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IMF announces protection plan for African countries

IMF announces protection plan for African countries
Written by Chiwoyu Sinyangwe
Wednesday, February 18, 2009 4:29:41 AM

THE International Monetary Fund (IMF) has announced increased lending portfolio to protect African countries so that the current global crisis does not wipe out the hard-won gains of recent years.

Director for African Development, Antoinette Sayeh stated that IMF was also providing technical assistance by sending in experts to help African members strengthen their economic management capacity.

Sayeh stated that the IMF already had three region Regional Technical Assistance Centers in the continent, and that the Fund planned to open two more.

“To that end, the IMF provided increased financial support to countries that were hit hard by last year’s surges in food and fuel prices, and recently introduced a new more flexible financing facility for countries hit by unexpected shocks…we are providing policy advice, drawing on the experience of working with other countries, on how to meet the challenges of a global slowdown,” she stated.

Sayeh also announced that IMF was encouraging countries to keep focused on their goals not just for this year but for the next several years, so that in responding to the present, governments did not impoverish themselves for the future.

“More broadly, the international community has a key role to play. In this challenging time for Africa, it is essential that the international community meet its commitments to provide financial support,” she stated.

“Beyond that, it is critical that the region is able to benefit from an open trading system because, over time, this remains central to its economic development…Africa cannot avoid the problems facing the global economy, but working together, we can ensure that countries preserve the foundation of their recent success so that they can benefit when the global economy recovers.”

Sayeh, however, observed that many African economies were now in a much healthier position more than they were about 10 years ago.

“Many countries have built up comfortable levels of foreign exchange reserves that provide a cushion while these countries adjust to the new economic environment,” stated Sayeh.

“Low levels of public debt and high savings in recent years provides some countries with the scope to sustain or even increase government spending and widen deficits, without risking instability. In other cases, however, financing constraints limit this scope.”

Labels: IMF

posted by MrK @ 4:29 AM