Ethiopia has secured a $1 billion credit from the World Bank, following the country’s decision to allow its currency to trade freely, a key step in its long-term debt restructuring efforts. In addition to this, the East African country also secured a four-year, $3.4 program loan from the International Monetary Fund (IMF). Furthermore, the World Bank’s International Development Association (IDA) will provide a $500 million concessional credit as part of a broader $10.7 billion financing package involving the IMF and other creditors. Ethiopia’s decision to move to a market-based exchange rate has led to plenty of support from development partners. However, analysts warn that it can lead to potential inflation and short-term investment challenges.
SOURCE: BUSINESS INSIDER
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