The Complex Relationship Between Ethiopia and Banco di Roma
Background
In the mid-20th century, the Ethiopian government had concerns about the operations of Banco di Roma, an Italian bank that operated in Eritrea. The relationship between the two entities was complex, with political considerations and economic interests at play.
Key Events
- 1956: A representative from Banco di Roma visited Addis Ababa to discuss opening a liaison office. However, Finance Minister Mekonnen Habte Wolde made it clear that any new agency would have to be based in a building he had recently constructed.
- 1962: Eritrea was incorporated as the 14th province of the Ethiopian Empire, creating a juridical limbo for Banco di Roma’s operations.
- 1963: Proclamation 206 introduced a new banking law that split the State Bank of Ethiopia into two separate banks: the National Bank and the Commercial Bank. The Commercial Bank was allowed to engage in commercial activities with foreign banks, which were required to establish joint ventures with a majority Ethiopian shareholding.
The Request for Adaptation
Governor Menasse Lemma of the National Bank approached Banco di Roma to request adaptation to Ethiopian law regarding capitalization and shareholding structure. However, the Italian bank was determined to maintain full control of its Eritrean subsidiaries and sought diplomatic intervention from the Italian government.
A Compromise is Reached
Emperor Haile Selassie accepted a proposal that exempted Banco di Roma from adapting to the new banking law but limited its operations. This arrangement reflected a compromise between the interests of both parties, with the Ethiopian government asserting its sovereignty over Eritrea and Banco di Roma maintaining some autonomy and privileges.
The relationship between Ethiopia and Banco di Roma was shaped by complex political and economic factors. The two entities were able to reach an agreement that balanced their competing interests, but the arrangement also highlighted the challenges of navigating multiple stakeholders in a rapidly changing international landscape.