Ethiopia to pay U.S. fine over Hydro-electric dam bonds

By Tinishu Solomon

  

CONSTRUCTION WORK TAKES PLACE FRIDAY, JUNE 28, 2013, AT THE SITE OF THE PLANNED GRAND ETHIOPIAN RENAISSANCE DAM. PHOTO©ELIAS ASMARE/AP/SIPA

State-owned Ethiopian Electric Power Corporation (EEPC) is going to pay close to $6.5m as a result of US charges that it incorrectly sold bonds to residents of the US to finance the Grand Ethiopian Renaissance Dam.

On 8 June, the United States Securities and Exchange Commission (SEC) announced that the EEPC violated securities laws by failing to register the bond offer, which raised about $5.8m from more than 3,100 people from 2011 to 2014.

Foreign governments are welcome to raise money in the US capital markets so long as they comply with the federal securities laws

Stephen L. Cohen, associate director of the SEC's division of enforcement, explained in a statement: "Foreign governments are welcome to raise money in the US capital markets so long as they comply with the federal securities laws, including registration provisions designed to ensure that investors receive important information about prospective investments."

He added that investors will get back all of their money plus interest.

The Grand Ethiopian Renaissance Dam (GERD) is expected to have the capacity to produce 6,000 megawatts of electricity making it Africa's biggest hydro-electric power station.