Ethiopia’s Sovereign Wealth Fund Ranked Largest in Africa with $45 Billion Assets

Ethiopian Investment Holdings (EIH) was ranked as the 34^th biggest sovereign wealth fund in the world, with nearly 45 billion dollars of assets. The Sovereign Wealth Fund Institute’s (SWFI) latest ranking places EIH as the biggest sovereign wealth fund in Africa, beating out the Libyan Investment Authority for the top spot on the continent. The Norway Government Pension Fund Global is by far the biggest sovereign wealth fund in the world, with over 1.7 trillion dollars in assets 

EIH has a portfolio of 40 state-owned enterprises that span everything from aviation to financial services, telecom, and hospitality. The Fund was established nearly four years ago with 28 SOEs under its portfolio and 100 billion birr capital. Its founding CEO was the current governor of the National Bank of Ethiopia, Mamo Mihretu. EIH absorbed around eight SOEs last December into its portfolio, formerly managed by the Public Enterprise Holdings & Administration (PEHA).

Under Brook Taye (PhD), the former Director General of the Ethiopian Capital Market Authority (ECMA) and EIH’s current CEO, a series of reforms have been kick-started to sharpen the Fund’s competitive edge and reverse years of precarious management. Several executive positions have been replaced by new talent while contemporary accounting standards have been rolled out across the board.

SOE reform is one of the main targets in the four-year economic extended credit facility the International Monetary Fund prescribed for Ethiopia. One of the key macro-financial vulnerabilities being addressed by the program stems from past lending to these SOEs by the systemic state-owned Commercial Bank of Ethiopia (CBE). Operating losses and failure to service debt resulted in CBE evergreening these loans, as sovereign guarantees were not made effective. 

The equivalent of about 6.2 percent of GDP in such legacy loans, including overdue interest, had been taken over by the federally owned Liability and Asset Management Corporation (LAMC) by 2022/23. In early 2024/25, CBE’s claims on LAMC and Ethiopian Electric Power were replaced with a government bond. In addition, a further amount was provided to ensure CBE is fully capitalized beyond the 8 percent regulatory requirement. The total amount of bonds provided was 900 billion birr (7.7 percent of GDP) of which 55 billion birr was for the capital increase.

SWFI is a global organization designed to study sovereign wealth funds, pensions, superannuation funds, family offices, endowments, central banks, and other long-term asset owners.