The International Monetary Fund (IMF) and the Ethiopian government have reached a Staff-Level Agreement on the economic policies necessary to complete the fourth review of the country's Extended Credit Facility (ECF) arrangement. This crucial step makes Ethiopia eligible to draw approximately $261 million in fresh financing.

However, the disbursement is not yet finalized or released.

The agreement, announced by the IMF on December 10, 2025, is now subject to the final approval of the IMF Executive Board, which is expected to review the matter "in the coming weeks." Once formally approved, this new tranche will bring the total IMF financial support under the four-year ECF arrangement to about $2.13 billion.

Key Drivers Behind the Positive Review

The IMF staff praised the progress under Ethiopia's Home-Grown Economic Reform (HGER) agenda, citing "favorable macroeconomic outcomes," including:

Accelerating Growth: Economic growth has strengthened since mid-2024, supported by robust production in sectors like gold, electricity, and agriculture.

Stronger Exports: The value of goods exports has more than doubled.

Eased Inflation: Inflation has continued its decline, and government revenue collection has risen sharply.

According to Ecofin Agency, despite the progress, the IMF emphasized that maintaining the reform momentum is critical to consolidating stability. 

The IMF urged authorities to continue actions aimed at enhancing competition in the foreign-exchange market, maintaining a tight monetary stance to anchor inflation, and advancing efforts to mobilize fiscal revenue.

This pending disbursement is intended to help Ethiopia meet its balance-of-payments and fiscal financing needs as it continues its sweeping reform program.