Ethiopia and the World Bank reach a $1 billion loan agreement
Ethiopia said on Friday that it and the World Bank had inked a $1 billion finance deal to help Ethiopia’s economic reform initiative and spur economic expansion.
According to a Facebook post by Ethiopia’s finance ministry, the funds would support government initiatives to guarantee the stability of the financial system, improve trade competitiveness, and fortify domestic resource mobilization.
The funding included a $350 million concessional loan and a $650 million grant, according to a statement from the World Bank.
It stated that the World Bank Group’s International Development Association anticipates providing Ethiopia with around $5 billion in fresh funding over the next three fiscal years, contingent on board approval and resource availability.
The cash commitments come after the most recent review of the East African nation’s $3.4 billion loan program was approved by the International Monetary Fund this week, opening the door to an additional $262.3 million tranche.
Among the reforms supported by the IMF are efforts to open up the hitherto closed economy to the private sector and the floating of the nation’s birr currency last year.
According to the IMF, Ethiopia must increase domestic revenue, restore the sustainability of its external debt, improve fiscal transparency, and strengthen the functioning of its foreign exchange market.
