Ethiopia Gets a Difficult Start in BRICS

Vinod Dsouza
ethiopia flag brics
Source: Ethiopia Ministry of Foreign Affairs

The BRICS alliance invited six new countries to join the bloc during the 15th summit in August 2023 in Johannesburg. Argentina was the only country to reject BRICS membership as the newly-elected President Javier Milei was skeptical about the group. Read here to know the real reason why Argentina declined BRICS membership after receiving the invitation. However, the United Arab Emirates, Egypt, Iran, and Ethiopia joined BRICS and are now part of the grouping. Conflicting reports about Saudi Arabia joining the alliance are now making the rounds.

Also Read: 3 Countries Agree To Launch BRICS Currency To Challenge US Dollar

BRICS: Ethiopia Succumbs To Financial Burden

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Source: Watcher Guru

The new BRICS member Ethiopia recently defaulted on a Eurobond loan installment redemption. Just a few days before the New Year, the US-based rating agency Fitch marked Ethiopia down to “restricted default”. The government of Ethiopia is unable to repay the Eurobond loan installments and is now in the process of negotiating an aid package with the International Monetary Fund (IMF).

Also Read: These 25 Countries Are Ready To Join BRICS in 2024

Ethiopia hopes the aid package will lift up its ailing economy and help the country on a path of recovery. The aid will not only bring hope to Ethiopia but will also provide stability to Africa as a whole. Finance Minister Ahmed Shide explained that the move is seen as an important gain to Ethiopia during the financial crisis.

“Ethiopia will continue to cooperate with its traditional partners,” Shide said. “But Ethiopia will also significantly improve its relations with new partners, such as the BRICS countries, whose economies are growing quickly”.

Also Read: BRICS: Investors Bet Indian Rupee Will Rise, US Dollar To Decline

The majority of the BRICS members, both old and new, are financially stable except for Ethiopia. However, Susanne Stollreiter, Head of the Friedrich Ebert Foundation (FES) in Addis Ababa, said that Ethiopia will grow with BRICS. “Ethiopia is very important from a geopolitical point of view. Owing to its large population, its economy has the potential to grow strongly in the future,” she said.