The International Monetary Fund (IMF) has announced a staff-level agreement with Ethiopian authorities on the second review of Ethiopia's economic program under the Extended Credit Facility (ECF). This follows a visit by an IMF team led by Alvaro Piris to Addis Ababa from November 12 to 26, 2024. The ECF arrangement was initially approved by the IMF Executive Board on July 29, 2024, for SDR 2.556 billion, approximately US$3.4 billion at that time.
Mr. Piris stated, "The IMF staff team and the Ethiopian authorities have reached staff-level agreement on the second review of Ethiopia’s economic program under the ECF arrangement." He noted that this agreement is pending approval from IMF management and the Executive Board in the coming weeks. Once approved, Ethiopia would gain access to SDR 191.70 million, about US$251 million.
Ethiopia's economic reform program is progressing well according to Mr. Piris. "Ethiopia’s economic reform program, including the transition to a market-determined exchange rate, continues to advance well," he said. Recent progress includes easing foreign exchange surrender requirements and increased activity in both interbank FX and domestic money markets.
Macroeconomic stability appears promising due to prudent policy measures and limited inflation impact from FX reforms. "With macroeconomic stability supported by prudent policy and a so far muted FX reform impact on inflation, conditions for economic growth in the period ahead appear promising," Mr. Piris remarked.
The mission involved discussions with key Ethiopian officials such as Finance Minister Ahmed Shide and Governor of the National Bank of Ethiopia Mamo Mihretu among others. "The staff team is grateful to the authorities for good discussions and their strong action to ensuring success of the IMF-supported economic program," Mr. Piris concluded.