Ethiopia Defaults on Debt Payment Amid Civil War and Humanitarian Crisis, Raising Borrowing Costs for African Nations

Ethiopia defaulted on $33 million interest payment on its $1 billion Eurobond, joining Zambia and Ghana as African bond defaulters. This will raise borrowing costs.

The default comes amidst a civil war, drought, high inflation, declining forex reserves, and humanitarian crisis that has left over 15 million Ethiopians facing hunger.

The default could worsen investor perceptions of Africa, raise bond yields for countries like Kenya, and negatively impact Ethiopia's plans to launch a stock exchange.

Ethiopia sought debt relief from official creditors but talks with private creditors like pension funds broke down, triggering the Eurobond default.

There are concerns over human rights issues in Ethiopia as it tries to rebuild after the civil war, with calls for accountability and transitional justice.