Ethiopian creditors to discuss debt restructuring on Monday

International Monetary Fund chief Kristalina Georgieva meets with Democratic Republic of Congo President Felix Tshisekedi in Kinshasa, Democratic Republic of Congo, December 8, 2021. REUTERS/Hereward Holland/File Photo

TOKYO, July 12 (Reuters) – Ethiopia’s creditors’ committee will meet on Monday, a source briefed on the matter said on Tuesday, bringing the cash-strapped African country one step closer to restructuring its debts as part of a common set up by the group. of 20 savings.

The committee, co-chaired by France and China, first met in September 2021, but progress on Ethiopia’s debt relief has been complicated by a 20-month insurgency that began in the northern Tigray region.

The International Monetary Fund, World Bank and others are pushing China and private creditors to accelerate work on debt treatments sought by Ethiopia, Chad and Zambia after glacial progress over the past year and a half. Read more

“Ethiopia’s creditors will meet on Monday,” the source said, without giving further details.

IMF Managing Director Kristalina Georgieva told Reuters last week that reviving a process that has so far failed to produce a single result was crucial given the worsening problems of the IMF. debt faced by developing countries and even middle-income countries.

On Tuesday in Tokyo, US Treasury Secretary Janet Yellen also called for an “orderly resolution of the sovereign debt overhang”.

The issue will be at the center of this week’s meetings of G20 finance officials in Bali, Indonesia.

John Denton, secretary general of the International Chamber of Commerce, has warned G20 finance ministers that recent private sector estimates put more than two dozen countries at risk of default in 2022.

The war in Ukraine has compounded the problems facing many developing countries by driving up food, fertilizer and energy prices, Denton said in a letter to ministers.

“We see a real risk of solvency problems creating a systemic developing country debt crisis,” Denton wrote. “This must be avoided at all costs given the serious downside risks such a scenario would create for trade and the global economy as a whole.”

Reporting by Andrea Shalal in Tokyo and Rachel Savage in London; Editing by Bradley Perrett

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