Redirecting Korea's ODA Strategy in Africa: Insights from an Entrepreneurship Project in Ethiopia

This paper examines Korea's Official Development Assistance (ODA) strategy, with particular emphasis on an entrepreneurship support initiative in Ethiopia. Over the past decade, Korea has progressively reoriented its ODA focus from Asia toward Africa, in alignment with global development priorities. Ethiopia — recognized as Africa's political and diplomatic center and the second most populous nation in the region — has emerged as Korea's largest ODA recipient in Africa in recent years. This support, Ethiopia's startup ecosystem remains underdeveloped, facing persistent structural barriers, including limited institutional capacity, restricted access to finance, despite insufficient private sector participation, and fragmented coordination among support organizations. In response, the Korea International Cooperation Agency (KOICA) has implemented a multifaceted entrepreneurship support program centered on promoting ICT-based startups, enhancing human and institutional capacity, and strengthening innovation infrastructure. The initiative is structured around four strategic pillars: (1) establishing enabling institutional frameworks, (2) developing innovation centers, (3) offering digital platforms to facilitate access to entrepreneurial resources, and (4) designing tailored financial support mechanisms. These efforts have been reinforced by local institutions such as BlueMoon, ICEADDIS, and the Ethiopian Development Institute (EDI), which function as incubators, accelerators, and ecosystem enablers. This study contends that ODA targeting startups and innovation can significantly contribute to youth employment, inclusive growth, and the structural transformation of Ethiopia's economy. Furthermore, it identifies seven promising sectors for entrepreneurship development: mobile financial services, Agri-tech, affordable housing, digital education, sanitation and hygiene, last-mile logistics, and clean energy. Through in-depth analysis and actionable recommendations, this paper argues that startup-centered ODA can serve as a new model of sustainable development cooperation — one that promotes self-reliant growth and innovation in partner countries.