Ethiopia has become a defaulter after failing to pay $33 million on the coupon of its international sovereign bond, media reported on Tuesday.
The Ethiopian government had failed to pay interest on $1 billion of international bonds as of December 22, the last international banking business day before the grace period expired, the report added.
Although the payment was originally scheduled for December 11, the East African nation technically had until Tuesday to fulfill the obligation, benefiting from a 14-day "grace period" clause embedded in the bond.
On December 16, S&P Global Ratings said that Ethiopia had entered into selective default, a situation in which a debtor selectively defaults on a particular issue or class of obligations while continuing to make timely payments on other issues or classes.
The development came days after the Ethiopia's finance ministry announced that it would "treat all its external creditors equitably," explaining the decision to withhold the December coupon payment.
In its restructuring counter-proposal, the government asked bondholders to extend the maturity date from July 2028 to January 2032 and to reduce the coupon rate to 5.5% from the current 6.625%.
In November, Addis Ababa said that it had reached an agreement in principle with bilateral creditors to temporarily suspend debt payments and planned to start talks to restructure its $1 billion Eurobond due next year. Late last month, Ethiopia reached an agreement with creditors to suspend debt service on $1.5 billion of debt, according to the country's central bank governor.