IMF, Ethiopia reach staff-level agreement on first review of loan program

WASHINGTON (Reuters) – International Monetary Fund staff and Ethiopia have reached an agreement on economic policies to conclude the first review of a four-year $3.4 billion loan arrangement, the IMF said on Friday.

The IMF said formal completion of the review by the fund’s Executive Board would give Ethiopia access to financing of about $345 million.

Implementation of Ethiopia’s economic reform program, including the adoption of a floating exchange rate, is advancing well, the IMF said in a statement.

“Successful implementation of reforms will help strengthen Ethiopia’s macroeconomic stability, improve foreign exchange availability, and support sustainable economic growth,” it said.

Ethiopia, Africa’s second-most populous country, secured the $3.4 billion financing program from the IMF in July.

The Horn-of-Africa nation, which is struggling with high inflation and chronic foreign currency shortages, became the third economy on the continent in as many years to default on its debt at the end of last year.