Many have argued that decades of harsh International Monetary Fund (IMF) structural adjustment programs is one of the major causes of weak health systems in Africa. This was cited to be the fundamental cause for failures in disease surveillance and control that led to the Ebola outbreak in West Africa in 2014-16. What’s worse is that even the COVID-19 pandemic did not lead to a change of policy inside this institution.
When COVID-19 struck at the beginning of 2020, most of the African countries were tied up in IMF loan repayments. As of January 2020, 26 out of 54 African countries were undergoing IMF loan programs that demanded austerity, leaving countries with no untied money to spend freely for emergency preparation, one of the key prerequisites for a robust COVID-19 response.
By October 2020, the IMF had given out COVID-19 loans to 81 countries, 41 of which were in Africa. At that time, many pointed out that the loans were not enough to compensate for the immediate costs of handling COVID-19, let alone for making up for the losses in the long-term. The emergency loans did little to nothing when it came to secure payment suspension for existing debts, including those from the IMF. Reports pointed out that some of the emergency funding was actually used to pay off debts instead of being used for COVID-19 response.
While the IMF is not the only creditor for African countries, it sits at the top of the pyramid of international financial institutions. Failing to meet the IMF repayment schedule would result in further direct and indirect repercussions from other creditors. At the same time, IMF loans are structured in a way that undermines the government’s ability to provide public services. The conditions and debt repayment schedule are often extremely strict. Thus, funds which are needed for, for example, health and education, are heavily cut and large portions of the collected tax are earmarked for debt payment.
*The views of the above article are those of the author and do not necessarily reflect the views of Africa Speaks 4 Africa or its editorial team.