June 15, 2014 – The World Bank (WB) and the government of Ethiopia have signed financial agreement for a total of 203 million dollar comprising of credit and grant.
The financing agreement was signed on last Tuesday, May 10, 2014 between Guang Zhe Chen, WB country director for Ethiopia and Ahmed Shide, state minister for Finance & Economic Development (MoFED).
“This represents the largest lending program that the Bank has ever provided to Ethiopia in a single year,” said Guang Zhe Chen, World Bank country director for Ethiopia.
The agreement was made following the approval by the Bank’s Board of Executive Directors May 29, this year. The agreement comprises of 178.5 million dollar on credit from the International Development Association (IDA) and the remaining 24.5 is a grant from Scaling-up Renewable Energy Program (SREP) Trust Fund of the Bank.
The finance extended to Ethiopia is intended to help Ethiopia “develop its geothermal energy sources to boost electricity supply to all Ethiopians and increasingly become a regional power hub,” according a press statement from the Bank.
The finance will be utilised for the implementation of Geothermal Energy Development Project of the country. As part of this project, two geothermal sites, Aluto and Alalobad, will be developed in addition to the procurement of drilling rigs and spare parts while disbursing the finance.
On top of this, part of the finance will be used to towards enhancing the geothermal development capacity of Ethiopian Electric Power (EEP); Geological Survey of Ethiopia (GSE) and Ministry of Water, Irrigation & Energy (MoWIE).