Commissioner Síkela Announces Resumption of Budget Support and Strengthened Partnership with Ethiopia at Business Forum

The European Union (EU) has reaffirmed its commitment to deepening economic and developmental partnership with Ethiopia, as announced today by Jozef Síkela, EU Commissioner for International Partnerships, during his keynote address at the Ethiopia Business Forum. The Commissioner unveiled a series of measures designed to bolster Ethiopia's economic reforms, foster private sector growth, and enhance cooperation on migration and stability in the Horn of Africa.

The package includes new financing, budget support, and private sector investments aimed at creating jobs, improving infrastructure, and deepening EU-Ethiopia trade ties.

Key Announcements

1. Resumption of EU Budget Support (over €140 Million)

The EU will resume budget support to Ethiopia, unlocking over €140 million to advance shared priorities in energy, connectivity, healthcare, and business climate reforms. This decision follows Ethiopia's progress in implementing economic and governance reforms.

"The resumption of budget support is a testament to our confidence in Ethiopia's reform agenda and our long-term commitment to this partnership," said Jozef Síkela. "These funds will help Ethiopia build a more resilient, inclusive, and competitive economy."

The support will focus on:

• Expanding electricity access to rural and underserved communities.
• Strengthening digital infrastructure to boost connectivity and innovation.
• Improving healthcare systems and business environments to attract investment.

2. Digital Economy Package (€150 Million, with Ambition to Double)

The EU and Ethiopia signed a Digital Economy Package, a joint framework to accelerate Ethiopia's digital transformation as a Team Europe. The initial commitment of €150 million will support:

• Digital infrastructure (e.g., fibre optic expansion).
• Skills development for Ethiopia's youth.
• Governance reforms to create an enabling environment for tech innovation.

"Two-thirds of Ethiopia's population is under 30, and digital connectivity is key to unlocking their potential," the Commissioner noted. "This package will help Ethiopia build the digital backbone it needs for the next generation."

3. European Investment Bank (EIB) Lending Operations (€130 Million)

The European Investment Bank (EIB) signed two new lending operations to boost Ethiopia's agribusiness and rural finance sectors:

• €20 million loan to Zemen Bank to provide affordable credit to agri-food businesses and smallholder farmers.
• €110 million loan for rural finance, targeting rural households, women, and small enterprises across Ethiopia.

These investments will help modernise agriculture, increase productivity, and create jobs in rural communities.

4. Expansion of the RISED Programme (€269 Million)

The RISED (Resilience and Inclusive Sustainable Economic Development) programme, a €269 million Team Europe investment, is already delivering tangible results:

• Electricity access for 4 million people.
• 2,500 km of fibre optic cable laid to improve digital connectivity.
• Rehabilitation of the Ashegoda Wind Farm in Tigray, reducing power outages by 50% and saving 16 GWh of energy annually.

"RISED is a perfect example of how Europe's partnership delivers real change - connecting communities, powering businesses, and driving sustainable growth," the Commissioner stated.

A Partnership for Shared Prosperity

The EU has been a longstanding partner to Ethiopia for over 50 years, supporting development in healthcare, agriculture, infrastructure, and education. Today's announcements build on this legacy, with a focus on investment, mutual benefit, and economic resilience.

"Ethiopia is Africa's oldest independent nation and one of its fastest-growing economies," the Commissioner said. "With these investments, we are not just supporting Ethiopia's growth - we are shaping a future of shared prosperity between Europe and Ethiopia."

Ethiopia is already Europe's largest trading partner in the Horn of Africa, with record exports of coffee, flowers, and agricultural products in 2023. The EU aims to increase the value retained in Ethiopia by supporting higher wages, better working conditions, and stronger local industries.

Next Steps

The EU and Ethiopia will work together to:

• Disburse the €140 million budget support in alignment with reform milestones.
• Implement the Digital Economy Package, with plans to double the initial €150 million investment.
• Scale up private sector engagement, particularly in agribusiness, renewable energy, and digital innovation.
• Strengthen trade ties to ensure Ethiopian products reach European markets more efficiently.

About the EU-Ethiopia Business Forum

The EU-Ethiopia Business Forum brings together over 500 participants, including government leaders, private sector representatives, and investors from Ethiopia and Europe. The event focuses on trade, investment, and economic cooperation, with a strong emphasis on sustainable and inclusive growth. It takes place in Addis Ababa from 20-22 April 2026.

Notes to Editors:

• Team Europe refers to the collective efforts of the EU, its Member States, and European financial institutions (e.g., EIB) to deliver coordinated support.
• The RISED programme is a flagship initiative under Global Gateway, the EU's strategy to boost smart, clean, and secure infrastructure investments worldwide.
• Ethiopia's 135 million-strong population and 7% annual GDP growth make it one of Africa's most dynamic economies.

For More Information

EU-Ethiopia Business Forum 2026
DG INTPA - Ethiopia
DG INTPA - Global Gateway
European Union to Ethiopia
Global Gateway in Ethiopia