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| AFP |
Ethiopia needs to find
new ways to finance infrastructure projects after relying heavily on
state-driven investment to build new roads, railways and dams to drive growth
in its economy, the World Bank has said, Reuters news agency reports.
Huge
public investment has been credited with pushing economic growth above 10% in
the 2014/15 financial year, one of the fastest rates of expansion in Africa.
But
the state has carried much of the burden of raising financing, while demanding
that banks invest the equivalent of 27% of the loan portfolio in low-yield
state development bonds, leaving little for private business to borrow.
"Continued
infrastructure development remains one of Ethiopia's best strategies to sustain
growth, but the current financing model is not sustainable," Reuters
quotes a World Bank report as saying.
A
US$4bn hydro-electric dam on the Blue Nile and finishing a programme to build a
5,000 km railway network are among projects Ethiopia aims to complete in the
next five years.
Raising taxes, increased
private sector activity and improved public investment management were some of
the options Ethiopia should consider, the World Bank said, Reuters reports.
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