IMF nod paves the way for Ethiopia debt restructuring

Significance Official creditors, to which Ethiopia will talk in December, will closely examine the IMF report and design the restructuring around the results. Ethiopian officials hope that restructuring will begin shortly thereafter. Impacts Despite July’s exchange-rate liberalisation, inflation has continued to fall, although this trend is expected to reverse soon. To achieve the target of positive real interest rates by the first quarter of 2025, further policy rate increases will be necessary. The government plans to spend USD4.7bn to cushion the social impact of reforms, but fiscal policy will otherwise remain quite restrictive.