Ethiopian Prime Minister Abiy Ahmed on Tuesday rejected claims by U.S. President Donald Trump that the United States financed Ethiopia’s flagship hydroelectric project on the River Nile, insisting the multibillion-dollar dam was built entirely with domestic resources.
Speaking to members of parliament, Abiy said Ethiopia did not receive any foreign loans or financial assistance for the construction of the Grand Ethiopian Renaissance Dam (GERD), Africa’s largest hydroelectric power plant.
“We did not receive a single birr in loans or financial aid from any foreign sources for the construction of the mega-dam,” Abiy told lawmakers. “This project was realised through the strong commitment and sacrifices of Ethiopians at home and in the diaspora.”
Trump made the claim last month on the sidelines of the World Economic Forum in Davos, where he echoed long-standing Egyptian concerns about the dam, saying it was “financed by the United States” and “basically blocks the Nile.” Ethiopia has repeatedly dismissed such assertions as inaccurate.
The US$4 billion GERD, located in Ethiopia’s northwestern Benishangul-Gumuz region near the Sudanese border, is being built on the Blue Nile, a major tributary of the River Nile. Once fully operational, it is expected to generate 5,150 megawatts of electricity, transforming Ethiopia into a regional power exporter and easing chronic domestic power shortages.
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Construction of the dam began in 2011 and has been a source of diplomatic tension between Ethiopia, Egypt and Sudan for more than a decade. Egypt, which relies on the Nile for about 97 percent of its freshwater needs, has described the project as an “existential threat,” arguing that the dam could reduce downstream water flows during filling and operation.
Ethiopia has consistently countered that the GERD will not significantly harm downstream countries and will instead benefit the region by regulating river flows, reducing flooding and providing cheaper electricity.
Abiy reiterated that position on Tuesday, saying Ethiopia remained committed to dialogue but would not accept claims that undermine the country’s sovereignty or misrepresent the project’s financing.
The prime contractor for the dam, Italian construction group Webuild, has also said the project was entirely funded by Ethiopia. Speaking at the inauguration ceremony in September, Webuild CEO Pietro Salini said no international financial institutions were willing to support the project because of political sensitivities surrounding the Nile.
“Not one international lender was willing to put money in this project,” Salini said at the time, adding that the dam does not divert water for irrigation and therefore does not consume Nile water.
“The dam releases water to produce energy,” Salini told AFP. “They are not irrigation schemes that consume water.”
Financing for the GERD has come largely from domestic sources, including government bonds sold to Ethiopians, voluntary public contributions and budgetary allocations. Civil servants and members of the diaspora were encouraged to buy bonds and make donations to support construction.
Trump, a long-time ally of Egypt’s leadership, has previously taken a strong stance in support of Cairo’s position on the Nile dispute. During his first term in office, the United States played a mediating role in negotiations between Ethiopia, Egypt and Sudan, although talks ultimately stalled.
In Davos, Trump said he intended to “get negotiations back on track,” a statement welcomed by Egypt, which has repeatedly called for binding agreements on the filling and operation of the dam.
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Egypt has said it is ready to relaunch mediation efforts, while Sudan has urged all sides to resume talks. Ethiopian officials have not publicly responded to the latest calls but have maintained that negotiations should respect Ethiopia’s development rights.
Despite years of diplomatic efforts involving the African Union, the United States and the European Union, the three Nile basin countries have yet to reach a comprehensive agreement, leaving the GERD a continuing source of regional tension.
