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News“Distressing and concerning”: IMF on conflicts in Amhara, Oromia

“Distressing and concerning”: IMF on conflicts in Amhara, Oromia

The International Monetary Fund (IMF) says it is “distressed” by violent conflict in the Amhara and Oromia regional states as it prepares to send a mission to Addis Ababa in the coming weeks as part of the Ethiopian government’s three-year quest for a financial package deal.

The comments came from IMF Communications Director Julie Kozack during a press briefing on March 7, 2024, in response to a query on Ethiopia’s drawn-out efforts for an IMF package.

“The recent violent incidents in Amhara and Oromia have indeed been distressing and concerning. We are closely following these developments and we note the concerns from the United States, and we hope for a peaceful resolution of this issue,” said Kozack.

Observers say the comments cast an ominous shadow on the prospects of finalizing an IMF agreement, and note that Ethiopia’s quests for external debt restructuring and fresh disbursements from international financial institutions are inextricably linked to domestic politics and US strategies and interests.

The US has been vocal about the continued conflicts in Amhara and Oromia, urging for negotiation and peaceful settlements. Washington has also condemned the alarming rise of civilian casualties in the regions.

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This week, clashes between federal security forces and armed groups in the Amhara region reportedly expanded into urban centers like Bahir Dar, the regional capital, but the government maintains it is in full control.

Ervin Massinga, US ambassador to Ethiopia since October 2023, voiced concern when Parliament voted to extend the state of emergency by an additional four months in February.

“As a longstanding friend of Ethiopia, we are deeply concerned with the renewal of the state of emergency. Dialogue is the only way to resolve the complex political and security issues,” said Massinga.

Following a visit to Ethiopia two weeks ago, Molly Phee, US assistant secretary of State for African Affairs, and Mike Hammer, special envoy to the Horn, offered to mediate negotiations between the federal government and armed groups in Amhara and Oromia.

“We have received a request for financial assistance to help Ethiopia address the significant challenges that the country is facing, including food insecurity, humanitarian needs, post conflict reconstruction and high inflation, and also to support the homegrown economic reform agenda which aims to fulfill Ethiopia’s considerable economic potential. An October mission made good progress on how the IMF could support the authority’s economic program and the set of reforms that could underpin the requested program. Discussions are ongoing,” said Kozack.

Fitsum Assefa (PhD), minister of Planning and Development, told the Council of Ministers this week that China’s decision to restructure Ethiopia’s debt service is a big relief, and said efforts from the creditors committee under the Paris Club are “encouraging.”

It remains unclear whether the IMF’s preconditions for approving Ethiopia’s finance request from 2021 go further than calls for peaceful resolution to internal conflicts.

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