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Erudite AfricaCenter of Excellence
← Introduction to Capital Markets

Why capital markets matter

Module 01 / 5 · 50 min · Free preview

See how capital markets turn long-term savings into long-term investment, how market finance differs from bank finance, and why Ethiopia rebuilt a market after a gap of almost fifty years.

In this module you will learn to

  • Explain how a capital market links savers who want returns with businesses and government that need long-term funds
  • Compare bank finance and market finance for a growing Ethiopian company
  • Outline Ethiopia's capital market history, from the 1960s share dealing group to the 2021 proclamation and the 2025 launch of ESX
  • Describe why the reform matters for banks, insurers and companies in Ethiopia

Built on

  • Erudite Africa training module: Ethiopian Context, topic 2.a Introduction to Capital Markets, Level 1 (October 2026)
  • Capital Market Proclamation No. 1248/2021 and National Bank of Ethiopia Proclamation No. 1359/2025
  • ECMA Directives No. 980/2024 (service provider licensing) and No. 996/2024 (fees); directives on exchanges and OTC (reported as No. 1009/2024) and public offers (reported as No. 1030/2024); draft Foreign Portfolio Investment Regulation (September 2026)
  • Ethiopian Securities Exchange Rulebook (December 2024)
  • NBE Directive No. SBB/92/2024 and NBE Monetary Policy Committee release No. 7 (July 2026)

Examples and companies are fictional. Bank practices are shown as typical Ethiopian practice, not as any one bank's policy. Always apply your own institution's approved policy and the current NBE directives.