The International Monetary Fund announced on 10th December that it had agreed with Ethiopia at the staff level on the fourth review of a 3.4 billion dollar lending programme, which would allow the next disbursement of 261 million dollars to be made upon the signing of the board.

It would also make the IMF, in its extended credit facility to Ethiopia, provide financial assistance to approximately $2.13 billion.

In July 2024, the East African country was getting the bailout loan as the government continued to restructure its debts.

In its assessment of the Ethiopian economic programme, the Fund said that the only way to lock in macroeconomic stability and development-favouring growth and poverty reduction in the medium term was to keep reform momentum, coupled with a tight monetary policy and promotion of private investment.

Before the next loan tranche is disbursed, the IMF executive board has to examine and approve the agreement.

Ethiopia decided to restructure its external debt through the Common Framework initiative of the G20, and it defaulted on its only Eurobond at the end of 2023.

Since it has made an agreement to reorganize its official debt with bilateral creditors, but differences with investors as to the possible magnitude of a debt write-off have held up efforts to reorganize its 1 billion Eurobond.

The Fund indicated that debt treatment and debt sustainability were on track with the restructuring process.