* Ethiopia rated ‘B’ by Fitch
* Government has mostly relied on domestic financing
* Rwanda, others have already issued Eurobonds
* Prices rose after U.S. tapered bond buying (Adds comment by FinMin about IMF, growth projection)
By Richard Lough
ADDIS ABABA, May 14 (Reuters) - Ethiopia has not yet decided if it will follow other African countries that have tapped international markets with Eurobonds, the finance minister said on Wednesday after his country secured a sovereign credit rating.
Ethiopia, which has previously said it was considering issuing a Eurobond, was awarded a ‘B’ rating by Fitch on Friday with a stable outlook. Kenya, which plans a Eurobond worth up to $2 billion, has received a ‘B+’ rating by Fitch.
“This (rating) result offers an opportunity for Ethiopia if it decides, to enter international capital markets. We have not yet decided,” Finance Minister Sufian Ahmed told a press conference in Addis Ababa.
Foreign investors are closely watching Ethiopia, attracted by a decade of high growth and a market of about 90 million people. But the authorities have been reluctant to open up the economy, which is now dominated by the state.
Sufian said growth was still on track to reach about 11 percent in the 2013/2014 financial year, making Ethiopia one of Africa’s fastest growing economies.
Several African nations, including the tiny nation of Rwanda last year, have successfully issued Eurobonds.
Since then, the price for such issues has climbed since the U.S. central bank scaled back its bond buying programme that had prompted investors to seek higher-yields in developing markets.
Ethiopia has mostly relied on domestic resources and Chinese loans to finance big infrastructure projects across the country. It has not made clear when it might tap international markets.
“It depends on the global financial situation,” Sufian said when describing the timing of any Eurobond or other international borrowing. He said most financing for domestic projects was already secured.
The International Monetary Fund has said Ethiopia risks crimping growth if it does not give private business more space.
Sufian rejected the notion that the government was crowding out business and said the government’s role was central to keeping the economy growing at a pace.
“Without government investment in infrastructure, we cannot sustain this growth,” he said. “We hope this (investment) will crowd in the private sector in the long term.” (Reporting by Richard Lough; Writing by Drazen Jorgic; Editing by Edmund Blair and Toby Chopra)