Sources also disclosed that the sovereign bond that Ethiopia offered for the first time is revealed to investors in London, where the team is also scheduled to travel other European cities and the US to make the offer known to investors there. According to sources, the certificates offer six to seven percent interest rates with a maturity date of ten years.
High-level delegation led by Sufian Ahmed, minister of Finance and Economic Development (MoFED), including Teklewold Atnafu, Governor of the National Bank of Ethiopia (NBE), Fisseha Abera, International Financial Institutions Cooperation Directorate Director at MoFED, Wasihun Abate, Director of Legal Division at MoFED and Mezgebu Ameha, Macro-economy Policy and Management Directorate Director have traveled to Europe for this purpose.
The move was expected after the House of Peoples' Representatives (HPR) discussed in a closed session and gave the responsibility to MoFED to issue a sovereign bond.
Though The Reporter approached Ahmed Shide, state minister of MoFED, on the event of the signing ceremony of a loan agreements between the Government of Ethiopia and the World Bank and African Development Bank, he declined to disclose the amount of the bond issued in London. However, he did say that “the interest rate that the bond got was quite reasonable.” According to the state minister this is mainly because the bonds were offered at the right time.
The move to issue an international sovereign bond came after Ethiopia got a B+ rating by renowned credit rating agencies in May 2014 namely, Moody's, S&P and Fitch. Last month MoFED selected J.P. Morgan and Deutsche Bank Group from America and Germany, respectively, to organize and facilitate meetings with potential investors with Ethiopian delegation across Europe and the US.
Sources also said that the delegation will conclude its tour next week in the US and they are expected to reveal the amount they were able to sell to investors.
Redwan Hussein, head of Government Communication Affairs Office with a ministerial portfolio, while briefing local journalist two weeks ago said that the foreign currency that would be obtained from the sales of sovereign bonds will be used to finance mega government projects which are grappling with severe hard currency shortage.