July 10, 2020 / 1:31 PM / a month ago

Moody's: Ethiopia political tensions are credit negative

LONDON, July 10 (Reuters) - Ratings agency Moody’s said on Friday that the latest bout of political unrest in Ethiopia following the murder of a popular singer threatened to further slow already stalling economic growth and was “credit negative”.

More than 166 people were killed during anti-government protests in Ethiopia in early July after popular Oromo musician Haacaaluu Hundeessaa was shot dead by unknown gunmen, with his death tapping into grievances fuelled by decades of government repression.

“We expect the economy to grow by only 2% in 2020 compared with 9% in 2019,” Moody’s Kelvin Dalrymple wrote in a note to clients. “The unrest also has the potential to derail Ethiopia’s democratic transition, especially in the run up to the now-delayed first multiparty democratic elections.”

Moody’s downgraded Ethiopia’s long-term issuer rating to B2 from B1 in May. (Reporting by Karin Strohecker; Editing by Tom Arnold)

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