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A half-year cabinet performance review meeting revealed that Ethiopia’s long-lived protectionism over the wholesale and retail market is coming to an end, pending the approval of a roadmap under preparation by the Ethiopian Investment Commission (EIC) and Ethiopian Investment Board.

Liberalization of the retail market is a core macroeconomic objective in the second Homegrown Economic Reform Agenda (HGER 2.0), which looks to alter the existing retail market structure through private sector involvement.

The government is working towards “opening up the wholesale and retail sector as outlined in HGER 2.0,” said Fistum Assefa (PhD), minister for Planning and Development, during an overview of macroeconomic trends before the Council of Ministers earlier this week.

“We are working to gradually open these businesses to competition,” Fitsum said.

Six months into the implementation of HGER 2.0, which is slated to last for the coming two and a half years, the preparation of the roadmap is the most pronounced step on the path to retail and wholesale market liberalization thus far.

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“Once the preparation of the roadmap is finalized, we will start opening up the trade sector step by step so as to solve the problems it currently has,” said the Minister.

The current structure “has multiple inefficiencies leading to product shortages, price hikes, and limited incentives for local producers,” according to the reform agenda.

The modernization plan included “sequenced liberalization” and attracting foreign or local investors to make their contribution to the “adoption of new technologies and exploitation of economies of scale to boost productivity, expand choices and lower consumer prices.”

A source close to the matter at EIC told The Reporter that “a lot has been done” with regard to progress in discussions about liberalizing the retail market.

“This is in light of the approaches that are liberalizing different economic sectors,” the source said, but declined to speak further.

Attempts to garner responses from EIC officials on the progress of the liberalization efforts were unsuccessful.

The Ethiopian Investment Board, chaired by Prime Minister Abiy Ahmed (PhD), oversees the Commission.

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