The International Monetary Fund (IMF) has made known its plans to allocate USD 11 Bn to help 32 African countries mitigate the effects of the coronavirus pandemic.
These countries are the ones that previously requested assistance from the organization during the early days of the outbreak. The IMF is making this possible by joining hands with the World Bank, World Health Organization (WHO), African Development Bank (AfDB), and the African Union (AU).
Already, the fund has disbursed money to Senegal, Ghana, Rwanda, Niger, Togo, Chad, Gabon, Madagascar and Burkina Faso. This adds to the debt-relief service the lender has approved for 25 poor countries of the world, supporting their emergency medical efforts.
The new USD 11 Bn facility will be funded via the IMF’s rapid-disbursement instruments and debt-relief support of about USD 300 Mn, which will be provided this year.
Among many other things, this financial effort will bolster domestic measures employed by African countries in the fight against COVID-19. This includes transferring to vulnerable households, monetary and fiscal policy responses.
The IMF believes that the novel pandemic, which has brought unexpected health and economic struggles, will hamper Africa’s growth prospects. It forecasts that the region’s GDP will contract by 1.6 percent in 2020, the worst outcome recorded.
As such, the continent is in need of a projected emergency economic stimulus of USD 100 Bn in order to weather the storm. Nearly half of the amount could come from interest payment waivers, according to UNECA.
“Together with the World Bank, the IMF is also making the case for debt relief from official bilateral creditors for those low-income countries that request forbearance,” the International Monetary Fund said in a statement.