Ethiopia is set to draw about US$ 340mn from the International Monetary Fund (IMF) after the Bretton Woods institution’s board completed its first review.
- The completion of the review brings total disbursements under the arrangement to about US$1.363 billion.
- Under the Extended Credit Facility (ECF) approved in July 2024, Addis Ababa will draw about US$340 billion in total.
- The new approval will be used to meet balance of payments needs, as part of the country’s Homegrown Economic Reform Agenda (HGER) “to address macroeconomic imbalances and lay the foundations for private sector led growth.”
“Implementation of the early stages of the authorities’ monetary policy reforms and the shift to an interest-rate based regime has been encouraging, including the steady uptake of NBE open market operations,” Bo Li, IMF’s Deputy Managing Director and Chairman of the Board said.
The spread between the formal and parallel market exchange rates has narrowed to low levels, with little sign of disruption to the broader economy. The supply of foreign exchange is picking up, helping alleviate acute foreign exchange shortages. Nonetheless, some unmet foreign exchange demand persists as economic agents are still adjusting to the new FX regime.
-IMF statement
