EU finance Ethiopia’s job creation effort

The European Union (EU) on Thursday agrees to provide 130 million euros to Ethiopia in support of the country’s effort to create jobs.

The grant will mainly be used for agro-industry and sustainable energy development projects. “These agreements between the Ethiopia and the EU will support sustainable energy initiatives, agro-industry parks and job creation,” the Office of the Prime Minister twitted.

The agreements is signed by the Foreign Minister of Ethiopia Workineh Gebeyehu and EU Commissioner for International Cooperation and Development, Neven Mimica.

The agreement was signed in Brussels following Prime Minister Abiy Ahmed’s discussions with European Union Commission President Jean-Claude Juncker in Brussels, Belgium. During the meeting the two sides have discussed about EU support to Ethiopia’s reform process.

Of the total amount granted, €50 million will go to support job creation, €35 million for sustainable energy and €45 million for the establishment of agro-industrial parks in Ethiopia, according to EU press statement.

“EU development cooperation spending in Ethiopia is one of the largest in Africa and in the world, €715 million for the period 2014-2020. EU also provides additional €257.5 million in emergency and €381 million in humanitarian assistance for the period 2014-2018,” it said.

Both, Prime Minister Abiy Ahmed and European Union Commission President, Jean-Claude Juncker witnessed the signing of financing agreements. In a related development, Prime Minister Abiy and his delegation held a lunch meeting with the EU Commission Vice President and High Representative of the EU for Foreign Affairs and Security Policy, Ms. Federica Mogherini and other EU officials.

There are presently 21 EU Member States represented in Ethiopia, in addition to the EU and like-minded partners, such as Norway and Switzerland, constituting the EU+ group.

In recent years, the EU+ group disbursed annually around one billion euros of Overseas Development Assistance (ODA), equivalent to roughly a quarter of total external aid to Ethiopia and can reach up to 10% of the country’s annual federal budget in certain years.

The EU, its Member States are working on working towards concluding a Joint Cooperation Strategy EU+ – Ethiopia for the period 2017 to 2020.

EU development cooperation support to Ethiopia exceeds € 2 billion for the period 2014-2020.

EU’s Cooperation with Ethiopia  rests on the following pillars:

  • Programmable development aid from the European Development Fund – EDF (currently 10th and 11th EDF), amounting to more than € 1 billion in programmes under implementation or in preparation for the period 2014-2020 in four areas of concentration: Agriculture and food security, Health, Transport and energy, and Governance;
  • Non-programmable development aid from the different EU thematic instruments, such as civil society, democracy & human rights, stability & peace, global funds and other facilities;
  • Projects funded by the EU Trust Fund for Africa addressing the root causes of irregular migration, displacement of population and instability;
  • Concessional loans of the European investment Bank (EIB) in water, energy and credit line facilities;