Ethiopia

Agriculture is an essential driver of economic growth in the Ethiopian economy contributing to over 30% of the country’s GDP, and providing employment for an estimated 65% of the working population. The EU-Ethiopia partnership supports sustainable agri-food systems and the modernisation of export value chains, with a particular focus on coffee and horticulture. The aim is to increase their reach to European markets, generate income for smallholder farmers and promote nutritious food in Ethiopia.

Investments and interventions focus on green business development, food security and nutrition, food safety and phytosanitary standards, job creation and labour standards, logistics, water resource management, climate resilience and disaster risk management. 

Ethiopia has abundant and diversified renewable energy resources, offering significant potential to develop a highly decarbonised energy system benefitting all Ethiopians. Yet, nearly half of the population still lacks access to electricity and fewer than 10% have access to clean cooking solutions. Through Global Gateway investments, the EU and Team Europe partners aim to foster a clean energy transition for all in Ethiopia by:

• Electricity grid: Mobilising blended finance to assist national operators in the rehabilitation, modernisation and digitalisation of the power grid infrastructure and the professionalisation of their workforce (RISED project).
• Renewable energy: Stimulating sustainable investments in renewable energy generation through EFSD+ guarantees.
• Access to energy: Accelerating rural electrification through the deployment of off-grid renewable energy, clean cooking and productive use solutions. 

Ethiopia’s digital transformation is accelerating, although several critical challenges, including limited internet coverage, a shortage of relevant skills and policy hurdles, impede its full potential. In response, the EU supports Ethiopia’s digital journey through funding and expertise in:

• Digital infrastructure: actively identifying and preparing Global Gateway investments to further develop the national fibre backbone, mobile networks and data centres.
• Digital governance: supporting the development of an enabling regulatory framework for the country’s digital economy, including the development of citizen-centric e-services (e.g. on digitalising business registration).
• Digital skills: developing market-relevant digital skills through Technical and Vocational Education and Training (TVET) and, in turn, increasing youth employability and job creation.
• Digital rights: raising awareness on the need to protect human rights in the digital sphere, e.g. through advocacy for data protection enforcement.

The transformative impact of Global Gateway flagship projects can only materialise if enablers to a conducive, transparent and stable political and socio-economic environment are put in place. Team Europe supports Ethiopia in its national Disarmament, Demobilisation and Reintegration (DDR) programme and peacebuilding efforts, including the National Dialogue process.

Measures include:

• Investing in a democratic package, including the electoral cycle support and criminal justice reform.
• Promoting inclusive and gender sensitive reconciliation and peacebuilding, providing relief for conflict affected communities in Tigray.
• Strengthening economic governance for investments by fostering public finance management reforms.

Supporting Micro, Small and Medium Enterprises (MSMEs) in post-conflict areas, notably through:

• Access to finance
• Business incubation and development support
• Integration of digital financial services to enhance financial inclusion
• Job creation for rural women and youth
• Agricultural and livestock recovery.

Supporting business environment and investment climate reforms, through: 

• The introduction and strengthening of digital tools/systems to deliver improved government services for businesses in tax administration, business licensing and registration and contributing towards a robust credit registry
• Improving the regulatory capacity of business-facing institutions;
• Introducing innovative tools and processes for Public Private Dialogue and improved inclusivity of law making in Ethiopia;
• The development of a digital Government Strategy (2025-2030) and a corresponding Government Enterprise Architecture.

Enabling private sector in key value chains in Ethiopia, primarily through: 

• Enhancing transparent, accountable tax administration and auditing in Ethiopia, with improved service to private sector operators in key value chains.
• Improving cross-border trade transparency through optimized electronic customs systems and efficient digital services.
• Promoting strong Business Membership Organisations (BMOs) with strong value proposition for investors;
• Strengthening the Ethiopian capital market to support youth- and women-led MSMEs, including enhancing their use of securities/stock exchange platforms.

Ethiopia has achieved major health improvements over the past decade and on primary education towards universal enrolment. Structural challenges remain, especially in areas affected by conflicts and in terms of social services for vulnerable populations. The EU supports a holistic approach that enhances capacities of education and health systems to recover from conflict and crisis and to become more resilient to shocks. 

Our approach combines rehabilitation of damaged social infrastructure together with a strengthening of education and health systems. We focus on:

• Early primary and primary education, including through provision of school meals to over 60 000 children.
• Improved access to primary health care, including mental health and psychosocial support.
• Development of medical specialisation in university hospitals. 

Ethiopia is a country of origin, transit, and destination for migrants, with approximately 250,000 Ethiopians migrating annually, driven by natural and man-made disasters and severe economic hardship. Ethiopia hosts over 823,000 refugees and asylum seekers predominantly from South Sudan, Somalia and Eritrea. There are also 4.2 million Internally Displaced Persons (IDPs), largely resulting from ongoing conflicts and tensions in different parts of the country.

EU is engaged in protecting rights and responding to basic needs of IDPS, returnees and host communities in different parts of the countries. Our actions targets 461800 individuals, with an emphasis on economic support, water, sanitation and hygiene (WASH) services and social protection.

During the past years, the EU supported the dignified returns of over 200 Ethiopians who had no legal right to stay in Europe.

From 2025 onwards, the EU will continue promoting the durable solutions agenda for refugees and host communities in Somali regions and will support the process of legal labour migration and protection of rights of Ethiopian labourers going abroad.