The $10 Billion Mega-Airport Financing Partnership Between Ethiopian Airlines and African Development Bank Takes Off

Ethiopia’s ambition to build a new international airport that will rival some of the world’s biggest, took off on Monday with a monumental signing ceremony marking the African Development Bank’s role (www.AfDB.org) as the initial mandated lead arranger, global coordinator and book runner to mobilize nearly $8 billion of the $10 billion needed for the mega project.

The Bank plans to provide financing of $500 million, subject to Board approval.

The mandate letter was signed by Ethiopian Airlines Group Chief Commercial Officer Lemma Yadecha and the President of the African Development Bank Group Dr. Akinwumi Adesina, in the presence of Ethiopia’s Minister of Finance, Hon. Ahmed Shide.

Other guests at the ceremony included Ethiopian Airlines Group Board Chair Hon. Lt General Yilma Merdessa, Malawi’s Minister of Finance and Economic Affairs Simplex Chithyola, South Sudan’s Ambassador to Ethiopia Boutros Thok Deng, the Democratic Republic of Congo’s Chargé d'affaires in Ethiopia Exkael Kabongo, his Togolese counterpart Thomas Deji, and Zambia’s Nawa Sibongo.  

Located 40 kilometers south of Addis Ababa, the new greenfield Bishoftu International Airport (BIA) will have an initial capacity of 60 million passengers, eventually expanding to 110 million, and transport 3.73 million tons of cargo annually.

“The African Development Bank is proud to partner with Ethiopia in its vision to expand the operational and fleet capacity of the Ethiopian Airlines,” Adesina said, praising Ethiopia for putting “Africa at the top in global aviation.”

 “With its 75 years of operational history, Ethiopian airlines is Africa’s oldest and best airline. It is critical for regional economic integration, connecting capitals, people and markets, with its globally rated cargo facilities,” the Bank Group chief said.

Ethiopian Airlines Group CEO Mesfin Tasew, who was represented at the signing ceremony by Chief Commercial Officer Yadecha said, “The signing of this mandate letter marks a decisive step toward realizing a world-class pan-African gateway that will boost intra-African trade, regional integration, tourism, and global connectivity.”

Groundworks are expected to begin late 2025, with Phase I expected to be completed by November 2029. The multi-billion-dollar project will include an airport city with facilities such as shopping malls, hotels, recreation areas, as well as direct rail and expressway links to Addis Ababa.

Adesina, making his last official visit to Ethiopia, praised the “visionary leadership” of Ethiopia’s Prime Minister, Abiy Ahmed, who he noted is transforming the country “every hour, every day, every week, at scale. Speed and scale are now the hallmarks of Ethiopia.”

He summed up the financing partnership between Ethiopian Airlines and the Bank as a fitting one between Africa’s largest airline—with an especially noteworthy record of supporting the global response to the Covid19 pandemic—and the continent’s biggest infrastructure financier, to deliver a “game changer” for African and global aviation.

“In the past ten years under my Presidency, the Bank has financed over $55 billion in infrastructure,” Adesina said, pledging to “do all we can to support Ethiopia to achieve its dream.” He noted that the African Development Bank in 2016 extended a $160 million corporate loan to support the modernization and expansion of Ethiopian Airline’s fleet. 

“I wish to assure you that the African Development Bank will deliver, so that this project can be delivered by Ethiopia for its people,” said Adesina.

The Ethiopian Airlines Group and the African Development Bank signed a Letter of Intent on 24 March 2025 to partner for the financing of this flagship project.

The Bank has a track record of responsibly structuring and mobilizing financing from commercial banks, development finance institutions, and institutional investors for structured projects across the continent.

It supports several transformative infrastructure projects as a mandated lead arranger, including the Aysha Wind Power Project in Ethiopia and the Tanzania-Burundi-DR Congo Standard Gauge Railway Project.

Over the years, the Bank has successfully executed debt-raise mandates for limited-recourse infrastructure projects as well as state-owned transport companies such as Transnet, Portos e Caminhos de Ferro de Moçambique, and Ghana Airports Company.

The Bishoftu International Airport will serve international passenger and cargo traffic, complementing Bole International Airport, which will retain Ethiopian’s domestic operations.

Ethiopian Airlines hub-and-spoke network, with subregional hubs, is driving connectivity across Africa and with the rest of the world.  With the planned airport, the speed, frequency and scale of connections for people, goods, and services is set to increase significantly. The expansion is also in line with one of the African Development Bank’s High 5 priorities, which is to Integrate Africa by breaking down barriers, building cross-border links, and enabling African economies to trade, travel, and thrive together in a globally competitive environment.

Ethiopian Airlines Group, Africa’s most successful airline, with more than 75 years of operational history, is the seven-time consecutive winner of Skytrax’s ‘Best Airline’ in Africa’ award. In the fiscal year ending 30 June 2025, the airline reported record revenues of $7.6 billion, reflecting an 8% year-on-year growth. It transported 19.0 million passengers, with 15.1 million on international routes and 3.9 million within the country.

The company has allocated a total of $350 million for livelihood restoration and resettlement of communities that will be affected by the construction.

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