The Ethiopian government owes 56.4 billion dollars to domestic and external lenders, a new report by the Ministry of Finance shows.
Of the total amount, the share of external lenders reached 28.4 billion dollars. The remaining is borrowed from the central bank and other lenders in the form of treaurey bill and other debt instruments.
China is by far the biggest external lender for Ethiopia, with 45 percent share. The rest is secured from bilateral and multilateral institutions in the west.
Ever since Abiy Ahmed became Ethiopia's Prime Minister, Ethiopia has been following a careful approach towards concessional loan.
His administration stopped taking concessional loans for the last four years, as Ethiopia transitioned to "high risk" country, edging closer to defaulting, based on an assessment by the IMF.
Over 90 percent of Ethiopia's external debt was borrowed before Abiy came to power. Though it was a measure meant to narrow the infrastructural gap in the country, it tarnished the country’s image, prompting lenders to turn their back on Ethiopia, fearing it would default.