Ethiopia on Thursday got a nod from international lenders for $3,3-billion in debt relief under the Heavily Indebted Poor Countries Initiative (HIPC).
The East African country is the thirteenth country to obtain debt forgiveness through the World Bank and International Monetary Fund. Countries must undertake economic reforms and tackle corruption in order to join the elite club.
Since 1996, debt has also been forgiven in Benin, Bolivia, Burkina Faso, Guyana, Mauritania, Mali, Mozambique, Nicaragua, Niger, Senegal, Tanzania, and Uganda.
Another 14 countries are in the process of qualifying for debt forgiveness.
”The track record of the Ethiopian authorities in policy and reform implementation has been strong, and the authorities have borrowed prudently despite being adversely affected by a severe drought and lower coffee prices,” a statement issued in Washington said.
Ethiopia, a landlocked nation in the Horn of Africa, has a per capita gross domestic product of about $100 a year — only one-fifth of the sub-Saharan average. A bloody border war with Eritrea, which ended in 2000, plus plunging coffee prices have hindered development.
But bank officials said Ethiopia’s GDP growth averaged five percent since 1991.
The debt relief initiative was kicked off in 1996 as an anti-poverty measure to relieve poor countries from heavy debt service payments. – Sapa-DPA