Ethiopia defaulted on government debt – Kommersant
[ad_1]
Ethiopian authorities failed to pay $33 million in coupon income on their government bonds, thus defaulting on their external debt, reports Reuters. Previously, the country’s authorities had already warned about this possibility against the backdrop of a worsening financial situation after the COVID-19 pandemic and a civil war that lasted for about two years, which ended only in November 2022.
As Reuters notes, the Ethiopian government was supposed to pay the coupon income on a $1 billion foreign loan on December 11, but was unable to do so. After this, a 14-day “grace period” was automatically activated, during which the authorities could pay without defaulting. This period expired on December 22, which was the last working day in the country.
According to the agency Bloomberg, the country’s authorities are now negotiating with creditors to restructure the debt in order to postpone the loan repayment period from 2028 to 2032, and to reduce the coupon rate from 6.6% to 5.5%. Ethiopia has become the third country to default on its government debt since the outbreak of the COVID-19 pandemic. In November 2020 about default announced Zambia, and in December last year – Ghana.
[ad_2]
Source link
