Corporate News
By SIMON CIURI
Co-operative Bank is seeking to enter the Ethiopian market through a joint venture.
The bank’s chief executive, Gideon Muriuki, said
on Friday the Ethiopia entry will be in addition to the planned venture
into Tanzania and Uganda, which he estimates will cost Sh1.8 billion
($20 million).
“Just like in Uganda where we are planning to
establish our presence through joint ventures, the same model will apply
in Ethiopia,’’ said Mr Muriuki.
Co-operative Bank already has a presence in South
Sudan where it entered through joint ventures with the local
co-operative movement.
Its bid to enter Ethiopia, which frowns upon
foreign investment in its financial sector, will be helped by a special
agreement former president Mwai Kibaki signed with Ethiopia’s Prime
Minister Hailemariam Desalegn allowing Kenyan lenders to establish
offices in the country.
Ethiopia restricts foreign investors from
venturing into its telecommunications, banking, media, retail,
insurance, and electricity sectors, only allowing selective
participation.
The restriction has slowed the expansion agenda of
Kenyan banks, which have opened subsidiaries in the region to cut
reliance on the local market.
Lenders like Equity Bank
had outlined ambitions of opening shop in Addis Ababa in the hope that
Ethiopia would open its financial services sector to foreign investors.
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