Ethiopia on Tuesday officially inaugurated the Grand Ethiopian Renaissance Dam (GERD), Africa’s largest hydroelectric project, marking a milestone in the country’s bid to expand energy access and fuel economic growth, even as the project deepens a bitter dispute with downstream Egypt.
The $5 billion dam, located on the Blue Nile, has been under construction since 2011. Ethiopia, with a population of 120 million, regards the GERD as central to its development ambitions. Once fully operational, the facility is expected to generate 5,150 megawatts of electricity, a significant leap from the 750 MW already produced by its two active turbines.
Prime Minister Abiy Ahmed said the project would improve domestic access to electricity while enabling the country to export surplus power across the region. “The Renaissance Dam is not a threat, but a shared opportunity,” he told parliament earlier, insisting the project would uplift not only Ethiopia but also neighbouring countries.
For Egypt, however, the GERD represents a potential existential challenge. The North African nation, home to 108 million people, relies on the Nile for around 90% of its fresh water. Cairo fears the dam could restrict supplies during drought periods and set a precedent for further upstream projects.
“Egypt will continue to monitor developments on the Blue Nile and exercise its right to take all appropriate measures to defend and protect the interests of the Egyptian people,” Foreign Ministry spokesperson Tamim Khallaf told Reuters on Monday.
Egypt has long opposed the GERD, citing colonial-era water treaties and warning of its impact. The concern drew international attention during Donald Trump’s presidency, when he described the situation as dangerous and suggested Cairo might resort to “blowing up the dam.” Despite years of negotiations, no binding agreement has been reached on its filling and operation.
Sudan, another downstream nation, has joined Egypt’s calls for a legally binding framework but could also reap benefits, including cheaper electricity and improved flood management.
Symbol of Unity
Despite regional tensions, the dam has become a powerful symbol of national pride and unity within Ethiopia, which has endured years of internal armed conflict. “The idea that Ethiopia should be able to build a dam on its own territory and not be pushed around by Egypt is broadly something that most Ethiopians would get behind,” said Magnus Taylor of the International Crisis Group.
The GERD has been largely domestically funded, with Ethiopia’s central bank covering 91% of costs and the remainder raised through bond sales and public contributions, underscoring the country’s determination to complete the project without foreign assistance.
Its reservoir, which now covers an area larger than Greater London, is expected to provide a steady supply of water for hydropower and irrigation while reducing floods and drought. Independent studies suggest downstream flows have not been significantly disrupted so far, thanks to favourable rainfall and cautious phased filling.
Challenges Ahead
Still, challenges remain. Around half of rural Ethiopians remain unconnected to the national grid, meaning many communities will not immediately benefit from the dam’s power.
At the geopolitical level, Ethiopia’s relations with Egypt remain fraught. Analysts warn the rift could deepen further as Addis Ababa pursues maritime access through Eritrea or Somalia — a move Cairo views as strategically sensitive.
“The idea of Egypt dictating not only Nile water usage but access to the Red Sea is unacceptable to Addis Ababa,” said Matt Bryden of Sahan Research.
For Ethiopia, however, the GERD’s inauguration signals more than just energy generation. It is a declaration of sovereignty and self-reliance, a message that resonates strongly at home even as it unsettles the wider region.
