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Political pitfalls will limit Ethiopian liberalisation

Monday, July 8, 2019

Significance

This would constitute the first major step in Prime Minister Abiy Ahmed’s much-heralded privatisation drive. However, political and security risks remain likely to delay and dilute the wider initiative.

Impacts

  • The prospect of new windfalls from asset sales should help ensure elite buy-in for partial privatisation.
  • Internet blackouts underscore risks for telecoms investors but appetite for Ethio Telecom and its 60 million customers will remain robust.
  • WTO accession remains a priority but will likely not be finalised until next year.
  • Investor interest in Ethiopia’s largely untapped 100 million-strong market will remain elevated barring an outright stagnation of reforms.
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