Investors threaten litigation over Ethiopia's unsettled Eurobond debt
via The Reporter Ethiopia6 min read
A group of investors holding Ethiopia's billion-dollar Eurobond debt are threatening to sue the Ethiopian government in UK courts. This follows the collapse of debt restructuring negotiations last month. Ethiopia defaulted on a 33 million USD coupon payment in December 2023, marking its first external debt default. Bondholders had previously threatened legal action after earlier unsuccessful restructuring efforts. In January 2026, an agreement in principle reached with bondholders was rejected by Ethiopia’s Official Creditors Committee. The Ad Hoc Committee representing bondholders rejected a new proposal last month, which included a 12 percent haircut and staggered payments totaling 880 million USD through July 2029. Debt Justice, a UK-based organization, has called the bondholders' plans to sue "outrageous," stating that the bondholders stood to make 28 percent more profit under the Ethiopian government’s latest proposal than if they had lent to the US government. The Eurobond was issued in 2014 at an interest rate of over 6.6 percent and was primarily used to fund the construction of industrial parks.
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