Addis Ababa – 27 May 2026. The Ministry of Finance (“MoF”) of the Federal Democratic Republic of Ethiopia (“Ethiopia”) announces today that between 6 May 2026 and 27 May 2026 (the “Restricted Period”), it held restricted discussions with a group of holders (the “Ad Hoc Committee”, and together with Ethiopia, the “Parties”) of its US$ 1 billion 6.625% Notes due 2024 (ISIN US29766LAA44) (the “2024 Notes”) to discuss the potential restructuring of the 2024 Notes. Ethiopia was joined by its legal and financial advisors, White & Case LLP and Lazard, respectively, and the Ad Hoc Committee was joined by its legal and financial advisors, Weil, Gotshal & Manges (London) LLP and Ankura Sovereign Advisors LLP, respectively.

The MoF refers to its announcement of 29 January 2026 and the letter from the Co-chairs of the Official Creditor Committee (the “OCC”) attached thereto, regarding the determination by Ethiopia’s OCC that the agreement in principle on restructuring terms reached on 2 January 2026 with the Ad Hoc Committee (“AIP”) is not compliant with the Comparability of Treatment (“CoT”) principle.

 

The AIP included as part of the proposed restructuring consideration a value recovery instrument (“VRI”) which would have provided holders with additional payments conditional on, and calibrated to, achievement by Ethiopia of specified future macroeconomic outcomes. The OCC subsequently stressed that the fast-evolving macroeconomic environment is not conducive to the use of a VRI.

In light of this feedback, Ethiopia prepared an alternative restructuring proposal for the 2024 Notes (the “Revised Proposal”) which does not include a VRI. The Revised Proposal, attached as Annex A to this announcement, was first shared by Ethiopia with the Co-chairs of the OCC, who confirmed that in their view it satisfied the CoT principle.

Subsequently, the Revised Proposal was presented to the Ad Hoc Committee for consideration during the Restricted Period. The Ad Hoc Committee rejected the Revised Proposal, and the Restricted Period was subsequently terminated.

While regretting such decision of the Ad Hoc Committee, Ethiopia remains committed to finding and implementing a market-based solution for the 2024 Notes that is both consistent with the CoT principle and compatible with Ethiopia’s commitments under its IMF programme. To this end, Ethiopia will continue to engage constructively with all stakeholders, and at the same time will assess all its available options to resolve the current situation, including a potential exchange offer or other market transaction relating to the 2024 Notes.

This announcement is made by the Government of the Federal Democratic Republic of Ethiopia and constitutes a public disclosure of inside information under Regulation (EU) 596/2014 (16 April 2014).

This press release does not constitute an offer of securities for sale or solicitation of an offer to buy any securities in the United States for purposes of the U.S. Securities Act of 1933, as amended.

Annex A

 

REVISED PROPOSAL

COMMERCIAL TERMS VALIDATED BY THE OCC CO-CHAIRS

 

New Bond Issue

 

Issue Amount	USD 880m (12% haircut)
Amortization schedule	Principal payments of US$180m payable on 15 July 2026 US$100m payable on 15 July 2027 US$300m payable on 15 July 2028 US$300m payable on 15 July 2029
Maturity date	15 July 2029
Interest rate	6.15%, payable on 15 January and 15 July of each year until maturity Long first coupon, interest accruing from 11 December 2024, payable 1 July 2026
Consent Fee	0.5% of original nominal value of 2024 Notes, payable on settlement
PDIs	3 Missed coupons (USD 99.375m) from Dec. 2023 to Dec. 2024, paid in full at settlement

 

Note: Non-Financial Terms (NFTs) to be agreed but in the context of the current offer, which is a short-term vanilla instrument, Ethiopia does not expect to provide non-market NFTs

 

 

Comparability of Treatment indicators

 

	Δ NPV	Δ Duration	Δ DS over program period
OCC	-12.5%	3.0	-33.5%
Proposed Terms	-10.0%	3.3	-48.5%

 

Restructured Schedule

 

In USDm, illustrative transaction date on 1 July 2026