Ethiopia requests $2 billion from IMF

Ethiopia is negotiating a $2 billion loan from the International Monetary Fund (IMF) as part of a reform program, as per Reuters.

The IMF is still examining the country’s debt sustainability following a request for a program equal to around 500% of the amount of its stock in the global lender, according to sources this week who spoke on the condition of anonymity since the negotiations are confidential.

According to two people close to the discussions, the IMF predicted in this first debt study that Ethiopia will face a financial deficit of at least $6 billion until 2026. If the country is successful in obtaining the sum under consideration, this would still create a financial gap of around $4 billion during that time period.

“The scope of the support for Ethiopia is yet not set in stone, both parts are still working on the debt sustainability analysis,” one of the sources said.

Requests for comment from an IMF spokeswoman did not immediately receive a response. Eyob Tekalign Tolina, the country’s state finance minister, and Mamo Mihretu, the governor of the central bank, both declined Reuters’ requests for comment right away.

Early in 2021, the second-most populous nation in Africa asked for a larger debt restructuring under the Group of 20’s Common Framework, a program for reorganizing public debt geared for low-income nations. However, a two-year civil conflict that started in November 2020 and resulted in thousands of fatalities and millions of displaced people has hampered growth.