ADDIS ABABA–The World Bank (WB) has approved a substantial 700 million USD credit from the International Development Association (IDA) to bolster Ethiopia’s financial sector.
This funding will support the Financial Sector Strengthening Project (FSSP), aimed at enhancing the stability and resilience of the nation’s financial institutions.
Ethiopia’s financial sector faces a range of significant challenges, including outdated regulatory frameworks and underperforming public financial institutions. According to information obtained from the World Bank’s official website, the FSSP will focus on modernizing the regulatory and supervisory structures of the National Bank of Ethiopia (NBE).
The project will also support governance reforms, balance sheet restructuring, and the recapitalization of the Commercial Bank of Ethiopia (CBE), as well as the transformation of the Development Bank of Ethiopia (DBE) into a more sustainable development finance institution.
In addition to these vital reforms, the initiative will provide crucial implementation support and capacity-building efforts to NBE, CBE, and DBE, ensuring their long-term viability and resilience in an evolving global financial landscape.
World Bank Country Director for Ethiopia, Eritrea, South Sudan, and Sudan, Maryam Salim, emphasized the institution’s unwavering commitment to Ethiopia’s economic development. “This project underscores our dedication to strengthening Ethiopia’s financial sector, with the overarching goal of creating a more resilient and accessible system that effectively meets the diverse needs of all Ethiopians,” Salim stated.
The approval of the Financial Sector Strengthening Project represents a significant milestone in Ethiopia’s efforts to modernize its financial infrastructure. By addressing the sector’s current challenges and focusing on critical reforms, this initiative is poised to unlock new avenues for economic growth and foster a more inclusive financial system that will benefit the entire country, it was stated.
BY STAFF REPORTER
THE ETHIOPIAN HERALD TUESDAY 24 DECEMBER 2024
