Fitch slashes Ethiopia foreign rating

Fitch Ratings said it downgraded Ethiopia's long-term foreign-currency issuer default rating and its eurobond to C from CC. The agency typically does not assign outlooks to sovereigns with a rating of CCC+ or below.

The downgrade of Ethiopia's LTFC IDR reflects Fitch's understanding that the $33 million coupon payment on Ethiopia's single outstanding $1 billion eurobond, maturing in 2024, was not made by the due date on Dec. 11, 2023. The government announced on Dec. 8 that Ethiopia was not in a position to make the coupon payment. Fitch views the failure to make the coupon payment as the beginning of a sovereign default process and consistent with a C rating,” the agency said in a press release.

Fitch said it cut Ethiopa’s rating to RD, restricted default unless the payment is made within the 14-day grace period.

The agency also affirmed Ethiopia’s CCC- local-currency IDR.

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