Mboweni: The World Bank can 'keep their cents' if they want to dictate SA policy

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Minster of Finance, Tito Mboweni.
Minster of Finance, Tito Mboweni.
Gallo Images/Jeffrey Abrahams
  • In a wide-ranging interview with Fin24, Finance Minister Tito Mboweni opened up about the state of SA's borrowings.
  • Government has been in negotiations to secure loans from multilateral institutions, but Mboweni has vowed that SA will not lose its sovereignty on his watch.
  • SA has secured loans from the International Monetary Fund, the New Development Bank and the African Development Bank to fund its Covid-19 response.

Finance Minister Tito Mboweni has vowed that policy interventions by multilateral organisations such as the World Bank will not be allowed on his watch.

In a wide-ranging interview with Fin24, the minister spoke on the state of the country's borrowings, and the tough decisions that had to be taken in stabilising debt.

Government earlier this year successfully secured loans from the International Monetary Fund, the African Development Bank and the New Development Bank to fund its responses to the Covid-19 pandemic. Negotiations with the World Bank, however, appeared to have stalled.

Loans from the IMF and the World Bank are notorious for having strict conditions tied to them – requiring countries to roll out structural reforms and, say critics, lose their sovereignty.

The $4.3 billion secured from the IMF is a rapid financing instrument – it does not come with conditions – Mboweni and Reserve Bank Governor Lesetja Kganyago, however, had to iron out repayment terms of the loan.

Mboweni says he won't be conceding to any policy interventions from the World Bank. "We are not under any pressure, so any international organisation that thinks that they can provide funds to us but dictate policy are wasting their time…If the World Bank thinks it can dictate policy, let them keep their cents I'll just issue bonds here at home…Thank you very much," he told Fin24.

Treasury borrows about R20 billion every week from the market. Outside of local borrowings, South Africa also has international bond issues that are dollar denominated. Treasury's target for international bond issues is $7 billion this year. It is currently sitting around $6.5 billion.

"South Africa is not your average emerging market country. We can't be dictated to. We have a deep market here. As long as there is anything to do with policy intervention by the World Bank here, not under my watch…It's not going to happen," Mboweni said.

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