Ethiopia is open to selling off state-owned firms, either partially or entirely, as part of a major economic reform drive designed to “unleash the potential of the private sector”, its information minister said.
In an interview with Reuters, Ahmed Shide said the government of Prime Minister Abiy Ahmed – which has announced a stream of reforms since coming into office in April – would retain majority holdings in the state-run airline, logistics, telecoms and energy companies.
Everything else from hotels to sugar farming to cement production could be for sale, with the sole exception of the tightly controlled financial services sector whose future was yet to be decided, he said.
“The main objective is to encourage private sector development in the country,” Ahmed said, making it clear Ethiopia was turning the page on decades of state reliance to drive economic growth in the nation of 100 million people.
“The role of the private sector is fundamental. We did a lot of state development projects. Now we need to unleash the potential of the private sector,” he said.
Ahmed did not give a time-frame for privatisation saying Addis was tendering for advice from global business consultancies including McKinsey and PwC.
“Detailed planning is not complete but precautions will be made to avoid mistakes,” he said. “We will do it with caution.”
Having come to power less than four months ago, 41-year-old Abiy turned the Horn of Africa nation on its head with his bold plans to reshape politics and the economy.
Beside his desire to attract foreign capital to one of the continent’s most closed states – a consequence of Ethiopia’s chronic lack of foreign exchange – Abiy brokered peace with arch-enemy Eritrea.
The first commercial flights from Ethiopia to Eritrea in 20 years took off on Wednesday.