Ethiopia Moves Closer to Bond Restructuring Deal with Investors

Ethiopia bond restructuring took a key step forward this week. The government reached a draft deal with investors holding part of its international bond. Officials shared the update through the Finance Ministry’s verified social media page. As a result, optimism has grown around Ethiopia’s debt recovery efforts.
The agreement focuses on major financial terms. However, talks on non-financial conditions are still ongoing.

Investors and institutions remain involved

Authorities continue discussions with the Ad Hoc Committee representing bondholders. These talks aim to finalize the structure of the new financial instrument. In addition, Ethiopia shared the draft terms with global partners. The International Monetary Fund and the Official Creditor Committee both received the proposal.
Officials now await feedback from these institutions. Therefore, the next phase depends on their responses. The ministry stressed the importance of long term sustainability. Leaders want the new deal to support economic stability and future growth.

Debt challenges shaped recent decisions

Ethiopia defaulted on its only international bond in late 2023. This decision followed mounting pressure on public finances. As a result, the country entered the G20 Common Framework process. This system ensures fair treatment for all creditors. Under the framework, Ethiopia must apply equal terms to bilateral lenders and commercial investors. Therefore, negotiations take time and require balance.
Progress with bondholders has moved slowly in recent months. However, the new draft signals a positive shift. Earlier this year, Ethiopia reached a deal with bilateral creditors. That agreement unlocked over $3.5 billion in cash flow relief.
In addition, it created space for deeper talks with private investors. Officials say this step helped rebuild confidence.
Economic experts view the latest move as encouraging. Still, they caution that final approval remains essential.
If successful, the restructuring could ease budget pressure. It may also help restore investor trust over time. For citizens and businesses, stability matters most. Therefore, leaders continue working toward a sustainable outcome for everyone.