AfDB and Eritrea Sign US $41.5m Funding Agreement

African Development Bank loans to Eritrea
The Education Sector Development Program and National Food Security program gets a vital boost from the African Development Bank

By TesfaNews,

THE African Development Bank (AfDB) and Eritrea today signed a US $41.5 million funding agreement to finance two major government projects on skill development, drought resilience and sustainable livelihood programs.

The Agreement was signed in Asmara by the Minister of Finance, Mr. Berhane Habtemariam, and AfDB Regional Director, Mr. Gabriel Negatu.

AfDB Regional Director, Mr. Gabriel Negatu and Minister Berhane Habtemariam sigining the agreement
AfDB Regional Director, Mr. Gabriel Negatu and Minister Berhane Habtemariam sigining the agreement

According to Mr. Gabriel Negatu, 50% of the amount is in development assistance to Eritrea and the remaining 50% in the form of interest-free loan.

The Nairobi-based regional African Development Bank is by far the largest investor in the education sector in Eritrea contributing over US $71 million since 2010.

In March of this year, the AfDB Board of Executive Directors similarly approved US $19 million for projects comprising an African Development Fund (ADF) loan of US $10.7 million and an ADF grant of US $8.3 million to boost the Technical, Vocational, Education and Training (TVET) sector in the country.

Eritrea is a relatively small country of 6 million inhabitants, with a GDP per capita of US $543 and one of the lowest Human Development Index rankings at 177 out of 187 countries and territories.

Ironically though, the country receives the least development aid per capita and is now making significant efforts to boost private sector investments as well as human capital development.