The World Bank has approved US$ 1.15 billion interest-free credit to help Ethiopia promote regional trade, support education and hire extra teachers and tens of thousands of health and agriculture extension workers, bank officials said Wednesday.
The Bank approved a four-year country aid strategy which aims to improve the service delivery within the state institutions. This was endorsed by the World Bank’s Board of Executive Directors in New York, US.
The latest loan facility accounts for nearly a third of Ethiopia’s annual aid package of US$ 4 billion a year.
“The new Country Partnership Strategy (CPS) for Ethiopia seeks to build on the development progress over the last five years of its previous strategy and to help its government and communities go further to enhance growth, more jobs, better health and education, and significantly less poverty,” the Bank said in a statement.
The interest-free credits would support key services to poor people across the country. The Bank said the funds would help to further develop road networks to help promote better regional trade and internal travel.
Bank officials said following the approval, it agreed to mobilize US$ 600 million in development financing for the third phase of the Promoting Basic Services (PBS III) programme, which serves nearly 84 million people in Ethiopia.
Guang Zhe Chen, Bank’s Country Director for Ethiopia, said the anti-poverty plan will continue to contribute to Ethiopia’s rapid progress towards achieving most of the Millennium Development Goals, by providing funding for crucial staff to help to improve key services such as education, health, food production, water and sanitation.
“Promoting improved access to quality, decentralized basic services is also central to the core elements of Ethiopia’s new CPS,” the Bank official added.
The plan is co-financed by the Government of Ethiopia, the European Union, the UK Department for International Development, the African Development Bank, Italy and Austria.
Launched in 2006, the programme has helped hire over 100,000 new primary school teachers at the district level; more than 38,000 health extension workers nationwide; and some 45,000 agricultural extension workers.
The programme has also promoted transparency and citizen engagement by posting its budgets and performance score-cards in 84% of its operating districts and encouraging greater social accountability.
Donors praise Ethiopia for its ability to help reduce its under-5 mortality rate from 123 per 1,000 live births in 2005 to 88 per 1,000 live births in 2010.
The Bank said it would support the Government’s impressive progress in expanding the road network; the Ethiopia Transport Sector Project will invest US$ 415 million to upgrade five main roads that will play an important role in supporting economic growth in Ethiopia over the medium to long term.
The roads project will help provide better access for industrial, agricultural and tourism developments, and will also provide improve access for beneficiaries in the project areas to essential services.