Africa welcomes IMF US$45 billion resilience fund
AFRICAN countries have welcomed the International Monetary Funds (IMF) US$45 billion Resilience and Sustainability Trust (RST) loan fund, which has so far attracted US$40 billion pledges.
The fund, set up at the recent IMF and World Bank Annual Spring Meetings in Washington, is aimed at assisting countries to build resilience to external shocks and ensuring sustainable growth.
Zimbabwe is one of the 190 members of the Bretton Woods Institution and is set to benefit from the resources.
In a joint statement the Minister of Economy and Finance Ms Nadia Fettah who is also chair of the African Caucus and Ms Kristalina Georgieva, managing director of the IMF who co-chaired the African Consultative Group meeting, said the fund is a welcome development.
“The ACG welcomed initial pledges of about $40 billion toward financing the RST and encouraged other contributors to make additional pledges to ensure the RST is wellpositioned to support African countries to address their long-term challenges and build resilience,”reads part of the statement.
Finance and Economic Development Minister, Professor Mthuli Ncube attended the annual Spring Meetings on behalf of Zimbabwe and also held key meetings with global economic players.
The African Consultative Group comprises the Fund Governors of a subset of 12 African countries belonging to the African Caucus (African finance ministers and central bank governors) and Fund Management.
It was formed in 2007 to enhance the IMF’s policy dialogue with the African Caucus and the group meets at the time of the Spring Meetings while Fund Management meets with the full membership of the African Caucus at the same time.
The intervention is set to enhance member countries’ contribution to long-term balance of payments stability.
The facility is expected to come into effect on May 1 following approval on April 13 by the IMF executive board and the loans will have a 20-year maturity and a 10-and-a-halfyear grace period.
The African Consultative Group said there is a need to address rising debt vulnerabilities of developing countries, particularly in Africa and finding effective ways to alleviate the weight of the debt service.
The African Consultative Group
It also stressed the need to continue working together to strengthen the debt resolution architecture, including by improving the Common Framework for debt treatments and technical assistance within the Multipronged Approach (MPA) to address the remaining capacity requirements.-The Chronicle
