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EIB Global, part of the European Investment Bank Group, has teamed up with Dashen Bank, one of Ethiopia’s largest private commercial banks, to provide $44.6 million in financing for small and medium-sized enterprises (SMEs). The focus will be on agriculture, environmental sustainability, and supporting women’s economic empowerment.
Under the agreement, EIB Global will provide a $22.3 million long-term loan to Dashen Bank, which will match the amount and contribute another $22.3 million.
Dashen Bank Chief Executive Officer Asfaw Alemu said, “We are committed to expanding access to finance for the businesses that drive Ethiopia’s economy. This partnership with EIB Global will enable us to offer longer-term financing to agricultural enterprises, exporters and other eligible businesses while strengthening our support for green investment and women-led companies. It also reflects our ambition to work with international partners to mobilise capital, expertise and innovative financial solutions for our customers.”
The combined pool will be channelled to Ethiopian SMEs on more favourable terms than those available in the domestic commercial market, including longer maturities, directly addressing one of the most persistent barriers to private-sector growth in the country: limited access to finance.
A significant portion, at least 70%, is allocated specifically for agricultural and related activities. Priority will be given to SMEs involved in sectors such as coffee, pulses, horticulture, and cereals, particularly those engaged in exports to Europe and other international markets.
Additionally, a minimum of 30% of the funds will focus on supporting climate action and environmental sustainability, while another 30% will concentrate on women-led businesses. This initiative is expected to create and sustain over 34,000 full-time jobs across the beneficiary enterprises.
Agriculture sits at the core of Ethiopia’s economy, employment base and export earnings, yet many agribusinesses struggle to secure the capital needed to modernise production, meet international standards and build resilience against droughts, floods and other climate shocks. The partnership aims to close that gap while preparing Ethiopian firms for a more competitive, climate-conscious marketplace.
In addition to financial support, EIB Global will offer technical assistance to improve Dashen Bank’s ability to manage environmental and social risks and enhance its climate finance and reporting systems, funded by the EU. Dashen Bank is also part of the EIB’s program to help Ethiopian banks assess climate risks and increase green lending.
EIB Vice-President Ambroise Fayolle said, “EIB Global will support agribusinesses to invest, adapt to climate change, grow and reach new markets. The operation demonstrates how European Union financing can reinforce resilient agricultural value chains, support quality employment and accelerate sustainable private-sector development in Ethiopia.”
The initiative also aligns with the EU’s Global Gateway strategy, which seeks to build more resilient agrifood systems, promote sustainable growth and improve access to finance for microenterprises and SMEs in partner countries.
“Through Global Gateway, Team Europe is helping Ethiopian entrepreneurs access the finance they need to grow, innovate and seize new opportunities. The result is more jobs for local communities, stronger environmental protection and more resilient local value chains,” said Jozef Síkela, European Commissioner for International Partnerships.
