The Eritreans who have left Ethiopia since the two countries went to war left behind them abandoned properties and unpaid debts. Nita Bhalla reports on an auction organised by Ethiopian banks to liquidate Eritrean assets.

At 0900 each Friday, Ethiopian businessmen and women slowly filter into the basement cafeteria of the Commercial Bank of Ethiopia, find a seat and wait patiently for the auction to begin.

The houses, garages and warehouses up for bidding all have one thing in common - they were once owned by Eritreans who lived in Addis Ababa and who have now been deported as a result of Ethiopia's border war with Eritrea.

Since the conflict began 18 months ago, there has been a steady stream of deportations by the two neighbours. In Ethiopia alone, it is believed tens of thousands of Eritreans, who had once lived in Ethiopia, have crossed the border into Eritrea, leaving behind them property worth millions and huge debts owed to Ethiopian banks.

The banks, however, are now taking action to recover the money owed to them. They are foreclosing assets and auctioning the property of the exiled Eritreans to the highest bidder.

The state-owned Commercial Bank of Ethiopia says 386 deported Eritreans took loans from the bank, before the war started in May last year, and now owe almost $50m.

Bank accused

But thousands of exiled Eritreans and the Eritrean government say the Ethiopian banks confiscated the goods for no reason. They claim that they are being discriminated against because they are Eritrean.

The vice-president of the Credit Analysis Department at the Commercial Bank, Mulugeta Gabre-Medhin, denies these accusations.

"We banks are in the business of banking, not in the business of politics. Our customers, whether they are Eritrean or Ethiopian, makes no difference to us.

"We treat them all equally and we are trying our level best to represent fairly the Eritrean deportees", he said.

The second round of auctioning of houses and small-scale enterprises began ealier this month, and six properties worth approximately $1m were auctioned.

Through auctions like this, the bank says they have managed to recover almost 30% of the money owed to them by the Eritreans, who either left Ethiopia voluntarily or were expelled.

The Ethiopian Government says many were forcefully deported, because they were considered a threat to the national security of the country, as they were members of the Ertirean ruling party, the Eritrean People's Liberation Front (EPLF), or because they have supported the Eritrean war effort financially.

Legal representatives

Many of the deportees were successful traders or merchants who had to leave their businesses in the hands of agents or legal representatives when they left the country. The bank says they deal directly with these legal representatives, but at last week's auction, only one representative of the six was present.

Senior credit analyst and member of the Auctioning Committee, Dr Gitachew, says that all the representatives of the auctions were invited to the auction, but are not legally obliged to attend.

"To come or not to come, is their own decision - we cannot force them. This is why we have other legal independent observers from Addis Ababa City Administration and Finance - so that the Eritrean deportees know that the process being carried out is legal", he said.

The Eritrean Relief and Refugee Commission says over 65,000 Eritreans have been deported since the conflict began. Efforts to resolve the dispute through negotiation have so far failed.

And so while negotiation goes on, and fighting persists on the front line, the deportations, foreclosures and auctions are likely to continue.