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Ethiopian Securities Exchange (ESX) announced that it has executed an Advisory Engagement Letter with the International Finance Corporation (IFC) to initiate the Ethiopia Money Market Capacity Building Project.
The project is designed to enhance institutional capacity and enable the establishment of a national dealer’s association for the local currency and foreign exchange interbank markets of Ethiopia.
ESX said that the project targets senior management and operations personnel of commercial banks and other capital market participants’ skills development by means of internationally recognized training and certification programs such as those offered by the ACI Financial Markets Association (ACI FMA).
The training will cover core areas like the local currency and foreign exchange interbank markets, treasury operations, and back-office finance.
According to ESX, the national dealers’ association is a core component of the initiative and will institutionalize collaboration among participants in Ethiopia’s money market and serve as a crucial institutional anchor to its establishment.
ESX noted that the project is in line with its broader roadmap to build an operational interbank market on its central trading platform, the pillar for building necessary financial instruments such as Treasury Bills, bonds, and commercial papers.
A liquid interbank market encourages optimal market-based pricing of short-term capital and fosters the development of healthy long-term debt and equity capital markets.
ESX will facilitate the launch of the project as the market organizer and the approved trading platform provider in the interbank market.
Cooperation with the IFC is aimed at encouraging capacity-building activities and supporting the establishment of the dealer association.
While the program is primarily designed to create wholesale interbank money market trading ability, ESX said that the experience and expertise gained might lead to the future development of new money market products, including spot and derivative instruments for foreign exchange.
Aliou Maiga, IFC’s Financial Institutions Group Director for Africa, said, “Well-functioning, sound capital markets are the foundation of an active financial system and sustainable diversified economic growth.
This collaboration is driving Ethiopia’s vision of building its financial market and aligns with the country’s economic ambitions.”
ESX CEO Tilahun Esmael Kassahun expressed gratitude to IFC for the support and added that product development and capacity building are the capital market’s future frontier in Ethiopia.
