CLAIRE BISSEKER: Exceptional access to deep pools of IMF funding looks unlikely
The big sticking point is that the IMF doesn’t lend to countries with unsustainable debt trajectories
Someone needs to puncture the myth that SA will sink into the arms of the IMF in the next year or two as we descend into a sovereign debt crisis, and that this will allow the country to magically press reset.
For starters, the size of the IMF funding pool SA could access is not large given our swollen borrowing needs. Normally SA would be entitled to 435% of its IMF quota over three years. (SA’s quota equates to about $4.3bn.) In July, SA loaned 100% of its quota (about R70bn) under the IMF’s rapid financing instrument (RFI) to help fund a historic R777bn borrowing requirement. For all the fuss made about approaching the IMF, the loan equates to less than 10% of SA’s borrowing needs for the year.