Capital Ethiopia Newspaper

DBE’s biggest loan ever for Turkish company

In one of its largest loans to the private sector the Development Bank of Ethiopia (DBE) is providing about 1.42 billion birr to a Turkish company, Saygin B.M. Technology Group LLC for the construction of a cable manufacturing plant. The company had asked for 2.1 billion birr, which is said to be one of the largest loans a private company has ever applied for.
Saygin B.M. Technology Group LLC intends to construct the plant on 15 hectares of land outside Sebeta town, 24Km west of Addis Ababa in Oromia special zone.
Tadesse Hatiya vice president credit services at the Development Bank of Ethiopia said the company intends to construct power cables and optical fiber. DBE officials had earlier visited the company’s main centre of operation, in Kayser city, Turkey.
The loan is expected to cover 50 percent of the costs for the cable plant, while the rest will be covered by Saygin B.M. Technology Group itself. The loan will be released in phases according to the needs of the plant and most of the money is said to be going for steel structures and machinery supplies.
The construction of the plant is expected to take six months to finish and they hope it will begin operation before the end of the year. 
Tadesse also said that since this loan is given to a project which is expected to be technologically advanced in its makeup, it is expected to create employment opportunity for only about a thousand people. Other sectors like textile employ far more people in their factories because they are labor intensive projects.
The loan is also in line with the Ethiopian government’s strategy of import substitution intended to cover the costs for projects of government institutions like Ethio-Telecom and Ethiopian Electric Power Corporation (EEPCO).
Tadesse further said the project, which will be the first to produce optical fibers locally, is expected to be useful for the Grand Renaissance Dam construction as well as a solid tax revenue base.
DBE’s loan finances used to be dominated by cement and textile projects but it is now trying to diversify into other areas.
This is going to be the third investment in a cable factory with two other companies involved in the large manufacturing of cables in Ethiopia; Euro Cables Plc, a joint venture between Glorious Plc of Ethiopia and Demes Kablo San Tic Limited of Turkey, and Elsewedy Cables Ethiopia Plc, an Egyptian company.
DBE had approved in September 2011 another huge loan of 1.5 billion birr to Habesha Cement still making it the single largest financing made by DBE to a private sector company.
The Development Bank of Ethiopia (DBE) is evaluating a 2.1 billion birr financing request, the biggest ever from the private sector, from SAYGIM – BM Capital Technology Group, another Turkish company planning to engage in the manufacturing of fiber optics.
Amare Amsalu, former CEO of the now Ethio telecom  is one of the company’s senior management team members.