Ethiopia signs $1.72 billion financing agreements with the World Bank

Addis Ababa, April 5, 2024 (FBC) – In a significant development for Ethiopia’s sustainable development initiatives, the Ministry of Finance and the World Bank have inked six Financing Agreements totaling 1.72 billion USD.

These agreements, comprising both credits and grants, are earmarked for the implementation of six pivotal projects aimed at fostering inclusive growth and sustainable development within the country.

Among the projects is the Rural Connectivity to Support Food Security Program, which will receive a substantial USD 300 million grant to bolster climate-resilient accessibility to food markets and services for targeted populations. Additionally, the Third Additional Financing for Strengthening Ethiopia’s Adaptive Safety Net Project will benefit from an extra USD 200 million grant to further enhance access to food markets and services while fortifying institutional capacity for rural road management.

Further initiatives include the Second Additional Financing for the Urban Productive Safety Net and Jobs Project, receiving a USD 82.5 million grant to uplift the incomes of the urban poor and promote labor market inclusion for disadvantaged urban youth. The Phase 2 of the Lowlands Livelihood Resilience Project is set to receive a USD 340 million credit to boost livelihoods and climate resilience for pastoral and agropastoral communities in Ethiopia’s lowlands.

Moreover, the Power Sector Reform, Investment, and Modernization in Ethiopia Project (PRIME), as part of a Multiphase Programmatic Approach, will see an investment of USD 522.63 million to strengthen the electricity network and facilitate renewable energy generation through operational and structural reforms.

Note that the amount mentioned for the PRIME project is part of the financial envelope of up to 1.4 billion USD that FBC reported on Thursday, citing the official press release from the World Bank.

Lastly, the Second Urban Water Supply and Sanitation Project – Additional Financing will benefit from a USD 275 million grant to enhance water supply and sanitation services in Addis Ababa and selected secondary cities.

These agreements were signed by Mr. Ahmed Shide, Minister of Finance representing the Government of Ethiopia, and Mr. Ousmane Dione, Country Director for Ethiopia, Eritrea, Sudan, and South Sudan at the World Bank, signifying a crucial step towards advancing Ethiopia’s development agenda.