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With over 100 million inhabitants and high growth levels since 2004, Ethiopia has benefited from remarkable progress in terms of development, but which has not, for the time being, led to major structural changes in the economy.

To maintain strong dynamics and achieve the status of Middle-Income Country (MIC) by 2025, Ethiopia needs to find alternatives to public funding and get out of a situation where there is a chronic lack of foreign exchange, as stressed by phase II of the Ethiopian Government’s Growth and Transformation Plan (GTP II).

The signing on 6 June 2019 in Addis Ababa of a € 85m public policy loan agreement and a € 15m grant agreement between AFD and the Ethiopian State, as well as a Memorandum of Understanding (MoU) with Expertise France for the implementation of part of a technical assistance program concerning the development of public-private partnerships (PPPs), supports the dynamics of these reforms and comes in addition to initial financing from the World Bank.

The planned reforms will include increasing private investment, phasing in the liberalization of the energy, logistics and telecommunications sectors, and a better governance of public enterprises, thereby reducing the financial risks borne by the State.

This operation will also support the new Ethiopian Public Enterprises Assets and Administration Agency, in line with the recommendations of the framework paper on the governance of public enterprises.