Ethiopia has taken a major step towards becoming Africa’s aviation hub as the African Development Bank (AfDB) has supported the construction of a new $7.8 billion international airport.

The new facility will be located in Bishoftu, about 40 kilometers southeast of Addis Ababa and will ease the congestion at Bole International Airport which is reaching its capacity due to Ethiopian Airlines’ rapid growth.

Partnership for Growth

The agreement was signed on Friday between Ethiopian Airlines CEO Mesfin Tasew and AfDB Vice President Nnenna Nwabufo, with Finance Minister Ahmed Shide emphasizing the key role of AfDB in the country’s transformation.

The new airport will increase annual passenger capacity from 17 million to over 60 million by 2040 and strengthen Ethiopian Airlines’ leadership in African aviation.

Financing and Economic Impact

The government has not yet revealed the detailed financing structure but officials are considering a mix of public and private investment to fund the project.

The initiative is in line with Ethiopia’s overall economic strategy which includes macroeconomic reforms targeting inflation stabilization, foreign investment attraction and infrastructure development.

AfDB President Akinwumi Adesina reiterated the bank’s full support to the airport calling it a “continental flagship” that will enhance regional connectivity and economic integration.

Finance Minister Shide also urged the AfDB to expand its financial and technical assistance beyond aviation, citing the country’s urgent needs in energy, transportation and industrialization. Currently, AfDB’s support portfolio in Ethiopia is $1.2 billion.

Strengthening Ethiopia’s Aviation Supremacy

Ethiopian Airlines, Africa’s largest and most profitable airline, has successfully made Addis Ababa a key intercontinental transit hub. The new airport will further solidify its competitive edge over rivals like Kenya Airways and South African Airways which have been struggling with financial crisis and government bailouts.

With this project, Ethiopia is not just building its aviation infrastructure; it is positioning itself as a global player.