Browsing by Author "Bezawit Abrham Melesse"

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    Assessing the Infrastructure Readiness For Capital Markets Development in Ethiopia: Opportunities and Challenges
    (AAU, 2025-03-24) Bezawit Abrham Melesse; Kalifa (PhD)
    This study assesses the infrastructure readiness for capital market development in Ethiopia, highlighting key opportunities and challenges. Ethiopia has historically lacked a formal capital market, but recent government initiatives aim to establish one. The research evaluates the current state of infrastructure, the readiness of financial and institutional systems, and the role of government and private sector initiatives in fostering market growth. Using a descriptive research design, data was gathered from 32 experts in the Ministry of Finance, Ethiopian Securities Exchange, insurance companies, and private commercial banks. Findings indicate that Ethiopia’s financial market infrastructure remains underdeveloped, with limited access to investment opportunities, inefficiencies in securities trading, and insufficient market data availability. However, advancements in financial technology and government policy support present significant opportunities for development. Strengthening regulatory frameworks, investing in digital trading platforms, and fostering public-private partnerships are crucial steps forward. Key recommendations include introducing tax incentives, improving financial literacy programs, establishing a stock exchange, and enhancing institutional collaboration to create a sustainable capital market in Ethiopia. This study assesses the infrastructure readiness for capital market development in Ethiopia by examining key opportunities and challenges. The research aims to evaluate the current state of infrastructure, the readiness of financial and institutional systems, and the role of government and private sector initiatives in fostering capital market growth. The study employed a descriptive research design, utilizing census sampling to gather data from 32 experts from the Ministry of Finance, Ethiopian Securities Exchange, insurance companies, and private commercial banks. Data were collected through structured questionnaires and interviews, with quantitative data analyzed using descriptive statistics and qualitative data analyzed through narration. Findings indicate that Ethiopia's capital market infrastructure is underdeveloped, with limited accessibility to investment opportunities, inefficiencies in securities trading, and insufficient market data availability. The reliability of the settlement and clearing systems was found to be neutral, while investor confidence in future market growth remains strong. The study further reveals gaps in financial and institutional infrastructure, with the regulatory framework perceived as inadequate and oversight capabilities questioned. Weak institutional collaboration and insufficient government support hinder market xiv participation. Major challenges include the absence of a stock exchange, inadequate technological infrastructure, and a shortage of skilled professionals. However, financial technology advancements and government policy support present opportunities for development. The study concludes that strengthening regulatory frameworks, investing in digital trading platforms, and fostering public-private partnerships are critical for enhancing market infrastructure. Key recommendations include introducing tax incentives, improving financial literacy programs, establishing a stock exchange, and enhancing institutional collaboration. These measures are essential for creating a sustainable and efficient capital market in Ethiopia