The squad at the helm of public and regulatory economic institutions attended a conference inside the meeting hall of the Commercial Bank of Ethiopia’s (CBE) new headquarters last week. It included, right to left, Girma Wake, board chairperson of the Ethiopian Airlines Group; Frehiwot Tamiru, CEO of Ethio telecom; Yinager Dessie (PhD), governor of the central; Eyob Tekalign (PhD), a state minister for Finance; and, Finance Minister Ahmed Shide. They showed up at the invitation of the recently established Ethiopian Investment Holdings, a sovereign wealth fund headed by Mamo Mihretu (farthest left).

The summit was held to bring on-board several state enterprises under Investment Holdings, which has a paid up capital of 25 billion Br and is chaired by the Prime Minister, and officially launch its operations. Many of the bigwigs in attendance are members of the fund's board. The meetings, held on Thursday and Friday last week, also included discussions on public assets and national wealth, portfolio management, and integration of procedures with the state enterprises.

The enterprises coming under the wing of Investment Holdings are the biggest in the country, and taken from nearly every economic sector. The largest ones are, by revenue, Ethiopian Airlines, the CBE, Ethio telecom, the Ethiopian Shipping & Logistics Services Enterprise, and the Ethiopian Insurance Corporation. These public enterprises and two dozen others will hereon serve as subsidiaries to Investment Holdings, which is structured as a parent company. The sovereign fund’s ambition is to consolidate assets, mobilise funds and serve as the primary investment arm of the government.

State enterprises have been as much a blessing to the government as they have been a thorn in its side. The likes of Ethio telecom are cash cows while CBE’s deposits are exhausted to serve development objectives. At the same time, the likes of the Ethiopian Sugar Corporation have been ticking time bombs, at least until their debt was soaked up, that have created a sovereign debt burden and placed the CBE in a precarious situation. Investment Holdings wants to turn the second part around and more.

PUBLISHED ON Jun 25,2022 [ VOL 23 , NO 1156]

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