US stops Trump's aid freeze to Ethiopia over dam dispute

People in the Ethiopian capital Addis Ababa celebrate the successful filling of the Grand Ethiopian Renaissance Dam (GERD) as the dam's first two turbines' electricity production is tested in August 2020
People in the Ethiopian capital Addis Ababa celebrate the successful filling of the Grand Ethiopian Renaissance Dam (GERD) as the dam's first two turbines' electricity production is tested in August 2020 Amanuel SILESHI AFP/File
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Washington (AFP)

The United States said Friday it was no longer blocking aid to Ethiopia over its controversial mega-dam but voiced hope for a diplomatic solution involving Egypt and Sudan.

The administration of former president Donald Trump, a steadfast ally of Egypt's leader, in September suspended around $272 million to Ethiopia, accusing it of intransigence as US-brokered talks on the Grand Ethiopian Renaissance Dam broke down.

President Joe Biden's administration is conducting a policy review on the project, which Egypt and Sudan consider an existential threat, but said it was no longer leveraging aid.

"The United States has decided to delink its temporary pause on certain assistance to Ethiopia from the United States policy on the Grand Ethiopian Renaissance Dam, or GERD," State Department spokesman Ned Price told reporters.

"We continue to support collaborative and constructive efforts by Ethiopia, Egypt and Sudan to reach an agreement on the GERD," he said.

Price said that a resumption of assistance would be tied to unspecified other factors but that humanitarian aid would be exempt.

Both the Biden and Trump administrations have voiced alarm over the humanitarian situation in the northern Tigray region where Prime Minister Abiy Ahmed in November launched an offensive in response to an attack on federal army camps blamed on the local ruling party.

Trump was a close ally of Egypt's general turned president Abdel Fattah al-Sisi and publicly mused in October that Egypt could bomb the dam -- leading Ethiopia to accuse the then US leader of trying to provoke a war.

Egypt is not believed to have any attack plans but it relies on water from the Nile for 97 percent of its needs and fears a crisis if Ethiopia goes ahead with the second phase of filling the dam.

Sudan is also heavily dependent on Nile water and on Wednesday recalled its ambassador to Ethiopia for consultations as tensions worsened.