The Ethiopian government has successfully negotiated a substantial debt restructuring agreement with its official creditors, securing relief on 8.4 billion US dollars in public debt.
The Ministry of Finance announced on Friday that the agreement will provide Ethiopia with 2.5 billion US dollars in debt service relief through the year 2028. This development is a crucial component of a broader economic reform plan backed by the International Monetary Fund (IMF), which necessitates a total of 3.5 billion US dollars in relief from external lenders.
The debt restructuring initiative was spearheaded by China and France under the G20 Common Framework, a mechanism designed to coordinate debt treatments for low-income countries. This breakthrough follows Ethiopia's recent acquisition of a 1.5 billion US dollars loan from the IMF. Officials in Addis Ababa are hopeful that this debt relief agreement will serve to restore confidence among investors.
The Ethiopian government has stated its commitment to engaging in negotiations with all creditor groups. The newly secured agreement with official creditors will be formalized through a Memorandum of Understanding, which will then be followed by the implementation of the terms through a series of bilateral agreements with the individual creditor nations involved.