South Africa: IMF approves USD4.3 billion to help country fight against COVID-19

The International Monetary Fund (IMF) has said on July 26 that it had approved USD4.3 billion emergency financial assistance under the Rapid Financing Instrument (RFI) to support the authorities' efforts in addressing the challenging health situation and severe economic impact of the COVID-19 shock, according to ac news report by Jacaranda Fm.

South Africa is the continent's most-industrialized economy and has the largest number of COVID-19 cases, with more than 445,000 detected and 6,769 deaths as of Monday, according to the Africa Centres for Disease Control and Prevention.

South African Finance Minister, Tito Mboweni in June has predicted the economy would shrink 7.2 percent in 2020, its deepest slump in 90 years, and compared the ballooning public debt to a "hippopotamus... eating our children's inheritance."

The South African treasury said the IMF money would go towards stabilizing the debt, creating jobs, helping frontline health workers fighting COVID-19, and reforming the economy to spur growth.

"Going forward, our fiscal measures will build on our policy strengths and limit the existing economic vulnerabilities which have been exacerbated by the COVID-19 pandemic," Mboweni said in a statement.

The money from the IMF is the latest disbursement under the RFI, which allows nations to circumvent the lengthy negotiations usually needed to secure a full economic assistance program, the time most countries do not have as they struggle to cope with the coronavirus crisis.