World Bank

World Bank Approves $400mln to Support Urban Poor in Ethiopia

ADDIS ABABA – The World Bank Group’s Board of Executive Directors has approved a 400 million US dollars grant  which will support the livelihoods of Ethiopia’s urban poor.

The latest approval is the second in a month from the Bank’s wing international development association, which provides low to zero-interest loans,  to the government of Ethiopia.

In mid-September, the World Bank approved 80mln US dollars grant to Support smallholder farmers.

In a statement issued late Wednesday, the bank announced it has approved another grant to support Ethiopia’s efforts to improve the incomes of the urban poor and promote the inclusion of disadvantaged urban youth in the labor market.

– Building on previous Success

The finance will fund East African nation’s Urban Productive Safety Nets and Jobs Project or UPSNJP.

“Poverty and limited access to economic opportunities remain serious challenges in Ethiopia’s urban areas, and the COVID-19- induced economic slowdown has further exacerbated the situation,” said Ousmane Dione, World Bank Country Director to Ethiopia.

Dione said, “Building on the successes of the World Bank financed Urban Productive Safety Net Project, it will provide social protection as well as jobs related services to 816,000 beneficiaries in around  83 cities across the country”.

Social protection systems have played a key role in reducing poverty in Ethiopia and are a critical component of the country’s long-term development strategy.

The need for effective social safety nets and stable jobs for the urban poor has been further highlighted by the disruptions posed by the ongoing COVID-19 crisis, according to the World Bank.

– Making it Inclusive

In order to provide income support in the short run as well as support livelihoods and financial independence over the medium-term, the Bank says the the safety net program will include public works activities with a built-in strategy for graduation, including for refugees and host communities.

Additionally, the project will provide direct cash transfers for the elderly, the disabled, and pregnant mothers, as well as specialized social services for children in street situations and homeless adults.

Government’s project is expected to complement a dynamic safety net system that is responsive to the diverse needs of the urban poor.

Emphasis on the Youth

Ayuba Sani Hussein, bank’s a senior social protection specialist, said it is important to combine safety nets with livelihood support and job opportunities given the economic opportunities in urban areas, and based on Ethiopia’s priority for inclusive growth.

The expert said the move would particularly be key in Ethiopia “where young people account for the majority of its population”.

The project will provide adequate technical assistance and capacity building for the Federal Urban Job Creation and Food Security Agency under government agencies and their development partners, and private sector firms.

This capacity building would ensure the successful implementation of planned activities, the bank added.