Ethiopia officially entered default territory nn Tuesday, becoming Africa's third nation to do so within a span of three years. The failure to make a $33 million "coupon" payment on its sole international government bond underscores the country's severe financial challenges exacerbated by the COVID-19 pandemic and a recently concluded two-year civil war in November 2022. The payment, originally due on December 11, had a technical grace period extending until Tuesday, thanks to a 14-day clause in the $1 billion bond agreement. Subsequently, credit ratings agency S&P Global downgraded the bond to "Default" on December 15, based on the assumption that the coupon payment would not be fulfilled. The default places Ethiopia in a challenging economic position, requiring strategic measures to address its financial instability and navigate the complexities of debt restructuring.

Source: Ethiopian News December 27, 2023 08:17 UTC