UPDATE 1-Ethiopia plans to open up banking sector to foreign investors

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ADDIS ABABA, Sept 3 (Reuters) - Ethiopia’s government has decided to open up the country’s banking sector to foreign investors, the prime minister’s office said on Saturday, the latest measure aimed at drawing investment from abroad.

The government of Prime Minister Abiy Ahmed, who came to power in 2018, has been working to open up various economic sectors including the telecommunications industry to help drive foreign investment inflows and bolster overall economic growth.

In a Facebook post, the prime minister’s office said opening up banking to foreign investors would “transform our country’s economy by boosting it to have a better link with the international market”.

The cabinet agreed the policy and passed a draft resolution at a meeting, state-affiliated news agency Fana said in a tweet.

Last year, Abiy’s government granted a licence to a private telecom operator to break the monopoly of state-owned Ethio Telecom in one of the economy’s most lucrative sectors.

Kenya’s Safaricom, together with South Africa’s Vodacom, Britain’s Vodafone and Japan’s Sumitomo, paid $850 million for the licence.

Foreign investors have long eyed key sectors including banking, telecoms, transportation, aviation and others in Ethiopia, a country of more than a 100 million and one of the biggest economies in sub-Sahara Africa.

Abiy’s office said in its post that bringing private players into the sector would lead to competition, improve foreign currency inflows and create jobs. (Reporting by Nairobi Newsroom Writing by Elias Biryabarema Editing by Jason Neely and Helen Popper)