The World Bank has approved a USD 700 million credit through the International Development Association (IDA) to support Ethiopia’s Financial Sector Strengthening Project (FSSP). This initiative aims to bolster the stability and resilience of Ethiopia’s financial institutions.
Ethiopia’s financial sector currently faces significant challenges, including outdated regulatory frameworks and underperforming public institutions. The FSSP will focus on modernizing the regulatory and supervisory structures of the National Bank of Ethiopia (NBE), ensuring it can effectively oversee the sector.
The project also includes governance reforms, balance sheet restructuring, and the recapitalization of the Commercial Bank of Ethiopia (CBE). Additionally, it aims to transform the Development Bank of Ethiopia (DBE) into a more sustainable development finance institution.
Capacity-building efforts for the NBE, CBE, and DBE are integral to the initiative, providing long-term support for their operations within a changing global financial landscape.
Maryam Salim, World Bank Country Director for Ethiopia, Eritrea, South Sudan, and Sudan, highlighted the institution’s commitment to Ethiopia’s economic development. “This project underscores our dedication to creating a resilient and accessible financial system that meets the diverse needs of all Ethiopians,” she stated.
The FSSP marks a critical step in modernizing Ethiopia’s financial infrastructure, unlocking inclusive growth and economic development opportunities.
Source: The Ethiopian Herald
