Only 20pc of the lease financing proposals submitted to the Development Bank of Ethiopia (DBE) has been approved, according to the Federal Small & Medium Manufacturing Industry Development Agency.
This is despite applications for financing for over 10 billion Br worth of lease had been received. Delay in machinery purchase and that the initiative is new have been put forward as reasons for the shortfall.
The financing loan was put in place by the government to support businesses in the manufacturing sector that submit a detailed business proposal. It is also mandatory that they raise a fifth of the machine's price on their own.
Early January of this year, 276 million dollars was secured from the World Bank Group (WBG) and the European Investment Bank (EIB) to finance this initiative within five years. DBE has stated that out of the total amount, 60 million dollars has been loaned out.