September 9th, Ethiopia inaugurates the GERD: an engine for development, but now also for conflict

On Tuesday, September 9, the GERD, the Grand Ethiopian Renaissance Dam, will be inaugurated. Powered by the waters of the Blue Nile and located a short distance from the Sudanese border, its construction has generated endless controversy since 2011 between Ethiopia, Sudan, and Egypt, with serious repercussions on other regional players as well. With a capacity of 6,450 MW and a cost of 5 billion dollars, it is now the largest infrastructure of its kind on the entire African continent, far surpassing the Aswan dams in Egypt, the Merowe Dam in Sudan, or the Gilgel Gibe III dam, also in Ethiopia. The latter, built on the Omo River, had already doubled Ethiopia’s energy production compared to previous levels; the GERD, in turn, will enable a further increase, thus providing a country with over 120 million inhabitants with greater guarantees for its energy security. With the GERD, Addis Ababa aims to improve access to electricity at home, currently estimated at just over 50%, to reduce the import of fossil fuels, with related benefits in containing the trade deficit, and even more to become a regional energy hub, making electricity an increasingly important part of its exports. All this expresses the idea of a far-reaching project, which, even at the cost of serious sacrifices, can ultimately provide important advantages for national development.

This is precisely where the main problems arise. Egypt and Sudan depend on the waters of the Nile for over 90% of their electricity production and agricultural activities, not to mention the water needs of the population, which in both cases is mainly located along the banks of the Great River. Trilateal negotiations, led by the African Union, have not yielded great results over the years, and the same goes for those attempted by their other important common allies, from China to Russia. To date, the use of the Nile’s waters is regulated by the agreement signed between Egypt and Sudan in 1959, a revision of the 1929 colonial one, with a division of 55.5 and 18.5 million cubic meters, respectively, based on the flood cycle. This agreement is reinforced by an arbitral ruling by the UN International Court of Justice in 1989, which established the same immutability for water agreements as for border agreements. Ethiopia, however, considering itself extraneous to an agreement it did not sign, and unconstrained by failed mediations from common understandings on the GERD’s operation, has proceeded unilaterally to fill its reservoir since 2020. This has unleashed new tensions with Cairo, leading it to unsuccessfully request the intervention of the UN Security Council.

The geopolitical clash over the use of the Nile’s waters also intertwines with other regional issues; in the Sudanese civil war, for example, Ethiopia supports the RSF (Rapid Support Forces) of General Mohamed Dagalo Hemeti, while Egypt is on the side of the Sudanese national government, led by the Head of the Transitional Sovereign Council, General Abdel Fattah Burhan. Among the reasons for the conflict in Sudan are not only the control of water, which Addis Ababa indirectly aims to obtain by weakening the state unity of Khartoum and promoting the rise to power of its ally Hemeti, but also access to the sea, as evidenced by the RSF’s long attempts to conquer Port Sudan and the areas closest to the Ethiopian border. Also for access to the sea, Ethiopia has fueled strong tensions with neighboring Eritrea, especially over the port of Assab, and with Somalia, in 2024 floating a specific memorandum recognizing the separatist state of Somaliland in exchange for a concession from the latter of a port and military base on the Gulf of Aden.

Behind these objectives, which go far beyond a simple desire to pursue and safeguard national interest and sovereignty, are intertwined the ambitions of two important allies of Addis Ababa, the United Arab Emirates and Israel, who are eager to expand their influence in the Horn of Africa and the Red Sea. Israel aims to establish its own naval and military outposts on the coasts, in order to better control the Arab countries of the Gulf, the Red Sea and Gulf of Aden routes, and to tighten the noose on the Yemeni Houthis; the Emirates aim to strengthen their weight in the area and contain that of their rival Riyadh by financing these projects and carrying out other similar ones for their own use. The strategic triangulation between Ethiopia, Israel, and the Emirates last year led to the birth of another alliance, between Egypt, Eritrea, and Somalia, and also to a more decisive commitment by Turkey in Mogadishu, determined not to see years of efforts and investments in the reconstitution of Somali statehood fade away. In particular, Ankara strongly mediated between Addis Ababa and Mogadishu for an overcoming of the MoU between Ethiopia and Somaliland, a result that was finally achieved. All this time, Turkey and Egypt have also doubled their military presence in Mogadishu.

The tensions around the dam, in such a context, can only rise as the level of its reservoir does. Due to continuous and underground interference from other countries like Israel, the Emirates, and even the United States, who have acted as interested and incendiary mediators, the countries of the Nile Valley have not managed to reach a common point of view on the use of the Great River’s waters through political means over the years. Consequently, the probabilities of new direct and indirect military clashes do not appear entirely far-fetched. To defend the GERD, in fear of an Egyptian air attack, Addis Ababa has deployed new Pantsir-S1 anti-aircraft systems, purchased from Russia with strong protests from Cairo, which, in return, has sold new Su-35 fighters to Egypt. Other defense systems that have entered Addis Ababa’s arsenal, such as the SPYDER-MR purchased from Israel, have also raised concerns in Cairo, with its unsuccessful attempt to block the sale. Ethiopia justifies its growing militarization with the possibility of attacks, not only from Cairo but also from Khartoum, with whom relations are understandably not the best and which, in the event of a clash between Addis Ababa and the alliance of Egypt, Eritrea, and Somalia, would side with the latter.

However, there are also other more hidden motivations, related to the internal front. The government in Addis Ababa, led by Abiy Ahmed’s Prosperity Party, is suffering from an increasingly severe crisis of consensus, with the outbreak of numerous internal rebellions, from the Amhara FANO fighters to the Oromo OLA. Entire units of the Ethiopian federal army, often equipped with heavy weapons, surrender to the insurgents, especially the FANO, who have only light weapons, not infrequently then joining their side; this proves that even the best military technologies cannot compensate for demoralization and a lack of political consensus in an army. The economic crisis is what is eroding support for the government: inflation, estimated well above the official figure of 13.7%, erodes purchasing power; the value of the birr, officially quoted at 142 per 1 dollar, is worth much less on the black market; while public debt, increasingly in the hands of the IMF, is now well over the declared 30 billion dollars. These data express the idea of a government that on the one hand seeks to project its growing internal contradictions outward, and on the other, locks itself in its palaces, fearing confrontation with a population that, while divided by strong internal conflicts, is also increasingly united by the worrying desire to turn a political page. The growing militarization of Addis Ababa is therefore also explained by an internal use, although it does not seem to yield truly effective results at the moment.

Such opaque economic data also raise doubts about how the GERD was actually financed over the years. According to the government, the project costs were covered with internal resources, for example by forcing public employees to contribute part of their salaries, selling bonds to citizens, and resorting to other government resources; these measures, in a country with a per capita income of $1,200, understandably sparked more than one criticism. In addition to internal sources, to cover part of the funding Addis Ababa also resorted to a subscription among citizens of the Ethiopian Diaspora abroad; but in any case, to complete the payments to the group of companies led by WeBuild (formerly Salini Impregilo), a lot of capital was still missing. In July, Prime Minister Abiy Ahmed, during a visit to Rome, asked Giorgia Meloni to use a part of the funds from the Mattei Plan to cover the last installment of the GERD, effectively asking Italy to pay for it alone; he understandably faced an Italian refusal. Shortly after, President Donald Trump announced that the United States had provided to cover the payment, but this was denied by Ethiopia. In any case, to conclude the list of financiers, another 1.8 billion was also provided by China, especially for the construction of ancillary works for the dam, such as the electricity transmission network to Ethiopian cities and potentially neighboring countries, through credits disbursed by the Export-Import Bank of China (Exim Bank).

As we have already said, the GERD is undoubtedly a far-reaching project, likely to become a great engine for development for Ethiopia: like certain immense hydraulic works of antiquity, built with the sweat and lives of generations, it too has had a high human cost, estimated at the lives of at least 15,000 Ethiopians. But it is also the result of unilateral decisions, which have not taken into account the geopolitical balances in the entire region, and which are still being pursued today with the same unilateralism. Its inauguration certainly marks a historical milestone for Ethiopia, and for the entire African continent in general. But at the same time, it also assigns Ethiopia a new and historical duty: to ensure that this new engine of development also becomes an engine for regional cooperation and integration, rather than tension and conflict.