In the context of ongoing reforms in Ethiopia, KfW and GIZ are working with the German Federal Ministry of Economic Cooperation and Development (BMZ) to develop a proposed strategic framework/design for Germany’s future development co-operation with Ethiopia. One of the key programme areas, “Sustainable Economic Development”, focuses on the promotion of the private sector generally and private sector job creation specifically. Among other priorities, the German government is interested in strengthening the financial sector, which remains relatively underdeveloped.

KfW contracted IPC to provide support in developing this strategic programme and advising its Ethiopian country leadership team on programme development, preparing KfW for further strategic discussions with BMZ. IPC experts contributed to KfW’s knowledge base by conducting an analysis of the development of the private sector, with a focus on SMEs, and examining the current obstacles to growth facing the private sector in Ethiopia, such as bureaucracy, financing, technical/digital know-how and market access. IPC also summarised the objectives and strategies of the Ethiopian government, provided an overview of other donor commitments to promote co-ordination, and proposed a design for a German development co-operation programme.