Turkey’s state-owned Ziraat Bank hopes to open a representative office in Ethiopia by the end of the year, Economy Minister Nihat Zeybekci said on Monday, becoming a rare entrant into a market largely closed to foreigners.
Foreign banks have long sought to enter Ethiopia. Economic growth in Africa’s second most populous nation averaged more than 9 percent a year between 2005 and 2013, World Bank figures show, and the government is investing heavily in new roads and power plants. “We have applied to open an office in Ethiopia,” Zeybekci told reporters in İstanbul, adding that Ziraat hopes eventually to obtain a banking license in the east African country. Only a handful of non-Ethiopian banks, including Germany’s Commerzbank and Togo-based Ecobank, have been allowed to establish offices in the country. Representative offices are not allowed to offer commercial banking services but are seen as a way for lenders to establish a foothold in a foreign country.
Ethiopia put itself on the international investment map last year with a debut Eurobond, raising $1 billion. The 10-year issue in December was oversubscribed. Credit ratings agencies Moody’s and Standard & Poor’s rate the country B1 and B respectively. Turkey is already active in east Africa, particularly Somalia, where the Mogadishu port is now managed by a Turkish company. Turkish Airlines now flies daily to Somalia.