Ethiopia's Debt Odyssey: A Timeline of Financial Struggles and IMF Interventions

Ethiopia's economic journey, heavily influenced by war and the COVID-19 pandemic, has seen significant events including a $2.9 billion IMF programme collapse, foreign currency shortages, and a $1 billion Eurobond default. Remarkable progress was made with a recent $3.4 billion IMF package aimed at debt restructuring.

In a significant development, Ethiopia aims to realign its long-delayed debt restructuring plan by securing a new financing arrangement with the International Monetary Fund (IMF).

War erupted in November 2020 in Tigray, straining the nation's finances already heavily affected by the COVID-19 pandemic. This conflict resulted in the collapse of a $2.9 billion IMF programme.

By January 2021, Ethiopia, under the G20 Common Framework initiative, sought to restructure its debt. In a July 2024 move, the central bank floated the birr currency, leading to the IMF approving a four-year $3.4 billion programme.