EFF rejects IMF loan as ‘biggest political blunder’
The Economic Freedom Fighters (EFF) believes the government has made a massive mistake by seeking Covid-19 emergency funding from the International Monetary Fund (IMF).
The IMF board on Monday approved the R70 billion support package to help the country weather the economic storm brought about by the Covid-19 pandemic.
The loan comes with an interest rate of around 1% and much less stringent condition than the IMF usually attaches to its financing.
But the EFF has described the IMF loan as “the biggest political blunder in the history of South Africa”.
"Loans from the IMF always come with neoliberal and neo-colonial conditionalities and South Africa will not escape from this reality. Whether immediately or in the long run, the IMF will impose conditionalities which will certainly undermine South Africa's macroeconomic and fiscal policy sovereignty," says the party’s national spokesperson Vuyani Pambo.
"It is foolish and naïve to think that the IMF can give South Africa, that has the highest inequality in the world, one of the highest unemployment rates and an economy that is facing deep depression without conditionalities that will benefit multi-national American and European corporations.”
Government had to make certain commitments, including to rein in the deficit and contain the debt to GDP ratio, before the IMF was willing to approve the loan.
The money will be used to provide financial relief and forge a new economy, Treasury said in a statement on Monday.
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