Borkena
Toronto – Kristalina Georgieva, Managing Director of the International Monetary Fund (IMF), recently concluded a two-day working visit to Ethiopia.
The organization she leads granted Abiy Ahmed’s administration what the National Bank of Ethiopia called ” the largest ever concessional funding in IMF history.”
This funding followed the Ethiopian government’s introduction of major macroeconomic reforms in July 2024. Central to these reforms was the adoption of a market-based foreign exchange system and depreciation of the Ethiopian currency by over 100%. Additionally, the National Bank of Ethiopia implemented a series of regulatory policies aimed at “stabilizing the economy and financial sector.”
The Ethiopian government has claimed that these policy measures have shown “encouraging signs” since their implementation. However, notable economists in the country, such as Kebour Ghenna, whose analyses have been featured on Borkena, have raised concerns about the manner in which the reforms were introduced and their broader implications. Critics point to worsening living conditions, a spiraling cost of living, and rising poverty levels across the country. A recent report by a UN agency revealed that 22 million Ethiopians require emergency food aid, casting doubt on the government’s optimistic claims.
Furthermore, allegations have surfaced that the government is diverting IMF funding to finance ongoing conflicts in the Amhara and Oromia regions, with tensions escalating in Tigray once again. These accusations have added to the skepticism surrounding the way IMF funding is spent in the country.
While the IMF Director has not yet issued an official statement regarding her visit, she shared her reflections on social media. Describing her trip as “wonderful,” she noted her “productive” meeting with Prime Minister Abiy Ahmed.
Details of their discussions remain undisclosed, consistent with past practices. The reforms, which the IMF has endorsed, have been framed as a “homegrown economic growth model,” with the IMF providing concessional funding to support their implementation.
In addition to meeting government officials, Georgieva engaged with Ethiopian business leaders and entrepreneurs. She remarked, “Recent reforms are clearly helping improve the investment climate. It is important to maintain momentum with an efficient and predictable tax and regulatory environment to pave the way for strong private-sector growth.” However, questions remain about how private sector representatives were selected for these discussions.
The National Bank of Ethiopia provided a brief update on Georgieva’s visit, stating that she commended Ethiopia’s progress in implementing reforms despite challenging global conditions. She reportedly emphasized the importance of staying the course with the reforms, stating, “The conditions for increased investment and higher growth will be solidly in place with the ongoing reforms, making it possible for Ethiopia to fulfill its ambitions to be the ‘Africa beacon of prosperity.'”
During her visit, Georgieva was taken on a tour of Emperor Haile Selassie’s renovated Jubilee Palace near the historic Filwuha Springs and the Adwa Museum, which was inaugurated last year. These visits have become a customary part of hosting high-profile guests in Ethiopia.
In the guest book at the Adwa Museum, Georgieva left a message that hinted at a political observation: “I wish you [Abiy] and the people of Ethiopia a bright future—built on the foundation of your impressive past.” This statement raises questions about her awareness of Ethiopia’s complex historical narrative and the current political climate, where the country’s past is often vilified with support from government administrative structures.
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