ADDIS ABABA Dec 5 (Reuters) - Ethiopia said on Friday it had completed
raising $1 billion with its debut Eurobond with a term of 10 years and
coupon of 6.625 percent, adding that the offer had been oversubscribed.
Ethiopia is the latest African sovereign to receive a strong response on its
first foray into the international debt markets. Investors have been eyeing
Africa's sturdy growth rates and Ethiopia's economy is now expanding by
about 9 percent a year.
"Ethiopia attracted high quality investor interest despite a challenging
market environment," the Finance Ministry said in a statement, adding the
10-year maturity aimed to create a benchmark and proceeds would be invested
in infrastructure.
Deutsche Bank and JP Morgan were the lead managers. The ministry said a
French firm had acted as financial adviser but did not name the company.
Despite strong growth rates, analysts said Ethiopia had limited hard
currency earnings, making its debt-servicing capacity weaker than some
African states. It will also be more difficult for Ethiopia to build foreign
reserves, which now cover little more than two months of imports, they said.
Kenya, Ethiopia's southern neighbour which issued its debut Eurobond earlier
this year, has reserves to cover around four months of imports.
(Reporting by Aaron Maasho; Writing by Edmund Blair; Editing by Gareth
Jones)