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Addis Ababa – Ethiopia is ready to sell part of the state-owned enterprises, partially or wholly, as part of major economic reforms aimed at "unlocking the potential of the private sector," said his cabinet minister on Wednesday. l & # 39; information. 19659002] Ahmed Shide said that the government of Prime Minister Abiy Ahmed, who announced a series of reshuffles since taking office in April, would retain majority stakes in airlines, logistics, telecommunications and energy managed by the state. Everything else, from hotels and sugar factories to cement production, could go on sale, with the exception of the tightly controlled financial services sector, whose fate was yet to be determined, he said.
to encourage the development of the private sector in the country, "said Ahmed, adding that the nation turned the page on decades of trust in the state to spur economic growth.
State Development Projects
The Role of the Private Sector is Very Fundamental
"We have carried out a lot of state development projects. It is now necessary to unleash the potential of the private sector, "he said.
Ahmed did not give a timetable for privatizations, but said the government was seeking advice from international consulting firms, including McKinsey and PwC. "The detailed planning is not complete but precautions will be taken to not have any mistakes," he said, "so we will do it with caution," he said.
Having taken power less than four months ago, Abiy led the nation with his bold plans to reshape politics and the economy. attracting foreign capital to one of the most closed states on the continent, Abiy negotiated peace with the Erythra archipelago.The first commercial flights between Ethiopia and Eritrea in 20 years took off early Wednesday, just a week after Asmara and Addis Ababa had buried the hatchet.
Although it is one of the fastest growing African economies, the export sector, mainly clothing manufacturing and agriculture, had hard to take off. The economy does not generate enough dollars to pay for imports.
Currency shortages have been exacerbated by the government's huge investments in infrastructure over the past decade. With some notable exceptions, such as Ethiopian Airlines, state-owned enterprises that are at the heart of the economy are poorly run by inexperienced politicians with links to security services or the ruling EPRDF coalition. The banking sector is dominated by the Ethiopian State Bank, which controls more than half of the sector's badets and remains stuck in time. There is no way to transfer funds between banks, which significantly slows down the basic economic activity.
Kenya Safaricom is ready to roll out its popular mobile money service M-Pesa, they hope, technology that has changed The face of Kenya's economy since 2007 will do the same in Ethiopia.
"This will really ease their liquidity constraints," said Jacques Nel of the Cape Town-based NKC African Economics consulting firm. "People will start using this electronic money and will not have to waste time looking for Birr or currency," Nel said.
Abiy's reforms, particularly his peace agreement with Eritrea, have worked well, bringing Ethiopia's 2014 eurobond yield of 7.6% to 6.6% this week
Reuters
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