Addis Ababa : The World Bank’s Board of Executive Directors on Wednesday has approved 250 million USD in supplemental financing for the ongoing Second Ethiopia Growth and Competitiveness Programmatic Development Policy Financing.
The Bank approved 125 million USD in grants and the other 125 million loans to support Ethiopia to revitalize the economy by broadening the role of the private sector and attaining a more sustainable development path.
According to press release of the Bank, the supplemental financing will help to mitigate the impact of the ongoing COVID-19 crisis on the Government’s reform agenda.
Specifically, the program is intended to help address some of the unanticipated financing needs the Government of Ethiopia is facing due to the COVID-19 crisis.
Additional financing needs are estimated to be approximately1.5 billion USD, as revenue collection is expected to weaken and additional expenditure also needed to mitigate the public health and economic impacts of the crisis.
“The COVID 19 pandemic is expected to severely impact Ethiopia’s economy. The austerity of the required containment measures, along with disruptions to air travel and the collapse in international demand for goods exported by Ethiopia are already taking a toll on the economy,” said Carolyn Turk, World Bank Country Director for Ethiopia, Sudan, South Sudan and Eritrea.
She stated that “additionally, an estimated 1.8 million jobs are at risk, and the incomes and livelihoods of several million informal workers, self-employed individuals and farmers are expected to be affected.”
Miguel Eduardo Sanchez Martin, World Bank Task Team Leader for the Operation said “this additional financing to the Second Growth and Competitiveness Programmatic Development Policy Financing, approved in March 2020, will support the continued implementation of the structural reforms towards private-sector-led development under the Homegrown Reform Agenda.”
The financing will complement the government of Ethiopia’s ongoing efforts to mobilize financial assistance for crisis response.
The operation is one of the pillars of the World Bank’s immediate response to mitigate the impact of the global crisis on Ethiopia.
In April, the World Bank had already provided 82.6 million USD for Ethiopia COVID-19 Emergency Response Investment Policy Financing under the Fast-Track COVID-19 Facility to prevent, detect, and respond to the threat posed by COVID-19 and to strengthen national systems for public health preparedness.
Source: Ethiopia News agency