16-07-2025
Ethiopia's reform momentum faces risks, waning donor support: IMF
The International Monetary Fund (IMF) cautioned Ethiopia on Tuesday that its reform agenda under a $3.4bn (R60.97bn) loan deal is facing challenges from declining donor support, despite the country's meeting key programme targets.
The IMF, in an extensive report, praised Ethiopian authorities for implementing economic adjustments, including subsidy cuts, monetary tightening and tax reforms.
However, it warned that rising risks, such as a resurgent parallel foreign exchange market and fragile security conditions, could hinder progress and complicate debt restructuring efforts.
Ethiopia remains in default and is seeking comparable debt relief from bondholders after agreeing terms in principle with official creditors earlier this year.
"The outlook remains subject to downside risks given security challenges and declining donor support," said IMF deputy managing director Nigel Clarke.