Jugoimport seeks enforcement of Ethiopian property in Belgrade over old arms debt

The company Jugoimport-SDPR is trying to sell the Federal Democratic Republic of Ethiopia’s movable property to settle the country’s debt for military equipment delivered to it in the 1980s and early 1990s, Forbes reports.

Enforcement is being sought based on an arbitration award made in 2015 by the International Court of Arbitration at the International Chamber of Commerce in Paris.

Ethiopia has so far not voluntarily paid its debts to SDPR, so the Serbian company is trying to settle its claims by inventorying, assessing and selling the country’s movable property located at two addresses in Belgrade, 6/6 Kneza Mihaila Street and 20 Kneza Aleksandara Karadjordjevica Street.

Ethiopia owes Jugoimport a total of 26.3 billion dinars, or almost EUR 225 million at the current exchange rate.

The amount includes the principal of the debt, default interest and the costs of the arbitration proceedings. The individual debts for each of the items were determined by the arbitration award itself.

However, in order for enforcement to be possible, it is necessary for the Commercial Court in Belgrade to recognize the international arbitration award from 2015 and decide on the enforcement itself. The proposal for this was submitted to the Commercial Court in April 2025.

A solution for Ethiopia’s debt, which arose on the basis of 21 contracts for the sale of weapons and other military equipment and one credit agreement, has been sought for more than two decades.

Jugoimport initiated two arbitration proceedings against Ethiopia. The first in 2000, and the second in 2011, which was concluded by an arbitration award in 2015.

In between these two years, the parties unsuccessfully tried to resolve the Ethiopian debt problem through negotiations.

Jugoimport SDPR, which at that time was the Federal Directorate for Supply and Procurement, signed these contracts between February 1984 and December 1990.

The company then acted in its own name, but also on behalf of former Yugoslav manufacturers. The sales contracts included a wide range of goods such as automatic rifles, light machine guns, semi-automatic rifles, ammunition, sleeping bags, radio equipment, etc.

In addition to the sales contract, a credit agreement was also signed. With this credit agreement, SDPR, as the supplier, granted the buyer a loan under each of the contracts for the delivery of goods.

The total credit line amounted to 200 million dollars and was intended to cover deliveries in the period 1984-1988.

The credit coverage included 90 percent of the value of each individual contract. Repayment of the loan under each of the contracts was envisaged within eight years, in 16 equal semi-annual installments.

Jugoimort claimed in the arbitration that the credit funds had not been fully repaid. The Ethiopian side proposed that the negotiations be conducted within the framework of the World Bank and IMF’s Heavily Indebted Poor Countries Initiative, which SDPR rejected.

At the time of the signing of the contract with Ethiopia, Jugoimport was the Federal Directorate of the former Yugoslav state. In that form, it was responsible for foreign trade in weapons, military equipment, engineering and consulting contracts, the arbitration award emphasizes.

The legal status of the Directorate was changed in 1991. At that time, it became a separate organization with special functions and characteristics, operating according to the rules applicable to publicly owned companies.

After that, in 1996, it became a public company under the name Jugoimport-SDPR.

The company took over all the property, rights and obligations and staff of the former SDPR.

Jugoimport did not respond to Forbes Serbia’s question about which movable assets were in question, what their value was, and whether the company would settle the entire debt by selling the aforementioned movable assets.

Jugoimport-SDPR Beograd

Jugoimport SDPR

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arms debt