South Africa’s corruption problem has led to calls for greater transparency on how the government plans to dispense the R65 billion International Monetary Fund (IMF) injection.
The funds come courtesy of Special Drawing Rights through the IMF. The R65 billion injection from IMF is on top of the R70 billion emergency financial assistance extended through the IMF’s Rapid Financing Instrument.
And the Democratic Alliance (DA) said while it welcomed the cash injection into the economy, the money should go to funding investments instead of public-sector wages or non-operating expenses such as interest payments.
“Current IMF data indicates that South Africa’s total overdue obligations and projected payments for 2021 amount to 16.2 million SDRs, or R348.28 million, and is projected to increase to 1 547.7 million SDRs, or R33.26 billion, by 2024,” said DA shadow deputy minister of finance, Dion George.
George said National Treasury should be transparent about how these funds would be utilised.
“Treasury must tell us how it will impact our interest payment obligations to the IMF based on the negative difference between South Africa’s SDR holdings, on which we receive interest, and allocations, on which we pay interest.”