AfDB approves USD 40M for trade finance in Ethiopia amid Green Legacy Initiative success

ETHIOPIA – The African Development Bank (AfDB) has approved a significant USD 40 million transaction guarantee facility to bolster trade finance in Ethiopia.

This move aims to support Dashen Bank’s financing of small and medium-sized enterprises (SMEs) and local corporates, enhancing both import and export activities.

The facility is also designed to promote intra-Africa trade and support the African Continental Free Trade Area (AfCFTA).

Nnenna Nwabufo, Director General for East Africa at AfDB, stated, “Supporting trade in Africa is a key priority at the AfDB. Trade finance is essential for economic growth and cross-border trade, especially in emerging markets. We are thrilled to collaborate with Dashen Bank to support regional trade.”

The USD 40 million facility will cover up to 100 percent of the non-payment risk associated with trade finance instruments issued by Dashen Bank.

This will enable the bank to expand its trade services and enhance its support for Ethiopian SMEs, particularly in agriculture and manufacturing.

Asfaw Alemu, CEO of Dashen Bank, expressed his enthusiasm, saying, “We are delighted that the AfDB has approved this vital guarantee facility. It will greatly assist in expanding our trade services and strengthening our role in Ethiopia’s economic development.”

Green legacy initiative boosts fruit cultivation in Ethiopia

Meanwhile, Ethiopia is making strides in fruit cultivation through the Green Legacy Initiative, launched in 2019.

The initiative focuses on restoring degraded lands, increasing forest cover, and mitigating climate change. With over 32.5 billion tree saplings planted nationwide, the goal is to reach 50 billion by 2026.

Prime Minister Abiy Ahmed recently highlighted the progress made in fruit cultivation as part of the initiative.

“The Green Legacy Initiative has seen significant success in enhancing fruit cultivation. We are now focusing on advancing practices and adopting new techniques to further our environmental and agricultural objectives,” he stated.

The initiative not only aims to improve afforestation but also targets the cultivation of high-value fruits such as avocados, mangoes, apples, and papayas for both domestic and international markets.

This initiative aligns with Ethiopia’s 2030 Agenda and aims to contribute to national food security. The country is targeting the planting of 7.5 billion tree seedlings this rainy season, with a goal of 40 billion by the end of the year.

Both developments underscore Ethiopia’s commitment to economic growth and environmental sustainability, reflecting a concerted effort to boost trade and enhance agricultural productivity.

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