Bank’s Secret Deals with Eritrean Elite Revealed

A shocking discovery has shed light on the shady dealings of Italy’s Banco di Roma in Eritrea during the 1950s and 1960s. Newly uncovered documents have revealed that the bank engaged in a pattern of bribery and corruption, using mortgage loans to influential members of the Eritrean administration and their relatives.

Large-Scale Transactions

According to the documents, the bank issued large loans to prominent figures such as Asfaha Woldemichael, the Chief Executive of the Eritrean government, and his wife. These transactions were seen by the bank as a way to secure political protection and support for its operations in the region.

The loans were used for speculative purposes, with one notable example being the purchase of shares in the Barattolo company, an Italian firm that offered generous dividends to shareholders.
This highlights the bank’s focus on generating quick profits rather than fostering long-term economic development.

Small Loans and Recognition

In addition to these large-scale transactions, the bank also made small loans to Eritrean clients working in various sectors such as wholesale trade and artisanal textile production. This was seen as a way for the bank to gain recognition from the Eritrean administration and demonstrate its role in the region’s development.

Opposition and Controversy

However, not everyone was pleased with Banco di Roma’s activities. The Minister of Finance in Addis Ababa, Mekonnen Habte Wolde, was vocal about his opposition to foreign firms operating in Ethiopia and accused them of exploiting the country’s economic wealth. But it appears that his hostility towards Banco di Roma may have been driven by personal factors rather than ideological opposition.

Questions Raised

The discovery of these secret deals has raised questions about the bank’s integrity and its commitment to ethical business practices. The revelations are likely to spark further investigation into the bank’s activities in Eritrea during this period.

Sources

ASBR, Fondo Banco di Roma, 1880-1993
Uficio Fidi Estero, Affari Generali, 5, Asmara
ASBI, Banca d’Italia, Studi, Pratiche, b. 520

“Eritrea’s Economic Struggles: A History of Corruption and Mismanagement”
“Italy’s Colonial Legacy in Eritrea: A Study of the Bank’s Role”