In December 2019, at $27.68 billion, foreign debt was 75 per cent of reserves. Some of these are composition of debt maturities, the ratio of debt to Gross Domestic Product and the ratio of debt service to export earnings. The government unwisely borrows massively for what, with liberalisation, foreign and domestic private capital will undertake more efficiently without burdening the taxpayer. By overthrowing the state monopoly and emplacing a robust regulatory regime, private capital, local and foreign, will do the job better. It limited foreign borrowing to $1.8 billion, raising the remaining $3 billion partly from bonds targeted at the Ethiopian Diaspora.

Source: Punch July 21, 2020 23:48 UTC