𝐍𝐞𝐠𝐚𝐫𝐢𝐭 𝐁𝐮𝐬𝐢𝐧𝐞𝐬𝐬 𝐑𝐞𝐯𝐢𝐞𝐰’s Post

In case you missed it :The International Monetary Fund (IMF) acknowledges that there are ongoing discussions with Ethiopia regarding a new loan program. Despite some remaining differences between the two parties, negotiations are progressing. One of the key points of contention is the potential need for Ethiopia to #devalue its birr currency, which is currently trading significantly lower on the black market compared to the official exchange rate. While the IMF has not explicitly stated devaluation as a condition for funding, it generally supports market-determined exchange rates. Alvaro Piris Chavarri, the IMF Mission Chief for Ethiopia, expressed cautious optimism during the discussions at the IMF and World Bank Spring Meetings in Washington. The resolution of these differences is vital to unlock financial support for Ethiopia, which has not received IMF funds since 2020. The country's last lending arrangement with the IMF faced challenges in 2021, but recent efforts to stabilize the situation post-civil conflict show promise for a positive outcome.  #IMF #Ethiopia #EconomicDevelopment #Finance #Negotiations #MarketReforms https://t.co/iz0IXCC0cx

The International Monetary Fund (IMF) has approved the first review of Ethiopia’s $3.4 billion loan program, unlocking a $340.7 million disbursement. This decision follows Ethiopia’s efforts in implementing key reforms, including floating its currency, the birr, and advancing its debt restructuring plan. The IMF's four-year financing agreement, initiated in July, is aimed at stabilizing the country’s economy. Last month, a staff-level agreement was reached, which has now been ratified by the IMF board. While the Ethiopian government is pushing to make significant progress on its debt restructuring by December, investors holding the country’s $1 billion Eurobond have opposed a proposed 18% reduction in repayment. The IMF plans to closely monitor Ethiopia’s economic reforms, with particular attention to the foreign exchange market, and has scheduled frequent reviews to ensure progress.

💥 Global debt is at an astounding level. The IMF's massive books demonstrate this. The total global outstanding debt owed to the IMF stood at $149bn on April 2 2024, or 112.9bn special drawing rights (SDRs), as its loan portfolio has expanded following a number of recently agreed bailouts for ailing developing economies. 👉 A full list of the IMF's top 10 biggest debtors can be found here: https://lnkd.in/ertyuBt6 Here are the three countries which owe International Monetary Fund (IMF) the most: 1️⃣ #Argentina: total outstanding debt of $42.9bn. The country has had a long and troubled relationship with the IMF, with a history of equally spectacular fall-outs and bail-outs. The macroeconomic plan of Argentina’s current president Javier Milei has been praised by the IMF as “far more ambitious” than recent administrations. 2️⃣ #Egypt is the second-largest debtor with an outstanding balance of $14.9bn. Egypt and the IMF reached a staff level agreement on March 29 about economic policies needed for further support, which made $820m immediately available to the country. Further support of up to $8bn is available if Egypt allows the value of its currency to be determined by market forces. 3️⃣ #Ukraine was the IMF’s third largest debtor with a total outstanding debt of almost $12bn. In March 2024, the IMF dispersed $880m to Ukraine as part of a $15.6bn loan approved a year earlier to help the country’s economy respond to Russia’s full-scale invasion. This forms part of a $122bn support package for Ukraine. #data #GraphTime #IMF #debt #lenderoflastresort #publicdebt

The recent delay in the International Monetary Fund's (IMF) loan disbursement to Pakistan has sparked concerns regarding the country's foreign policy priorities and their implications on economic stability (The Express Tribune, August 21, 2024). As an economist, I argue that this delay is a symptom of a broader issue - Pakistan's over-reliance on IMF loans and its unsustainable economic model. The IMF's delay in releasing the loan has significant implications for Pakistan's economy, which is already grappling with high inflation, a large trade deficit, and dwindling foreign exchange reserves (The Express Tribune, August 21, 2024). This development underscores the need for Pakistan to reassess its economic strategy and reduce its dependence on external financing. Furthermore, the delay highlights the tension between Pakistan's foreign policy priorities and its economic interests. The country's foreign policy decisions, such as its relationships with regional partners and its stance on global issues, may be influenced by its economic vulnerabilities. Therefore, Pakistan needs to adopt a more balanced approach, one that aligns its foreign policy priorities with its economic interests. To address these challenges, Pakistan should consider diversifying its financing options, such as exploring bilateral agreements with other countries or issuing sovereign bonds. Additionally, the government should implement structural reforms to improve the business environment, increase investment, and enhance economic competitiveness. No doubt, the International Monetary Fund's delay in loan disbursement serves as a wake-up call for Pakistan to reassess its economic and foreign policy priorities. By adopting a more sustainable economic model and aligning its foreign policy decisions with its economic interests, Pakistan can reduce its vulnerability to external shocks and achieve long-term economic stability. World Bank Asian Development Bank (ADB) International Monetary Fund #Pakistan #KSA #UAE #China https://lnkd.in/gcf2tqas

The International Monetary Fund (IMF) has expressed concerns over Pakistan's external debt repayment capacity, describing it as fragile. According to the IMF, under the Extended Fund Facility (EFF) program, Pakistan's external financing needs are expected to reach $62.6 billion over the next three years. Looking further ahead, these requirements could swell to $110.5 billion over the five-year period from 2024 to 2029. For the current fiscal year, the IMF estimates that Pakistan will require external financing of $18.813 billion. This need is projected to rise, with $23.714 billion anticipated by the 2026-27 fiscal year. Several factors pose significant risks to Pakistan's ability to meet these debt obligations, including high public debt, low foreign reserves, and ongoing sociopolitical instability. Despite these challenges, there is a glimmer of optimism. The IMF projects a noticeable decrease in gross financing needs for fiscal year 2025, which are expected to drop to $18.8 billion. This reduction provides a slightly more hopeful outlook for the country’s economic future. #PakistanEconomy #IMF #DebtRepayment #EconomicOutlook #FinancialChallenges #EconomicStability

The International Monetary Fund (IMF) has announced a significant reduction in borrowing costs for its member countries, a move that is expected to cut borrowing expenses by approximately US$1.2 billion annually. This decision marks one of the most substantial changes to the IMF’s lending policies in recent years, aimed at easing the financial burdens of its member states. Kristalina Georgieva, the IMF’s Managing Director, unveiled the changes in a press release on Friday, noting that the new measures will reduce borrowing costs by 36%, providing much-needed relief to nations facing heightened financial strain. https://bit.ly/3Nr5yBY

IMF Mission Visits Ethiopia as Nation Navigates Loan Deadline Pressure A senior finance ministry official confirmed on Thursday that a staff mission from the International Monetary Fund (IMF) is currently in Ethiopia, signaling the nation's efforts to meet a critical deadline with major creditor countries for securing a loan from the international lender. Last month, IMF spokesperson Julie Kozack announced plans for the fund to dispatch a mission to the Horn of Africa nation to discuss its request for a loan program. However, the purpose of the current visit by the IMF mission was not disclosed by the ministry official. Ethiopia faces mounting pressure to secure financial assistance, especially after the Paris Club of developed creditor nations indicated that the agreement to suspend debt payments until 2025 could be revoked if the country fails to secure an IMF loan by March 31, 2024. Additionally, Ethiopia's recent default on its $1 billion Eurobond further underscores the urgency of the situation. In December, Reuters reported that Ethiopia is in discussions with the IMF to borrow approximately $3.5 billion under a reform program, according to three sources familiar with the matter. As Ethiopia grapples with economic challenges exacerbated by the COVID-19 pandemic and internal conflicts, the outcome of the IMF mission's visit is anticipated to have significant implications for the nation's financial stability and its ability to meet its debt obligations. #IMF #Ethiopia #LoanDeadline #EconomicReform #DebtCrisis #FinancialAssistance #InternationalLender

The US$360m would bring the total disbursements for the three-year IMF financing support under the country’s Post COVID-19 Programme for Economic Growth (PC-PEG) to US$1.6 billion.

Into IMF's 1st, 2nd reviews of extended fund facility arrangement for Egypt The International Monetary Fund (IMF) has released its experts' report on Egypt's first and second review of its financing program, shedding light on the country's economic policies and financial commitments. The completion of the third review of the financing program is expected by June 15, 2024, or later, with the fourth review by September 15, 2024, or later. Egypt has committed to providing the IMF with accurate and timely data necessary for program monitoring reviews, as well as any information materially affecting economic conditions and program objectives. According to the IMF, Egypt has fulfilled 7 out of 15 conditions required to complete the two reviews. #egypt #imf #financial #review Read more: https://lnkd.in/d7KxDJ2m

📈 Good News for Pakistan! 📈 Fitch Ratings has upgraded Pakistan’s Long-Term Issuer Default Rating to ‘CCC+’, up from ‘CCC’, thanks to the recent $7 billion IMF agreement. This upgrade reflects stronger external funding confidence and positive economic forecasts. With significant external financing secured and expected improvements in reserves and fiscal balance, Pakistan is on a path to economic stability. 🌟 #fitchratings #pakistanfinance #economicupdate #imf #ratingupgrade #financialnews #economicgrowth #pakistan #globalfinance #financialstability #externalfunding #investment #economy https://lnkd.in/d6EmHHnp