IRR welcomes IMF putting SACP-ANC government on notice: Pursue pro-growth policies to save SA
28 July 2020
The IRR welcomes the unambiguous message in favour of ‘growth-enhancing structural reforms’ in South Africa in the approval by the International Monetary Fund (IMF) of $4.3bn in emergency support to address the Covid-19 pandemic.
In its statement late yesterday, the IMF made it clear what it expects of the South African government: “a pressing need to strengthen economic fundamentals and ensure debt sustainability by carrying out fiscal consolidation, improving governance and operations of SOEs, and implementing other growth-enhancing structural reforms”.
These key points echo the thrust of IRR communications through diplomatic and other channels over the past two months to alert prominent IMF donor nations to their critical role in strengthening the drive for solution-based support and efforts to overcome fundamental weaknesses in the South African economy.
Significantly, the IMF singled out South Africa’s pre-Covid-19 structural weaknesses – repeatedly highlighted by the IRR – when it noted: “A deep economic recession is unfolding as the decline in domestic activity and disruptions in the global supply chain resulting from the Covid-19 shock have added to a pre-existing situation of structural constraints, subdued growth, and deteriorating social outcomes.”