.”

Mekonnen believes farmers should have easier access to credit than in the past, even as he cautions that securing funds may still be cumbersome, with disbursements being processed manually.

The government, development partners and the private sector will share financing. Private investors are expected to develop over 48,000hct, up from about 14,000hct currently under cultivation. Smallholder farmers, particularly those producing mangoes and avocados, are to receive financing and extension support to increase yields. The Ministry’s benchmarks claim labour intensity could be high in some crops, with tomatoes and onions expected to employ up to 35 people per hectare.

Data from the Ministry and Customs Commission show that in 2022/23, the domestic market absorbed 98.37pc of vegetable output and 99.5pc of fruit production. Only 1.63pc of vegetables and 0.5pc of fruits were exported, and more than 96pc of those exports went to neighbouring Djibouti and Somalia. To change that balance, officials and industry players converge on the same list of bottlenecks, including land, logistics, water, quality, cold chains and market access.

Producers say the new approach could unlock constrained capacity if it is executed. For Tewodros Zewdu, president of the Ethiopian Horticulture Producers & Exporters Association, the decision to make more land available to private investors marks a break with the past. Access to suitable land has been one of the industry’s tightest constraints. While he sees improvements in logistics, water, and production quality, he argued that sustained implementation will ultimately determine the outcomes.

“The past system had no enabling environment, especially for vegetables and fruits,” Tewodros told Fortune. “The strategy has it; now, it’s about implementation.”

According to Tewodros, broader private participation can increase both household consumption and export earnings, provided investors receive timely access to land and infrastructure, which could also enhance government revenue. He called for a clear policy framework for labour and property management, warning that without it, potential gains could be lost.

“If we get this right,” he said, “we can get billions of dollars, not millions, in a year.”

To reach that scale, he urged policymakers to prioritise agro-logistics and nationwide infrastructure upgrades to move fresh produce faster.

The stakes are visible on farms such as that of Alemu Aboye in Arbaminch, who grows bananas, avocados, mangoes and occasionally onions. Most of his vegetables feed his household. However, fruits are sold when he can find a buyer. Inconsistent yields, especially from his mango trees, often leave him with fruit he cannot sell.

“The tree bears much fruit, but it’s disease-ridden,” Alemu told Fortune.

For him, raising output is less about planting more trees than managing existing orchards effectively, using modern seeds and expert guidance to combat pests and disease.

“We planted fruit on our land,” he said, calling for stronger market links, advisory support and logistics. “We must get proper value for that. We need someone to track the cause, not simply say plant trees.”

Officials acknowledge the fragility of the last mile. According to the State Minister, while horticulture yields are high, post-harvest losses are a pressing problem. Limited packaging options, pest and disease outbreaks, inadequate cold storage and weak logistics eat into profits and blunt export potential. He called for infrastructure investment, broader participation, and the inclusion of youth and women, alongside technology transfer systems, out-grower schemes, and more resilient production models.

“Our vision is to build a globally competitive sub-sector and be a leading producer and exporter of horticulture,” Meles said.

Researchers point to agronomy, inputs and market design as levers that matter as much as money.

Sabura Shara (PhD), a horticulture researcher at Arbaminch University with over 15 years of teaching experience, emphasised agroecology, matching crops to the right environments.

“It’s necessary to plant the appropriate vegetable in the appropriate place,” he said, urging inspections and modern seedlings for crops such as mangoes and bananas.

Sabura warned that outcomes depend on execution, not only plans, and pressed for investment in disease-resistant seeds, refrigerated transport and a balance between domestic and export markets. He criticised reliance on imported seeds for staples like onions, tomatoes and peppers, arguing for the development of local seeds. Stronger market linkages, “the heart of horticulture”, are essential, he said, or products risk going to waste.

The researcher called for coordinated interventions against mango pests, along with tighter quality control and long-term seed preservation. For perishable goods, he likened horticulture logistics to the meat industry, where speed and careful handling are paramount.

“Without these measures,” Sabura cautioned, “the country’s ambitions for the sector could wither before they bear fruit.”

 

Parents Push Back as Elite School’s Tuition Hike Spurs Dispute

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An elite private school has sparked controversy over fees after its Administration more than doubled tuition for the 2025/26 academic year.

Lebawi International Academy (LIA), renowned for its high standards and international orientation, informed parents in July that the change was a currency-based adjustment rather than a fee increase.

Parents disagree. They call it “a large and unjustified price hike.” According to a statement the Parent-Teachers Association issued, “what the School calls an adjustment is, in both substance and impact, a major price increase.”

Lebawi, founded in 2004, offers a hybrid curriculum aligned with international standards and draws students from Ethiopians, the diaspora, and families of foreign nationality. It enrols more than 1,400 students across early childhood, primary, and secondary levels and operates as a private, fee-based academic institution subject to national education regulations.

The dispute dates back to an edict by education officials banning the collection of tuition in dollars. The Education & Training Authority (ETA), alongside the National Bank of Ethiopia (NBE), issued a prohibition earlier this year.

Lebawi had, for years, tied its fees to the dollar, despite existing policies against it. After the ban, the school switched to a Birr-denominated schedule that parents say closely mirrors the old dollar amounts at prevailing exchange rates.

As complaints mounted, the ETA issued a series of escalating directives. A first letter dated June 4 followed a complaint from parents who said they were being asked to pay tuition pegged to the dollar. The Authority, under Ahmed Abitew, instructed the school to halt the practice immediately.

A second letter, issued on June 30, reiterated the order and told LIA administrators to comply by July 2. Five days later, the Authority sent a third warning, expressing frustration that student registration continued under revised rates. The education authorities state that they had consulted the school’s board and secured backing from the NBE, which confirmed the prohibition on tuition in any foreign currency.

The Authority demanded a detailed report by July 8 and called for an immediate suspension of student registration.

The school’s July notice outlined the new annual charges: 693,000 Br for early childhood and kindergarten, 840,000 Br for primary, and nearly a million Birr for Grades 9 through 12. In a letter to parents, the Administration defended the fees as final and carefully calculated to meet operational costs while sustaining educational quality in the wake of the currency shift.

Administrators insisted it was not a fee increase.

Families were not persuaded. According to leaders of the Parent-Teacher Association (PTA), the School’s Administration moved without “meaningful discussions” with the broader parent community. They argue that Lebawi bypassed legal requirements mandating a general assembly of parents and guardians before financial decisions that impact parents and that the School unilaterally imposed the new fee structure.

A virtual meeting held on July 30, 2025, brought together the PTA, school administrators, and an ETA representative, but it ended without a consensus. According to the PTA, the School refused to acknowledge the increase as a “tuition hike” and declined to call a general parent assembly, despite the 2024 education regulation requiring formal consultation and agreement before any significant change in fees.

Wubshet Tadelle, deputy director of the ETA, confirmed that Lebawi had operated under a dollar-based model. He disclosed that repeated efforts were made to bring the institution into compliance, but the School’s administrations remained steadfast that what they once earned in dollar value is no longer recoverable in local currency without an upward price change.

“Essentially, they wanted to compensate for the loss of profit,” he told Fortune.

Despite multiple attempts, Lebawi’s Administration, run by Panos Hatziandreas, declined to comment.

The authorities also conceded that while the ETA had facilitated meetings and issued clear directives, it lacked the authority to impose price ceilings or penalise schools for excessive tuition.

“Our role is to mediate and consult,” said Wubshet. “We encouraged both sides to find common ground and reach possible compromises.”

That legal gap is what frustrates parents like Abel Gebretsadik, who now faces a tuition bill exceeding 1.5 million Br for his two children. Last year, Abel paid 330,000 Br for his son’s kindergarten tuition. This year, the same level costs more than double. As his son advances to Grade 1, the fee rises to 840,000 Br, all while his younger child begins school as well.

“There was no parent meeting,” Abel said. “No platform for questions, no transparency. They just announced a new fee. We’re expected to accept it, no matter how steep or sudden.”

There is currently no cap on tuition fees, no formal mechanism to approve or reject fee changes, and no accountability beyond consultation, leaving families exposed to market forces and schools largely unchecked. Education sector experts warn that private education could face greater instability if regulatory blind spots persist.

One of such experts is Mekbib Tasew (PhD), who brings 22 years of experience in capacity building, educational research, and pedagogy design. He holds both a postgraduate and doctoral degrees from Vision International University in the United States.

“The government needs to draft a law that clearly outlines what schools can and cannot do when it comes to tuition in international schools,” said Mekbib, who served in the Addis Abeba Private Schools Association and conducted research for the group.

While he acknowledged the broader rationale behind banning forex-based tuition, he argued that secondary legislation should be introduced to protect families from abrupt or excessive fees. Mekbib believes that banning payments in forex was necessary; however, without a framework to ensure equitable price adjustment, he says, the financial burden is falling on parents.

“The state should step in, not just as a mediator, but as a regulator,” he said.

With the registration deadline looming on August 8, most families face difficult choices. Some may transfer their children, although seats at alternative schools are limited. Others will reluctantly pay the new rates to secure placements while hoping for intervention. Many, like Abel, want the government to step in not only to enforce financial policy, but also to protect the interests of parents and students.

Abdurazak Nesro, a senior legal consultant and advisor with 15 years of experience and a board member of Ethiopian media legal support, foresee the case fall under the Trade Practice & Consumer Protection Tribunal, which also covers service providers, including schools.

“There is always a consumer protection angle when there is an excessive fee,” he said. “When a school and parent have a prior agreement, any major change to that agreement should also be mutual.”

While acknowledging that contracts often favour institutions, Abdurazak believes the law is not powerless.

“Just because a parent signed a document does not mean they waived their rights,” Abdurazak told Fortune. “When a contract is deemed one-sided or abusive, legal provisions allow it to be adjusted or overridden.”

He argued that “excessive pricing or procedural unfairness” can also trigger legal intervention, even after the fact.

Ethiopians Among Top Visa Overstayers in U.S.

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A Department of Homeland Security (DHS) data places Ethiopia among the global hotspots for B1/B2 visa overstays, uncovering the growing tension between migration pressures at home and tightening immigration scrutiny abroad.

In 2023, 15,809 Ethiopian nationals entered the United States on business or tourist visas. Close to 1,225 failed to depart within their authorised stay, a 7.75pc overstay rate, more than five times the global average of 1.45pc. Most of these, 1,150 cases, were “suspected in-country overstays,” presenting prolonged unlawful presence.

Regionally, Ethiopia ranks behind only Nigeria, Ghana, Kenya, and South Africa in Africa in the number of B1/B2 overstays. Globally, its overstay volume surpasses that of countries with much larger outbound travel numbers, including Romania, Turkey, and South Korea.

American law imposes reentry bans of three to 10 years for overstays beyond 180 days, and high rates can prompt more rigorous vetting, longer processing times, and increased visa denials.

Migration analysts attribute the trend to a combination of factors. They cite push factors, including political uncertainty, economic hardship, and limited employment opportunities in Ethiopia, as likely motivations. According to Tigabu Desalegn, a legal expert with over 17 years of experience in international law, political, economic and social pressures shape Ethiopia’s refugee and migration patterns.

“As long as there are pushing factors in the country, people will continue to leave,” said Tigabu. “Their only goal is to get a better life, no matter what those factors may be. We can’t avoid or stop people from seeking better lives abroad, because it is their right.”

Pull factors, including informal diaspora networks, relaxed internal mobility once inside the US, and challenges in exit tracking at ports, add to the complexity.

The implications are showing up at consular windows, according to practitioners in Addis Abeba. While the US does not formally penalise a country for overstay rates alone, the consular practice of “visa refusal based on past patterns” is already quietly affecting Ethiopian applicants.

DHS data show that student and exchange categories also face elevated rates. In 2023, 1,660 Ethiopian students and exchange visitors were expected to depart; however, 328 overstayed, resulting in a 19.76pc total overstay rate. Of these, 308 were suspected to have remained in-country, an 18.55pc suspected in-country rate. Other non-immigrant admission classes from Ethiopia saw 617 expected departures and 85 overstays, a 13.78pc rate, including 81 suspected in-country overstays. The figures for 2022 were even higher for students and exchange visitors with 1,664 expected departures and 514 overstays, pushing the total overstay rate to 30.89pc, with 30.29pc suspected to have remained in the United States.

Washington’s political calendar adds a charged backdrop. Analysts warn that elevated overstay rates from African countries could be pulled into the broader immigration debate. For Ethiopia, already facing pressure from multilateral institutions over governance and economic reform, the numbers could complicate relations with the US. Still, Ethiopian officials have avoided some of the sharpest measures.

While Ethiopia has not been subjected to the bond requirement, US Ambassador to Ethiopia, Ervin Massinga, told Fortune that the Embassy is working with the government to reduce overstay rates.

“We’re working intensively for effective progress,” Massinga said.

Tigabu believes that changes in US immigration law often depend on the Administration in office and warned that measures like the visa bond pilot in Malawi and Zambia could eventually be applied to Ethiopia.

Marjon E. Kamrani, spokesperson for the US Embassy in Addis Abeba, confirmed that there have been no recent changes to visa approval policies in the past two weeks. However, she noted uncertainty about future developments.

“We can’t assure that there will be no policy changes in the future,” Kamrani said. “All visa interviews and applications are assessed on a case-by-case basis.”

Legal experts urge looking beyond enforcement alone.

He stated that Ethiopia’s long diplomatic history with the United States, spanning over 120 years, should be leveraged to prevent such measures, even as current ties have weakened.

“The only way to fix and avoid such decisions is to have strong government-to-government and citizen-to-citizen relationships and open discussions,” Tigabu said.

Ethiopian Airlines Cruises High Altitude while Parts Shortages, Price Surges Bite

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Ethiopian Airlines is facing an operational and financial balancing act, with its supply-chain bottlenecks now persisting for a fifth year since the pandemic. The shortage of aircraft spare parts has grounded roughly a quarter of its domestic fleet daily, along with two wide-body international aircraft, which constrains seat capacity and contributes to last year’s 28 million dollars domestic loss.

Slow global production and parts delivery from suppliers such as Rolls-Royce and Canadian manufacturers are industry-wide, but for a carrier with a dual mandate of public service and commercial viability, the impact is magnified.

Five aircraft from its 21-plane domestic fleet are grounded daily due to a lack of engine components. Two additional planes on international flights, including Boeing jets, have also been out of service for the same reason. One aircraft slated for delivery four months earlier arrived only recently because Airbus did not receive a required seat component on time.

Mesfin Tassew, CEO of the Ethiopian Airlines Group, projected that the situation will normalise by January 2026, but the interim is costly.

An electrical engineer by training, Mesfin became Group CEO in March 2022 and is set to retire next year after an extended term. He joined Ethiopian in 1984 as an associate engineer and later held senior maintenance and operational posts, including COO of Ethiopian Airlines and CEO of ASKY Airlines.

Spare parts prices have doubled, fuel expenses have surged by more than 50pc, and the Birr’s depreciation is eroding margins on domestic tickets priced in local currency. The Airline plans to expand its domestic network from 21 to 27 destinations, but passengers should expect fare hikes, as management signals a willingness to continue raising prices until a break-even point is reached.

“We’ll readjust until we break even,” Mesfin said last week during a press briefing held at the Skylihgt Hotel, its subsidiary, on August 5, 2025.

Travellers say they are already feeling the strain.

According to Abebaw Mebtu, 26, a native of Bahir Dar who now lives in Addis Abeba, a fare for his family’s trip jumped from 4,800 Br to 5,200 Br within minutes, and agents often charge an additional 50pc.

“I’ve to pay 2,000 Br extra and book one week prior through an agent,” he told Fortune.

The Group’s topline continued to grow last year, but profit dynamics softened. It reported 7.04 billion dollars in revenue for the 2022/23 operational year, up 14pc from the prior year. Operating profit rose by 12pc to 1.05 billion dollars, while net profit before tax slipped four percent to 860.3 million dollars. However, total expenditure increased by 15pc to 5.99 billion dollars due to expansion spending and higher operating costs.

Ethiopian’s Vision 2035 strategy centres on a major fleet build-out, more than 100 additional aircraft, including the Boeing 777X, which would make Ethiopian the first African carrier to acquire the model. Infrastructure plans include expanding Terminal I at Addis Abeba Bole International Airport and upgrading regional airports in Gode, Robe, Jinka, and Nekemte, alongside a feasibility study for a mega hub in Bishoftu (Debrec Zeit) town.

The Group is rolling out digital upgrades, including self-check-in kiosks, bag-drop systems, expanded digital payments, and cargo booking through Cargo.one. It has set sustainability targets to use five percent Sustainable Aviation Fuel by 2035 and to reach net-zero emissions by 2050.

Nonetheless, fuel price volatility looms over the strategy.

“Fuel cost volatility is one of the biggest risks,” said Satta Abreham, an independent analyst who published a three-year review of the Group.

He urged the carrier to lock in prices through hedging, restructure high-interest debt, and enforce faster payments from agents and partners.

“More aggressive hedging when prices were lower could have softened the recent spike,” he told Fortune.

Cargo remains a pillar, contributing 30pc of Group revenue, and management expects further growth. Chief Commercial Officer Lemma Yadecha cited cargo flows linked to the Belt & Road Initiative from China to Africa. Ethiopian operates 15 dedicated freighters and has invested 50 million dollars in e-commerce warehouses at Bole Airport. It is also expanding internationally, including with Air Congo in the DR Congo.

Ethiopian Aviation University trains more than 4,000 students annually and now offers degree programs through global partnerships. However, it remains dependent on Group profits, faces post-pandemic skill gaps, and still trails some regional peers in recognition. Liquidity is tightening across the Group. Operating cash fell 10pc, fuel costs surged 54pc to 132.45 billion Br from 85.85 billion Br. Debt servicing exceeded 51 billion Br, while rising receivables and inventory are straining resources.

The Skylight Hotel, which manages four lodges and two watercraft, posted a sharper turnaround, reaching its revenue of 53.4 million dollars, a 70pc increase from the previous year. Its pre-tax results swung from a 338,019 dollar loss two years ago to a nearly one million dollar gain. Net profit came to 636,471 dollars.

According to Mesfin, Birr-denominated revenue has risen, but depreciation has eroded its dollar value.

The Group’s annual report, however, flags inconsistencies within Skylight’s accounts. Segment reporting shows a 103pc increase in Birr revenue, but external hotel services revenue fell 47pc, revealing that intercompany bookings, such as crew accommodations, may be inflating the results. Costs have surged, too, with hotel costs of sales jumping by 146pc.

Satta urged management to simplify and refocus their efforts. He urged isolating hotel revenue, cutting costs, rebranding Skylight and restructuring debt.

“The group remains dependent on airline profits, faces post-COVID skill gaps from virtual training, and still lags behind regional competitors in global recognition,” said Satta. “I say Cargo is King! It’s yet to see its potential. The cold chain line of pharmaceuticals from Miami is an indication.”

Satta also proposed monetising the training arm by offering certifications to other African carriers, securing AU education grants, and investing in VR/AR to support remote practical learning. He cautioned that opening training to outside airlines could dilute Ethiopian’s competitive edge unless the carrier expands ownership stakes in regional airlines to offset that risk. He argued that the domestic market barely moves the needle and delivers most value as a public service.

Recent demand spikes mainly reflect road travel risks due to insecurity. Leisure travel may soften, but essential trips face few substitutes. There are plans underway to make Addis Abeba Bole International Airport a destination for imports to African countries.

“That makes sense,” Satta told Fortune. “If demand spikes, raising prices makes commercial sense, though it complicates the public service role. If fares rise in nominal terms, that’s a win, especially since they haven’t grown much in recent years.”

Fleet modernisation with A350s and B787s has improved efficiency; however, the Group does not publish key indicators, such as fuel consumption per Available Seat Kilometre, which limits transparency and external benchmarking. Satta argued that releasing efficiency data would build public confidence and enable comparisons with the global average of around 3.15L/ASK. He also called for route optimisation using analytics and broader Sustainable Aviation Fuel trials on high-visibility routes to position Ethiopian Airlines as a leader in sustainable aviation.

While he acknowledged strong performance under the government-appointed board of directors, Satta would want to see a more diversified board to strengthen long-term resilience.

FOREX MARKET SQUEEZES TEST REFORM NERVE

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The hum of Addis Abeba’s import hubs has faded to a fretful murmur as importers claim their banks demand to know how long their cash would idle before signing off on letters of credit. The message, they say, is clear: try the parallel market. Their frustration is the front-line reality of the foreign-exchange liberalisation. A year after the National Bank of Ethiopia (NBE) scrapped its peg to the dollar, the policy remains mired in uneven auctions, persistent shortages, and a widening gap between official and street market rates. The government’s policy reform credibility, and its billion-dollar programme with the IMF and World Bank, now rests on whether it can close that spread without choking supply in an import-dependent economy.

The July 2024 policy change to let market forces set the Birr was meant to revive dollar flows. For a few months, it appeared to have worked. However, after April 2025, interruptions to the biweekly auctions forced banks to slow down the issuance of letters of credit. Speculation that the official rate could double in September turbocharged demand outside the formal system. Even last week’s record auction, 150 million dollars at a weighted average of 138 Br to the dollar, barely nudged the parallel rate below 170 Br. Between July 28 and August 8, Awash Bank’s posted rate rose 1.47 Br, the Central Bank’s by 0.90 Br, while the state-owned Commercial Bank of Ethiopia (CBE) held flat and Roha Forex dipped 0.28 Br. The parallel market fell slightly but remained well above the official band.

The IMF’s mid-July review pegged the official-parallel spread at 15pc, blaming high transaction costs, thin interbank liquidity and the Central Bank’s 2.5pc commission on bank-to-bank trades. A recent fee cap at four percent from as high as 12pc to 13pc has not eased importers’ burdens. Importers claim that deposit requirements often run at 150pc to 200pc, and approvals stretch from weeks to months. Official data reveal an uneven picture. Awash Bank provided 125 million dollars in July, 110 million planned in August; Dashen Bank supplied 112.6 million in July; Bank of Abyssinia 94 million (July–early August); Wegagen over 70 million; Bunna 47.7 million; and Sidama Bank made one million dollars available in July, while it slated four million for August. Such disparities feed perceptions of preferential allocation and reinforce incentives to bypass the formal channel.

Governor Mamo Mehiretu countered that the Central Bank’s position is stronger, with reserves tripled in a year. Although he did not disclose the reserve amount, IMF data showed that it reached more than three billion dollars, equivalent to about 2.1 months of imports, and auctions will continue. Yet market frictions endure. Executives in private banks blame rising remittance-transfer fees and self-regulated foreign exchange bureaus whose quotes allegedly drive up informal rates. Tightening Franco Valuta rules have pushed more traders into the shadows, while seasonal travel, expat salary payments and foreign property promotions add fuel. Whether authorities can narrow the spread without draining reserves will determine not only the fate of the exchange-rate experiment but also whether importers are lured back from the parallel market, or stay there.

ENAT BANK’S MEASURABLE EQUITY

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In a landmark move to promote gender equity in the banking industry, the National Bank of Ethiopia (NBE) has released its inaugural Gender Financial Inclusion Index, positioning Enat Bank at the forefront. Among 30 commercial banks evaluated, Enat Bank emerged as the sole financial institution to attain a “transformational” rating, outpacing competitors in a field where most lenders remain at early stages of integration. The five-tier composite index, developed by the Central Bank as a benchmarking tool, rates banks across dimensions such as leadership commitment, product innovation, credit accessibility, data transparency, and organisational policies targeting women’s financial participation. While three other banks received recognition for progress, the industry’s average settled at 2.95, categorising the majority within the “Building Momentum” tier, a midpoint demonstrating nascent but incomplete commitments to inclusive banking practices.

Enat Bank’s performance stood out not only for scoring highest but also for its structural and cultural alignment with gender equity principles. Founded in 2008 with a mission to empower women economically, Enat Bank has since issued over 1.4 billion Br in non-collateral loans to women-led enterprises, contributing to the creation of more than 22,000 jobs. According to reviewers, the Bank’s operational ethos integrates gender inclusion at every level, from its boardroom, where Chairperson Meaza Ashenafi, a former president of the Supreme Court, provides strategic oversight, to front-line services geared toward underserved female entrepreneurs. The symbolic weight of the achievement was observed during a celebration at the Addis Abeba Hilton on June 19, 2025, where former President Sahle-Work Zewde joined Enat Bank President Ermias Andarge and other board members for a toast marking the milestone.

Addis Abeba’s Messy Taxi Overhaul Leaves Riders Waiting, Veterans Sidelined

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Around 5:00pm, a time when most civil servants spill out of office towers and scramble for rides home, Mexico Square was oddly hushed.

On Mozambique Street, in the Genet Hotel area, only a few battered blue-and-white minivans nosed into the curb, leaving long queues of commuters staring at the empty road and the lowering sun. A man in fresh orange-and-blue uniform, a facilitator, and two transport officers, strolled past the waiting crowd, offering little comfort to fraying tempers.

Adnan Arfano, in his early 20s and juggling school with a sales job, stood at the head of the line bound for Mexico Square from the Haile Garment district. He has learned the choreography of the city’s unruly taxi ballet on the Piassa-Megenagna-Ayat corridor, but lately the rhythm is off.

“Sometimes it’s a stampede, people run, elbow their way through,” he said. “And, the new line facilitator stands there, fixated on collecting money from the driver.”

He never saw it this way before. The fix, he argued, was better staffing at busy transfer points and facilitators who do more than guard their commissions.

“The changes are a good idea, but they need teeth,” said Adnan, one of the approximately 1.43 million commuters in the capital who depend on minibus taxis, which cover 80pc of the demand. “When there is no one watching, people cut in line and take others’ seats.”

Commuters who rely on public transport represent 31pc, doubt the size of the city population that uses a personal vehicle. Aside from the city bus services and nearly 400 midibuses, approximately 9,000 minibuses operate in the city, with 3,000 of them being Code-1 coloured in blue and white.

For decades, the capital’s 14-seat mini-buses were marshalled by a loosely governed army of line facilitators, known locally as “Tera Askebari”. The arrangement gave work to thousands but annoyed passengers and officials who complained about chaotic dispatching and persistent side payments.

According to Yabibal Addis, head of the Addis Abeba Transport Bureau, talking to Addis Media Network said the city finally decided to reboot the system. Officials wanted to change the old setup where every place a taxi passed was treated as a terminal, and a facilitator was assigned there.

That practice produced 197 terminals and more than 3,600 facilitators, one for roughly every half-block on some routes. Drivers paid a fee at almost every stop. On a short route, a driver could charge at least 20 Br or 40 Br for a round trip.

“That was a burden,” said Nuredin Ditamo of Nib Taxi Owners’ Share Company.

However, the city officials’ plan to administer could be radical, limiting facilitators to the first and last stop, slashing recognised terminals to 87, thereby trimming the workforce to 996.

Each enterprise received a two-year permit. The Bureau also replaced cash with a digital payment of 10 Br per trip, routed through Siket Bank, a financial institution that morphed from the Addis Abeba Credit & Saving Institute, which was under the city administration.

The cut is pre-programmed: 20pc to city coffers, 30pc to future sector projects, and the rest to facilitators’ wages.

“Facilitators can only remain on this job for two years,” said Yabibal. “They must move on to growth-focused sectors henceforth.”

While the new system promises opportunity, it has displaced many.

Biniam Getu, once a familiar face helping commuters at Mexico Square, now spends his days on a spiritual retreat in a monastery after losing his job to the city’s overhauled transport facilitator system. The former member of the Tigat Facilitators Union still clings to a promised three-month training program that he hopes will teach him skills such as welding or woodworking.

“We submitted our request and are waiting,” he said.

Biniam’s troubles deepened when Girmachew Sileshi, chairman of the Addis Abeba Taxi Facilitators’ Union, left the country. Repeated attempts by the Union to secure a meeting with the Mayor’s office were turned away.

“We’re told our union isn’t recognised and advised to approach our District,” Biniam said.

However, that coordination fell apart in the chairman’s absence. Some displaced workers have drifted back to their former curbs, hoping to scrape together the 200 Br to 300 Br, a fraction of what they once earned daily. Newly hired facilitators toil through entire shifts but are paid only after digital reconciliation, rather than up front, the way veterans were.

Getu complained that the newcomers do not know the streets and show little care for the elderly or pregnant commuters. He also claimed thefts have risen while many former facilitators struggle to feed their families.

City officials counter that the reforms seek to create lasting opportunity.

Feyissa Feleke, communications director at the Addis Abeba Labour & Skills Bureau, outlined a training initiative intended to steer displaced facilitators toward new trades and small business ownership. To qualify, applicants are required to prove their residence with a Kebele ID, register on the Labour Market Information System, and submit their biometric data. Accepted trainees attend courses at institutions such as General Wingate and Entoto Polytechnic Colleges.

“We make sure applicants aren’t those who already built up sufficient capital to start a business on their own,” Feyissa said.

Some participants have already completed their training, and most newcomers choose to pursue trade skills. Current facilitators nearing the end of their two-year contracts will receive a shorter, five- to 15-day course tailored to their next field of work.

“The ultimate aim is not just income generation,” Feyissa noted. “We’re working toward real economic empowerment and long-term employment opportunities.”

Trainees should set aside 30pc of their income in a mandatory deposit and are encouraged to build extra savings as a cushion for future ventures.

The policy has its academic supporters. Berhanu Zeleke (PhD), a lecturer in urban transport at Kotebe Education University, called the overhaul overdue. Replacing the old guard, he argued, makes room for fresh job seekers while contractual terms increase accountability.

“The contract system encourages facilitators to plan for their future,” he said,  acknowledging past misconduct among some facilitators.

On paper, the new system looks clean. On the curb, it is sputtering.

One of these terminals is located around the Stadium, where Abraham Weldesenbet, a slight facilitator in a crisp uniform, paced between vans last week, scribbling plate numbers in a dog-eared notebook. Stars marked those that had paid, but taxis often pulled away before he reached them.

“It’s so frustrating,” he told Fortune, shoulders sagging.

The outfit has 13 members for one of the busiest junctions in the city, a ratio that leaves him alone during rush hour.

By 10am, he had logged about 40 vehicles. Only a handful carried the multiple stars, showing they had settled their fees.

“The system is nonexistent,” he grumbled.

Amelewerk Megeressa, a traffic coordinator in the area, confirmed the shortage.

“There are students and workers in long queues,” she said.

Some drivers, fearing phone theft, refuse to use the mandatory app; others do not own a smartphone.

“There should be someone designated to help facilitate the payments,” she said.

Indeed, the citywide shift to electronic fare collection has opened a digital divide.

Abraham Haika, who shuttles between Stadium and Qality for the Kirkos District Taxi Association, acknowledged that the new facilitators are learning.

“They’re getting used to the job,” he said. “There is no conflict between us. They help manage queues and even direct passengers when needed,” he said.

For him, the hitch is the network. It takes too long, connections are slow, and many drivers lack compatible devices. However, intermediaries sense an opportunity. Since the government mandated digital fuel purchases two years ago, young hustlers have offered to run transactions on old Nokia phones for a fee.

“It’s the same problem all over again,” Nuradin from the taxi association told Fortune. “These middlemen are turning it into a job.”

The price to work with the intermediaries is a five Birr premium over the 10 Br fee the city imposed, which they pocket after making the transfer.

Officials concede the rollout is bumpy. The flat charge could be set to stop facilitators from quietly shifting taxis to longer routes and demanding higher cash tips. But, fixing the bug is underway by software developers.

“These issues are being evaluated daily,” Yabibal confirmed.

Siket Bank’s early versions of its system required drivers to key in a 13-digit account number, an ordeal on analogue handsets. The Bank responded by introducing a four-digit short code system, from 1001 to 1087, each representing a specific terminal enterprise. The Bank works with Ethio telecom’s Telebirr, a platform that drivers already use to pay for fuel, although transfers from 32 banks are also possible.

Messay Woubshet, Ethio telecom’s communications chief, denied any exclusivity.

“Siket’s system is simply integrated into the Telebirr app like the systems of 28 other banks,” he told Fortune. “Drivers use the ‘transfer to bank’ feature within the app to make payments.”

Most glitches, he said, are cleared within a day.

“If a transfer takes time, it is usually resolved within 12 to 24 hours,” said Messay. “In rare cases where it takes longer, we apologise and follow up directly with the affected parties.”

Facilitators on the ground say they improvise. Some drivers with no Telebirr account still pay cash. According to a facilitator who requested anonymity, they accept the fees when drivers return from their trips.

“We only want to help people get where they need to go,” he said while pocketing coins. “But, people criticise every detail.”

He recalled the time a passenger shot video of a cash hand-off, an offence that can bring a fine of 5,000 Br to 10,000 Br for both parties.

Those penalties are spelt out in a sweeping regulation that covers everyone involved, from taxis and terminals to facilitators, the Ministry of Labour & Skills, the Peace & Security Administration Bureau, as well as the drivers’ associations. Enterprises should register, open two bank accounts, and submit quarterly reports to the authorities.

Working without an ID or the required uniform draws a 10,000 Br fine and instant dismissal for repeat offenders. Members who stir up trouble face 5,000 Br on the first strike and 10,000 Br on the second; enterprises employing workers caught drinking, smoking, or using substances such as Khat risk both fines and loss of permits. Drivers involved in disturbances pay 1,000 Br.

City officers can pull plates from individuals who are chronic offenders.

Officials want these changes in public transport management to fit into a bigger corridor project to modernise the capital’s transport arteries with new lanes, electric buses, and bicycle paths.

Dagnachew Shiferaw, deputy head of transport operations, argues that the Addis Abeba City Bus Service Enterprise moves 1.1 million people daily without line facilitators.

“That proves structure and respect can do the job,” he told Fortune. “We don’t need more personnel. What we need is stricter monitoring and consistent penalties.”

A live dashboard tracking the city’s new Velocity electric buses, passenger counts, fare mix, and location is displayed. The city now has 81 terminals and 85 enterprises, with more than 100 staffed locations, although some lack formal structures. Thousands of students and unemployed youth volunteer during rush hour after completing a seven-day course that covers financial literacy, discipline, and public safety.

Back on Mozambique Street, another dusk settles over a line of weary commuters. The sun was gone, the crowd thinned, and Adnan still waited for a taxi. A facilitator waved down an empty van, but the driver rolled past, horn blaring. Change is coming, city officials insist, but for riders like Adnan, the road home feels longer than ever.

Many of the holdups are low-tech. Drivers cling to basic phones because smartphones are more prone to theft. Punching a 13-digit account number on a tiny keypad is slow; one mistake means starting over from scratch. Siket Bank’s engineers promise a more straightforward menu and a QR code option, but that will require sturdier handsets than most drivers trust themselves to keep.

Road tweaks are coming, too. The corridor project bundles taxi reform with resurfaced asphalt, wider sidewalks, bicycle lanes, marked crosswalks, pocket parks, and designated parking bays. Officials pitch it as a package: digital payments to clean up the money, and physical investments to clean up the streets.

Even supporters concede the early days feel messy.

“The benefits are ultimately for the drivers themselves,” said Berhanu, teh lecturer, urging patience. “Transport is the lifeblood of a city; change never arrives as fast as the traffic light turns.”

Though he believes those who showed dedication deserved better recognition, he sees the broader changes. New transit hubs and digital payments are steps worth the temporary inconvenience.

Real Estate Faces Sweeping Regulatory Overhaul

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Officials of the Ministry of Urban & Infrastructure have tabled a draft regulation they believe will restore public trust and tighten fiscal discipline.

Unveiled at the “2025 Ethio Real Estate Summit” on June 14, 2025, at the Sheraton Addis, the draft comes amid a storm of pent-up demand, rising costs, and widespread financing dysfunction. It coincides with the launch of the Ethiopian Real Estate Developers Association (EREDA), now positioning itself as both a stakeholder and a pressure group in the evolving regulatory landscape.

The regulation, if approved, will be a sweeping move to rein in an opaque and underregulated real estate market. It is a presale-tiered finance framework designed to restrain the speculative use of buyer advances.

Developers who secure more than 80pc of project costs from presales will be compelled to provide a 20pc loan guarantee. Those with presale receipts between 50pc and 80pc will be required to present a bank guarantee and commit one-fourth of the total project cost as a disbursed loan.

For underfunded projects below the 50pc mark, the draft imposes the heaviest restrictions, including CFO-backed guarantees and stringent disbursement limits. Only 30pc of the construction funds may be accessed, with half of which is withheld until 20pc of the construction is verified.

The regulation mandates escrow accounts co-managed by developers and buyer representatives, echoing international practices that insulate buyers’ funds from potential misuse. Disbursements tied to construction milestones should be reported to banks within two weeks, while project infractions, ranging from unauthorised presales to misleading marketing, could invite stiff penalties, including fines of up to one million Birr and permanent license revocation.

However,  the rollout is already encountering industry headwinds.

Alemayehu Ketema, president of the newly formed Association and a veteran developer, warned that the proposed financial guarantees risk inflating housing costs rather than curbing developer risk.

He criticised the draft for lacking flexibility in its treatment of fluctuating input costs, VAT computations, and cost pass-throughs in partially completed housing units.

“Without government backing to lower operational costs, especially land lease fees and the price of imported materials, housing will remain unaffordable,” Alemayehu told Fortune, on the sidelines of the draft’s presentation at the Summit.

Alemayehu also lobbied for exemptions for smaller-scale projects under 6,000Sqm, along with revised procedures for modifying site maps in near-completed projects.

The Association is not merely pushing back. It is also actively repositioning. Its Secretary General, Kedir Seid, announced plans to establish a headquarters and engage the state-owned Ethiopian Investment Holdings in bulk-import arrangements to lower input prices and sidestep foreign exchange bottlenecks.

Letters of credit, long seen as a choke point, have become a primary industry grievance.

“Bulk importing will give us stronger negotiation power,” Alemayehu said.

Officials appear receptive but cautious. Tsegaye Moshe, an advisor at the Ministry, disclosed that eligibility for discounted land leases in Addis Abeba has been relaxed, from a 10,000-unit threshold to 2,500 units, in a bid to attract affordable housing projects. Areas under the Industrial Parks Development Corporation (IPDC) are now obliged to build a minimum of 500 units, and presales for joint and fractional ownership structures have received formal sanction.

A liberalisation move permits foreign investors to own up to 49pc of real estate projects through joint ventures, conditional on capital inflows being denominated in foreign currency. These arrangements are expected to support technology transfer and skills development, while fully compliant domestic developers are expected to benefit from land grants and duty-free status, even outside public-led housing initiatives.

The regulatory recalibration arrives amid a profound urban housing shortfall. Ethiopia’s urban population has surged by 160pc over the past 15 years, with Addis Abeba alone needing nearly 1.2 million housing units. While the World Bank projects a national need for 486,000 homes annually, completions hover around 165,000. Private developers have contributed only 21,000 units over a decade, dwarfed by the government’s condominium scheme, which has registered over one million units but handed over only 384,000.

Soaring prices and limited mortgage access unveil this undersupply.

A one-bedroom condominium now commands 1.1 million Br, while two- to three-bedroom units fetch as high as nine million Birr. Compounding the problem is the exponential growth in construction costs, which are now 43 times higher than they were 25 years ago, far outpacing the fivefold increase in public salaries. With only four percent of private housing financed through formal bank loans, informal credit continues to dominate.

Stakeholders like Meseret Mekonen, CEO of NMC Real Estate, bemoan a credit environment steeped in aversion. Despite delivering 1,000 homes, Meseret failed to secure a two billion Birr loan for an 11.5 billion Br project.

“I approached 10 banks,” she said. “None were confident enough to lend. I’m building entirely using my own resources.”

Others echo her frustration. Zinabu Tebeje of Africon Group dismissed assumptions of 300pc profit margins, attributing pricing pressures to rising input costs rather than developer profiteering.

Zinabu estimated that land and labour alone account for half of a project’s cost structure, further squeezing margins.

“Housing prices have remained stable for the past three years despite rising construction costs,” Zinabu said.

In an environment where soft loan facilities are scarce and long-term mortgages remain commercially unviable, many developers are calling for bolder policy intervention. These include subsidised interest rates, free land allocations, and duty-free import status, particularly for developers meeting affordability benchmarks and sustainability metrics.

Yet, regulatory opacity remains a concern. The rules surrounding fractional ownership are still ill-defined, and developers fear double taxation under certain private partnership structures.

For Leul Dereje, a veteran consultant, the proposed presale collection threshold needs a clear definition, especially in a market increasingly oriented toward semi-finished units. He also warned that a looming 10pc fuel price hike could further erode already thin margins.

“Long-term mortgages are unprofitable, and real estate loans are widely abused,” he told Fortune, citing banks’ reluctance to extend tenors.

The draft’s strict disciplinary measures, he argued, should be matched with reforms that promote liquidity and clarify contract enforcement.

“The blocked account mandate benefits banks more than builders,” Leul said. “We need fund release schedules better aligned with real construction milestones.”

Still, the Ministry remains firm on its long-term objectives, localising 70pc of construction inputs within a decade and drafting a separate housing finance proclamation to build out the moribund mortgage sector. The broader goal, according to Tsegaye, is to root out speculative excess while enabling a robust, transparent, and scalable housing market.

Debebe Seifu serves as the finance director of the Association and the general manager of Jambo Real Estate & Construction. He wants to see the upcoming regulation to target the legal uncertainties that enable fraud under rigid compliance regimes. He urged more straightforward guidelines on fractional ownership and private partnerships to enable “a level playing field.”

However, as the regulation winds its way through consultations and revisions, the balancing act between protection and productivity has only just begun.

Electric Blitz Strands Domestic Car Builders

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A sudden ban on the importation of semi-knockdown and completely knockdown kits for gasoline-powered vehicles, a move authorities say rapidly accelerates a shift toward electric mobility, has left a burgeoning industry disoriented.

For the domestic assemblers that produced roughly 21,800 vehicles last year, including more than 2,000 electric units, the edict landed without warning. Many had been operating lines dedicated to gasoline kits, supported by bank letters of credit and a predictable import regime.

For Mintesnot Tessera, general manager of Belayab Motors, one of the 14 assemblers active in the market, the authorities “never provided” a firm timeline, although he had seen a sign about a potential ban.

Effective May 15, 2025, the measure allows only electric, hybrid or ambulance kits to enter the country. According to officials of the Ministry of Industry, the policy move forms part of a broader, 10-year strategy to phase out gasoline cars, develop local technical skills, curb mounting fuel import bills and tackle worsening pollution in Addis Abeba and other cities.

However, the abrupt cutoff has thrown manufacturers and buyers into uncertainty, an outcome policymakers are now scrambling to manage.

“A clear transition period would have allowed the industry to adjust,” Mintesnot told Fortune.

Until May’s announcement, assemblers like Multiverse Enterprise Plc had mapped out plans for new diesel and electric taxi models. Multiverse, which had partnered with the Defence Engineering Industry Corporation (DEIC) to assemble 5,000 vehicles, relied on a down payment of roughly 1.5 million Br for a five million Birr diesel package. Under the new rules, electric taxis now carry a sticker price of 8.5 million Br with a 2.5 million Birr down payment, an increase many drivers cannot absorb.

“For almost all drivers, this amount is financially out of reach,” said Nuredin Ditamo, chairperson of the Blen Taxi Association. “Desperate operators had hoped for state support or trade-in programs to cushion the blow.”

In addition to the financial shock, infrastructure shortcomings pose another obstacle to rapid electrification. Charging stations remain scarce outside of Addis Abeba, and most current installations offer slow charging. Field vehicles used in remote regions, typically double-cabin pickups, often lack electric versions with the necessary range or payload capacity.

Semereab Serekeberhan, deputy board director of the Ethiopian Automotive Industries Association, applauded the green push but urged policymakers to allow exemptions for specialised vehicles until viable electric alternatives are available.

“We’re not informed ahead of time,” he said. “Without exemptions, critical services could be disrupted.”

The policy has also strained financing channels. The Commercial Bank of Ethiopia (CBE), the largest state-owned lender, has declined to open letters of credit for gasoline-based kits since the ban on such transactions was implemented.

According to Seid Negash, who heads Multiverse’s import operations, banks are concerned about the risk of importing now-prohibited items. The abrupt tax and customs changes have also compounded liquidity pressures. With no formal grace period for existing inventory, assemblers have faced the choice between writing off assets or scrambling to retool facilities for a product line in which the domestic market is still nascent.

On June 9, the Ethiopian Customs Commission issued instructions to its regional offices, mandating stricter inspection protocols and designating that any attempt to import kits not allowed will incur penalties equal to twice the vehicle’s value, along with forfeiture. According to Yonas Teklewoled, head of the Commission’s operations division, detailed declarations and rigorous oversight are essential to enforce the ban.

“We remain aligned with the policy’s goals,” he told Fortune. “But, explicit directives are important to ensure smooth implementation.”

Within the Ministry of Industry, officials are racing to fine-tune technical guidelines and policy frameworks. Tilahun Abay, strategic affairs executive,  acknowledged the need for a “reasonable adjustment period” to train workers and allow existing gasoline kits, many of which benefited from prior government support, to clear customs.

The Ministry plans to convene affected parties for a series of meetings to address issues and roll out financial and administrative incentives for local electric vehicle (EV) assemblers.

Still, analysts warn that rolling out ambitious green policies without commensurate infrastructure and regulatory certainty can backfire.

Bereket Tesfaye, an EV consultant and general manager of Circular Nexus Consulting, praised the government’s environmental objectives but cautioned that the country’s grid remains fragile and that trained technicians are in short supply. He urged the authorities to study the staged approach used in countries like Norway, where incentives for early adopters and careful sequencing of charging-network expansion accompanied gradual phase-outs of gasoline vehicles.

“Policy must be anchored in real-world constraints,” he said. “Without meticulous planning, we risk creating new problems while failing to solve existing ones.”

Hefty Deposit Thresholds Threaten Maritime Labour Export Ambitions

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Mufariat Kamil, minister of Labour & Skills (MoLS), is rewriting the rules on overseas work, hoping to export skilled labour rather than being limited to housemaid services.

A bill her experts have circulated would let fully foreign-owned outsourcing agencies operate in the country and launch in the maritime trade, where her officials want Ethiopia, though landlocked, to supply crews to world shipping lines. The Ethiopian Maritime Training Institute S.C. (EMTI), in partnership with Bahir-Dar University, graduates more than 500 marine engineering and electro-technical officers each year. Its executives want to see this figure doubled.

The Ethiopian Manning Agency GmbH places graduates with established carriers, transforming classrooms in the Amhara Regional State into a talent pool for vessels thousands of miles away.

The bill encourages foreign agencies that can train workers and secure placements, a step Mufariat and her officials believe is needed, as experienced local agents are scarce. The measure also shifts labour-export policy toward jobs that require credentials, starting with seafarers but designed to extend later to other skilled occupations.

The existing law, written mainly for housemaids bound for the Gulf countries, left professionals such as officers and engineers out in the cold. When the Ministry assumed the mandate of overseas employment, it began drafting a replacement, hoping to curb illegal brokerage and murky fees through a central labour market information system and stricter oversight. Close to 92pc of the 521,000 workers sent since 2023 have passed through this system.

“The draft law introduces major changes to the outsourcing of Ethiopian workers,” said Sitina Mengistu, a legal adviser at the Ministry.

Under existing rules, agencies cannot send workers abroad unless Ethiopia has a bilateral deal with the destination country. The bill would permit outsourcing through Ethiopian consulates, even in the absence of a bilateral agreement. It also lets the Ministry work with foreign companies to train and certify labour that could later be hired overseas.

“We’ll work out the details during implementation to ensure it complies with conflict-of-interest rules and allows qualified foreign maritime agencies to operate here,” she told Fortune.

Money is where the draft bites. Employers should pay for contract authentication, but workers still bear the costs of passports, police clearances, birth certificates, and training. Agencies would need capital of five million Birr to 20 million Br and are required to park bonds of 50,000 to 250,000 dollars in blocked accounts, thresholds that rise with the license class. Those funds cannot be drawn down for day-to-day expenses, removing an incentive that agencies previously leveraged to secure credit or earn interest.

However, the deposit required unsettles smaller outfits such as Bereka, an Addis Abeba-based agency that mainly places housemaids, drivers and occasional hairdressers. Its managers say they lack the cash for a lump-sum deposit.

“We want to send skilled labour to foreign employment,” said Mohammed Awel, a founding shareholder. “If the Ministry makes things possible, we want to be part of it.”

However, he feared that the blocked-account rule was a burden the firm could not overcome.

Resistance is spreading inside the Ethiopian Overseas Employment Agencies Federation. Its members have discussed the issue twice.

“Most agencies opposed its core ideas,” said Seid Ahmed, the group’s public-relations head and a board member.

Seid faults the bill for omitting crisis-management plans for natural disasters or diplomatic rifts and questions whether many companies can afford the annual renewal fees or the value lost on the deposit that earns no interest.

“This could severely damage the sector,” he said, warning that up to 80pc of agencies could close if the thresholds stand. “We play a crucial role in generating foreign currency income.”

According to Aseged Getachew, an economist by training and former state minister for Labour, local firms rarely recruit directly. Instead, they sign deals with foreign partners and earn commissions of about 900 dollars a worker, an amount that often drops to 500 or 600 dollars when they chase volume.

“It’s a volume game,” he told Fortune. “Sometimes, you’ve got to compromise to stay in the business.”

Aseged sees upside in letting established maritime agencies to run operations in Ethiopia, arguing that trained officers could boost foreign-currency earnings.

“We’ve the workforce, and with the right channels, we can become a key player in the global maritime labour market,” he said.

Still, he finds gaps. The bill does not say which local agencies may focus on skilled labour, and none now do. He also fears the quarter of a million dollars in deposits will deter most players and leave the field to a few well-funded firms. Without clearer tiers, he warned, larger companies might encroach on roles intended for smaller ones.

“Unless these barriers are reconsidered, we risk locking out the very actors who’ve kept this sector alive,” he warned.

Officials say they will listen, and the bill remains open for comment. Federation members are drafting counterproposals that lower bond levels, stagger renewal fees, and outline how to rescue workers in the event of a war or pandemic. Employers, meanwhile, are crunching numbers to see whether higher service charges can offset the tougher rules.