Ethiopia: CBE has launched a state-controlled digital remittance network

• CBE launched CBE Connect Digital Wallet to channel diaspora remittances. 

• The platform targets capturing part of $35 billion annual remittances. 

• Only 22 % ($7.2 billion) of remittances currently flows through formal channels. 

• NBE granted exclusive Dollar Wallet rights for digital foreign-currency holding. 

• API gateway enables 1–2 day global fintech integration with Ethiopian banking system. 

Why it matters: The new platform represents a policy shift toward formalizing remittances and strengthening foreign exchange inflows, potentially reducing reliance on informal channels and costly intermediaries in Ethiopia’s payments ecosystem. 

• ESX reported 2,500 active investment accounts during its first year. 

• Total trading value exceeded 12 million birr on the Ethiopian Securities Exchange. 

• Account numbers remain below the initial 30,000 target. 

• ESX is prioritizing more listings and market participation tools. 

• Digital access efforts aim to improve investor participation. 

Why it matters: These figures reflect early capital market growth and participation trends in Ethiopia’s evolving securities ecosystem. 

• Afreximbank terminated its credit rating relationship with Fitch on January 23, 2026. 

• The decision followed a review finding Fitch’s ratings didn’t reflect Afreximbank’s mandate and legal framework. 

• Fitch had downgraded Afreximbank to one notch above “junk” status with a negative outlook. 

• Afreximbank reported assets and contingencies over US$40.1 billion at end-2024. 

• It retains investment-grade ratings from Moody’s, GCR, CCXI, and JCR. 

Why it matters: This decision highlights debates on how global credit agencies assess multilateral African lenders and may influence future financing and risk perception. 

1. CATL officially introduced the Tianxing II battery series on January 22, 2026, highlighting a new sodium-ion variant. 

2. The 45 kWh sodium-ion battery is designed specifically for small vans, micro vans, and light trucks. 

3. The battery achieves energy density of 175 Wh/kg and a cycle life exceeding 10,000 cycles. 

4. It is the industry’s first mass-produced sodium-ion battery for commercial vehicles. 

5. The battery received GB 38031-2025 certification, China’s new national EV battery standard. 

6. In extreme cold of -40 °C, the battery retains about 90 % usable capacity. 

7. The pack supports immediate charging at -30 °C, addressing winter operation challenges. 

8. The Tianxing II lineup includes four versions: low-temperature (sodium), fast-charging, long-range, and high-temperature fast-charging variants. 

9. The long-range variant offers up to 253 kWh capacity with ≈800 km range for logistics use. 

10. Sodium is >1,000× more abundant and ~1/20 the extraction cost of lithium, implying future cost advantages. 

    
    

    Implications of CATL’s mass-produced sodium-ion battery announcement for the Ethiopian market:

    1. Potential cost reduction in EV fleets: Sodium-ion batteries use abundant sodium instead of lithium, which could lower battery and thus EV costs if adopted regionally. 

    2. Enhanced cold-weather performance: The new battery’s ability to retain performance in low temperatures could benefit logistics and commercial EV use in highland and variable climates. 

    3. Acceleration of commercial EV adoption: With Ethiopia rapidly increasing electric vehicle numbers (over 115,000 EVs) and policy support for EVs, more affordable, durable batteries support this growth trajectory. 

    4. Encouragement for local infrastructure investment: The technology spotlight may incentivize expansion of charging and service networks, addressing current shortages that limit EV use outside Addis Ababa. 

    5. Opportunity for domestic participation: As Ethiopia explores local EV and battery industries and assembly initiatives, sodium-ion technology can present a simpler, potentially more accessible entry point for manufacturing and skills development. 

1. Ethiopia generated over USD 5.1 billion in export earnings over the past six months, surpassing official targets. 

2. The export performance exceeded government expectations, indicating stronger external demand and improved export activity. 

3. Export growth was broad-based across key sectors (not detailed in snippet but implied in reporting). 

4. The six-month revenue achievement signals a possible upward revision of full-year targets. 

5. The export result contributes to foreign exchange inflows, helping ease external balances. 

   
   

Implications for the market

• Foreign Exchange & Banking: Higher export earnings bolster foreign currency reserves, easing pressure on the birr and supporting financial sector liquidity.

• Trade & Industry: Stronger export performance can attract investment in export-oriented sectors (agriculture, manufacturing), potentially expanding jobs and output.

• Logistics & Transport: Increased exports drive demand for freight, shipping, and transport services, benefiting related enterprises and infrastructure development.

1. The Ethiopian Capital Market Authority (ECMA) set the maximum investor compensation at 100,000 birr (~$640 USD) for losses covered by the Capital Market Compensation Fund. 

2. The compensation fund is designed to cover fraud or default losses when licensed providers fail to meet obligations. 

3. A dedicated committee will oversee the fund’s operations and ensure fair distribution of payouts to eligible investors. 

4. The compensation limit corresponds to a relatively low ceiling compared with potential capital market losses, given market volatility and fraud risk. 

5. The decision comes amid broader moves to strengthen investor confidence as Ethiopia’s capital market begins operations and the birr continues to slip against foreign currencies. 

Market Implications

• Investor confidence: A compensation cap of 100,000 birr (~$640) may be seen as modest, possibly limiting its reassurance value for larger investors and high-net-worth participants. › This could slow institutional participation. 

• Retail protection: While a formal mechanism exists, the low cap may mainly benefit small, retail investors, leaving larger claimants exposed. 

• Market attraction: Regulatory clarity may attract cautious investors seeking a structured market, but the compensation cap may need future adjustment to entice deeper liquidity and foreign capital. 

• Risk pricing: Brokers and issuers may price risk premiums into products if the compensation threshold is perceived as insufficient, potentially raising cost of capital. 

• Capital market development: The establishment of governance structures like this, even with low limits, is a step toward formal capital market infrastructure in Ethiopia, laying groundwork for expansion. 

1. The International Finance Corporation (IFC) is considering up to $80 million A-loan to support MIDROC Ethiopia Plc’s Sheraton Addis project. 

2. The financing would cover the refurbishment of the existing 294-room Sheraton Addis and construction of a new 200-key hotel + private villas on 2.5 acres. 

3. The Sheraton Addis renovation has been underway since 2023 and is expected to complete in 2026. 

4. IFC classifies the investment as Environmental Category B (limited risk) after due diligence and consultations. 

5. The project is still pending IFC Board approval, meaning the $80m financing is not yet finalized. 

Market Implications

• Hospitality sector boost: An $80m potential IFC loan signals confidence and can catalyze further foreign investment in Ethiopia’s hospitality infrastructure, especially in luxury segments.

• Construction and jobs: The refurbishment and new build expand demand for construction services, skilled labor, and local suppliers during the multi-year project.

• Tourism positioning: Enhancing a flagship property like Sheraton Addis supports Ethiopia’s strategy to attract international business, conferences, and tourism ahead of global events.

• Financing precedent: IFC’s involvement may lower perceived risk for other lenders to fund large multipurpose real-estate projects in Ethiopia.

• Currency and capital flows: Large USD-denominated financing, if approved, affects capital account activity and may help leverage further international capital inflows into service sectors.

1. The new Investment Incentive Regulation introduces an exit penalty that prevents investors who close businesses from reclaiming previously granted tax incentives. 

2. Tax holidays previously enjoyed by exiting investors are now linked to future eligibility, effectively barring tax incentive refunds once a project is closed. 

3. The regulation tightens accounting and reporting requirements, likely increasing compliance obligations relative to prior rules. 

4. Transfers of duty-free imported goods are restricted under the new rules, limiting how investors can redeploy such assets after closure. 

5. Startups, green projects, and Special Economic Zone (SEZ) developers remain eligible for preferential tax treatment, marking a targeted retention of incentives. 

   
   

   Implications for foreign investors:

   • Higher exit cost: Investors who shut down projects lose the right to reclaim tax holidays and duty-free incentives, raising downside risk.

   • Lower flexibility: Assets imported duty-free face transfer restrictions after closure, limiting capital recovery.

   • Stricter compliance: Tighter reporting and post-exit scrutiny increase administrative and legal exposure.

   • Longer commitment bias: The policy favors long-term operations over short or speculative investments.

   • Selective attractiveness: Incentives remain stronger for startups, green projects, and SEZs, but weaker for general investors.

1. Launch of StarPay: The Commercial Bank of Ethiopia (CBE) has launched a new digital payment platform called StarPay to integrate banking and payment services. 

2. Online and Offline Integration: StarPay is designed to work both online and offline, enabling payments and banking functions without network constraints. 

3. Single Platform Access: Customers can access a wide range of banking and digital payment services through one unified interface. 

4. Digital Ecosystem Support: The platform supports digital transaction growth and aligns with national digital transformation goals like Digital Ethiopia 2030. 

5. Bank–Fintech Collaboration: StarPay is developed through a strategic partnership between CBE and StarPay FinTech, highlighting tech–bank cooperation. 

   
   

   What it means for traders and users:

   For Traders (Merchants):

   • Lower cash dependence: Ability to accept digital payments online and offline, reducing cash handling risks and costs.

   • Faster settlements: Transactions are processed directly through CBE-linked accounts, improving cash flow.

   • Wider customer reach: Access to millions of CBE customers using one unified payment platform.

   For Users (Customers):

   • One platform convenience: Banking and payments handled in a single app, reducing the need for multiple wallets.

   • Offline usability: Ability to make payments even without internet, critical in low-connectivity areas.

   • Lower transaction friction: Faster, simpler payments for daily retail, transport, and service expenses.

1. Oromia Regional State has imposed a 5% levy on coffee beans sold for export. 

2. The 5% fee applies to every kilogram of coffee bought from farmers for export. 

3. The levy affects over 4,000 coffee producers in the region. 

4. Oromia accounts for nearly 79% of Ethiopia’s total coffee exports. 

5. The levy is tied to benchmark prices set by the Ethiopian Coffee & Tea Authority. 

    The implications for exporters:

• Higher costs: The new 5% levy directly raises procurement costs per kilogram.

• Margin pressure: Exporters must absorb the fee or pass it on, reducing competitiveness.

• Pricing risk: Higher export prices may weaken demand in price-sensitive markets.

• Cash-flow strain: Upfront fees increase working capital requirements.

• Supply distortion: Exporters may seek non-Oromia sources or informal channels to avoid the levy.

1. Starting February 8, 2026, Ethiopia will impose a 5% levy on all mobile airtime and data purchases to fund the National Disaster Fund. 

2. The directive establishing the levy is dated January 16, 2025 and makes contributions to the disaster fund mandatory. 

3. Under the broader framework, banks and microfinance institutions will contribute 1% of the value of loans disbursed to the disaster fund. 

4. Insurance companies will remit 1% of total premiums collected, while digital banking services will incur an additional 5% surcharge. 

5. Other sector levies include 1 Birr per liter on fuel and 100 Birr fixed fee on domestic airline tickets as contributions to the disaster financing scheme. 

1. Ethiopia’s central bank allocated $70 million in foreign exchange at its latest auction. 

2. Total bids from commercial banks exceeded $94 million, indicating strong demand relative to supply. 

3. The marginal cut-off rate for successful bids was around Birr 154.78–154.92 per US dollar. 

4. 15 banks received foreign exchange allocations in this 15th auction under the current forex framework. 

5. Bid offers ranged from Birr 153 to Birr 155 per dollar, showing price variation within the auction. 

1. Ethiopia’s Council of Ministers approved revisions to the Customs Proclamation to modernize and align it with international trade standards. 

2. The updated customs law aims  to streamline customs procedures, support manufacturing sector growth, and provide a more predictable environment for legal trade and investment

3. The cabinet also endorsed new investment incentive and tax exemption regulations alongside the customs law updates. 

4. A national entrepreneurship development policy was also adopted to support innovation and business expansion. 

5. These reforms are part of a broader economic reform agenda to boost trade, attract investment, and support export growth. 

1. EAG expects to select a lead contractor between June and July 2026.
   Ethiopian Airlines Group (EAG) aims to finalize the principal contractor for the Bishoftu airport project in this period. 

2. The Bishoftu International Airport project budget is in the multi-billion-dollar range.
   Estimates place the total cost between $7.8 billion and over $12.5 billion depending on scope and expansion phases. 

3. Bishoftu International Airport will handle up to 110 million passengers annually.
   Full project completion is designed for an annual capacity of 110 million passengers. 

4. Construction began in January 2026 with phased delivery by 2030.
   Groundbreaking occurred 10 January 2026, and Phase I targeting 60 million passengers per year is set for completion by 2030. 

5. EAG and lenders will finance the project with defined ratios.
   Ethiopian Airlines will cover about 30 % of costs, while lenders—including the African Development Bank’s $500 million contribution—will fund the remainder. 

1. National Bank bans CAD payments for exports to certain African markets.
   The central bank barred the use of Cash Against Documents (CAD) for exports to five African countries to protect scarce foreign exchange. 

2. Policy aims to ensure timely foreign currency inflows.
   Officials cited repeated failures by exporters to repatriate forex earnings under CAD arrangements. 

3. Alternative payment methods required.
   Exporters must now use advance payments or Letters of Credit (LCs) to secure foreign currency receipts. 

4. Directive is linked to foreign exchange shortages.
   The clampdown reflects ongoing forex scarcity and volatility in Ethiopia’s external payments landscape. 

5. Enforcement will involve customs and penalties.
   Customs authorities will monitor compliance, and violations could delay shipments or risk goods confiscation. 

1. CBE plans to extend over 100 billion birr in loans this fiscal year.
   This funding targets the private sector, agriculture input suppliers, and public enterprises. 

2. The government’s temporary debt ban has been lifted.
   Ending the three-month ban allows banks to resume lending activity across sectors. 

3. 25 billion birr is allocated for private businesses.
   A further 30 billion birr will support agricultural inputs, with the remainder for public enterprises. 

4. CBE leadership says loans will stimulate the economy.
   Expanded credit access is expected to increase investment and job creation nationwide. 

5. Financing aims to restart suspended projects.
   Release of loan funds is intended to complete stalled initiatives and generate employment. 

1. Dashen Bank reported a profit of ETB 6.6 billion for 2023/24.
   This figure reflects significant growth and positions the bank strongly among Ethiopia’s private lenders. 

2. Pre-tax profit increased by about 32% year-on-year.
   Profit rose from ETB 5.0 billion the previous year, indicating improved operational performance. 

3. Growth driven by digital banking investment.
   Expansion of mobile and internet banking boosted customer reach and service efficiency. 

4. Branch network expanded nationwide.
   A wider physical presence helped the bank access new markets and increase its customer base. 

5. Focus on financial stability and CSR.
   Strong balance sheet, risk management, and community development efforts enhanced the bank’s reputation. 

1. EDR plans to double its freight rolling stock by year-end.
   The Ethio-Djibouti Railway Share Company will expand its fleet of freight wagons and electric locomotives to increase cargo capacity. 

2. Current fleet includes about 1,100 wagons and 35 locomotives.
   Doubling these assets aims to significantly raise freight handling on the cross-border corridor. 

3. This expansion supports higher cargo throughput.
   Increased rolling stock directly boosts the railway’s ability to move more goods between Ethiopia and Djibouti. 

1. Ethiopia’s trucking industry is largely manual.
   The sector — valued at about 800 million Birr — still depends on phone calls, paper, and cash deals, causing inefficiencies.

2. TOLO FREIGHT is digitizing freight matching.
   The homegrown multilingual digital marketplace connects shippers, carriers, and brokers via an app to streamline load matching.

3. Documentation and tracking are being digitized.
   Contracts, tracking and paperwork are transitioned into the platform, reducing reliance on informal systems.

4. The platform separates load matching from payment settlement.
   TOLO FREIGHT’s design accommodates Ethiopia’s cash-based market by keeping matching and payment distinct.

5. Smaller shippers and drivers will benefit.
   The digital solution aims to cut costs, improve utilization, and help independent drivers and exporters access better freight options.

1. BYD has phased out the Song Plus globally.
   The model, contributing to the Song family’s sales of 788,003 units in 2025, has been removed from BYD’s global lineup as part of product streamlining.

2. Song Plus remains a top-selling EV in Ethiopia.
   It continues to perform strongly in the Ethiopian market. Commonly listed at about 5.1–6.5 million ETB in local market prices

3. The model is being repositioned, not fully discontinued.
   BYD is shifting Song Plus within its portfolio rather than ending production entirely.

4. This reflects BYD’s broader global strategy shift.
   Product decisions are driven by global alignment, not individual market performance.

• The AfDB approved 214.47 million dollars for phase two of the South Sudan-Ethiopia-Djibouti Transport Corridor.
•  Ethiopia receives the largest share at 181.5 million dollars, Djibouti 29.71 million dollars, and South Sudan 1.96 million dollars, with an additional 1.3 million dollars for South Sudan’s fragile state needs.
•  The project will build a 67Km expressway in Ethiopia, upgrade 18Km of road in Djibouti, and fund studies for 280Km of road in South Sudan.

• The new NBE directive cited as " Foreign Exchange Exposure Limits of Banks Directive No. SBB/96/2025" has entered into force starting today November, 10th , 2025.
• A key change links a bank’s maximum foreign exchange exposure to its core capital, enhancing financial stability by aligning risk capacity with a bank’s actual financial strength.
• This reform transitions from a static paid-up capital requirement to a dynamic system where capital must align with the risks a bank undertakes.
• For the first time, banks must calculate separate capital charges for market risk and operational risk, moving beyond the traditional focus on credit risk.
  
  
  

• African Export-Import Bank (Afreximbank) is set to pioneer Africa’s use of the Chinese renminbi (RMB) in project financing after becoming a direct participant in China’s Cross-Border Interbank Payment System (CIPS)
• With direct access to CIPS since June 2025, Afreximbank gains the ability to finance projects across Africa using RMB, streamlining transaction processes and cutting costs and currency exchange risks associated with cross-border trade and project finance.
• Afreximbank’s successful issuance of Panda bonds on China’s capital market has diversified its funding