IMF Reacts To World’s Condemnation Of Its Austerity Measures During The Coronavirus Period

THEBE MABANGA

THE International Monetary Fund (IMF) has been challenged to end austerity measures as a condition for countries to access financial assistance, with South Africa, Egypt, Ukraine and Ecuador cited as the latest countries to be forced into government spending cuts.  

A range of international Civil Society Organisations and academics, including Section 27 from South Africa, have called on the IMF to instead promote an equitable and inclusive recovery and not require countries to embark on fiscal consolidations in order to access loans form the IMF.

Fiscal consolidation and austerity measures refer to steps taken to cut public spending, such as education, health and social grants. In extreme cases, civil service salaries or pensions are affected by these measures.

In July this year, South Africa was granted $4.3 billion (R70 billion) under the Rapid Finance Instrument to assist with combating the health and economic fallout from the COVID-19