With a rationale of providing more financial access to Small & Medium Enterprises (SMEs), the European Investment Bank and Ethiopia signed a 1.8 billion Br concessional loan agreement last week.
Admasu Nebebe, state minister of Finance & Economic Cooperation, and Pim Van Ballekom, vice president of the European Investment Bank, signed the loan agreement at Radisson Blu Hotel, in the presence of Getahun Nana, president of the Development Bank of Ethiopia (DBE).
The SMEs involved in agro-processing manufacturing sectors are primary beneficiaries of the loan managed by DBE. The fund will be availed in line with the lease financing programme of the Bank.
"The project will ease the challenge of the missing middle by providing more financial resources to SMEs," said Getahun.
Last year, DBE opened more than 70 branches in a bid to promote lease financing programmes in the country.
The new agreement is the largest ever financing agreement by the European Investment Bank since it partnered with the government of Ethiopia four decades ago. The new concessional loan will be repaid in 40 years with an interest rate of below one percent.