The South African Institute of Race Relations (IRR) said on Tuesday it welcomed the "unambiguous" message from the International Monetary Fund (IMF) in favour of growth-enhancing structural reforms as it approved US$4.3-billion in emergency support to the country to grapple with Covid-19.
The IMF approved South Africa’s request for emergency funding under its Rapid Financing Instrument on Monday, saying this was a low interest loan that would contribute to the government’s fiscal relief efforts without impacting on its sovereignty.
It said there was a pressing need to strengthen economic fundamentals and ensure debt sustainability by carrying out fiscal consolidation, improving the governance and operations of state-owned enterprises and implementing other growth-enhancing structural reforms.
The health crisis heightened the urgency of implementing these efforts to achieve sustainable and inclusive growth, the IMF added.
On Tuesday, the IRR said these key points echoed the thrust of its own 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.
"The IRR has led the calls for linking sensible pro-growth reforms to IMF support," IRR deputy head of policy research Hermann Pretorius said.
"This is by no means the end of our efforts to ensure maximum accountability by the ... government, but we are heartened by the IMF’s willingness to not let the principle of accountability be lost. No-one should miss the significance of the IMF’s announcement and what this means for the future.”
He said the government should consider itself on notice that what he called destructive policies such as plans to expropriate land without compensation "will not be tolerated, not by South Africans suffering under the mounting effects of a decade of economic lockdown, and not by the IMF donor nations whose support in this difficult time gives ordinary South Africans a stronger hand in demanding a free and open economy that works".