African Development Bank is to provide a $500 million loan and lead efforts to raise remaining financing for the establishment of a new Ethiopian Airlines capital hub at Bishoftu, south of Addis Ababa.
The airport is intended to have initial capacity for 60 million passengers with expansion options taking the figure to 110 million.
Ethiopian Airlines Group says the loan and financing for the “mega-airport” are the subject of a mandate letter appointing African Development Bank as an initial lead arranger.
“Signing of this mandate letter marks a decisive step toward realising a world-class pan-African gateway that will boost intra-African trade, regional integration, tourism, and global connectivity,” says group chief Mesfin Tasew.
According to African Development Bank the first-phase construction of the airport, sited 40km south of Addis Ababa, will commence later this year.
It will address capacity constraints at Ethiopian Airlines’ base at Bole international airport. Bole will eventually complement the new airport, switching its focus to domestic operations, the bank adds.
Ethiopia’s new hub will cost around $10 billion and the bank says it will “lead resource mobilisation efforts” to raise debt financing of up to $8 billion. Its initial loan of $500 million will “anchor the funding” of the project, it states.
Source : https://www.flightglobal.com/air-transport/african-development-bank-anchors-new-ethiopian-hub-financing-with-initial-500m-loan/164142.article