The African Export-Import Bank (Afreximbank) has issued a formal response to Fitch Ratings’ June 4, 2025, downgrade of its long-term foreign currency issuer default rating from ‘BBB’ to ‘BBB-’ with a negative outlook, rejecting the agency’s concerns over non-performing loans (NPLs) and affirming its robust financial position and adherence to its founding treaty.
The statement follows criticism from the African Peer Review Mechanism (APRM), which labeled Fitch’s methodology as “analytically and legally flawed” for misclassifying sovereign loans to Ghana, Zambia, and South Sudan as NPLs.
Afreximbank emphasized its strict compliance with International Financial Reporting Standards (IFRS), particularly IFRS 9, which governs loan classification and NPL treatment.
The bank reported an NPL ratio of 2.44 percent for Q1 2025, well below its strategic ceiling of four percent, contrasting with Fitch’s estimate of 7.1 percent.
The bank attributed this discrepancy to Fitch’s failure to account for its forward-looking approach, as detailed in its 2024 Financial Statements and external auditors’ report.
Afreximbank firmly rejected any involvement in debt restructuring, citing its 1993 founding treaty, signed by 53 African member states, which grants it preferred creditor status and prohibits such actions.
The bank argued that Fitch’s negative outlook, based on potential debt restructuring, overlooks this legal framework, which ensures repayment obligations by member states. The APRM echoed this, asserting that classifying these loans as NPLs is “legally incongruent” absent formal defaults or debt repudiation.
The bank highlighted its financial resilience, reporting a 29 percent increase in net income to USD 973.5 million for 2024 and a 21 percent rise to USD 215 million for Q1 2025, alongside shareholders’ funds of USD 7.5 billion. Its liquidity profile strengthened, with liquid assets comprising 20 percent of total assets, up from 13 percent at the end of 2024.
(BirrMetrics)
Etihad and Ethiopian Airlines start strategic codeshare partnership
Etihad and Ethiopian Airlines activated their codeshare agreement, strengthening connectivity between Africa and Asia, Australia, and the Middle East. This bilateral partnership enhances global travel opportunities for guests, with seats available to book now.
Ethiopian will start services from Addis Ababa Bole International Airport (ADD) to Zayed International Airport (AUH) on 15 July, and Etihad Airways introducing daily flights to Addis Ababa starting 8 October..
This is the first step ahead of implementation of the groundbreaking13 Joint Venture agreed between Etihad and Ethiopian in March 2025 unlocking greater travel opportunities for passengers across both networks.
The codeshare lets guests simplify their journeys by making a single booking with one check-in process at the start and the added convenience of having their baggage transferred to their final destination.
Arik De, Etihad’s Chief Revenue and Commercial Officer said: “By leveraging our combined networks, we are unlocking seamless travel opportunities between Africa and Asia, Australia, and the Middle East. Easy connections via Abu Dhabi and Addis Ababa, will enhance flexibility, boosting trade and tourism, and delivering unparalleled travel experiences to guests of both airlines.”
Under this partnership, Etihad passengers will gain access to Ethiopian Airlines’ extensive African network, with connections via Addis Ababa to 55 destinations across 33 countries, including Entebbe, Kinshasa, Kigali, Lusaka, Harare and Victoria Falls expanding their travel options across the continent.
At the same time, Ethiopian Airlines passengers can book itineraries connecting to Etihad-operated flights through Abu Dhabi, with onward service to 20 key destinations across Asia, Australia, and the Middle East including Sydney, Krabi, Colombo and Phnom Penh.
As part of its commitment to Africa’s growing demand for air travel, Etihad is significantly expanding its network in 2025, introducing new destinations and increased frequencies to strengthen links across the continent.
(Aeronews)
Ethiopia forecasts faster growth next fiscal year
Ethiopia’s economy will grow slightly faster in the fiscal year that starts next month, while its budget deficit will increase marginally, its finance minister said on Tuesday.
The East African nation, which is restructuring its external debt, is implementing far-reaching economic reforms backed by an International Monetary Fund loan programme.
Finance Minister Ahmed Shide told parliament that the government is forecasting economic growth of 8.9 percent in the fiscal year that runs from July 8, 2025, to July 7, 2026, up from an estimated 8.4 percent in the current fiscal year.
A budget deficit of 2.2 percent of gross domestic product (GDP) is expected versus 2.1 percent this fiscal year, while overall spending will be about 1.9 trillion birr (USD 14 billion) next year, he said.
Ethiopia’s export revenue over the past 11 months of this fiscal year stood at USD 7.2 billion, Ahmed said, up 118.2 percent from the previous financial year. Prime Minister Abiy Ahmed has told domestic media outlets in recent days that the country’s coffee and gold exports have surged.
The IMF projected in its January assessment that goods exports for the full financial year would grow to USD 4.59 billion and for services to USD 7.97 billion. The fund has been carrying out another assessment of the economy, with its findings expected to be published in the coming weeks.
Ethiopia’s export figures are being watched closely by markets as they are at the centre of a row between bondholders and the government over whether Ethiopia faces an insolvency problem or a liquidity issue, which could determine whether the investors will accept a writedown or not.
Strong export earnings growth could support the bondholders’ case that Ethiopia faces a liquidity issue.
That would enable them to push for repayments on Ethiopia’s defaulted $1 billion bond to be stretched out, rather than taking losses on the principal of their investments, also known as haircuts, if an assessment of insolvency carries the day.
Formal talks between the two sides on the restructuring of the bond are expected to start in the coming weeks.
(Reuters)
