Water, Energy Sectors Struggle to Meet Financing Goals

Apr 30 , 2024

Development partners have fallen far short of their financing targets for Ethiopia's water and energy sectors over the past five years. Despite a target of six billion dollars, the energy sector received only a fraction of one billion dollars. Electrification projects remain stalled due to this lack of funding. The World Bank was the largest contributor, providing over 600 million dollars in loans and grants. A recent discussion at the Ministry of Water & Energy headquarters brought together representatives from the World Bank, UNICEF, and GIZ to discuss the challenges and opportunities in achieving universal access to electricity and water. In the past five years, only an additional 1.4 million people gained access to electricity through these financing programs. This leaves nearly half (49pc) of the Ethiopian population without electricity. According to Mesfin Dabi, head of electrification and information at the Ministry, factors such as scarce financial resources, improper resource utilisation, poor management, and security concerns, hamper the process. The water sector faces similar challenges. While development partners provided 589.83 million dollars over the past five years, this still fell short of targets. The World Bank has pledged 1.5 billion dollars for the next five years, to be implemented in three phases. Minister Habtamu Itefa (PhD) emphasised the importance of coordinated efforts, highlighting the recently drafted WASH (Water, Sanitation, and Hygiene) strategy and the year-long development of a new energy policy. These initiatives, he believes, will be instrumental in transforming the water and energy sectors. Participants also stressed the need to involve the private sector in developing strategies and policies to address the water crisis.