Ethiopia’s New Dam Deepens Rift with Egypt

Ethiopia has officially inaugurated the Grand Ethiopian Renaissance Dam (GERD), Africa’s largest hydroelectric project, marking the culmination of more than a century of ambition, decades of political battles, and 14 years of construction.

The $5 billion megastructure, standing at 170 meters high and stretching nearly two kilometers across the Blue Nile in Ethiopia’s Benishangul-Gumuz region, promises to more than double the country’s power capacity with an output of 5,150 megawatts.

At the inauguration, Prime Minister Abiy Ahmed declared the project a turning point not just for Ethiopia but for the region. “To our brothers, Ethiopia built the dam to prosper, to electrify the entire region and to change the history of black people,” he said, addressing an audience of dignitaries including the presidents of Somalia, Djibouti, and Kenya. For Ethiopia, a country of 120 million people where nearly half the population lacked electricity as recently as 2022, the dam represents energy independence, a chance to export power to neighbors, and a symbol of collective national pride, but for Egypt and Sudan downstream, the project has long been a source of existential anxiety.

A Century-Old Dream, Funded by the People

The GERD is the culmination of visions first sketched in the early 20th century, when colonial powers mulled damming the Blue Nile. Emperor Haile Selassie revived the idea in the 1950s, commissioning feasibility studies from the U.S. Bureau of Reclamation. “It is Ethiopia’s primary and sacred duty to develop her water resources,” he said in 1957.

But political upheaval, wars, and lack of financing stalled the dream until 2011, when then-Prime Minister Meles Zenawi laid the cornerstone of the project. Facing limited external support, his government turned to the Ethiopian public to fund it. Civil servants gave part of their salaries, shoe shiners donated spare coins, and the diaspora bought bonds, with schoolchildren asked to contribute pocket money.

In 2025, more than 25,000 workers had labored on site, and about 91 percent of the funding had come from the Ethiopian state, supplemented by citizens’ contributions through bonds and gifts.

A New Era, or a New Fault Line?

While Ethiopians see the GERD as a miracle of development, across the border, Egypt sees it as a looming threat. With a population of more than 108 million, little rainfall, and dependence on the Nile for up to 97 percent of its freshwater, Cairo has described the dam as an “existential” danger. President Abdel Fattah el-Sisi warned last month: “Whoever thinks Egypt will turn a blind eye to its water rights is mistaken.”

Egypt argues that GERD violates colonial-era water treaties signed in 1929 and 1959 that granted it dominant rights over Nile waters while excluding upstream states like Ethiopia. Its Foreign Ministry recently told the UN Security Council that Ethiopia’s unilateral inauguration of the dam breached international law.

Cairo has responded diplomatically, strengthening ties with Eritrea and Somalia—two states with fraught relations with Ethiopia, and aligning with Sudan in demanding a legally binding framework for filling and operating the dam. Sudan, however, has taken a more ambivalent stance: while echoing Egyptian concerns, it could also benefit from reduced flooding and cheaper electricity.

Independent studies suggest that, so far, downstream flows have not been significantly disrupted, thanks to cautious phased filling and favorable rainfall. But experts warn that the real test will come during prolonged droughts, when water allocation could become a flashpoint for conflict.

For Ethiopia, the GERD is as much a political project as an engineering feat. It has survived leadership changes, corruption scandals, the 2018 assassination of its chief engineer, and a devastating civil war in Tigray that claimed hundreds of thousands of lives.

Officials say the GERD could generate $1 billion annually from electricity exports, powering not just homes and industries but even Ethiopia’s growing bitcoin mining sector. Rural electrification, however, remains constrained by weak transmission infrastructure, leaving many villages still in the dark.

Yet the project’s sheer scale is undeniable: its reservoir, already flooding an area larger than Greater London, will store 74 billion cubic meters of water. For supporters, it embodies national renewal. “Most of our citizens live in darkness. We hope this dam will mark the beginning of a new era,” said activist Musa Sheko Mengi.

But for Egypt and Sudan, the unresolved dispute lingers over one of the world’s most important rivers. As negotiations falter, the GERD stands not only as Africa’s largest hydroelectric dam but also as the continent’s latest geopolitical fault line, an immense promise of power and progress shadowed by the threat of conflict over water.