
“A few days ago, Inside Africa reported that the IMF wanted the Ethiopian birr to be devalued, as it currently trades about 50% weaker than the exchange rate on the black market. This devaluation was necessary for Ethiopia to secure $10.5 billion from the IMF. It seems the Ethiopian government has accepted the IMF’s demands by adjusting the exchange rate to reflect market realities” (Inside Africa, 28.07.2024).
This here is a big blow for the Prosperity Party and the Prime Minister Abiy Ahmed Ali who has broken the economy. All of his warfare and destruction is haunting the state reserves. The continues plague of conflict and usage of force is costing him. That’s why the markets and the lenders are putting hefty strings on the next loan.
Prime Minister Abiy is now in the mercy of the International Monetary Fund (IMF) and the World Bank to run his nation. They are now putting strings on the loans he needs to be fiscally stable. The need of fresh currency and cash-flow is the reason for this. As the government needs more funding to operate and be viable.
That’s why the recent macro-economic policy shift is a worrying sign. The devaluation of the currency will wreck the economy. It will cause an affect on the rating of the nation economy as a whole and also ensure possible rising inflation. This is an evil cycle that can break a nation.
That the Prime Minister is accepting these strings is possibly the “kill shot”. This is the end-game… and it shows that the PM had no other choice. He knew he couldn’t muster confidence or donors to cover a possibly shortfall. He needed the IMF to bail him out. They are now bailing him out, but the government will pay. The citizens will pay even more and the businesses will pay a huge burden too. This is just a tale of sinking ship.
The birr will over time be worthless or even be a mockery of it once was. The short-term salvage and fiscal funding will cease. The state will need more over time and cannot sustain whatever it has for the moment. That’s why they were in need of IMF bailout to begin with. The wars and the conflicts has also stopped the progression and the positive outlook that the Ethiopian economy had.
The PM had inherited a nation of prospects and hope in financial terms, but has been able to destroy and deplete that completely. That’s part of Abiy’s legacy and now he bends the knee for IMF. He becomes their puppets and he tries to make it seem like it was his idea. When the IMF gave him the stings and he made the song out of it. The tune will be played and it will be funeral march. This will be the start of a financial downturn and depression. That’s what is bond to happen.
The birr devaluation is the first step to a highly rising inflation and added costs on everyone. This means everything imported will cost more and that burden will be on the citizens. That’s a cycle of more taking away more funds from circulation and will be spiral of evil. The sort that destroys an economy and that was done on the altar of internal warfare. Internal warfare born out of greed to consolidate power by any means necessary.
Prime Minister Abiy isn’t only depraving people their freedoms and liberties, but now he will empty their pockets on behalf of the IMF and World Bank. Those institutions save him and his reign, but the cost of that will become the burden of the citizens. Peace.















