Ethiopia and the International Monetary Fund have reached a staff-level agreement, which would unlock a US$ 3.4 billion extended credit facility if approved.
IMF said Ethiopia will have access to financing of about US$345 million upon completing the review of the country’s economic program by the IMF Executive Board.
Ethiopia’s economic reform program is advancing well. This program encompasses the adoption of a floating exchange rate regime.
“Successful implementation of reforms will help strengthen Ethiopia’s macroeconomic stability, improve foreign exchange availability, and support sustainable economic growth,” IMF said.
Mr. Alvaro Piris, who led the IMF staff team, said that “Ethiopia’s economic reform program, including the transition to a market-determined exchange rate, is advancing well. The new exchange rate regime is alleviating the acute shortage of foreign exchange that previously existed, lifting a significant impediment to economic activity.”
“The staff team is grateful to the authorities for good discussions and their strong action to ensure the success of the IMF-supported economic program,” he added.
Ethiopia is one of the African countries that has experienced strong economic growth over the past few years. In 2022/2023, Ethiopia’s economy grew by 7.1%, up from 6.4% in the previous year, according to government data.
The remarkable economic expansion has been attributed to substantial growth in the industry, agriculture, and service sectors.
Also, the relative improvement in Ethiopia’s political stability has contributed to the growth in its GDP. IMF projected Ethiopia’s economy to grow by 6.2% in 2024.
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