Gov’t ensures effective loan allocation

BY TSEAGYE TILAHUN

ADDIS ABABA – The government has been effectively channeling the allocation of loans in mega projects and other strategic areas that would play a significant role in supporting the intended progress, the Development Bank of Ethiopia (DBE) said.

DBE President Yohannes Ayalew (PhD) told the Ethiopian Press Agency (EPA) that a new approach has been taken to ensure the public finance is spent for intended purposes and bringing overall economic progress.

The president further highlighted that during the reign of TPLF, there were widespread malpractices and the loan provision seriously lacks transparency and fairness thereby creating an immense amount of unperformed loans. “Several projects were delayed due to lack of proper governance and the loan provision system was not guided in the correct manner;  manipulated by officials and theft and corruption was rampant. As a result, several states were complaining to correct the system of unfair distribution of wealth.”

Noting the policy bank collected over eight billion Birr last fiscal year, Yohannes indicated that about 3.5 billion Birr is disbursed to various projects. Also, the discussion the firm conducted with state representatives and partners has brought about tangible results to solve investment operation obstacles.

DBE trained over 5,800 small and medium-scale enterprise operators who have been the beneficiaries of its loan in twelve centers. “To sustain inclusiveness and fairness, we have been opening branches (centers) in all  states to serve nearby,” he added.” Also, the bank has prepared a new business model to create strong bonds with industries to make them effective.

Commenting on Ethiopia’s revocation from the African Growth and Opportunity Act (AGOA), the veteran economist said that the withdrawal doesn’t mean the end of all activities or total economic loss for Ethiopia. The country has a huge potential to compensate for the loss by increasing productivity and regulating public expenditure. Policy support for industries and tax improvements have also equal importance to ease the effect of the unjustified measure.

The Ethiopian Herald January 8/202

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