HILARY JOFFE: To get IMF money, SA will have to pledge tough action

05 July 2020 - 05:01 By HILARY JOFFE

The rapid financing instrument (RFI) for which SA has applied to the International Monetary Fund (IMF) is proving to be anything but rapid. It is more than three months since finance minister Tito Mboweni said SA planned to take advantage of the Covid-related funding the IMF had made available to its member countries. The IMF, which since the start of the crisis has provided $82bn of emergency loans to 77 countries, confirmed last month that SA had approached it for $4.2bn under the RFI. But the loan is the subject of "tough negotiations", Mboweni said last week, with the IMF's board likely to approve it only next month.

The loan would be the largest of the Covid emergency packages and in line with SA's quota at the IMF. Other countries that have put in for this kind of money - such as Egypt's recent $5bn - have taken not just emergency lines but the more conventional, and more overtly conditional, IMF standby arrangement. There has been no mention of this in SA's case, apparently. Even so, the IMF is unlikely to dish out the money just like that...

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