Ethiopia's only foreign-owned financial company, Ethio Lease, is set to shut operations in the Horn of Africa nation after four years, its parent company has said citing forex constraints.

The New York-based African Asset Finance Company (AAFC), a leasing firm targeting emerging markets, said it had directed its Ethiopian unit "to begin the process of voluntary liquidation".

"As a result of the changes to the regulatory framework, the viability of Ethio Lease as a foreign-owned leasing company became structurally impaired," it said in a statement dated November 15.

The company was the first and only foreign group to obtain a financial licence from the National Bank of Ethiopia in 2019, as part of reforms to open the country's tightly-controlled economy.

Prime Minister Abi Ahmed announced the ambitious economic reform package after coming to power in 2018.

But the economy has deteriorated sharply in recent years and the will to continue the reforms has largely stalled.

According to Ethio Lease, chaired by former Ethiopian Airlines chief executive Girma Wake, the troubles began in 2021 when the central bank changed the regulatory framework.

Source: AFP

Is Abiy Ahmed the Most Dangerous Man in Africa?

Ethiopia: Rulers, Reputations, Reality and the Promise of Fano. (2)

Deliberate Destruction of Museum, Hospitals, Schools, and Hotels. (2)