According to the latest official reports and financial disclosures, the government’s total outstanding debt has reached new highs, reflecting both increased borrowing from international partners and a greater dependence on domestic sources. Analysts warn that while loans have supported key investments in energy, transport, and health, the mounting debt burden poses risks to long-term economic stability.
The International Monetary Fund (IMF) and World Bank have both urged the government to strengthen fiscal discipline, improve revenue collection, and prioritize concessional borrowing to avoid a debt crisis. “Ethiopia’s debt remains at high risk of distress,” the IMF noted in its latest review, calling for “decisive policy actions to restore macroeconomic stability and safeguard debt sustainability.”
As of June 2025, the total public debt is estimated to exceed $38 billion, with external loans accounting for over 60% of the total. Debt servicing costs—interest and principal repayments—have risen sharply, now consuming a significant share of government revenues.
critics point out that delays, cost overruns, and inefficiencies in project implementation have sometimes undermined the expected benefits. There are also concerns about the transparency of loan agreements and the terms attached, particularly with non-traditional lenders.
https://capitalethiopia.com/2025/06/29/ ... pressures/
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