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World Bank, IMF meeting considers freezing loan repayments for African countries

The World Economic Forum’s Africa head, Elsie Kanza said this would allow the continent to prioritize healthcare while economies recover.

FILE: A man walks past the International Monetary Fund (IMF) headquarters in Washington DC. Picture: AFP.

JOHANNESBURG - The World Bank and International Monetary Fund (IMF) spring meeting that was under way on Thursday is considering a loan repayment freeze for African countries.

The World Economic Forum Africa head Elsie Kanza said this would allow the continent to prioritise healthcare while economies recover.

Kanza said 1,200 companies were supporting its COVID-19 response efforts.

But a recent study by McKinsey & Company had found that one-third of Africans in informal and formal employment are likely to lose their jobs due to the coronavirus pandemic.

Kanza said talks were under way to give the continent some breathing room.

“According to the World Bank, it now looks increasingly likely that Africa will face its first recession in 25 years - accordingly, the World Bank and IMF are supporting the call by finance ministers in Africa and the governments for that servicing standstill. This is essential to free up revenues, which are already cut back due to the loss of export markets.”

She said while restricting movement was necessary, it was also disrupting food value chains.

And informal traders and small, medium micro-enterprises are most at risk but economies will need to bounce back soon

“Tourism-related revenues as well as the sharp drop in oil prices... so it’s really important to free up space in the government’s budget so that more allocations can be made to get ahead of the health challenge.”

The World Health Organisation Africa director Matshidiso Moeti said more than 17,000 COVID-19 cases had been confirmed on the continent and 900 deaths.