World Bank approves $700 million credit to Ethiopia

Addis Ababa, December 23, 2024 (FMC) – The World Bank approved $700 million credit to Ethiopia from the International Development Association (IDA) for the Financial Sector Strengthening Project (FSSP). This project aims to enhance the stability of the country’s financial sector. The World Bank pledged to significantly scaling up its support for Ethiopia’s financial sector.

The project is designed to tackle these issues head-on by modernizing the regulatory and supervisory framework of the National Bank of Ethiopia (NBE), supporting governance reforms, balance sheet restructuring, and recapitalization of the Commercial Bank of Ethiopia (CBE), and transforming the Development Bank of Ethiopia (DBE) into a sustainable development finance institution.

Additionally, the project will provide implementation support and capacity building for NBE, CBE, and DBE to ensure their resilience and sustainability. By strengthening these key financial institutions and modernizing the financial system, the project will contribute to the country’s economic growth, according to the World Bank.

“We are proud to support Ethiopia in its journey to transform and strengthen its financial sector. This project reflects our commitment to promoting economic stability and inclusive growth in the country. By boosting the capacity of key financial institutions, we aim to build a more resilient and accessible financial system that truly meets the needs of all Ethiopians,” said Maryam Salim, World Bank Country Director for Eritrea, Ethiopia, South Sudan, and Sudan.

The approval of the Financial Sector Strengthening Project is a major milestone in building a stronger financial system in Ethiopia. This project goes beyond addressing current challenges; it aims to build a more resilient financial system and unlock new opportunities for growth. By focusing on key areas that need improvement, it aims to support a financial system that can better support the diverse needs of all Ethiopians, the World Bank added.