Interview with families of the late Ethiopian artist Madingo Afework on the Seifu show. Opening Ethiopia’s financial sector to foreign investors would ease liquidity constraints, improve credit standards, provide capital to support the financing of major projects, and increase the availability of foreign exchange. This should bring several potential operational benefits, such as facilitating trade transactions and providing additional expertise—the country’s underdeveloped capital market. Ethiopia’s banking sector is highly profitable, with an average after-tax return on assets of 1.9% in December 2020 (when we last reported), reflecting the country’s solid economic performance over the past decade. With a large unbanked population, the sector offers attractive opportunities for foreign investors. That will be difficult as we need to see what constitutes growth and what has driven her double-digit growth in the past. The double-digit growth is mainly due to heavy public spending on major infrastructure projects, which also contributes to the depletion of foreign exchange reserves. As governments move towards opening up their economies and paying more attention to fiscal prudence, this will become very difficult to achieve in the future unless the country receives a large influx of international investment. The economy presents significant opportunities. Since most production facilities are located south of the conflict, production losses have been less severe than expected. So far, the economy has been largely buoyed by rising global coffee prices, which has boosted exports.
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