Includes how major projects are financed and gives examples where relevant. Explains activities of the multilateral development banks in and other aid-funded projects where procurement is open to U.S. bidders.

Access to finance is a challenge for the Ethiopian local market. Local private banks often require a large percentage of loans as collateral, which must usually consist of cash, real estate or durable capital physically located in Ethiopia. The National Bank of Ethiopia must approve loans from overseas institutions that require hard currency debt repayments.

The World Bank's International Finance Corporation provides some equity financing for private sector projects. African Development Bank also provides financing for some projects that are involved in production for exporting purpose. African Development Bank is working with Power Africa on energy generation, transmission and distribution projects. They also finance transportation and other infrastructure projects. Other European and Asian Development Finance Institutions are collaborating on the financing of infrastructure projects.

In 2016, the U.S. Export Import Bank (EXIM) Board of Directors approved Ethiopia for long term financing. EXIM Bank financing of long term projects could create significant business opportunities for U.S. companies’ engagement in Ethiopia particularly in upcoming mega infrastructural projects. The U.S. Overseas Private Investment Corporation (OPIC) is also open for business in Ethiopia and is looking at financing options for the energy, agriculture and other infrastructure projects. On December 2018,

Millennium Challenge Corporation (MCC) also approved Ethiopia for a threshold program.

As a part of the Government of Ethiopia initiative to develop the manufacturing sector and export oriented investments, the Development Bank of Ethiopia (DBE) promises to loan out 70% of investment projects in selected sectors including commercial farms, agro processing, export oriented businesses and manufacturing sector with the remaining 30% covered by owner’s equity.

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