Ethiopia Remains in Talks with IMF over New Program Support

ADDIS ABABA – The International Monetary Fund (IMF) and Ethiopian authorities are still in talks over a new support program, a spokesperson for the global lender says.

Ethiopia has been hit by multiple shocks, including drought, internal conflict, as well as the impact of the pandemic and the war in Ukraine.

Authorities have prepared a three-year homegrown economic reform agenda to respond to the economic challenges ranging from post-conflict reconstruction to high inflation and shortages of foreign exchange.

And they requested the global lender’s support, looking to borrow at least two billion US dollars.

In a press briefing Thursday, Julie Kozack said discussions between the two sides are still in talks but any program support would require creditors’ financial assurances.

The spokeswoman said, “Discussions are now ongoing on the economic policies and reforms that could, potentially, be supported by an IMF program, … which supports the home-grown economic reform agenda to help address macroeconomic vulnerabilities and to help unlock Ethiopia’s considerable economic potential.

“A new program would also require clear commitments from development partners and financing assurances from creditors under the G20 common framework to help ensure that it can meet its objectives.”

Ethiopia requested a debt revamp under Group-20’s Common Framework, a process through which low-income countries can seek debt restructuring, in early 2021. But the country has not yet reached a restructuring deal under the framework which, experts say, has not lived up to expectations due to its delays.