The World Bank has loaned Ethiopia a total sum of $1.72 billion to enhance electricity, expand water supply, and also facilitate the movement of food to markets.
According to Reuters, the World Bank and the East African country signed the loan agreements on Friday as announced by Ethiopia’s finance minister.
The World Bank will provide Ethiopia with $523 million to expand the nation’s electricity network and also augment the country’s investment in renewable energy.
Another $500 million from the World Bank will finance two projects, including boosting access to food markets and renovating and constructing new projects in rural areas.
The remaining World Bank fund will be allocated to the expansion and improvement of water supply in the country. The remaining funds will also be used to fund support programs in programs in towns that employ disadvantaged youths.
Ethiopia for some years now has gone through difficult times which is a direct result of a string of factors.
The East African country has witnessed foreign currency shortages, still feeling the effect of the Covid 19 pandemic, a two-year war in the Northern Tigray region, Drought, floods, and locust invasion in parts of the country.
Nevertheless, Ethiopian GDP is projected by the African Development Bank to grow by 6.2% in 2024.
What to Know
- World Bank loans carry low to zero interest rates and have repayment periods of 30 to 40 years.
- In 2022, Ethiopia and the World Bank signed a pact for a grant of $300 million to assist in the reconstruction and recovery of conflict-hit areas after War ravaged the Northern Tigray part of the country.
- The World Bank is an international development organization owned by 187 countries. Its role is to reduce poverty by lending money to the governments of its poorer members to improve their economies and improve the standard of living of their people.
