MOGADISHU, Somalia

Ethiopia and the European Union signed a €650 million ($680 million) financial support agreement for the Multi-Annual Indicative Program on Tuesday.

The agreement was signed by Ethiopia’s Finance Minister Ahmed Shide and European Commissioner for International Partnerships Jutta Urpilainen in the presence of ambassadors from EU member states based in the capital, Addis Ababa.

It aims to support green growth, inclusive human development and governance and peace building in the country.

The Multi-Annual Indicative Program shows the EU’s willingness to support Ethiopia to emerge from conflict and step up its development efforts, Urpilainen said in a statement on X.

She was in Addis Ababa for an official working visit to Ethiopia.

The program will be implemented in Ethiopia from 2024 to 2027.

“The priorities of the €650 million Multi-Annual Indicative Program for Ethiopia are green growth, inclusive human development, governance and peace building. Cooperation in these crucial sectors has to be accompanied by active policy dialogue with the government,” Urpilainen said in a statement.

She said the Horn of Africa has great potential for Africa’s development, and to increase economic integration, “it needs rigorously implemented quality investments in connections and social cohesion.”

A statement issued by Ethiopia’s Finance Ministry after Shide and Urpilainen met on the sidelines of the Ministerial Meeting of the Horn of Africa Initiative said he briefed her on the current socioeconomic and political situation in Ethiopia.

The agreement comes as the country faces multifaceted challenges, including a cholera outbreak and an influx of refugees from Sudan.

Although the Tigray conflict ended and the government of Ethiopia and the Tigray People's Liberation Front (TPLF) signed a Cessation of Hostilities Agreement in Pretoria in November 2022, fresh unrest emerged in the Amhara region.

The Pretoria agreement had ended one of the deadliest conflicts of the 21st century, which has devastated many families, left hundreds of thousands dead and displaced millions.

A UN report released late last year put the number of displaced people at 2.75 million, with 12.5 million children said to require urgent humanitarian assistance.