---
title: "IMF Approves $3.4 Billion Funding Program for Ethiopia"
description: "(Bloomberg) -- The International Monetary Fund agreed to lend Ethiopia $3.4 billion over four years in a new economic reform program, a key step to begin negotiations with creditors on restructuring the nation’s debt."
type: "NewsArticle"
publisher: "Daily Maverick"
site: "https://www.dailymaverick.co.za"
section: "Newsdeck"
author: "Bloomberg"
author_url: "https://www.dailymaverick.co.za/author/bloomberg/"
canonical_url: "https://www.dailymaverick.co.za/article/2024-07-29-imf-approves-3-4-billion-funding-program-for-ethiopia/"
published: "2024-07-29T21:26:48"
updated: "2024-07-29T21:26:49"
lang: "en-ZA"
word_count: 227
---

# IMF Approves $3.4 Billion Funding Program for Ethiopia

> (Bloomberg) -- The International Monetary Fund agreed to lend Ethiopia $3.4 billion over four years in a new economic reform program, a key step to begin negotiations with creditors on restructuring the nation’s debt.

By Bloomberg · Published 29 July 2024, 23:26 SAST · Updated 29 July 2024, 23:26 SAST

## Content

The decision will allow the immediate disbursement of about $1 billion, the fund said in an statement Monday.

The funds are part of about $10.7 billion that the Horn of Africa nation is expecting from creditors that includes loans, grants and debt re-profiling.

“This is a landmark moment for Ethiopia,” IMF Managing Director Kristalina Georgieva said in the statement.

Ethiopia has about $28.4 billion of external debt and has been seeking to restructure its loans since 2021. Progress on the overhaul was delayed by a two-year civil war in the nation’s northern Tigray region that ended in November 2022. The country defaulted on a eurobond payment in December.

Ethiopia’s central bank paved the way for a deal with the IMF when it announced on Monday that it would allow the nation’s currency — the birr — to trade freely. The step echoed a similar measure by Egypt in March, when it allowed its currency to weaken almost 40%, enabling an $8 billion bailout from the IMF.

Earlier this month, the country’s official creditors committee granted Ethiopia financing assurances to help fast-track approval of a new IMF loan.

Ethiopia has introduced a series of economic reforms under Prime Minister Abiy Ahmed’s administration, including allowing foreign investment into domestic banks and establishing a capital market.

The country has previously had eight other IMF arrangements, according to the lender’s website.