Bond Issuance and Regulation in Ethiopia: the Case of Grand Renaissance Dam Bonds
No Thumbnail Available
Date
2014-06
Authors
Journal Title
Journal ISSN
Volume Title
Publisher
Addis Ababa University
Abstract
Bond issuance and its market in Ethiopia are at their rudimentary stage and have long distance to
go. Well developed goverJU11ent bond market can assist economic development in general and
infrastructure development endeavors in particular. Government bond issuance in Ethiopia is not
guided and supported by well designed legal and institutional frameworks. Such kind of
government bond issuance will leave its own black point on future developments of government
bond market and so requires great deal of care. Regulation of government bond issuance and
their circulation in secondary markets will be preliminary considerations in any capital markets
building. The author of this study found that despite government bond issuance in Ethiopia
including the issuance of GRDBs, it is not based on full-fledged legal and institutional
frameworks.
Government bonds market needs many measures including cultivating institutional and
normative spheres for its development There are many factors that policy makers should
consider in developing government securities markets. Sufficient regulation both in primary and
secondary markets is yet to be designed. For instance some institutiuns whi(;h are crucial
elements of government bond market like central depositories and settlement centers are not
available. Likewise government bond market in Ethiopia is not lucky in utilizing financial
intermediaries that are called underwriting or syndicate groups which will serve as market
makers. These institutions would assist the bonds distribution to a considerable extent
Keywords: Government bond, primary market, secondary market, financial intermediaries,
underwriters, long term debt instruments, capital market, money market
Description
Keywords
Government bond, primary market, secondary market, financial intermediaries, underwriters, long term debt instruments, capital market, money market