Establishing financial markets in Ethiopia: the environmental foundation, challenges and opportunities

This paper intends to examine the environmental foundation for establishing financial markets in Ethiopia, identify the potential challenges and opportunities. The environmental foundation is assessed using the PEST (political, economic, social and technological) perspectives. Emphasis is given to identify the roles that financial markets can play in expediting Ethiopian economy, the environmental factors that need to be analyzed the current situation of Ethiopia in terms of each factor. An exhaustive analysis of literature has been made on the secondary data obtained from different sources. The research method employed in the study has both qualitative and quantitative features. The findings of the study are presumed to be of paramount importance in providing input information for policy makers towards establishing financial markets in Ethiopia. As a way forward the Government of Ethiopia (GoE) need to take timely actions to further investigate the environmental situation to establish financial markets, appreciate the potential opportunities and make preparations towards addressing the direct challenges.