Ethiopia is set to receive approximately USD 468 million in additional financing after the International Monetary Fund (IMF) reached a staff-level agreement with Ethiopian authorities on the fifth review of the country’s four-year Extended Credit Facility (ECF) program.
Once approved, the latest disbursement of about USD 468 million will bring total IMF support disbursed under the USD 3.4 billion ECF arrangement to approximately USD 2.65 billion since the program was launched in July 2024.
The IMF said Ethiopia has continued to register “encouraging macroeconomic performance, despite facing external shocks stemming from the ongoing war in the Middle East.” These shocks have disrupted trade routes, caused temporary fuel shortages, and sharply increased the cost of imported fuel and fertilizer.
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According to IMF mission chief Alvaro Piris, economic activity remained “resilient,” with output indicators, exports, foreign exchange reserves, and government revenues showing continued improvement through early 2026.
However, the IMF warned that risks to Ethiopia’s economic outlook have increased amid growing global uncertainty and heightened commodity price volatility linked to the conflict. While the Fund expects the effects on growth, inflation, and external balances to remain manageable if the shock proves temporary, it stressed the need for prudent resource management and swift policy responses should the disruption persist.
The IMF emphasized that maintaining strong policy implementation will be critical to preserving macroeconomic stability. It recommended continued tight monetary policy to contain inflationary pressures, further reforms to improve transparency and efficiency in the foreign exchange market, and strengthened domestic revenue mobilization alongside prudent public spending.
The Fund also highlighted the importance of accelerating structural reforms aimed at improving the business environment, strengthening the financial sector, and deepening market-based reforms to support private sector-led growth.
