The Khalifa Fund for Enterprise Development (KFED), a government agency formed to help small and medium-sized enterprises, signed a $100 million (Dh368m) agreement with the Ethiopian Ministry of Finance to support businesses in the African nation.
This pact followed a memorandum of understanding signed between the two parties in July, last year.
The fund’s loan is expected to finance about 37,000 projects over the next four years, creating over 200,000 job opportunities in Ethiopia.
“This agreement implements a stringent financial and technical framework that creates new employment opportunities [in Ethiopia]… alongside empowering women to grow their role in the Ethiopian economic agenda,” said Hussain Jasim Al Nowais, chairman of the KFED.
“The funding shall also be invested in areas with higher indices of poverty to help in their economic development,” he added.
At least 30 per cent of the projects which receive this funding will be led by women, while the rest of the grant will be equally distributed between male-led and female-led projects, said KFED.
This agreement is signed under the directive of Sheikh Mohammed bin Zayed Al Nahyan, Crown Prince of Abu Dhabi and Deputy Supreme Commander of the UAE Armed Forces, to strengthen cooperation and build strategic partnerships with different countries across the world.
Besides boosting the SME industry, the contract also aims to develop Ethiopia’s entrepreneurial sector.
“It seeks to create greater job opportunities for Ethiopians and build local entrepreneurial capability, using specified targeting mechanisms to provide funding to those who need it the most,” said Mr Nowais.
Established in June 2007, KFED was started with a total capital of Dh300m that was gradually increased to Dh2bn, according to its website.
It provides comprehensive support to SMEs in the UAE, funding over 1,700 projects nationally. Along with other government agencies, the fund provides various forms of support to Emirati entrepreneurs including facilitating their participation in local and international exhibitions and forums as well as giving them exemptions and priority in government procurement processes.
The fund has also expanded its model of entrepreneurial development to over 22 countries in Asia, Africa, and Europe by providing bespoke financing programmes.
“This agreement not only helps to strengthen Ethiopia’s national economic development, but will also benefit Ethiopian citizens … providing more jobs, more skills, and more specialties, helping those in poverty in Ethiopia,” said Ahmed Shide, the Ethiopian minister of finance.