House Approves over 124 Million Euro Concessional Loan

Addis Ababa, July 14, 2026 (ENA) —The House of People's Representatives (HPR) has unanimously approved 124.6-million-euro concessional loan agreements that support Ethiopia's Homegrown Economic Reform and accelerate the country's digital transformation. 

The loan agreements approved today were with the governments of Italy and France.

The House ratified the 70-million-euro concessional loan agreement provided as budget support in coordination with the World Bank's Third Ethiopia Sustainable Growth and Development Policy Operation with the government of Italy.

The financing will be channeled directly into the federal government's budget to facilitate the implementation of Ethiopia's macroeconomic reform agenda and help accelerate economic growth, it was learned.

The agreement, which carries no service charge and includes a 16-year grace period, will be repaid over 30 years, making it a highly concessional long-term financing arrangement.

Presenting the draft proclamation on the loan, Chief Whip Tesfaye Beljige said the program is designed to provide direct budget support for the government's reform agenda across multiple sectors, with the loan agreement intended to advance sustainable and inclusive economic growth.

 

The HPR also approved a 54.6-million-euro concessional loan agreement between the governments of Ethiopia and France to finance the modernization and digitalization of Ethiopia's command and control and asset management systems.

Speaking about the loan, the Chief Whip said the project was initiated to strengthen technological capacity, improve operational efficiency and speed, as well as to ensure transparency in asset management.

According to him, the project reflects the strong cooperation between Ethiopia and France and will be implemented with 54.6 million euro in concessional financing from the French government.

The loan carries a highly concessional annual interest rate of 0.347 percent, including a 10-year grace period. It will be repaid over 25 years.

For his part, Finance Minister Ahmed Shide said the project is designed to digitally integrate Ethiopian Electric Power's (EEP) transmission lines and substations across the country into a centralized command and control center.

 

The system will enable real-time monitoring of the national transmission network and improve the management of power sector assets.

It will also upgrade substations, strengthen maintenance systems, connect facilities through fiber-optic networks, establish a centralized electricity transmission control system, and deploy advanced software, sophisticated equipment, and real-time data collection technologies to improve operational efficiency and reliability.

The Minister added that French companies, technologies and services will be utilized in implementing the project, which is expected to modernize Ethiopia's electricity transmission management through a centralized command center capable of supervising transmission lines and substations nationwide in real time.

 

The project is part of a broader co-financing arrangement involving multiple international partners.

According to Ahmed, previous financing for the project was secured from the French Development Agency (AFD).

The European Union has also provided grant support for the initiative while the European Investment Bank (EIB) is expected to contribute additional financing worth hundreds of millions of dollars to support further upgrades of Ethiopia's electricity transmission infrastructure.