South Africa: IMF Loan Payback - It's the Economy, Stupid


While the terms of repayment of the R70-billion International Monetary Fund loan to South Africa are generous - an interest rate of 1.1% - exchange rate fluctuations are unpredictable. And as long as much of the economy is in partial lockdown, the tax base continues to shrink, and with it the ability to pay back the money.

The recent R70-billion loan by the International Monetary Fund (IMF) to South Africa has been received with mixed reviews by various segments of the country. National Treasury Director-General Dondo Mogajane has welcomed the decision, indicating that the government will ensure that it meets the loan conditions and that it has in no way compromised the country's sovereignty or risk.

The Economic Freedom Fighters (EFF) believes that it is one of the biggest political blunders in South African history, labeling it "neoliberal" and warning that it could undermine governance in the country.

The DA believes it represents a "watershed" moment for the country as it is the first time since 1994 that the government has had to resort to borrowing from the IMF. Highlighting the dire state of the economy and the effects of weak and corrupt governance, the DA has called for increased...

More From: Daily Maverick

Don't Miss

AllAfrica publishes around 800 reports a day from more than 130 news organizations and over 500 other institutions and individuals, representing a diversity of positions on every topic. We publish news and views ranging from vigorous opponents of governments to government publications and spokespersons. Publishers named above each report are responsible for their own content, which AllAfrica does not have the legal right to edit or correct.

Articles and commentaries that identify as the publisher are produced or commissioned by AllAfrica. To address comments or complaints, please Contact us.