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U.S. may halt nearly $130 million of foreign assistance for Ethiopia

U.S. may halt nearly $130 million of foreign assistance for Ethiopia

The U.S. administration has decided on a plan that entails the suspension of financial assistance for Ethiopia due to the country’s dispute with Egypt and Sudan over the Grand Ethiopian Renaissance Dam project which has been under construction since 2011. Located on the Blue Nile River, this huge endeavor was first proposed by Ethiopian Emperor Haile Selassie in the 1960s and it is now a subject of national pride.

Dispute over the dam began when construction started raising concerns that the project would affect the water supply to Egypt and Sudan – the downstream states – with both countries being highly dependent on the River Nile as a source of freshwater for both people and agriculture.

However, recently the tensions have escalated following Ethiopia’s announcement that it had started to fill the GERD’s reservoir without a legally binding agreement regarding the equitable allocation of the Nile’s waters. The reservoir is the subject of a long-running dispute between Egypt and Sudan and Ethiopia – an upstream state.

Egypt and Sudan required an undertaking from Ethiopia that it would not fill the dam until a legally binding agreement between all three countries was in place that would regulate how the water flows were managed during droughts or drier rainy seasons. Despite this demand, Ethiopia decided to proceed to fill the dam with 74 billion cubic meters of water in July, triggering a wave of protests from Egypt and Sudan.

Some Ethiopian officials claim that the Trump administration is taking Egypt’s side in the dispute as Egypt has, for many years, been a very close ally of Washington in the Middle East. Nevertheless, U.S. officials have ensured steps are being taken to address this stalemate and aim to mediate in the dispute between the African countries.

As such, Trump’s administration began negotiations last year led by Treasury Secretary, Steven Mnuchin which then caused tension amongst U.S. officials with some claiming that this was not the relevant institution to handle the issue.

Washington is planning to halt funding to Ethiopia for programs that address security assistance, counter-terrorism, and military education and training, as well as the financing of anti-human trafficking programs and broader development assistance funding. However, funding for emergency humanitarian relief, food assistance, and health programs aimed at addressing COVID-19 and HIV/AIDS will be excluded from this list. In 2019 alone, Washington provided a total of $824.3 million in assistance to Ethiopia, of which $497.3 million was humanitarian aid, according to State Department data.

Not all U.S. officials find this strategy appropriate and express doubt that suspending funding will work to persuade to Ethiopia to change its position, bearing in mind the political significance of the dam. The project aims to supply Ethiopia with energy as the country is regularly affected by electricity shortages and it, therefore, has to import energy from neighbors. When finished, the dam will be the largest hydroelectric power plant in Africa with a total capacity of 6.45 gigawatts.


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