9.2.3 Water Resources Development Fund

The Ethiopian government established the Water Resources Development Fund (WRDF) in 2002 as a semi-autonomous body within the then Ministry of Water Resources (which was renamed the Ministry of Water, Irrigation and Energy, and has since been renamed again as the Ministry of Water, Irrigation and Electricity). It was created to facilitate the funding arrangements for urban water supply and sanitation services throughout the country. The WRDF receives funds from the government and different development partners and provides loans to assist water supply and sanitation projects in large towns. The agreement between the WRDF and the town utility to recover the project cost within a fixed period of time mandates that towns will reimburse the loan within that timeframe.

The operational activity of the Fund started in 2004. Since that time, the WRDF has participated in a number of financing programmes by receiving funds from the government and donors which are then transferred by loan agreement to medium- and large-sized towns to support WASH activities. Through this experience, the Fund has had the opportunity to work with several organisations including the Federal Government, the World Bank, the African Development Bank, the Arab Development Bank, the European Investment Bank and the European Union.