IMF Backs Ethiopia’s Plan to Rework Debt Under G-20 Framework

Addias Ababa February 24/2021 (ENA) The International Monetary Fund backed Ethiopia’s plan to rework its debt under the Group-20 Common Framework after it reached a staff-level agreement with the government on credit facilities, Bloomberg reported.

“To strengthen debt sustainability, the authorities aim to lower the risk of debt distress rating to moderate by re-profiling debt service obligations,” IMF said on Tuesday in a statement.

 “In this context, the fund welcomes Ethiopia’s request for debt treatment under the G20 Common Framework.”

The IMF reached a staff-level agreement with Ethiopia on policy measures for the completion of the first and second reviews under the Extended Credit Facility and Extended Fund Facility arrangements, it added.  

“Risks to the economic outlook are tilted to the downside,” the IMF said, projecting economic growth of 2 percent in 2020-21 and 8.7 percent in the following fiscal year.

Ethiopia announced plans last month to rework its liabilities under the G-20 program that seeks to include private creditors into an agreement on debt relief for countries that need it following the fallout from the coronavirus pandemic.