Ethiopia’s bondholders have again rejected a debt restructuring deal and have threatened to sue.[1] Reacting to the news, Tim Jones, Policy Director at Debt Justice said:
“Ethiopia’s bondholders are refusing to agree a restructuring deal which would still see them make significant profit. The Common Framework lacks the teeth to make private creditors take part in debt cancellation. The UK and New York can give it bite by passing legislation to ensure commercial lenders participate in debt relief.”
Ethiopia’s bonds are governed by English law. Research by The Horn Economic and Social Policy Institute (HESPI), African Forum and Network on Debt and Development (AFRODAD) and Debt Justice has shown that Ethiopia’s initial proposal to bondholders would still see them make 30% more profit than if they had lent to the US government.[2]
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