Parliament of Ethiopia Approves $275M Loan for Urban Water Infrastructure

The Parliament of Ethiopia has approved a $275 million loan agreement that was presented to them during their 33rd regular meeting. The loan agreement is between Ethiopia and the International Development Association, and it is intended to fund the implementation of the second urban drinking water and sanitation project.

After thoroughly discussing the details of the loan agreement, the parliament of Ethiopia has unanimously approved it through Proclamation No. 1335/2016. This means that the government has officially accepted the terms of the loan and will now be able to access the funds to improve the country’s urban water and sanitation infrastructure.

The approval of this loan agreement is a significant step forward in Ethiopia’s efforts to provide clean and reliable water access to its growing urban population. The funds will be used to expand and upgrade the water supply and sanitation systems in various cities, ensuring that more people have access to safe drinking water and proper waste management services.

This project is part of the government’s broader strategy to address the country’s water and sanitation challenges. By investing in these critical infrastructure projects, the government aims to improve the quality of life for its citizens and support the country’s overall development goals.

According to the Chief Minister, Dr. Tesfaye, this additional loan is meant to help complete the ongoing projects under the previous loan agreement and fill any budget gaps. The minister explained that the new $275 million loan will be implemented over the next 3 years and will specifically focus on strengthening the second urban drinking water and sanitation initiative.

Notably, the minister highlighted that this loan is interest-free, with the borrower only required to pay a minimal 0.5% annual fee on any unused portion of the loan. Additionally, the managing bank will charge a service fee of up to 0.75% for overseeing the loan. The full loan repayment period is set at 38 years, including a 6-year grace period.

Moreover, this significant financial support from the International Development Association is expected to enable Ethiopia to make substantial progress in improving its urban water supply and sanitation infrastructure across the country. This aligns with the government’s broader strategy to enhance access to clean water and proper waste management services for its growing urban population.

Other Stories

Kenyan Banks Set to Enter the Ethiopian Banking Industry

National Bank of Ethiopia Announces New Policy of Gold